A Half-Good Budget

“The Government’s forecast surplus is built on the back of increased tax revenue, not prudent economic management,” said Kurt Wallace, Research Fellow at the free market think tank the Institute of Public Affairs.

“Taxes and spending continue to grow under the 2019-2020 budget. In the next financial year, taxes are set to hit a record $466 billion and spending a record $493 billion.”

“The modest forecast surplus of $7 billion is a result of tax revenue outpacing spending growth. For this, the Government can thank bracket creep and strong commodity prices.”

“It is good that the Government is bringing forward tax cuts that will relieve the tax burden for millions of Australians. However, the cuts are too little and too slow to reverse the concerning trend in household tax to income. Unfortunately, it is unlikely that we will see the tax reduction schedule through to 2024. ”

“To deliver meaningful tax cuts, the Government needs to slash spending. This budget does not present a plan to reduce government spending. Government spending is locked in at around 24.5 per cent of GDP.”

“Infrastructure projects are being funded on the basis of an optimistic economic forecast at a time of increasing economic headwinds for the Australian economy.”

“Gross debt is projected to be a record $560 billion in the coming year. A $7 billion surplus won’t even cover the interest on this debt. The next five years of estimates do not deliver surpluses capable of addressing the debt.”

“While the government is celebrating a long-awaited return to surplus, when off-budget investments in projects such as the NBN are taken into account, the budget remains in a $4.4 billion deficit.”

“The Government has not produced a plan for sustainable tax cuts through cuts to government spending. Less government intervention in the economy is required to allow Australians to flourish.”

“Since its first budget, the Coalition have had one and a half good budgets, 2014, and half for this budget. 2019 is all too late to discover fiscal responsibility. Structural reform will have to wait until the next Coalition Government,” said Mr Wallace.