Government rolls dice on “Labor-lite” budget

The Coalition has caught the Opposition flat-footed by revealing “Labor-lite” budget measures that could wedge them. But trying to crowd Labor out of the budget debate is a risky move.

The conservative Abbott Government is poised to bring down a Labor budget. At least that’s how some political commentators are depicting tomorrow’s “we’re sorry, how about this one?” budget from the contrite Prime Minister and his team.

It’s a fair assumption, given what’s been leaked from the budget to date. However, trying to crowd Labor out of the budget debate could be a risky move.

Last year’s budget was the Abbott Government’s first; the one that traditionally doles out the tough measures early, in the hope voters will have forgotten the pain by the time the next election is held. Treasurer Joe Hockey spent the appropriate amount of time preparing Australians for a budget that would bring an end to the “age of entitlement”, but stumbled when it became clear the economic statement tried to do precisely the opposite.

Twelve months later, Hockey hasn’t managed to live down his badly misjudged budgetary reforms, or his role in making matters worse by being caught on camera puffing stogies and complaining to anyone who’d listen that he was misunderstood.

This year Hockey is on a warning, and he has relinquished much of the budget sales job to the Prime Minister and the unlikely candidate for the 2015 Mr Congeniality award, Social Services Minister Scott Morrison.

Since attaining the welfare portfolio at the end of last year Morrison has reminded his colleagues – and the voters – how a competent minister operates; he’s kept an open mind on solutions to vexed policy issuesbrought the public into the discussion, and constantly explained what he is doing next and why.

The true test of Morrison’s competence of course will be how successfully he shepherds his reforms through the Senate. With this in mind he’s shaped the “jobs and families” component of the budget to mimic Labor policy, with proposed reforms to the aged pension and childcare support that essentially take from the rich and give to the poor, in accordance with what could be seen as Labor values.

Even the most recent budget leak, foreshadowing that parents with two possible sources of paid parental leave will be prevented from drawing on both, looks more like a Labor equity measure than a Liberal funding cut.

Just to help us connect these dots, Morrison pointedly told a journalist “a truly reforming Labor government, in the Hawke-Keating mode, would approve of this budget”.

In doing this, Morrison is presenting Labor with a conundrum similar to that which challenged the Greens over fuel tax excise – whether to support a Government proposal that is more aligned with their own values than the Coalition’s, or oppose it for fear of being seen to be complicit.

This has left Labor a little flat-footed, to say the least.

Shadow Treasurer Chris Bowen said yesterday that Labor welcomed any package focussed on making it easier for parents to participate in the workforce, but that linking it to cuts in family payments was “disingenuous and cruel” given that “children don’t get cheaper when they turn six”. Bowen seems to have conveniently forgotten that it was his government that moved parents from the Parenting Payment to the lower-paying Newstart when their youngest child turned six (incidentally on the same day as PM Gillard’s famed misogyny speech).

Bowen was also reduced to criticising the Government’s previous proposal on the aged pension, not the current one, which has the support of the welfare sector and some crossbench Senators. Labor’s families spokesperson, Jenny Macklin, similarly hedged her bets, lamely noting in response to the proposal to stop “double dipping” on parental leave that “you would never believe anything they say about paid parental leave” instead of addressing the actual policy.

No doubt the Government is finding it all very amusing to watch the Opposition grapple with this policy wedge, but there’s an attendant risk in offering up a Labor-lite budget to Australian voters.

It’s true that after last year’s omnishambles, voters have a high expectation that this year’s economic statement will be fair. But just as importantly, they will also expect the budget to be economically responsible. And thanks to years of the Abbott opposition chanting the debt and deficit mantra, voters now measure economic competency in these oversimplified terms.

This is a huge risk for the Government, exacerbated by the new spending on childcare and perhaps other initiatives in tomorrow’s budget.

Last year, Hockey claimed he would be able to deliver a balanced budget in four years, but this is now unlikely in the foreseeable future. Yet the Government has adjusted its message from the need to deal with a “budget emergency” to the budget being “manageable”, despite an anticipated blowout in this year’s deficit to $45 billion. Notably, the budget emergency was initially based on Labor’s projected deficit in 2013 of $18 billion.

Now Labor will attempt to return the favour, doing its best in the post budget wash-up to untangle its own economic credibility from the debt and deficit albatross so that it can be lashed around the current Treasurer’s neck.

Scott Morrison may have capably performed the role of budget whisperer in past weeks, but when the focus moves to the health of the economy on Tuesday night only the Treasurer will be in a position to explain why the burgeoning deficit is not a cause for voter concern. If Hockey fails, we may get to see if Morrison is up to this task. If he is not, then it will likely be Chris Bowen and Labor’s turn.

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