Labor’s Chris Bowen calls out Coalition’s ‘dodgy accounting tricks’

The Coalition’s plan to spend $250 billion without saying where it would come from has been labelled a “dodgy accounting trick”.

Labor today will accuse the Government of “dodgy accounting tricks” to boast it was back in black and of preparing to slash services.

The final two stages of the Government’s promised tax cut would not be possible without the two measures, shadow treasurer Chris Bowen will say today.

“The Government is using these dodgy accounting tricks to justify its stage two and three tax cuts,” Mr Bowen says in a speech to be delivered to the National Press Club in Canberra at lunchtime.

“Claiming that a reduction in spending — with no outline of where the cuts will come from — magically makes their expensive and regressive tax cuts suddenly affordable.”

The Government’s chief Budget ornament of a string of projected surpluses will be dismissed as the product of a change in accounting methods.

“We have a surplus by methodology. I kid you not,” Mr Bowen says in the speech.

And Mr Bowen will accuse the Government of “magically” reducing spending without cutting services.

He says this would be despite a warning from the Parliamentary Budget Office the cost of an ageing population would be around $36 billion a year within 10 years — more than the total projected cost of Medicare.

Shadow Treasurer Chris Bowen will speak at the National Press Club today.

He says in the speech the Government’s assumption that spending as a proportion of gross domestic product — the nation’s economic output — would fall from close to 25 per cent this year to around 23.6 per cent by the end of the decade.

“The size of government magically shrinks over time,” he says.

“If they are going to cut Government services they should outline what they are.”

He says, “The Budget surplus in 2022-23 is projected to be a thin $9 billion, just 0.4 per cent of GDP.

“A surplus that wouldn’t be there were it not for the government apparently spending $12 billion less than it anticipated just six months ago at MYEFO (the Budget’s halfway progress report, the Mid Year Economic and Fiscal Outlook).

“What Government decisions have led to this significant reduction in Government spending?

“Again, we know from Senate Estimates that there have been no such decisions. The Department of Finance told the Senate that there was a ‘methodology change’.

“A methodology change that boosted the bottom line in that year by $7.8 billion.”

Mr Bowen will promise Labor in government would be more prudent than Treasurer Josh Frydenberg, whom he says wants to spend $250 billion without saying where it would come from.

Treasurer Josh Frydenberg.

“Now imagine if I stood before you today and committed a Labor Government to spending $250 billion over the medium term on a program which is important to us,” his speech says.

“If I told you it was important, therefore we didn’t need to pay for that $250 billion, we could just assume that spending cuts elsewhere in the budget would pay for it, without outlining what those spending reductions were.

“I will tell you what would happen if I tried that. You’d laugh me out of the room. But that is effectively what Josh Frydenberg has done.”

And he would be ready to debate Mr Frydenberg at the NPC during the campaign. He expected Labor policy to be the main topic for both men.

“I said before that it was unusual for an Opposition to be able to claim that voting to change the government is the best way to bring about enhanced stability,” says Mr Bowen.

“But it’s also unusual for the Government of the day to be adopting the small target strategy and to be spending most of their time talking about Opposition polices so devoid of a policy agenda of their own they are.

“Well despite the fact that I think it is bad for the country that we a government without an agenda and obsessed with ours, I relish the debate.”