Laughably, Premier Nathan Rees’s NSW Government is calling it a “mini-budget”. It’s more like a MEGA budget.

Details of the NSW rescue package to be announced this afternoon are aimed at giving Labor a “red hot go” at arresting Labor’s electoral meltdown and staging a comeback between now and the state election in March 2011.

In that sense the mega-budget is about two things — rescuing the NSW economy, which is bordering on recession with the highest unemployment and lowest growth in the Commonwealth, and rescuing the NSW ALP from electoral oblivion in just over two years.

It will be the most far-reaching budget in NSW history: asset sales worth $10 billion, including the three state-owned electricity retailers; merger of government departments into centralised clusters; increased taxes on the coal mining industry and wealthy landowners with investment properties worth more than $2.25 million; a public transport plan; and a firesale of Crown land.

Premier Rees wants the budget to demonstrate his earlier commitment: “Fiscal responsibility will be the foundation stone of my premiership.”

And his Treasurer Eric Roozendaal is anxious to fulfil his repeated undertaking to preserve the State’s triple-A credit rating.

Can they do both? And given the seemingly irreversible meltdown in the global — and Australian — economy, will a Band Aid solution engineer the patient’s recovery?

While the media has focused on the inexperience and unpopular character defects of Treasurer Roozendaal and Finance Minister Joe Tripodi, the deadly duo who have engineered the package through Cabinet, the real muscle behind the mega-budget has come from two former Reserve Bank governors, Bernie Fraser and Ian MacFarlane.

They were hired within days of Rees becoming premier and in the wake of former Treasurer Michael Costa’s hand grenade announcement that he was leaving the government with a $1 billion revenue blackhole.

Details of the economic package have been leaked every day for the past fortnight providing Press Gallery journalists with a steady diet of “budget exclusives”. How odd that at his first press conference Rees said: “I think the public are absolutely fed up with spin, fed up to their back teeth.”

Clearly, we are watching the emergence of two categories of spin. There is spin, which is disgusting and reprehensible, and “core” spin which is meaningful and enlightening.

Can Rees save the State’s economy and the Labor Party at the same time? He sees both projects as synonymous and that’s how he would like us to see it too. But that would be spin of a non-core variety.

Peter Fray

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