Last night’s budget makes one thing crystal clear. Under the major parties, Australia is headed toward European levels of national debt. Trust me when I tell you it will not end well.
The Libs have abandoned any pretext of leaner, more efficient government and chosen instead to become a pale red imitation of the Labor Party. In fact many of the measures introduced last night were modifications of Labor policy and their vision of a big spending, big taxing, big deficit government.
Australians deserve better than a spiralling debt load predicted to reach $725 billion in 2025 but likely to be much, much higher. We deserve better than new and increased taxes to pay for unsustainable and overly bureaucratic spending programs. We deserve better than a supposedly conservative government abandoning the quest to cut spending and squirreling away billions in additional debt off the budget books.
Much was made of the decision to ditch the ‘zombie measures’ from the 2014 budget which couldn’t get past the leftist-leaning crossbench in the Senate. However, the government didn’t propose any new or substantive spending cuts that may actually have met with some support. Instead they chose the Labor way to tax and spend.
In 2014, the Commission of Audit recommended that 65 per cent of government agencies could be rationalised or abolished. That’s 890 bodies deemed unnecessary – a fertile ground for savings. And that’s just the start. The government needs to go line by line through every item of expenditure and ask if this spending is still necessary, effective and beneficial.
The two Audit Commission reports suggest up to $70 billion could be saved annually if their recommendations were introduced.
Similarly, there was not much in last night’s budget for the deregulation supporters who see government red and green tape as an impediment to prosperity. Instead, we saw the Mining Tax 2.0 levied on the banks.
Now I know that defending the banks against new taxes will be unpopular but I am only defending the principle attached to what the government did. In effect, the government has said the banks are making too much money and they want some more of it. This year it’s the banks and who knows what other industries will be targeted in years to come. It’s a clear sovereign risk for the predictability of Australia’s tax environment.
That risk will be felt by every self-funded retiree as bank shares fall in price by $14 billion for a $1.6 billion annual budget gain. Every bank customer will also feel the pinch as likely fee increases are introduced to help counter the measure.
The government also contradicted its own rhetoric on housing affordability. It has maintained that negative gearing has little impact on house prices and yet it tweaked the existing rules to raise more taxes under the guise of ‘housing affordability’.
In short, this is not a Conservative budget. Debt continues to grow out of control, welfare spending is out of control and three big new taxes were introduced.
Frankly, it vindicates the suspicion held by many that the Liberal Party have abandoned their core ethos and have lost their way. Australian Conservatives now stand as the only check against us having two Labor parties running the country. It means our mission to gain effective representation is more important than ever.
For the sake of the country, we need every conservative to do their bit to find a better way. Please consider joining us as a member or making a financial contribution to help us prepare for the battle ahead.