The Government, and specifically its Treasurer Joe Hockey, faces a credibility problem.
After years of lambasting former treasurer Wayne Swan’s inability to get the budget back to surplus, and still trying to get the more contentious measures of his first budget through the Senate, Hockey is now warning the budget will take a “hit” from the slowing world economy.
According to the The Australian this morning, Hockey said lower commodity prices “do have an impact on our budget — we’ll have more to say in MYEFO. As a result of the fall in iron ore and coal prices, there’s been a hit to the budget.”
That is Treasurer code for: “We need to redo our figures on when we’ll get back to surplus.”
Wayne Swan, Chris Bowen, and Bill Shorten will be dancing a jig as the Treasurer tries to avoid hoisting himself with his own petard. Hockey, who is in New York at an IMF conference, said that the MYEFO in December would not need to be a mini-budget.
“We’ve got to be realistic about the state of the economy and the state of the budget,” he said. “Our forecasts will be more realistic than what previous governments have had. And because they’re more realistic, it means we’re better informed about what we can and can’t do.”
Weak commodity prices, a slowing domestic economy, operations in the Middle East and an intransigent Senate is not making the promise of budget surpluses any easier.
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