By JR on Monday, April 16, 2012
Americans wouldn't believe it. Obama borrows 40% of what he spends
FINANCE Minister Penny Wong has rejected any suggestion that bringing the Budget back to surplus in 2012-13 could trigger a recession.
"It's the right thing to do to bring the Budget back to surplus," she told Network Ten yesterday.
Senator Wong said November's mid-year economic review forecast growth of 3.5 per cent and it "assumed the fiscal policy the Government's got in place".
She has rejected a suggestion by her Opposition counterpart Andrew Robb that a surplus would be achieved by fiddling the books.
Mr Robb said one example was the energy security fund to help coal-fired generators adjust to the carbon tax, scheduled to start on July 1.
Labor will spend $1 billion this financial year and in each of 2013-14 and 2014-15 on the fund, but only $1 million has been set aside for next financial year.
"You don't come back to surplus simply through accounting," Senator Wong said. "You come back to surplus because you make hard decisions."
But Mr Robb said he wasn't convinced. He said Senator Wong was caught out and unable to explain why the funding for generators wasn't anything other than a dodgy accounting trick.
"This is just one of many money shuffles that have been uncovered totalling billions of dollars," the Opposition finance spokesman said in a statement.
"What these desperate tricks confirm is that when Labor pencils in a wafer-thin Budget surplus for 2012-13 in May it simply cannot be believed. It will be illusory."
New Greens leader Christine Milne said Opposition Leader Tony Abbott was to blame for creating an environment where Labor felt locked into delivering a surplus in the May Budget even though economic circumstances have changed.
The Greens believe the Gillard Government shouldn't be rushing to bring the Budget back to surplus if it means tough spending cuts and delaying reforms such as the introduction of a universal dental care scheme.
"Everyone in Australia knows if the Prime Minister hadn't come out and made an emphatic statement in 2009 saying the Budget would return to surplus this year on the basis of Treasury modelling about the extent of the growth that was predicted, we wouldn't be in the position we are," Senator Milne told Network Ten.
"But it's actually Tony Abbott and the Ju-liar community who are responsible for this because it's a political imperative."
Senator Milne said Prime Minister Julia Gillard believed the Government couldn't change its position.