Joe should have just shut up

THERE is always a degree of euph­oria attached to being released from the budget lock-up. A positive spin can be placed on just about anything as you suck in that crisp Canberra evening air.

With the benefit of hindsight, it would seem that the budget was not just a dog, politically speaking, but the nature, size and timing of many of the measures were also highly suspect.

Joe Hockey is probably correct to criticise this year’s budget as being too soft.

On the assumption that all the budget measures are passed by the Senate (relatively quickly in a number of instances), real government spending is expected to grow at about 2.7 per cent this fin­ancial year. Even Wayne Swan could have delivered that sort of spending increase.

But I’m not sure that it is very useful for the current Treasurer to be expressing his opinion about the soft budget at this stage.

The real political mistake of the budget was to load up many of the adjustments until the last years of the four-year forward ­estimates and beyond.

Having mentioned the entitlements that will be cut and the spending areas to be trimmed, most voters assume that the changes have already been made or are about to be made.

The government wears the political pain, but none of the fiscal consolidation that is so desperately needed has actually been achieved — and it won’t be achieved for some time.

The government, including Hockey in the important role as Treasurer, can be criticised for failing to make the public case for cutting government spending and altering the features of many entitle­ment programs.

Perhaps Abbott and his colleagues were caught out by the re-run of the West Australian Senate election and the delay in releasing the National Commission of Audit report.

In reality, there was an eerie ­silence from the government when it was first elected, when a compelling case for repairing the budget should have been made.

My sense is that the public will wear a degree of short-term pain if the budgetary position is well explain­ed and the alternative is outlined (harsher adjustments down the track, an inability to respond to an economic downturn).

The trouble is that the government has not really provided this exposition.

We know learn from his newly released, authorised biography that Hockey suggested that the income tax levy on higher-­income earners should have been extended to a greater proportion of taxpayers.

This is a little more than passing strange.

Australia now has one of the highest marginal income tax rates among advanced countries and we know that high marginal income tax rates reduce work effort and labour-force participation.

For all the carry-on about the impact of the (unaffordable and unjustifiable) paid parental leave scheme on women’s labour-force participation, why would Hockey support a policy that will drive down labour-force participation, as well as being antithetical (supposedly) to what the Liberal Party stands for? Sometimes it’s better simply to shut up.