The Crest of the Commonwealth of Australia Treasury Portfolio Ministers
Picture of Wayne Swan

Wayne Swan

Deputy Prime Minister and Treasurer

3 December 2007 - 27 June 2013

28 January 2011


Mr Abbott Risking the Budget, Again

Tony Abbott has demonstrated yet again today that he has no interest or comprehension of how a Budget is put together and will resort to anything to score cheap political points from this natural disaster.

On Sydney radio this morning, Tony Abbott tried to suggest that the government could draw from the Budget's Contingency Reserve to fund the Queensland rebuild:

HOST: But isn't that, we're already paying tax, don't they have money in the slush fund?

ABBOTT: In the kitty.

HOST: And you're saying they do have the money?

ABBOTT: Exactly, I mean we've all heard the expression put something aside for a rainy day, and we had some very rainy days in Queensland, excuse the pun, and, and this is exactly the kind of thing that prudent governments ought to be able to pay for without a new tax.

[2Day FM – 28 January 2011]

This is either naïve and incompetent, intentionally deceitful, or more than likely a combination of the two.

As Leader of the Opposition and a former Minister, Tony Abbott really should know better than to make such absurd contributions that just reinforce how ill-equipped he is to run a Budget and what a risk he is to our economy.

Of course if Tony Abbott had been keeping up, he would know that it is long standing Budget practice for over 20 years in Australia that the Contingency Reserve exists to ensure the current budget numbers remain accurate, particularly in demand driven programs. For example, if more people go to the doctor in a given year than forecast, more PBS subsidised medicines will be needed, with a greater than expected cost to the Budget. The Contingency Reserve is appropriately there to meet those expenses.

Tony Abbott's comments also put him at odds with what former Treasurer Peter Costello said in his own budget papers when he was Treasurer that it is in no way a 'rainy day' allocation.*

Tony Abbott's consistent efforts to score cheap political points from the natural disaster we have in Queensland is disappointing, and not befitting of someone who wants to be Prime Minister.

28 January 2011

*"The forward estimates include an allowance for the established tendency for spending on existing government policy (particularly demand driven programmes) to be higher than estimated in the forward years. This allowance, known as the conservative bias allowance, is progressively reduced so that the budget year conservative bias allowance is zero. The conservative bias allowance is a technique to provide for more reliable forward estimates. It is not a policy reserve or 'rainy day' fund." [Budget Paper Number 1, 2003-04, p. 2-6]