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May 2, 2014

Keane: government makes a mess of its pre-budget message

The Commission of Audit release won't make it any easier for a government struggling to keep control of its budget messages. Crikey's political editor delivers his verdict.

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The Commission of Audit is not a report by the federal government but a report to the federal government. Just wanted to get that out there, because that point doesn’t appear to have been made at any time in recent weeks or in the last 24 hours.

The last government to try to release a major fiscal review in the lead-up to a budget was Kevin Rudd’s in 2010. That didn’t go well. “Didn’t go well” in the sense that, by the time the smoke cleared, Rudd’s party had removed him and a desperate deal with the mining industry had to be stitched up. Labor just managed to win another term in government, but they were crippled. So, in terms of how not to release a report, that one is pretty much the ne plus ultra.

Treasurer Joe Hockey and Finance Minister Mathias Cormann have, wisely, opted not to respond to the Commission of Audit, at least until the budget the week after next. But that’s wise only in the sense that they’ll avoid the kind of debacle we saw in 2010. Whether it’s wise in the normal sense of the word is less clear. Bit by bit, speech by speech, headline by headline, the government has lost control of the pre-budget period. It’s been a remarkable unforced error: the weeks in the lead-up to a budget, even a horror budget, are supposed to be a period in which expectations are shaped, nasties anticipated and, if necessary, some kites flown to see what the punters and key stakeholders think. It’s all in the control of the government.

This time around, we had an abortive debate on the pension age and indexation, before the government pulled back out of concern at the reaction. Then the debt levy broke. News Corporation journalists say it was a genuine scoop by Samantha Maiden, and not a drop, and there’s no reason to disbelieve them — to incense even the Coalition’s diehard media cheerleaders, let alone voters who heard Tony Abbott ad nauseum declare that he wouldn’t be raising taxes and he wouldn’t be breaking his promises, is just dumb.

Now the Commission of Audit has unveiled a big new suite of nasties to offend pretty much everyone, even if the bulk of its targets are those least able to defend themselves. The only positive for the government has been that it has offended so many people; ending bulk-billing via GP co-payments has attracted far less outrage than would’ve been expected if it had been announced in a vacuum.

Part of the government’s problems centre on the Treasurer, who was out today confirming that the pension age would be rising to 70 in the 2030s (essentially sound policy, if handled correctly). Hockey genuinely likes to start debates over public policy. He did it on banking regulation while in opposition. He did it on taxation of trusts in opposition, which led to him getting beaten up by the Nationals. He incurred considerable mockery in the 2009 leadership contest by publicly asking for views on climate change. He proposed a public debate about a renewed government role in Qantas last year. This is entirely commendable — one of Hockey’s best features is that, unusually for a politician, he appears to be genuinely receptive to new ideas.

“This was never going to be an easy first budget, but the government has seemed determined to make it much more difficult for itself.”

But politically it has repeatedly proved problematic, with opponents and the media taking the opportunity not to debate issues but mock Hockey or run scare campaigns.

And external circumstances haven’t favoured the government. It’s harder to explain to the electorate that it’s going to have to make sacrifices when senior figures of the home party branch of the Prime Minister and Treasurer are embroiled in corruption scandals.

But those explanations only get us so far. There is something genuinely off-key about this government. The new year was supposed to bring an end to the stumbles that marked its first few months and wiped out its polling honeymoon. All governments take time to settle in, so some early mistakes were understandable. But the mess the government has made of the budget suggests both a lack of a core message and of a strategy to sell that message, making it prone to wandering off course. Abbott’s speech early this week, in which he promised tax cuts in the future while talking about how everyone needed to sacrifice now, was emblematic of the extraordinarily mixed signals the government has been sending.

The logic behind the timing of the Commission of Audit is supposed to be that, by revealing what real cuts look like to voters ahead of the budget, they’ll be suitably grateful when budget night reveals much less pain, while the government has managed to shift the ideological frame for economic debate, and debate about the size of government, to the Right. But that looks like a strategy for 1996, when a Commission of Audit would be explained to voters through the press gallery and economic commentators.

For the last 24 hours, the Commission of Audit has been ripped apart on social media, with its errors, extreme recommendations and list of targets taken out of context and circulated as evidence of a depraved agenda of inflicting misery on the lowest in the community. And much more of the mainstream media is now occupied with commentary, and little of that commentary has been kind to chief auditor Tony Shepherd and his cronies, even from the Right.

The risk is thus: the Commission of Audit gets savaged by all and sundry for 10 days, before the budget marks the end of whatever “debate” we’re supposed to be having on its philosophy and recommendations (including some of its very good ones) because the government is unable to control its message.

This was never going to be an easy first budget, but the government has seemed determined to make it much more difficult for itself.

Bernard Keane — Politics Editor

Bernard Keane

Politics Editor

Bernard Keane is Crikey’s political editor. Before that he was Crikey’s Canberra press gallery correspondent, covering politics, national security and economics.

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