Tonight, the Treasurer of Australia, Josh Frydenberg will hand down his first Federal Budget. It will also be the first budget for Scott Morrison as Prime Minister. There have already been numerous leaks about what the government is going to give Australian’s, and even potential changes to superannuation. However the real question that should be asked is:
How much of this budget can you believe?
Tonight’s budget is a little different from the budgets that we have had in the recent past. This year the budget is being delivered in April, when it is usually delivered in May. Not since 1996 have we had a budget delivered outside of May.
This budget is a pre-election budget, so we can always expect a lot of spending into the future. On top of that it is expected that for the first time since before the Global Financial Crisis, the budget will be in surplus. Simply meaning the Government expects to collect more than it will spend.
Big spending means infrastructure projects, more money for health, as well as assistance for those who have suffered in the more recent past (think of the Queensland farmers), as well as attacking cost of living pressure.
On top of the big ticket spending, it is highly likely that in a post Banking and Financial Services Royal Commission world, that there will be changes to Superannuation, retirement savings and possibly policies to target the big end of banking.
How does it affect you?
Much of what is handed down in a Federal Budget is day to day business, dressed up to be something special. Day to day items rarely need legislation changes, and are just implemented by the various agencies charged with the task.
However, most of the big ticket items require some change to legislation. This requires the sitting of both houses of Parliament, much debate, and somewhere down the track agreement of some kind (the legislation is often substantially changed).
With an election due before the end of May, a required lead time from announcement to election date of 31 days and a Prime Minister that has already minimised sitting days for all of 2019, how does this Government propose to enact any of this legislation?
My message to everyone who picks up a newspaper on Wednesday the 3rd of April is to take everything with a grain of salt!! Passing these budget announcements won’t be the hardest part… getting the legislation into the House of Representatives might prove the most difficult for Prime Minister Morrison and Treasurer Frydenberg.