Federal Treasurer Joe Hockey has told the Coalition party room that the budget may “never get back to surplus”. Mr Hockey’s comment was made when addressing the damage done to the nation’s budget since May, which has blown out to between $46 billion and $56 billion. As Shadow Treasurer, Mr Hockey promised that if the Coalition won the next election, a budget surplus would be delivered in the first year and every year after that.
There are more than $15 billion in budget saving measures currently being held up in the Senate with little prospect of being approved. These measures include the cuts to higher education, reintroduction of fuel excise indexation, and cuts to the Medicare rebate associated with the introduction of a co-payment for bulk-billing.
The major blowout to budget projections has come in the wake of collapsing iron ore, coal and natural gas prices, which will cost the budget around $30–$40 billion per annum. Deloitte Access director Chris Richardson, has agreed with Mr Hockey’s assessment, saying that the budget may not return to surplus in the foreseeable future.
“The politics don’t help, but the tide would be going out for whoever was in office; whether it was Tony, Malcolm, Julie or Bill,” Mr Richardson said. “Even if the Senate said yes to every measure now before it, the budget would remain in much deeper deficit than presently forecast because of the slide in iron ore, coal and gas prices.”
As a proud Australian, I find myself bemused by how often the Federal Government budget projections have been incorrect. The last two Federal Governments have promised budget surpluses, and both will have failed to deliver on that promise if current trends continue.
As our debt level increases, concern should also increase for every Australian. From where do you think the money to pay down this debt will come? It won’t be coming from the pockets of the politicians, and it’s highly unlikely that we will see another resource boom to save our bacon.
If the Government fails to create additional revenue streams through policy changes, the money will have to be pulled from current expenditure, such as the funding of education, roads, hospitals and even social security.
Some of the most important government work on policy and changes is achieved by bi-partisanship. It’s time for the Coalition and Labor parties to sit down and discuss the nation’s budget outlook and to implement cuts to the budget for the greater good of our nation’s future.
What do you think? How important is it to achieve a budget surplus within the next four years? Should the Federal Government and Opposition work together on the next budget to get Australia back on track?