As I prepare to fly to Canberra for my 35th budget lock up, I find the anticipation no less than the first one. Every budget is like a good play or movie.
Sometimes the plot centres on the politics rather than the actual numbers. Other times the drama centres on treasurers who have agendas that they pursue irrespective of the consequences. This budget is about governments who rode the mining and banking boom which collapsed.
While the crash was well anticipated, no one expected that at the time of the collapse we would have a Government that went on an unprecedented spending spree to insulate us from the “global financial crisis” – a crisis that while originally was very frightening is now looking less ominous.
It is also a budget about political agendas. Treasury has always seen Peter Costello’s superannuation benefits that enable Australians to prepare for their future as middle class welfare. This is rubbish. We will see how far Wayne Swan allows Treasury to attack Australia’s middle class, who choose not to live on the pension.
In budgets like this, what treasurers do is introduce measures that have wide ramifications that affect subsequent years rather than the current one. But there is one certainty. Assuming we are looking at a deficit of around $60 billion we have got to stop throwing money from the sky in $10 billion dollops.
So the plot in 2009 will be how far the Government is prepared to attack middle Australia – those who have high mortgages or are preparing for retirement. There are a lot of people in these two boats, and they overlap.
This first appeared on Business Spectator.
Smart Company is a sister publication to The Mandarin, catering to Australia’s entrepreneurs, small and medium business owners and business managers.
