What the pundits say
Paul Kelly, The Australian: The first Rudd government budget is a great gamble that inflation can be conquered while working families are rewarded with a $55 billion package to cushion their pain. It is a daunting aspiration. This trade-off between competing objectives will make or break the budget. It is faithful to Labor’s political promises but tests the economic proposition that working families can be compensated at length for the inflation struggle.
Ross Gittins, Sydney Morning Herald: Kevin Rudd has failed to grasp the nettle. In his effort to demonstrate Labor’s credentials as a good economic manager he is off to a disappointing start. The budget could have been worse – as it almost certainly would have had John Howard been re-elected – but it could have been much, much better. By better, of course, I mean more unpleasant.
Michelle Grattan, The Age: Swan said he wouldn’t pull a rabbit out of the hat last night; even so, the budget was surprisingly surprise-free. Or at least, the surprises were little ones. Seldom have we seen quite such a systematic pre-budget massage of the message. Not only did the Government leak many measures, especially bad news, and then confirm the “leaks”, but Swan was out every day repeating his mantras about inflation and investing. This robbed the real thing of freshness, but it did thoroughly prepare the ground.
Malcolm Farr, Daily Telegraph: Kevin Rudd’s personal pledge to deliver on all election promises looked patchy last night as details of his Government’s first Budget became clear. The Rudd Government will honour almost all those pledges, but not necessarily when we expected it or how we thought it would be done. –
George Megalogenis, The Australian: Mr Swan is the first treasurer in history with no commonwealth debt to cover. There is no borrowing to pay off, or public service super liability to meet. Just a surplus that has to be returned to voters at some point. This is, indeed, a revolution. Labor has the luxury of thinking long-term because the budget it inherited from the Coalition allows it to.
Annabel Crabb, Sydney Morning Herald: On their own measure, [Rudd and Swan’s] budget had to be mean, or else it would just be plain irresponsible, hence the talking-up of the horror. But as a horror budget, it turned out to be a pretty PG-rated affair. If we were expecting Saw III, what we got was more High School Musical. The hulking spectres of our pre-budget nightmares turned out to be not much more than the distorted shadows of twigs on windows.
Piers Akerman, Daily Telegraph: It was delivered to the media in a cotton bag marked “MADE IN CHINA” and it was long on spin and short on substance. Forget the rhetoric about inflation being Public Enemy No. 1. It is a big-spending Budget, though there has been an attempt to disguise that fact by spreading some expensive promised programs over a few more years and claiming the reduced annual spending constitutes a “cut”. Labor MPs will, however, be able to tell the True Believers that the Rudd Government is seriously into wealth redistribution – in line with Labor’s antiquated policies.
What the editorials say
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The Australian: Yesterday, Wayne Swan continued the me-too lite theme with a federal budget that continued most of the Howard government programs and made only timid cuts and changes to spending. For all the talk about Robin Hood, this is Swan lite. In keeping with the Government’s style to date, the budget pain has been more symbolic than real.
The Age: Labor’s first federal budget in a decade is a model in marrying the philosophical and the practical. It is also a model of responsibility in difficult times. It gives form to the ethos of the fairer go while taking the crowbar to some of the foundations upon which society and within that, business and industry, have been erected. Labor has been helped by a surplus (inherited from the Costello years) of $21.7 billion projected for 2008-09, which is 1.8% of gross domestic product, and savings of $33 billion the Government says it can achieve over four years, $7 billion of that from 2008-09.
Adelaide Advertsier: Mr Swan has positioned the Rudd Government very carefully by laying the groundwork for what will be an election year Budget in two years. With the economy still going strong, tax revenues will continue to rise, giving the Government scope for further spending in the future while being able to keep inflation under control. This is a functional, solid and safe Budget in a difficult economic environment.
Courier Mail: The reality is that Labor is doing something the Coalition embarked upon and quite probably would have continued but it is more than welcome all the same. Where the Budget raises concerns is the new definition of rich people which, in Mr Swan’s mind, seems to start with households with incomes of more than $150,000. For many Australian households in 2008 this is not rich – it is possible for a couple with children, a large mortgage and all of the associated costs of living to struggle to make ends meet at this income level.
Sydney Morning Herald: The first surprise is that there were so few surprises. Mr Swan had led the public to believe that some would have to suffer in order for those less well-off to be properly provided for. The Prime Minister, Kevin Rudd, dropped equally dire hints about the need for some belts to be tightened. It was hard work, being this responsible, the electorate was repeatedly told. There were hints of the agony to come: pre-budget leaks about luxury car taxes, health insurance, the Baby Bonus, and Family Tax Benefit B. And lo, even as the prophets foretold, so it came to pass.