Horror budgets: a dummy’s guide
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The orthodoxy has been established: the Rudd Government faces major political trauma in its determination to cut spending. Its “horror budget” (splendid to see that phrase back in use – with any luck we’ll yet see the traditional “beer, cigs up”) will be the Coalition’s first big opportunity to inflict some damage on the Government. Brendan Nelson’s leadership may depend on it. News Ltd is helpfully pointing all this out. Having run a thoroughly creditable campaign against the Howard Government’s big-taxing ways, now The Australian, along with the Daily Telegraph, is giving the Government heaps for thinking about cutting handouts to carers. “Rudd’s reputation in tatters,” shrieked the headline to Dennis Shanahan’s effort on Saturday. “PM backflips” declared the Tele yesterday
No doubt plenty of interest groups will vociferously protest cuts to government spending. Not all of them will be quite as deserving as carers. Seniors, the recipient of considerable and unmerited largesse from both sides in the election campaign, were portrayed as the next group in line for the chop. And today, the rent-seekers and shonks of the ethanol industry have emerged to complain. The Financial Review has identified over $4b in one-off spending in the 2007-08 Budget in areas like welfare and superannuation. Not all of these are in the same category as the carers’ payment, but they all come with constituencies. Crikey also estimates that the previous Government committed a further half-billion dollars in one-off payments before the election (not including drought assistance), as well as several hundred million dollars in short-term programs over two or three years. But cuts to all these payments need not translate into political damage. The Howard Government’s first budget, in August 1996, contained massive cuts, but improved their standing in both Newspoll and Morgan polling. Howard and Costello managed that by following the four simple rules of horror budgets:
Properly managed, a horror budget can both burnish a new Government’s economic credentials and boost its public standing. A vein of masochism runs through the Australian electorate, and we don’t mind being told once in a while that we’ve been slack and need to get into shape. But it does help if the Treasurer and his office are actually coordinating this process. You get the impression the Government was caught out by the carers’ issue last week, until Rudd put his foot down from afar. Swan and his staff should be briefing their colleagues on how to handle these sorts of stories in the future. And they should ensure that from now it’s they who are revealing the slash-and-burn stories, not journalists. |
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11 Comments
Call me a hopeless optimist but I cannot see a Labor government imposing further hardship on pensioners living on $13,500 annually plus small non-recurring government crumbs. I hope the razor gang is looking at millionaire retirees living tax free.
Labor’s definaiton of fighting Inflation. Cut back pensioners from three square meals per day back to two. As for the Aussie Future Fund managers losing the nation’s dowry on the dud Stock market - another bottle of that lovely red with lunch please
Kill promised tax cuts/push them into extra SGC contributions. Takes the +2% inflationary heat to come out of the economy. Consider the alternative: take $31B from treasury, give increased mortgage payments to banks. OK politically difficult, but right
No light and no rescue at the end of our tunnel!
Dear Prime Minister,
Is it not enough that you demand carers work a minimum of 143 hours each week in order to receive a Carer Payment? Is it not enough that that carers are the only social security recipients who must work for their pittance? Is it not enough that you force carers to go without the basic rest that all other Australians enjoy? Is it not enough that our low cost/no cost labour saves the economy $36 billion each year – how else could you deliver $30billion in tax cuts? Is it not enough that we are forced to endure decades of guerilla warfare and sneaky snatch and grab raids in the name of economic rationalism? Is it not enough that our opportunity loss is so great?
Didn’t you listen when carers told you not only what is needed but also how to do it or is it that you don’t understand because you don’t care?
Have you ever felt that you were trapped at the bottom of a long dark tunnel, the life
Is this a West Wing script or what? First I thought Billy Shorten was leaking against the razor gang to protect his ministerial career ambitions? Or a desperate attempt at balance by the conservative Big Meeja lumped with a 7% nong? Means test? You be.
As a senior I was pleasantly surprised by Howard’s largesse; however I certainly didn’t need it, obviously there are those that do, - So how about a bit of means testing in future.Those in need could end up with more.
It looks to me that you are teaching the government how to spin.
”..if the Treaurer and his staff are actually co-ordinating this process” Surely, you jest. Swan needs a baby-sitter himself. I am relishing the upcoming parliamentary sittings, cause Swan in the last sitting was clearly not across his brief .
Tom, you’re watching too much West Wing!
Very nasty to take benefits from people least able to afford it. Election promises don’t amount to much when a “horror” budget is due in May.Crikey, I’d like to see tax cuts given back as super and saved for the future to help take pressure off inflation.
Howard cut disabled pensions. By over $50 per week. He cut benefits for many thousands of single mums with kids. Disabled pensioners got nada, zip and nothing while rich people got billions.
Rudd is going to follow Howard’s policy. OK? Enough.