3
May
2014

Various subjects

Yesterday’s resignation of the NSW Police Minister (a former policeman) after questioning at ICAC has been accompanied by a warning from ICAC that there are likely to be more “exposures” of promises by Liberal ministers (or shadows when in Opposition) for favoured treatment of businesses in return for donations.

In Victoria the Premier has defended favoured treatment of a businessman (under a grants scheme supposedly designed to help expand businesses and jobs in regions) but there has been no overt indication there of any resultant donations from the businessman. An application by Opposition Leader Andrews to IBAC (Victoria’s equivalent to ICAC in NSW) to investigate was rejected on the ground that “no evidence of wrongdoing is identified”.

At the federal level, the proposed deficit levy and continued speculation that, despite assurances that there will be a range of  expenditure reduction measures in the budget,  the budget will not be seen as making an effective start to the spending problems inherited from Labor. This speculation is helped by the very small spending reductions proposed by the Audit Commission for the pre-election period and a speech by Hockey yesterday that included an assurance this is “not going to be an austerity budget, but it is going to be a prudent budget”. Any claim that the era of entitlements is starting to end will likely be seen as premature.

It is not surprising, therefore, to see the emergence of “advance” critics  – and not only the usual ones (including the Opposition) who fear the Audit Commission’s analyses will result in a reduction adversely affecting them or their lobby group. A few more responsible commentators have added to their already expressed concerns about a likely shortfall in reductions, the need for a deficit levy and the accompanying broken promise, the last minute reduction by Abbott in his parental leave scheme, and his pre-election guarantees (see  articles by Shanahan and Kenny below). The poor polling of the Coalition, in the face of what seems an ineffective opposition (including its critique of a deficit levy on the high income group), probably mainly reflects the poor handling of these aspects of the lead up to the budget.