Maybe not your average Joe, but going for tough budget cuts is nothing special
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Version 0 of 1. If you believe the commentary of recent days it is apparently a truly extraordinary thing for a treasurer to have suggested tougher spending cuts than the ones ultimately unveiled in his budget. In fact I cannot remember a single treasurer, or a single budget, for which that statement would not have been true. Treasurers and finance ministers go into the expenditure review committee (ERC) process with a wish list of cuts, which are then pared back as cabinet ministers argue their case and the ERC as a whole considers the political consequences. The fact that this tried and true process also occurred in the lead-up to the 2014 budget is revealed in an authorised biography of Joe Hockey; Hockey: Not Your Average Joe, by Madonna King, launched today. The desire for a tougher budget was not made by way of a direct complaint by Hockey himself, but asserted by King. ''In reality, the budget was much softer than Joe would have liked. He wanted changes to pensions made earlier and the deficit levy to net more taxpayers,” she wrote. This concurs with what we already knew – for example that there had been detailed discussion of the deficit levy kicking in at earnings of $80,000 rather than the ultimately agreed $180,000. But it has been interpreted by commentators, and by some in the government, as a self-serving attack by Hockey on Tony Abbott, prompting criticisms of the treasurer’s self indulgence and lack of political judgment. Not even the sharpest government spin meisters deny that the budget “sales pitch” has been spectacularly unsuccessful. Some are even prepared to concede the package of savings was ill-conceived – opening too many complex policy arguments and combining defensible long-term savings with more immediate changes. For example, measures such as cutting payments to the young unemployed could be easily used to argue the entire document’s “unfairness”. But those decisions were taken by the ERC and the cabinet as a whole. And the “messaging” and delivery of a budget sales job is the responsibility not only of the treasurer, but also the prime minister and the entire ministerial team. For weeks after the budget both Hockey and Abbott blitzed the airwaves, arguing their case in similar terms. The finance minister, Mathias Cormann, and other ministers did too. And the central message in almost all the interviews was not to argue the detailed case for each measure but to sell the total package of savings as the only available solution to the “debt and deficit crisis” which was “not of the Coalition’s making” but which was now the Abbott government’s responsibility to solve. It is true that the publication date of the biography has come at an unfortunate time. Hockey acknowledged that and pulled out of scheduled television interviews about the book on Thursday morning. (He was also very clear that he had sought the prime minister’s advice and Abbott had encouraged him to co-operate with the project). And when King sent the manuscript to the publishers it would also not have been apparent just how comprehensively the budget sales strategy would fail, or how an observation that he had wanted some tougher spending cuts could provide political ammunition to Labor. It is also true that some in the Coalition are criticising the treasurer both for how the budget has been sold and how little has been done to convince the Senate crossbench of its merits. Those criticisms intensified when he returned from holidays to suggest that if the Senate blocked savings measures (most of which had not yet even been presented as legislation) the government would find alternative cuts (despite having spent weeks trying to convince the country there was no viable “plan B” for budget savings). But in my view the budget’s undoing was not the messaging, not the “sales pitch”, but the content. Some of the spending cuts were justifiable but, taken together, their impact is unfair, falling disproportionately on low- and middle-income earners. Savings options that would have spread the burden to higher-income earners were not included. Voters figured this out, and no amount of slick “selling” was going to change their minds. Responsibility for decisions about the content of the budget rests not only with Hockey but also the prime minister, the ERC and the whole cabinet. The fact a biography has been published at an inconvenient time revealing the treasurer handled a budget process like most treasurers before him is really not the Coalition’s biggest problem. Some in the government see the prime minister’s strong, capable and compassionate handling of the MH17 crisis as a springboard for a broader revival of his standing as a leader and the fortunes of his administration. For those hopes the deadlocked and politically deadly budget is the major impediment. But that is a dilemma of policy and strategy that won’t be solved by trying to make Hockey the fall guy. |