JIM CHALMERS MP
MEMBER FOR RANKIN
THE RIGHT KIND OF RECOVERY: RENEWAL NOT RORTS
As the difficulties of 2021 become the possibilities of 2022, it couldn’t be a more important time to take stock and try to renew and unite around genuine reasons to be optimistic about the future.
That’s why the mid-year budget update should have been an opportunity for the nation to consider what kind of economy and recovery we want and how we make sure it works for everyone.
It could have been an opportunity to support working families with skyrocketing costs of living, address job insecurity, and create a future made in Australia.
A chance to provide better access to childcare, cheaper and cleaner energy, investments in TAFE and training to address the skills shortages holding the recovery back, and a credible plan for the budget beyond the election cycle.
Instead, it just reminded us of the defining failures of the Morrison Government’s economic mismanagement: billions squirrelled away for pre-election waste; record debt and deficits as far as the eye can see with not enough to show for it; and real wages going backwards again this year.
At a time of great uncertainty, it offered more of the same rorts and risk and complacency that poisoned the green shoots of a nascent recovery this time last year and became instead one of the biggest downturns ever, in the third quarter of 2021.
No wonder it was received so poorly.
It’s clear the economy is recovering but we can’t be complacent or assume, as the budget now does, that the Morrison Government will perfectly manage new outbreaks and strains of the virus given their form in botching the health response this past year, and the risk they bungle the boosters now.
Scott Morrison and Josh Frydenberg can’t take credit for a recovery which hasn’t happened yet, without taking responsibility for the mistakes that saw billions of dollars a week shed from the national economy for large swathes of this year.
Even with welcome and unsurprising improvements in the budget forecasts, last week’s update still had deficits getting bigger in two years of the forward estimates; declining real wages this year and still stagnant thereafter; a tax take bigger than under Labor but still a trillion-plus dollars in debt.
The wages outlook is especially concerning, when you remember that of the 55 times the Government has forecast wages growth, actual wages outcomes have fallen short 52 times.
This is another reminder that many, if not most, of the key challenges to our prosperity have been with us for eight long years and not just the two years of COVID-19.
Remember, six in every ten dollars of net debt racked up by this Government was borrowed before the pandemic.
We hope wages do grow strongly, that the pandemic is well-managed, and that the economy recovers strongly, broadly and sustainably. But this is a government notorious for over-promising and under-delivering on the economy and the budget.
Flogging-off ‘Back in Black’ mugs then delivering more consecutive deficits than any government in a hundred years is testament to that.
The economy would be stronger were it not for the mistakes made on vaccines and quarantine.
The Budget would be stronger were it not weighed down with tens of billions of dollars in rorts and waste, and there’d be more room to fund essential services like Medicare and the NDIS.
Middle Australia would be better off without the stagnant wages and insecure work which still characterises the labour market.
So, the time for taking lectures from Liberals and Nationals on responsible economic management is well and truly over.
Now Scott Morrison and Josh Frydenberg say they’ll fix the budget but won’t say where the cuts are coming from until after the election.
When our economy needs a comprehensive strategy for the recovery, we get instead a two-part plan for secret slush funds this term, and secret cuts next.
No wonder so many Australians finish the year asking, ‘is this really the best we can do’?
They understand we can’t risk another three years like the last eight.
Not even the most optimistic among them would expect a fourth term of this flailing bunch of economic incompetents to be any better than the first three; or a second decade better than the first.
They know we won’t renew our society or create the right kind of recovery into the future with the same failed approaches that offer little more than a return to the stagnation and insecurity of the past.
More rorts and waste, more stagnant wages and job insecurity, more generational debt without a generational dividend, can’t be the thanks Australians get for all we’ve been through together.
I agree with the Treasurer that we should be optimistic, but that optimism needs to be grounded in a hard-headed assessment of how we got here and what we need to do to secure a better future, with an economy and a society stronger after COVID-19 than before.
This opinion piece was published as “Coalition has no plan to help the low-wage battlers” in The Australian on Wednesday, 22 December 2021