How many people still consider budget deficits and national debt important?

Prime Minister Scott Morrison and Treasurer Josh Frydenberg.

Tonight’s budget is going to test some of the fundamentals of Australian political and election strategies and assumptions of the last three decades: how many people still consider budget deficits and national debt important?

And, how many people will vote for what they regard as good economic management as opposed to promises for wage rises and bigger tax cuts?

Scott Morrison and Josh Frydenberg hope that a lot of people give responsible economic management top priority and they know producing a Budget surplus and reducing national debt is more important for their Coalition supporters than those who vote for other parties.

But the conventional wisdom and electoral experience in some State elections and globally suggest more voters are more concerned about tax cuts and benefits than reducing debt through budget surpluses.

In Europe stand up comics with no political or economic experience have led parties and are in the running for national leadership while in Victoria the Andrews Labor Government was elected after announcing a doubling of debt to finance infrastructure.

The Coalition has had to frame this Budget appealing to two opposing constituencies — the Coalition supporters who rate debt and deficit reduction as their top priority and the Labor and other supporters who put spending on government services and personal tax cuts ahead of a Budget surplus.

Drawing on the Victorian and NSW election experiences Morrison has ensured that some of the biggest spending items are infrastructure projects such as dams, roads and railways. He has also tried to address Bill Shorten’s central offer of tax cuts and wage rises to low and middle-income earners feeling the pinch of slow wages growth.

But the headline from Frydenberg’s first Budget is the first surplus in a decade and the central claim of superior economic management after years of Labor failure to produce a surplus.

Over the last three years Newspoll surveys have shown voters place cutting debt and deficits in the top two priorities with government spending on services and that Coalition supporters are the strongest believers in reducing national debt. The surveys also show that cutting debt sometimes polls ahead of personal income tax cuts.

There has been a general reduction in support for cutting debt but in the last poll in April support for government spending also fell while Coalition supporters were still the foundation for cutting debt.

Labor’s response is that the public can have everything — they say they will produce bigger surpluses, reduce debt faster and lift people’s standard of living through tax cuts funded by revenue from high income earners, investors and business — “the top end of town”.

So Labor recognises there is an attraction for a large tranche of voters in cutting debt but is working on the larger number of people who want government spending lifted.

For Morrison the challenge is to hold his base of Coalition voters on economic management while reassuring enough undecided voters that the promises he is making he can keep because of good economic management as evidenced by the first surplus in a decade.