“Labor’s spending promises made since Kevin Rudd became its leader last December now amount to more than $20 billion, further evidence of Labor’s lax approach to economic management,” Minister for Finance and Administration Nick Minchin claimed in a media release three weeks ago. “Australia’s current economic circumstances require a disciplined approach to Commonwealth Government spending.”

So, naturally, he didn’t admit that the Howard Government had already announced spending of $24 billion since the beginning of the year.

There’s still considerable fear amongst economists of an interest rate rise later in the year. It won’t be helped by a big-spending Budget.

It’s felt that given Australia’s low unemployment, any major new spending will just feed inflation and force the Reserve to raise rates.

HSBC chief economist John Edwards has warned that this Budget will be the most risky compiled in half a century. “I think that we’re in a very sensitive point for interest rates with government spending,” he says.

The Government, behind in the polls at the last two election Budgets, has taken the opportunity to hand out tax cuts and new spending. There’s still scope to move. It just has to be done carefully.

Will that be politically effective? Get ready tomorrow night for some dizzying spin.