Is Budget 2019 a winning card for Coalition in federal election?

Prime Minister Scott Morrison and Treasurer Josh Frydenberg were out in the early morning for television interviews to push their Budget.

Prime Minister Scott Morrison and Treasurer Josh Frydenberg were out in the early morning for television interviews to push their Budget. Source: AAP

The coalition's federal Budget is being seen as a budget that could swing borderline voters, despite the government having just six weeks before the federal election and consistently trailing in the polls.


Political analysts say the government has used this Budget to woe voters and to gloss over its previous turmoil, including the leadership spill that saw Malcolm Turnbull ousted in 2018.

With tax relief and big infrastructure spending on the way, some believe it could be enough to snatch a coalition victory in the next election rather than the expected defeat.

One thing political analysts agree on, including Professor Rosalind Dixon at the University of New South Wales is that this Budget was focused on the upcoming federal election, due by May.

"I think it's a budget that tells us it's going into election mode. It's got a number of short-term benefits for people in the middle income bracket and it's got a long term pitch to Australians to say that the coalition are good economic managers."

Dr Nick Economou, of the Monash University School of Social Sciences, says the government is attempting to use the Budget to its advantage.

"It was a classic pre-election budget, designed to try and maximise the appeal of the coalition to voters in strategically important seats, and it remains to be seen if it is received as such by the electors."

Regardless of who wins the election, low to middle income workers are set to get a personal income tax cut as both major parties have similar policies.

Dr Economou says that fiscally, and in other areas like infrastructure spending, there may not be a lot of difference between the coalition and Labor.

"If you didn't have the visuals to see that it was the coalition that was delivering it, you might have thought that it was a Labor budget because it was full of promises of infrastructure provision, statements of commitment to Medicare, statements of commitment to the NDIS and what have you. Now interestingly, both Labor and the coalition have committed themselves to substantial tax cuts."

The Treasurer has forecast a surplus for the coming financial year ((2019/20)), but Dr Economou is urging caution when it comes to predictions of surpluses.

"We've had forecasts before that have never been met and quite often, they've not been met, not necessarily because of the incompetence of the government of the day but because of the impact of external forces. When you have an economy like the Australian economy that is so linked with international trade, problems that occur with our trading partners can very quickly effect the economy in Australia and the budget bottom line."

But whether or not a surplus is delivered by the end of the fiscal year, Professor of Law at the University of New South Wales Rosalind Dixon says running a budget in surplus isn't always a good thing.

In particular, she points out the Victorian state Labor government's plan of running the state in debt in order to fund what it's labelled inter-generational projects.

Professor Dixon says those projects will eventually provide an economic benefit, suggesting it's economically feasible to run a country in debt.

"It's a bit like a young family buying a house, there's a lot of debt but the hope is that if they're making sensible investment, thinking about what they can afford in terms of repayments, whether there's going to be growth in the long-term, it's a good investment."

Both Labor and Greens parties say the Budget hasn't provided any policy or answers to some key issues.

They say those include energy policy, care of refugees, increases in welfare and wages and climate change.

Dr Ecomomou says that because the coalition has continued to trail in polls, it was most likely looking at ways to avoid complex issues that have split coalition M-Ps.

"The thing that has hurt the coalition the most has been its lack of internal discipline, manifested in a series of internal ideological debates over everything from refugees, border security to marriage equality and climate change."

It's been suggested the government will use short-term options, like payments to people on lower wages, to ease cost of living burdens and to avoid having to make bigger decisions surrounding policy.

In one example, the Federal Government has announced a one-off Energy Assistance Payment to recipients of the Newstart unemployment benefit and other concession card holders.

The policy will give $75 to singles and $125 to couples before July.

Dr Economou says one-off payments are sometimes the best answer when dealing with policy that divides the parliament and parties themselves.

"Energy policy has brought down a huge number of prime ministers and opposition leaders. In fact, Mr Morrison is prime minister as a result of the politics of energy. Because it was the National Energy Guarantee that had been formulated by Josh Frydenberg under the direction of the then prime minister Malcolm Turnbull, that led to Turnbull's demise as leader. So it's no wonder that as we run up to the election, the coalition has got not that much to say about energy, other than to make some vague reference to its intention to meet various targets."

Professor Dixon is particularly disappointed that the Budget doesn't address the issues of stagnating wages and real climate policy.

She's pushing for major change in the next parliament.

"Politicians can be too risk adverse sometimes about leading on these issues, especially climate. But in 2011, Labor was burnt by trying to lead and I think it's understandable that that makes them cautious. The hope is we can all just raise our voices as citizens and members of civil society to encourage more leadership."

Professor Dixon, at Monash University, says it's unlikely the coalition will record a victory at the election thanks to the 2019 Budget.

"I think it will help some undecided voters and it will put them more squarely in the government's column but it's not a big shift. It is a budget with a story about long-term economic management and some short-term sort of transfers and offsets. But it's not a visionary budget, it's not going to change people's economic circumstances in any significant way across the board that are going to really shift people's views."

With an election due by the end of May, Dr Economou says there isn't much time for the government to turn around its position in the polls, which are consistently suggesting a loss.

He says the government couldn't take any major risks and so this Budget was about glossing over previous instability.

He says it remains to be seen whether voters will be swayed by its contents.

"The election will turn on whether the voters are going to cast their opinion on what the last three years have been like and if they are going to vote on the question of their rejection of the dysfunctionality of the coalition, Labor will win. On the other hand, if the voters go, 'well hang on, Morrison and Frydenberg have done a great job with this budget, we'll forgive them for their roles and whatever happened before, and we will judge the coalition on its merit, on its policy merit,' then I think the coalition has got a bit of a chance."


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