Last week, as Wayne Swan announced his fourth budget, I highlighted the massive increases in spending, taxes, debt and annual interest payments that were at its core. These are the facts that Wayne Swan and Julia Gillard did not want you to think about on Budget night.
Well, a week later and further analysis just reveals more and more troubling facts about this Budget.
When we look at the Budget in historical context, with a fair comparison of all Governments over the last two decades, Wayne Swan comes out looking even worse.
Note the black bars – these are how much Government debt has been forecast to INCREASE in coming years since the last update only SIX MONTHS AGO.
And remember, when Wayne Swan talks about the fictional, promised surplus that hasn’t arrived yet, this doesn’t mean we have paid off the debt. A surplus will mean we have only stopped borrowing.
More importantly, Labor has reverted to accounting tools to manufacture a surplus. When expenditure on the NBN is included the promised surplus in 2013 disappears.
As Joe Hockey outlined in his Budget reply on Wednesday, there has never been an example of such a massive project being treated as ‘off budget’.
So what is driving all this growth in expenditure? Of course, staff levels in the public service continue to grow. Remember when Kevin Rudd promised to take the “meat axe” to the public service? Well, the axe never came out of the shed. The public service has grown remorselessly since Kevin Rudd took office.
And finally, the myth that the mining boom isn’t helping the Budget. As I said on the ABC in the lead up to the Budget, past Treasurers could only dream of economic circumstances like this.
John Howard and Peter Costello managed to pay off $96 billion of government debt in a climate nowhere near as generous as the one Wayne Swan is currently complaining about. Look at the historic graph below – the terms of trade have never been this good. In times like this we should be saving for the next rainy day, not spending windfall gains.
The Coalition will continue to expose the myth that this is a Budget of hard times. Families right across the country are being forced to work harder and tighten their belts to get by, it’s time the government did the same thing.