Finance minister Mathias Cormann says Australia is facing a budget emergency after declaring the situation was normal earlier this week.
After declaring a budget emergency last year, the government this week declared the budget situation normal but now Finance Minister Mathias Cormann says it’s back to an emergency.
Labor deputy leader Tanya Plibersek retorted that the government couldn’t keep their story straight for a day.
With parliament sitting again this week, Prime Minister Tony Abbott says the budget must be passed and the government will “carefully, courteously, patiently” negotiate outstanding measures through the senate.
On Tuesday, Finance Minister Mathias Cormann appeared to distance himself from the government’s previous insistence the budget was in crisis.
“Situation normal really,” he said.
Come Saturday, the message changed. He denied urgency had gone from the budget, which remained in the bad shape Labor left it.
“We are facing a budget emergency as a country, we are facing a very challenging fiscal situation but the government is dealing with it … through the normal processes of the parliament,” he told Sky News.
Shadow treasurer Chris Bowen said Senator Cormann had returned to the old script.
“This was the same minister who earlier in the week was claiming that it was mission accomplished and that the government had plenty of time to get its key budget measures through the Senate,” he said in a statement.
Mr Abbott acknowledged the government had achieved much of what it wanted.
He said not all news from federal parliament was “difficult and vexed” and about half the budget measures had passed.
The largest saving of some $7 billion from reducing growth of the foreign aid budget had passed as part of the appropriation bills.
What the government doesn’t have is a series of more controversial revenue raising and cost-cutting measures, including the GP co-payment, return to fuel indexation and reduced pension indexation.
The government needs to win support from cross-bench senators for these to pass against the opposition of Labor and Greens senators.
“Like other governments before us, we will carefully, courteously, patiently negotiate the rest of our budget through the parliament,” Mr Abbott said.
He said this had to be done and would be done, as failure to act now meant tougher decisions would be needed later.
Even those measures won’t cover the cost of the new initiatives including the paid parental leave scheme ($7 billion a year by 2024-25) and National Disability Insurance Scheme ($26 billion a year), a new report from the Parliamentary Budget Office says.
This report says a sustained period of growth in government spending over the past 10 years has probably lifted community expectations of what the government could provide.
“It is difficult to see how governments could continue to meet these expectations while containing spending growth to the level currently projected,” the report states.