Federal election 2016: David Feeney adds fuel to costings firefight

A senior ALP frontbencher was unable to say whether Labor would restore a $5.6bn bonus payment to families.

Labor justice spokesman David Feeney has hedged on whether the party would continue the Schoolkids Bonus to 1.3 million families. Picture: Hollie Adams

Bill Shorten has been thrown on the defensive over the cost of his election policies after a senior frontbencher could not say whether Labor would restore a $5.6 billion bonus payment to families, sparking a furious government assault on the attempt to “disown” a key policy.

Igniting a new fight over policy costings, Labor justice spokesman David Feeney hedged on whether the party would continue the Schoolkids Bonus to 1.3 million families, despite attacking the government for two years for phasing out the payment.

The gaffe-prone frontbencher yesterday added to his poor campaign performances by leaving behind a confidential document containing Labor’s campaign “talking points” after a television interview.

The email document, obtained by The Daily Telegraph, revealed that Labor would only be able to “fully offset” the cost of its promises “over the medium term”.

While federal budgets outline spending commitments over four years, the “medium term” typic­ally refers to a decade-long period and these costings are regarded as being speculative.

During the Sky News interview, Mr Feeney also refused to say whether a Shorten government would restore pension payments or family tax benefits that were cut last year, leaving Finance Minister Mathias Cormann to ­accuse Labor of being in “complete chaos” over the cost of its promises.

The confusion ignited a new dispute over $18bn in budget savings that Labor has blocked in the ­Senate or opposed, and a separate list of savings it has attacked as unfair, forcing it to come up with alternative ways to raise revenue or cut spending if it wants to convince Australians it can be trusted to scale back the deficit.

One day after the government stumbled on its claims the Oppos­ition Leader has a costings black hole of up to $67 billion, Labor floundered last night on major spending prog­rams that are crucial to millions of voters, including those on the Age Pension and those who receive Family Tax Benefits Parts A or B.

Labor finance spokesman Tony Burke defended the lack of clarity over the programs by saying there were several weeks ahead to announce its stance.

“We’re in week three of an eight-week campaign and Labor will continue to make policy ­announcements throughout the campaign,” Mr Burke said.

“The attempts by the government to have Labor release final costings on policies not yet ­announced are childish and hypo­critical.

GRAPHIC: Feeney’s notes

The latest costings furore was sparked by Mr Feeney’s interview in which he attacked the ­government over its “shambolic” claims about Labor’s policy costings but could not say where Labor stood on key issues. Mr Feeney appeared to confuse the Schoolkids Bonus with the Baby Bonus, a different payment mentioned in the confidential “talking points” email.

“You’d have to refer to our relevant shadow, I’ve been a little distracted over the last few days,” Mr Feeney told Sky News.

He offered a similar response when asked about changes to the assets test for the Age Pension that were included in last year’s budget but opposed by Labor. This would cost $3.6bn over four years if Labor acted on its rhetoric and reversed the change.

Compounding the political pain for Labor, Mr Feeney also admitted his failure to disclose a $2.3 million home on parliament’s register of interests, conceding it was Labor’s biggest campaign own goal. “I think unfortunately that is a trophy I managed to secure last week,” he said.

Labor families spokeswoman Jenny Macklin has campaigned against spending cuts as part of a crusade against Coalition savings, assuring voters she would fight the changes. The Schoolkids Bonus, which Labor introduced after the 2007 election, gives families $430 a year for each child in primary school and $856 a year for each child in secondary school. The Coalition gained a majority in the Senate to phase out the payment on the grounds it was funded from a mining tax that did not generate enough revenue. The last instalment of the bonus is due to be paid in July. The abolition will save $1.4bn next year alone — indicating a likely cost of $5.6bn if Labor chose to restore the payment over the four years of the budget forward estimates.

“Clearly David Feeney is as confused as the rest of Australia about the status of Labor’s past spending promises,” Senator Cormann said last night. “Having been confronted with the fiscal reality of their past promises, Labor is now in complete chaos having backflipped away from so many of them so quickly that not even their own frontbenchers could keep up.”

The Coalition misfired in its attack on Mr Shorten on Tuesday by claiming Labor would spend $19.3bn on foreign aid over the next four years, despite Labor issuing a public policy saying it would only spend $800 million.

Mr Burke’s comment suggests Labor’s final costings may show an increase in the deficit over the four-year budget period, while claiming a faster return to surplus over the decade ahead, which the budget definitions classify as the “medium term”. A number of Labor tax measures generate little revenue in the budget period but are projected to deliver much larger sums beyond 2020. The crackdown on negative gearing and capital gains generates only $565m over the next four years but $32.1bn over the next 10 years. Opposition to the government’s company tax cuts generates $2.6bn in the budget period but $49bn over a decade.

Ten-year costings are speculative and would not be accepted as representing the budget position under the Charter of Budget Honesty.

Spending commitments that are part of Labor’s election platform are so far about $4bn lower over the four-year budget period than its tax and savings promises. However, there are major policies on health and families yet to be unveiled while the pre-election budget review from Treasury and the Department of Finance identified $14.5bn in policies that Labor has prevented from passing through the Senate. Treasury says $3.5bn in policies included in the budget forward estimates have not yet been put to parliament.

Additional reporting: Adam Creighton