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Thursday, 25 September 2014
Page: 7150


Senator EDWARDS (South Australia) (14:04): My question is to the Minister for Finance, Senator Cormann, representing the Treasurer. Can the minister update the Senate on the final budget outcome for the 2013-14 budget released today, Labor's last budget?

Senator CORMANN (Western AustraliaMinister for Finance) (14:04): I thank Senator Edwards for that question. The Treasurer and I have released the final budget outcome for Labor's last budget. It shows the extent to which the previous government lost complete control of the budget. It shows the extent to which the previous government made a complete mess of the budget and left behind a debt and deficit disaster. It also shows that on coming to government we were able to stabilise the budget position as a foundation from which to repair the budget mess that we inherited from our predecessors.

The previous government left behind $123 billion worth of projected deficits in their last budget. They left behind a debt growth trajectory taking the country to $667 billion and growing beyond that. They left behind a situation where the government right now has to pay $1 billion a month in net interest payments. We have about 10 million taxpayers across Australia. Every month every single taxpayer in Australia pays 100 bucks just on the interest to service the debt that the Labor Party has left behind; every single taxpayer in Australia has to pay $1,200 a year on the debt that Labor left behind.

Of course, Labor said that 2013-14 was going to be a surplus budget—$2.2 billion they said. Then it became an $18 billion deficit. Then it became a $30 billion deficit. In the 11 short weeks between the 13 May budget and the election, the budget position deteriorated by more than $1 billion a week. So we inherited a deteriorating budget position, a weakening economy and rising unemployment. We have stabilised the situation. In the Mid-Year Economic and Fiscal Outlook we presented the true state of the budget. The final budget outcome shows that, unlike Labor, our estimates are realistic and accurate. (Time expired)

The PRESIDENT: Senator Edwards, do you have a supplementary question?

Senator EDWARDS (South Australia) (14:06): There is silence from the other side.

The PRESIDENT: The question, Senator Edwards?

Senator EDWARDS: Can the minister advise the Senate what this final budget outcome tells us about the state of Australia's public finances and in particular the spending growth trajectory?

Senator CORMANN (Western AustraliaMinister for Finance) (14:06): The spending growth trajectory that Labor left behind was completely unsustainable. The previous finance minister, Senator Wong, who presided over a $107 billion deterioration in the budget bottom line in the three short years that she was the finance minister, kept lecturing us how Labor was keeping real growth in government spending below two per cent. Well, the truth is it was 3½ per cent over the forward estimates. And it actually gets worse. In the period beyond the forward estimates, the previous Labor government recklessly and irresponsibly locked in spending growth of about six per cent per annum. Labor put us on a trajectory of taking government spending as a share of GDP to 26.5 per cent by 23-24, when revenue on average over the last 20 years has been 22.4 per cent. Labor wanted us to keep borrowing, keep adding to the debt and keep adding burdens to future generations for them to pay off. (Time expired)

Senator EDWARDS (South Australia) (14:08): Mr President, I ask a further supplementary question. Will the minister inform the Senate what the government is doing to repair this budget?

Senator CORMANN (Western AustraliaMinister for Finance) (14:08): The government is working in an orderly and methodical fashion to build a stronger and more prosperous economy where everyone has the opportunity to get ahead and to repair the budget mess that we have inherited from our predecessors—although, we are not getting any help from those opposite.

Opposition senators interjecting

The PRESIDENT: Order on my left!

Senator CORMANN: Those opposite want us to continue to borrow from our children and grandchildren so that they can pay the costs for our consumption here today. Well, we think that is unfair. We think that we have a responsibility and a duty to our children and grandchildren to put government spending back on a sustainable growth trajectory. And, of course, that is exactly what we are doing. The Labor Party wants to continue to put our consumption on the national credit card and hand the credit card over to our children down the track. That is what the Labor Party wants to do. That is absolutely irresponsible. If we want to protect our living standards, if we want to build stronger opportunity for the future, we need to repair the budget. (Time expired)