Last night saw Treasurer Wayne Swann deliver his sixth and most likely final budget.
Clearly the build up to the event was more focused on the upcoming election rather than any fiscal insights that Mr Swann was able to proffer. The reaction of the aussie dollar and likely movements in our equity market today will reflect that this is really a budget that nobody really cares too much about. It is too late for Labour to claim any kind of fiscal responsibility and so this as a curtain call is more about window dressing than anything.
For any sane person to believe that the budget will return to surplus under Labour in the next four years (NOT!) would likely require the smoking of the entire front lawn, as a precursor. To quote another classic from the movie, Wayne’s World “that’s what she said” springs to mind and could adequately cover the disbelief conveyed toward any budget support coming from the nasal tones of Ms Gillard.
But will this be labour’s last budget?
The notion of an un-losable election for the Liberals and Tony Abbot should not be taken lightly.
This scenario reminds me of the UK election, back in 1992, when the Kinnock led Labour Party were odds on to beat Prime Minister, John Major’s Conservatives. However, a poor decision to hold a pre-election US style rally by Labour spooked voters and resulted in one of the more surprising election results in the UK. As such, Mr Abbot and party need to be very careful, as the next weeks roll through, to ensure they hold the ground they have. The new government will inherit a balance sheet that looks like Chechnya and a series of legacy debts that are equally uninviting.
Listening to the ABC this morning, one lobby group, the Australian Council of Social Service’s response, when quizzed on the Treasury’s massively wrong forecasts was (as i was driving i can only paraphrase) – it’s hard and they did their best! Is that the level of accountability that we, the tax payer deserve? Perhaps Mr Swann could eBay his “worlds best finance minister” plaque and tip the proceeds back into the rather spartan Treasury coffers?
Thankfully the overall reaction from the market is likely to be more along the lines of “120 bottles of beer on the wall….” as we count down into the election. As such, expect an up day today, and continued opportunity to profit. Afterall, you are going to need to make more money just to offset the Medicare levy increase, reduction in benefits and host of other “goodies” in the 2013 Wayne’s World Budget Showbag!