The government spends a lot of money on a lot of things.
Not all of it wisely. It’s easy to be careless when you’re spending other people’s cash.
So credit where credit’s due: in the unlikely event there is an Abbott government in Canberra at the end of next month, the Opposition has proposed some genuine cuts to the federal budget. Tuesday morning they released another list of “savings” – some $1.2 billion worth – which they claim would help get the budget back into surplus.
Some of them are so stultifyingly obvious it’s amazing nobody has committed to scrapping them yet.
Retooling for Climate Change was announced by a fresh looking Rudd government all the way back in 2008. The government pays selected small businesses to upgrade to more environmentally friendly machinery.
In the two years the program has run, it has been taken up by just 65 businesses.
So it probably hasn’t made a substantial impact on global carbon emissions levels.
The Green Building Fund, a program to upgrade buildings in a green-ish manner, is even more expensive, and just as futile. The Opposition says scrapping it will save $400 million over the next few years.
The United Nations Security Council bid was another of Kevin Rudd’s attempts to aggrandise himself on the world stage. Dropping the bid, and keeping the $5.7 million the Coalition claims it would have cost, should be a no-brainer.
Every budget cut is controversial. Even this one. After Abbott announced his hostility to the UN bid, the Australian foreign policy establishment was decrying that doing abandoning this would undermine our “prestige”.
We’ve spent a lot of money in the past trying to enhance our “prestige” in the world. Remember the Sydney Olympics?
Indeed, if Tony Abbott is in the mood to kill some sacred cows he might consider abandoning Australia’s bid for the World Cup. We’ve given $45.6 million to Football Federation Australia to manage the bid so far. The cost to the Australian economy will be extraordinary if we win: PricewaterhouseCoopers has estimated hosting the Cup will cost at least $2.9 billion.
Supporters of the World Cup claim we’ll recoup the money through tourism and other miscellaneous sources. But a mega event which pays back is an extraordinarily rare one, despite the fevered dreams of their advocates. Let’s cut our losses while we still can.
Community cabinets, which Abbott also wants to eliminate, were always bit of a joke.
Sure, they flattered those communities which had a turn meeting senior politicians and complaining to their face. But if the Labor Party wants to run focus groups, it should pay for them itself.
And Rudd’s community cabinets were absurd when you realise that his actual cabinet was being marginalised. Senior ministers couldn’t get a few minutes of Rudd’s time to discuss major policy – so spending an hour with the PM at a community cabinet meeting was probably as exciting for his colleagues as it was for the dutiful citizenry.
The Opposition claims that, when added to the savings already announced before and after the May budget this year, it adds up to $23.8 billion of cuts. The federal government spends around $350 billion per year, but you have to start somewhere, I guess.
Nevertheless, we should dwell on the net effect of these savings. Both the Government and the Coalition believe that they will bring the budget to surplus by the 2012-13 financial year.
And projections of what the budget will look like in 2013 are, well, projections. Economic circumstances change. (After all, recall that as the global financial crisis was beginning to hit, the Rudd-Swan-Gillard-Tanner team were still saying our economy was doing too well, and pushing up interest rates.) And political circumstances change; governments decide they have new spending priorities.
So there is reason to be optimistic about these proposed cuts.
The Opposition could go a hell of a lot further. Here’s another idea for them to mull over: if a program appears on the AusIndustry website – as Retooling for Climate Change does – that should qualify it for immediately abolition. The site lists 53 separate government programs: all of which funnel money to favoured industries and lucky applicants who have mastered the art of filling out paperwork.
Of course, when the Opposition claims that it is dedicated to reducing “Labor waste” they are being too disingenuous by half. The Howard government was no stranger to waste. Their Regional Partnerships Program defined for a generation what pork-barrelling looks like in Australia. When Abbott claims “this reckless spending must stop” he is just redeploying Kevin Rudd’s powerful critique of Howard.
And Abbott is putting new pressure on the budget too: yesterday he announced more tax rebates on education.
No party has a good record on cutting spending. But every promise to do so counts.