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

5 May 2013

Tony Abbott's $15 billion worth of cuts to the bone

Joint media release with
Senator the Hon Penny Wong
Minister for Finance and Deregulation

The Coalition's strategy of cutting services has been exposed in a remarkable admission by the Opposition Leader Tony Abbott in today's Sunday Telegraph.

Opposition Leader Tony Abbott has said his party 'aspires' to have a lower tax to GDP ratio than current levels:

But does that then mean the Tax-to-GDP ratio would be better under an Abbott government?

"Well, my understanding is that to some extent at least that is a function of developments in the economy," he says. "But certainly, lower, simpler fairer taxes are in our DNA."

Asked to say yes or no, he offers: "That is certainly our aspiration."

Sunday Telegraph – 5 May 2013 – p108

Tax to GDP is already at the very low levels of around 22 per cent, lower than at any time under the Howard Government. If Tony Abbott 'aspires' to make it lower – by even just one percentage point– it would mean savage cuts of $15 billion in the 2013-14 financial year and cuts of up to $30 billion a year towards the end of the forward estimates.

Cuts of $15 billion in 2013-14 is the equivalent of:

  • Slashing the entire schools budget;
  • Cutting almost all Family Tax Benefit payments;
  • Taking an axe to all assistance for child care, carers and students; or
  • Ripping out almost three quarters of the entire defence budget.

This is in addition to the $70 billion crater in the Liberals' Budget Shadow Treasurer Joe Hockey and Shadow Finance Minister have both admitted to on live television.

Today's admission has exposed Tony Abbott's fiscal strategy – he means savage cuts across the board.

Such austere measures would slow the economy to a standstill at a time when we should be supporting jobs.

Tony Abbott's statement today shows the choice this Budget is clear - a choice between Labor putting jobs and growth first or Tony Abbott's savage cuts to the bone.

Unlike the Coalition, the Labor Party will always make responsible decisions to prioritise jobs and growth while making the smart investments Australia needs for the future.