Surplus, somewhere over the rainbow
As St Augustine has once prayed, “God, give me chastity, but not yet.” And so it is with budget surplus, the Godot of Australian federal politics, last apparently seen over a decade ago in the mists of mythical pre-social democratic times. But fear not, it’s always around the corner, about four years ahead.
The Budget deficit will fall from its current $49.9 billion to $29.8 billion next year. It will then fall to a deficit of $2.8 billion in 2017‑18.
From a $48 billion deficit we inherited, to $35 billion next year, down to a $7 billion deficit in another three years’ time.
The deficit in underlying cash balance terms is expected to reduce from $39.9 billion in 2015-16 to $37.1 billion, or 2.2 per cent as a share of the economy in 2016-17. The deficit is then projected to fall to $6.0 billion or just 0.3 per cent of GDP over the next four years to 2019-20.
The underlying cash balance will improve from a forecast deficit of $29.4 billion in 2017–18 to a projected surplus of $7.4 billion in 2020–21.
It’s always somewhere there, beyond the horizon.
Yes, I know that Labor in government has done that too, but I expect that from Labor. And yes, I know that the Senate over the past few years has proven to be particularly obstinate, refusing to make any significant cuts to anything, but them’s the breaks; Howard and Costello also did not have the control of the Senate for all but the last three years of their government.
As far as I am concerned, anyone in politics who makes statements or promises about what will happen beyond the forward estimates, that is more than four financial years ahead, should be heavily beaten about the body with Budget Papers, which I’m told like the White Pages don’t leave any marks, except on one’s psyche.
This is because it’s 1) meaningless – the government hardly knows what will happen this year, and often gets that wrong, much less having any confidence or credibility to predict the future that far ahead, 2) irrelevant – if it’s outside the budgetary four-year planning cycle it might as well not exist because it’s not being seriously accounted for at present, 3) ephemeral – promising something that is at least one, and sometimes even two elections away is a fantasy, particularly since governments are increasingly less stable and lasting nowadays.
And so the prospect of balanced budgets – and hopefully paying off government debt, though realistically any surpluses will more likely be spent rather than saved in the current political climate – remains forever in the future and just outside of our grasp. To quote one of my favourite novels:
Gatsby believed in the green light, the orgastic future that year by year recedes before us. It eluded us then, but that’s no matter—tomorrow we will run faster, stretch out our arms farther. . . . And then one fine morning— So we beat on, boats against the current, borne back ceaselessly into the past.