Treasury Secretary Warns: Cut Now or Risk Crisis

Posted on Sat 02/28/2015 by

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Bolt New 01By Andrew Bolt ~

Labor wants to talk about anything but the financial devastation it left and is stopping the government from fixing:

Rapid spending growth, not weak revenue, is responsible for Australia’s budget hole, which will continue to grow bigger, threatening future prosperity, unless the savings task starts now, Treasury secretary John Fraser has warned.

In a tough first speech since taking office six weeks ago … said Australia needed to match spending restraint with renewed commitment to struct­ural reform, including liberalisation of industrial relations regulation and reining in concessions given to superannuation…

“The reality is that Australia has spent its way to a structural budget problem. Government payments are growing faster than government revenues and, without action, this trend will continue.”…

The lack of spending restraint meant the federal government’s debt is now equivalent to 12.8 per cent of GDP and rising towards the highest level Australia has experienced since the years following World War II. Interest costs on the debt are less than 3 per cent now, but will increase.

“The debt burden is growing with each budget deficit and will grow even faster when interest rates rise,” he said…

“The only way that significant fiscal repair will be achieved in Australia is committing now to savings measures that build over time to deliver a return to surplus over the medium term,” he said.

“I don’t want to wait until we get a crisis, I don’t want to see the resolution coming from a crisis, I would like it to come because we do get a bipartisan approach on some of the issues.”

IN ONE HAND, OUT THE OTHER

But the only thing that seems clear from Bill Shorten’s waffle is that he’s spend more, not less:

“We’ve got to go for growth, and the way you go for growth is you spend money … if you’ve got growth you’re creating national wealth then a lot of pressure comes off the budget so what you’ve got to do is you’ve got to built the infrastructure of the future … you’ve got to have the skills and training of the future … it’s about the future … if you don’t know where you’re going any road will get you there.”

(Thanks to reader Peter of Bellevue Hill.)


Andrew Bolt is a journalist and columnist writing for The Herald Sun in Melbourne Victoria Australia.

Andrew Bolt’s columns appear in Melbourne’s Herald Sun, Sydney’s Daily Telegraph and Adelaide’s Advertiser. He runs the most-read political blog in Australia and hosts Channel 10’s The Bolt Report each Sunday at 10am. He is also heard from Monday to Friday at 8am on the breakfast show of radio station MTR 1377, and his book  Still Not Sorry remains very widely read.


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