In this year’s budget in May, then-treasurer Joe Hockey revealed that the government in both 2014-15 and 2015-16 would be spending 25.9% of GDP — the highest level of spending as a proportion of the economy since Kevin Rudd’s massive stimulus program to combat the financial crisis in 2009, which totaled 26% of GDP.
Hockey’s replacement, Scott Morrison, has on a couple of occasions since becoming Treasurer flagged that spending had risen. Today, he confirmed that, when Tony Abbott and Hockey were removed, the government was spending 26.2% of GDP.
That is, the Abbott-Hockey government, which so often promised to end the profligate Labor years and restore fiscal discipline, was spending more as a proportion of the economy than Kevin Rudd did to fight the financial crisis — despite the lack of any global economic meltdown. The level of spending is a full percentage point above the average of the Labor years — 25.1% of GDP.
Morrison’s goal in the forthcoming Mid Year Economic and Fiscal Outlook is to get spending back to the budget level of 25.9% — still nearly the same level as Rudd, and still way above Labor’s average. It’s a pretty weak ambition for a so-far underwhelming Treasurer who insists the government doesn’t have a revenue problem, it has a spending problem.
Peculiarly, the array of critics of Labor’s spending in the media and the commentariat haven’t said a word about the Coalition going well beyond Labor’s spending levels. Fiscal hypocrisy isn’t just the preserve of parliamentarians.