Federal election 2019: Labor promises bigger, ‘more realistic’ budget surpluses

Labor argues it’ll deliver more “realistic” and larger budget surpluses, commits to a tax ceiling.

Chris Bowen announces the Labor budget costings. Picture: AAP.

Labor has argued it will deliver more “realistic” and larger budget surpluses in a bid to trump Scott Morrison’s re-election agenda and committed to a tax ceiling in order to return $200bn in relief to low and middle income earners.

Speaking at Parliament House in Canberra, Labor’s treasury spokesman Chris Bowen said that a Labor government would deliver a surplus in the same year as the government’s planned return to surplus in 2019-20. But he argued that a Shorten government would provide bigger budget surpluses over the forward estimates period.

He dodged a question on whether Labor would prioritise its big spending agenda or focus on the budget surplus if the party’s key revenue measures were thwarted by a hostile Senate, instead arguing that Labor would “keep its election promises.”

Labor’s plan would see Mr Shorten using $87 billion in bigger surpluses over the medium term to pay down more debt with its big tax measures forecast to raise $154 billion over the decade.

.@Bowenchris: Tax relief should be delivered budget by budget, term by term, not on the never never. Under a Labor government, we'll have bigger budget surpluses over the forward estimates, as well as over the decade, each and every year.

MORE: https://t.co/9mCpFCdvBZ #NewsDay pic.twitter.com/4oyCVDmoYZ

— Sky News Australia (@SkyNewsAust) May 10, 2019

Under Labor’s costings, the budget surplus is estimated to reach $21.7 billion — or one per cent of GDP — by 2022-23.

Mr Bowen said this goal would be reached four years earlier than under a re-elected Morrison government in an attack on the government’s claim to be the superior economic manager.

Labor’s finance spokesman Jim Chalmers said this claim was the “biggest lie” of the election campaign.

“Of all the many lies during the course of the campaign, that is arguably the most significant one,” Dr Chalmers said. “Saying that the Liberals have done a good job of managing the economy is a bit like saying that Clive Palmer did a good job building a dinosaur park.”

.@Bowenchris: Australia will remain a low taxing government under a @AustralianLabor @billshortenmp government.

MORE: https://t.co/9mCpFCdvBZ #NewsDay pic.twitter.com/sL8S9Q8Yxa

— Sky News Australia (@SkyNewsAust) May 10, 2019

Mr Bowen also confirmed that further tax relief would be provided when the tax to GDP ratio reached 24.3 per cent in 2022-23, but indicated that further detail on the shape of these tax cuts would be provided in time.

“When the budget returns to sustainable surplus that’s when tax relief can prudently and sensibly be considered and delivered,” Mr Bowen said. “I agree with Peter Costello. Tax relief should be delivered budget by budget, term by term — not on the never never.”

.@Bowenchris: By having budget surpluses $86 billion bigger than @LiberalAus over the next ten years, we'll pay down debt faster. We are providing a real choice to the Australian people. A remedy, not a replica; an alternative not an echo.

MORE: https://t.co/9mCpFCdvBZ #NewsDay pic.twitter.com/u4LeAvoYlr

— Sky News Australia (@SkyNewsAust) May 10, 2019

Mr Bowen said that Labor’s policies would also help to boost economic growth, citing Labor’s “Australian Investment Guarantee” and its investments in skills and infrastructure. “They are pro-growth,” he said.

Pressed on Labor’s spending, Mr Bowen said that the spending-to-GDP ratio would “peak under us at 25 per cent — that’s the average under the Abbott/Turnbull/Morrison government.”