Bushfires: Scott Morrison, Josh Frydenberg set to blow the budget

Scott Morrison and Treasurer Josh Frydenberg announce $2bn in additional spending on bushfire relief. Picture: Getty Images

The Coalition government is laying the groundwork for the prospect of the all important surplus being eroded, or even junked altogether. But the devil will be in the detail.

The excuse? Spending up big on bushfires recovery. Few will argue with that. But let’s not forget this is the same political party – now in government – which in opposition cut Labor next to no slack for the budget impact of warding off the Global Financial Crisis. Rather, the Coalition (which has doubled the national debt since coming to government without such a threat) used the worsening budget position under Labor to slam its economic credibility.

Staving off a recession – Australia being one of the few developed nations globally to do so – was an important reason for the spending Wayne Swan and Kevin Rudd engaged in.

One of the criticisms which the then Labor government faced was that the quality of the spending was questionable at times, with waste and mismanagement present in the rush to roll out the cash. I certainly didn’t hold back on that front, nor did most commentators. It will be interesting to see how well managed (or not) the Commonwealth’s bushfire recovery funding is in the months and years ahead.

Yes the bushfire recovery will cost billions of dollars, and yes the total spend is as yet unknown. But the state of the economy was worsening anyway, and the budget has long been propped up by higher than expected commodity prices.

The size of the necessary spending, while significant, is small compared to what was required in the wake of the GFC to stave off recession.

One benefit the Coalition has is that Labor won’t play politics with the cash rolling out the door. Anthony Albanese, in fact, had already been advocating for a scheme along the lines of what the Prime Minister announced yesterday – without attribution of course. That’s politics.

Today it has been Treasurer Josh Frydenberg taking the lead in the media, discussing the bushfire recovery plans. A good move given the anger which has been directed at Scott Morrison for his Hawaiian holiday and bungled attempts to engage with victims of the fires upon his return.

Peter van Onselen is Politics Editor at Network 10 and a professor of politics and public policy at the University of Western Australia and Griffith University