What a difference a year makes in budgetary politics. More to the point, what a difference the availability of better-than-anticipated tax receipts makes in framing an electioneering budget.
Burgeoning tax revenues – for now – have enabled Treasurer Scott Morrison to bring down a budget that will put the government in a better position to fight the next election than otherwise might have been the case.
This is a budget that, on the face of it, more or less accords with conservative principles of fiscal restraint and a commitment to reduce the tax burden.
This would not have been possible without a surge in government receipts. In that respect, the government has been lucky.
What Morrison has put together in this, his third budget, is the outline of a policy manifesto for the next election across a range of government activities, including its response to escalating energy prices, infrastructure bottlenecks and cost-of-living pressures.
Coalition members of parliament, including a conservative rump, should not be displeased with a document that will provide a reasonable platform for polls due by mid-2019.
In their pre-budget deliberations, Morrison and fellow members of the Expenditure Review Committee will have obsessed about four basic questions in framing the 2018-19 document.
The first is how to shore up support in the Coalition’s heartland seats to create a political Maginot line against an aggressive Labor challenge. The second is how to distribute largesse from booming tax receipts in a way that avoids criticism of fiscal irresponsibility. The third is how credible are the Treasurer’s claims of charting a course back to a budget surplus a year earlier than anticipated to enable paying down debt. And finally, how to differentiate the Coalition from Labor across a suite policies because in the end, elections are about product differentiation.
For the government, the question will be whether Morrison’s budgetary measures, including a redrawing of the tax scales, increased assistance to seniors, and a boost to infrastructure spending will prompt jaded voters to give the Coalition another look.
Can people be persuaded to look more critically at what Labor will have on offer, bearing in mind that it has already announced measures on cash-back franking credits, negative gearing and capital gains that will provide scope for it to match – or better – the Coalition’s tax cuts?
Those Coalition representatives sitting behind Morrison on the Treasury benches will be encouraged – not necessarily convinced – by his budget offerings.
A budget poll bounce may materialise, but it is hard to see the budget changing the political calculus in and of itself, in which Labor has maintained an advantage since the knife-edge election of 2016 .