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Tuesday, 30 October 2012
Page: 8396

Budget

Senator BRANDIS (Queensland—Deputy Leader of the Opposition in the Senate) (14:00): My question is to the Minister for Finance and Deregulation, Senator Wong. Will the Minister give the Senate a guarantee that the government will deliver a budget surplus in 2012-13 as promised?

Senator WONG (South Australia—Minister for Finance and Deregulation) (14:00): I welcome a question from Senator Brandis on the economy. As the Senate would know, the government has just delivered a midyear budget update in which we took quite many billions of dollars worth of savings to return the budget to surplus. Of course we stand by that forecast, and we are on track to deliver it. The fact that we took the sorts of savings that we did at this time, at a time when we saw some $22 billion written down in terms of revenue to government—something which those opposite may not understand; that we are a lower taxing government than the Howard government—

Senator Abetz: Because you're borrowing, that's why.

Senator WONG: and we took $16.4 billion—Senator Abetz says it is because we are borrowing. It is because less tax is being generated, senator. It is because less tax is being paid to the government. If you would like to look at the tax-to-GDP ratio, it is 23.7 per cent for your government and just over 22 per cent for our government in this year. What is occurring is that for various reasons—including the thing they keep forgetting, which is the worst global downturn since the Great Depression—we are seeing less tax being paid to the federal government under this government than we saw under the Howard government. In fact, in these circumstances the government took some $16.4 billion worth of savings in the MYEFO. That adds to more than $130 billion of savings over five budgets. That level of savings demonstrates the commitment that this government has to fiscal discipline at a time when we see a softening in the global economy, something that those opposite might like to simply brush over.

Senator BRANDIS (Queensland—Deputy Leader of the Opposition in the Senate) (14:02): Mr President, I ask a supplementary question. I remind the Minister of the Prime Minister's commitment on 10 May 2011 to a budget surplus in 2012-13, 'on time as promised to the Australian people at the last election'. Minister, why is what was then a promise now merely, as the Minister has said, a forecast? Like the carbon tax, like the private health insurance rebate, like poker machine reforms, will this be just another promise to the Australian people which this government intends to dishonour?

Senator WONG (South Australia—Minister for Finance and Deregulation) (14:03): I can absolutely guarantee that this government will always run the right fiscal policy for the economic circumstances to support the economy and jobs. We are a Labor government that has steered this economy through the global financial crisis and Australians should be very proud of what we have all achieved, not just the government but workers and businesses and managers who have helped steer this economy through the global financial crisis to get to the position we are in today. So, we will always ensure that our fiscal settings are appropriate for the Australian economy and jobs. An economy at or around trend growth coming back to surplus is the appropriate fiscal setting, which is why the government has handed down a MYEFO, a budget update, with billions of dollars worth of savings that has us on track to return to surplus. That is the position of the government. I look forward to the opposition telling—(Time expired)

Senator BRANDIS (Queensland—Deputy Leader of the Opposition in the Senate) (14:04): Mr President, I ask a further supplementary question. I want to give the Minister one last opportunity to clarify this. Given that the Prime Minister said, and the Minister herself on previous occasions has told the chamber, that delivering a budget surplus in 2012-13 is a promise and she now says that it is merely a forecast, which is it? Is it a promise any longer or is it less than a promise?

Senator WONG (South Australia—Minister for Finance and Deregulation) (14:04): This government will always have the right fiscal settings for the economy and jobs. We will always do that. We stand in stark contrast to those opposite who we know opposed the stimulus package, who, to this day, try to brush over the global financial crisis. As I have said, we have just delivered a midyear budget update, which has billions of dollars in savings to return the budget to surplus, that demonstrates our commitment to fiscal discipline—

Senator Brandis: Mr President, on a point of order on the question of direct relevance, I did ask the Minister whether the commitment to return the budget to surplus was still a promise or merely a forecast. I ask you to invite the Minister to address the only issue I raised in my question: is it still a promise or isn't it?

The PRESIDENT: Order! The Minister is quite in order. The Minister is answering the question and has 28 seconds remaining.

Senator WONG: Thank you, Mr President. We have just delivered a midyear budget update which returns the budget to surplus. The opposition might want to have a look at it. While we are on that subject, they might want to tell us, if they are so keen on surpluses, whether or not they will actually back off savings measures because I noticed that Mr Hockey, after likening the baby bonus changes to the one-child policy in China—an outrageous statement—is still hedging his bets as to whether or not he will support it. (Time expired)