Matt Johnston: Labor’s Budget cash splash down to luck, but debt is growing
LABOR has been able to embark on its spend-a-thon because it has had the luck to be in government while the economic sun has been shining — but only time will tell if voters are grateful, writes Matt Johnston.
Opinion
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THIS State Budget has a lot of big spending initiatives, but that’s no surprise.
Determined not to repeat the mistakes of its predecessor, this government has had the pedal to the spending metal since Tim Pallas handed down his first budget three years ago.
Labor wants to go to this year’s election having kept its pre-election promise to “get things done”.
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Without doubt this is an election year document, zeroing in on Labor’s brand strengths in health and education.
Ominously for the Opposition, with $9 billion of surpluses, Labor will have plenty of opportunity offer more goodies between now and November.
Pallas was upfront about that today, saying Labor was prepared for a contest of ideas.
Over the past four years, the Labor government has overseen an infrastructure boom worth tens of billions of dollars. It has more than $40 billion scheduled for the next four years, too.
Whether the voters will be grateful or treat the increased spending as the government “just doing its job” may be answered later this year.
In his budget day press conference, Pallas wasn’t shying away from the enormous increase in the public sector wage bill under his watch, claiming population growth had forced his hand.
By complete coincidence of course, more public sector workers happy with their pay packets is likely to mean more Labor voters later this year.
Labor has been able to embark on its spend-a-thon because it has had the luck to be in government while the economic sun has been shining, with the global financial crisis a distant memory.
Stamp duty is up, the population is booming, boosting economic growth, unemployment is low.
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For now things are looking good, though debt is growing.
Labor’s argument, is that if you spend money, people will come. And it seems to be working in Victoria.
With the infrastructure boom ongoing, the government knows it can’t stop now — Pallas said as much today.
As a result, new TAFE spots are being created and some courses will be free to make sure enough people are pumped into jobs that are here in Victoria.
Again, this fits with Labor’s desired narrative, especially in outer suburbs and regional towns which are a big focus of this Budget.
An election-year Budget bonanza does not win an election — Denis Napthine can attest to this.
But Labor started setting its budget narrative early and believes it has set the direction it needs to get another four years in government.
If it sticks to the blueprint now set up, on top of selling an infrastructure spending splurge, it has every chance of seeing this happen.
If it is knocked off that course, as has repeatedly happened this term, all the budget spending in the world won’t save it.
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