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Labor resorts to budget tricks despite IMF warnings



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THE HON ANDREW ROBB AO MP Shadow Minister for Finance, Deregulation and Debt Reduction Chairman of the Coalition Policy Development Committee Federal Member for Goldstein

M E D I A R E L E A S E

Friday, 30 March 2012

LABOR RESORTS TO BUDGET TRICKS DESPITE IMF WARNINGS

A desperate and deceitful Labor is set to use more accounting tricks in its bid to manufacture a budget surplus for 2012-13 despite the International Monetary Fund (IMF) warning governments against using creative accounting to artificially improve budget positions.

“The Coalition has exposed billions of dollars worth of Labor money shuffles which are blatant attempts to improve the budget bottom line in 2012-13. This is despite reports today of the IMF urging governments to resist the temptation of replacing genuine spending cuts with tricks to ‘give the illusion of change without substance’,” Shadow Finance Minister Andrew Robb said.

“One egregious example sees Labor spending over $1 billion this year to support energy markets against the carbon tax, yet magically the carbon tax poses no threat in 2012-13, when spending drops a thousand times to less than $1 million. The following two years sees spending return to over $1 billion.”

Some other examples of Labor‟s dodgy money shuffles include:

o Labor‟s “coal sector jobs package” will see $222 million spent in 2011-12, $247 million in 2013-14 and $257 million in 2014-15, yet only $10 million in 2012-13.

o Labor also announced the bring-forward into 2011-12 of $1.4 billion of infrastructure funding for NSW, Queensland, Victoria, with $1.22 billion of this funding shifted out of 2012-13.

o By pre-paying its Clean Energy Advance household assistance payments in May and June 2012 rather than in July (as the carbon tax begins), Labor is shifting $1.51 billion of spending from 2012-13 into 2011-12 so as to artificially boost its 2012-13 budget position.

o The government has accelerated some disaster relief payments to the states and territories, involving an advance payment to Queensland of $1.4 billion brought forward into 2011-12.

On top of the money shuffles there are also $100 billion of liabilities against the budget which are either hidden from the bottom line or unfunded, including borrowings for both the NBN and the „Bob Brown Bank‟ and Labor‟s $30+ billion commitment to buy 12 new submarines.

“Labor‟s claims to be delivering a wafer-thin surplus in 2012-13 should be taken with a very large grain of salt - it is essential to look at the facts not the spin,” Mr Robb said.

Media contact: Cameron Hill on 0408 239 521.