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Wednesday, 9 May 2012
Page: 2936

Budget

Senator BRANDIS (Queensland—Deputy Leader of the Opposition in the Senate) (14:28): My question is to the Minister representing the Treasurer, Senator Wong. Is the minister aware that last year's budget projected a deficit for this financial year of $22.6 billion? Can the minister confirm that yesterday's budget estimated that the deficit will in fact be $44.4 billion? Since, by the government's own figures, its estimate of the deficit for this financial year was wrong by at least $22 billion, how can the public have any confidence that this year's budget projections will be any more accurate? Isn't it still the case that this government has never delivered a surplus budget and never will?

Senator WONG (South Australia—Minister for Finance and Deregulation) (14:29): First, this budget delivers a budget surplus on time and as promised. Second, in terms of the 2011-12 figures, I am happy to go through them in detail. In terms of the shift between 2011-12 and now, for the 2011-12 year we had about $9 billion in revenue write-downs. Some of those, obviously, resulted from what occurred in Europe, particularly towards the end of last year. We had a significant bout of global instability, which obviously has an effect on our economy via various mechanisms but particularly through its impact on confidence.

As a senator from Queensland, the senator might also like to know that some $2.3 billion of the increase in the deficit between the mid-year review and the budget was a consequence of natural disasters, particularly in Queensland. We made advance payments to Queensland of $1.3 billion to ensure the rebuild task could continue and we have had to revise up our natural disaster bill for 2011-12 by at least a billion dollars. The senator would also be aware that we have chosen to provide some carbon price assistance up front.

I am asked how we can demonstrate that we will deliver the surplus and I make this broader point. Between the 2011-12 budget and this year's budget, we had about a $10 billion write-down in revenue for the 2012-13 year. We have made savings to offset that revenue write-down and to protect the bottom line. We have demonstrated our determination to protect the surplus and make savings to do so.

Senator BRANDIS (Queensland—Deputy Leader of the Opposition in the Senate) (14:31): Mr President, I ask a supplementary question. If the government is so confident of its projection of a surplus as the outcome of this budget, why is it proposing to increase the national debt ceiling by $50 billion?

Senator WONG (South Australia—Minister for Finance and Deregulation) (14:31): I think the question on debt is the same question I was first asked, as I recall it, by the Leader of the Opposition in the Senate, Senator Abetz. I answered that in detail with reference to the advice of the Australian Office of Financial Management. In fact, I suggested to Senator Abetz that he take the opportunity to speak to Senator Bushby, who sits behind him, because he might be able to explain it to him in more detail. I make this point: if those opposite care so much about a surplus, why will they not front up with their savings? Of course you do not want to know about this, do you, George?

Senator Brandis: I raise a point of order on direct relevance, Mr President. As the minister rightly observes, this question is substantially the same as a question that Senator Abetz asked Senator Wong. I have given her the opportunity to answer to me what she failed to answer to him. Nothing she has said so far bears even remotely on the question, let alone being directly relevant to it. Why is the government increasing the debt limit by $50 billion?

The PRESIDENT: There is no point of order. I cannot instruct the minister how to answer the question. It might not be answered in the form or the way you would prefer and you might not be given the answer you would particularly like. But I understood from the minister's answer that she was responding to the question you asked.

Senator WONG: I refer the senator to the transcript of my earlier answers in which I outlined in quite a lot of detail, I thought, the advice of the Australian Office of Financial Management and the reasons for the increase in the legislated debt cap. I think I have answered that quite fulsomely.

Senator BRANDIS (Queensland—Deputy Leader of the Opposition in the Senate) (14:34): Mr President, I ask a further supplementary question. Given the government has now delivered four budgets and four deficits—the four biggest deficits in Australian history, which together amount to $174 billion—should not the Australian people see through the government's promise to deliver a surplus this time as just another unbelievable Labor Party promise based on spin, not facts?

Senator WONG (South Australia—Minister for Finance and Deregulation) (14:35): The Australian people can look to the determination to bring the budget back to surplus, which is demonstrated by the $34 billion of savings made in this budget. What the Australian people are also entitled to see—and this should be tomorrow night in the budget reply—is the party who claims they would deliver a bigger surplus telling Australians how they would get there. They have never fronted up on their $70 billion black hole. They have never made it clear to the Australian people just what they would cut. Last night my counterpart, Mr Robb, said they would deliver a surplus of $15 billion. To do that, you would have to not pay Medicare next year. You are making glib promises because you want to hide the real savings measures you have in mind. Either that or you are simply not telling the truth.