Emergency Budget Repair Kit

The August 2013 Economic Statement estimates that the Underlying Cash Balance for the 2013–14 Budget will be a deficit of $30.1 billion and the fiscal balance a deficit of $25.6 billion. For 2014–15, the Underlying Cash Balance is estimated to be a deficit of $24 billion and the fiscal balance a deficit of $22.2 billion.

Whether this constitutes a budget emergency is open to debate; however, it is clear there is a troubling trend of recurrent deficits and increasing debt. While the government has announced plans to address the budget deficit via a commission of audit, the commission cannot fix the budget problems in the short term because the government has committed
to take the commission’s recommendations to an election before implementing them.

The commission does have a valuable role as a circuit breaker to compel politicians to re-examine the role of government in society. If there is political will to follow its recommendations, such a commission could make a serious difference to the effectiveness and efficiency of government in the long term.

Yet, having repeatedly told the Australian people there is a budget emergency, the Coalition must now act decisively and quickly to identify and resolve the cause of Australia’s budget problems. Proposing to wait three years to implement solutions runs contrary to the appellation of ‘budget emergency.’