With one week to go until the federal budget, Tony Abbott is seeking to soften the political blow of one of his biggest failed election promises.

The deficit the Coalition government once promised would be under control in its first budget is not going anywhere fast, and Abbott and his Treasurer have been engaged in a media blitz to remind voters that circumstances apparently beyond their control — a plummeting iron ore price and weak wages growth — are only making that job harder.

But will this budget really be a horror story, as predicted by Deloitte Access Economics? As Bernard Keane writes in a budget preview today:

“Don’t assume, necessarily, that next Tuesday will reveal a further big blowout: one of the most basic of expectations management practices is to suggest things are absolutely diabolical, before producing a better-than-expected result. And Hockey is on the record as saying that the budget would be ‘mildly contractionary’, meaning next year’s deficit will be a little smaller than this year’s deficit. Of course, that depends on whether this year’s deficit remains at $40-odd billion, or goes up.”

Can the fire brigade finally contain the fiscal fire? It’ll all become clear on the night.

Next Tuesday the Crikey team will be heading into lock-up to rake over and interpret the 2015-16 budget papers, before a special Crikey newsletter lands in your inboxes around 8pm. (We’ll be bringing Ms Tips along for the ride, so you’ll also get a “morning after” edition packed with gossip as pollies, public servants and journos let their hair down in Canberra.)

Here we go again …

Peter Fray

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