The Federal government released its 2017/18 budget last night. On first glance it represents a radical departure from the infamous “lifters and leaners” budget delivered by the Coalition just a few years ago. As a commentator in one of our broadsheet newspapers noted, this is much more the sort of budget we expected from a Malcolm Turnbull prime ministership.
The underlying narrative has shifted from the notion that we are spending too much and must therefore make cuts to spending, to a recognition that we can increase revenue and maintain our spending while simultaneously reducing our deficit. Two significant revenue raising measures have been introduced –increased tax on the banks and a Google tax to make sure that multinationals don’t evade paying taxes, and an increase in the Medicare levy by .5%. These measures, along with the increasing government revenues that flow from a growing economy, are being used to ensure the National Disability Scheme has the funding it needs, to restore gonski style funding to the schools, to increase funding for homelessness, and some pretty decent infrastructure projects. Alongside this there is the now apparently mandatory projection of substantial increases in defence spending out over the next 20 years.
I’m quite astonished to see the Coalition government increasing revenue and spending, but I welcome it warmly. It strikes me that we squandered the opportunity of the boom years. With rivers of gold pouring into Treasury, the boom was surely a time to stack away hundreds of billions of dollars into sovereign wealth funds that would then generate income for the time when the boom wore off and we faced the challenge of maintaining our living standards at the same time as our population was ageing. Instead we delivered year after year of tax cuts. A return to revenue raising will allow us to have the services we demand of government.
If there’s been a turnaround in the domestic narrative, the budget shows there is no turnaround in our global narrative. The foreign affairs and Department of Immigration portfolio statements use all the language of being a good international citizen, yet $300 million has been slashed from an aid budget already sorely depleted; there is a welcome increase in the number of refugees we will settle to the order of two and half thousand more per year, yet considering we face the worst displacement crisis of history and Australia assumes such a small fraction of the burden of care, it seems very inadequate to the scale of the crisis. Moreover we will continue to expend well over $2 billion a year on offshore detention and preventing boats from arriving in Australia. There is no indication government will engage in the work required to build a genuine regional framework that will provide a long-term approach to providing protection for refugees and asylum seekers. And yet again there is no indication that we will up the ante on climate change.
Has Malcolm got his Mojo back? It certainly looks that way, at least when it comes to domestic policy. We may even be seeing glimmers of the Scott Morrison who entered Parliament a small liberal and humanitarian. Internationalism? I wouldn’t hold my breath.