In a bizarre “launch” of the Coalition’s debt reduction policy amidst leadership turmoil this morning, Malcolm Turnbull committed to reduce Commonwealth expenditure to 25% of GDP, in effect promising to slash more than $36b from Commonwealth expenditure, based on current forecasts for 2010-11.
The commitment, however, was a direct repudiation of Joe Hockey’s earlier commitment to slash spending by even more, to 24% of GDP, made barely a month ago.
Turnbull, joined by Hockey and finance spokesman Helen Coonan, spent all of the ensuing press conference fending off questions about leadership, with Hockey committing to Turnbull’s leadership and repeatedly declaring he only wanted Wayne Swan’s job. Yesterday Joe Hockey admitted he had been approached by colleagues to take over the leadership.
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Hockey handed Wayne Swan and Lindsay Tanner a golden opportunity to attack the Coalition in September when he committed to what the Government estimated would amount to a $48b cut in expenditure, although Hockey qualified his commitment to “over time”. The Federal Budget was only at or below 24% of GDP in normal budget circumstances once during the Coalition’s years in power, and before that only during the Keating Treasurership.