I spoke with Marius Benson on ABC NewsRadio about Joe Hockey's MYEFO, government spending levels and threats to DisabilityCare.
SHADOW ASSISTANT TREASURER
SHADOW MINISTER FOR COMPETITION
MEMBER FOR FRASER
ABC NEWSRADIO WITH MARIUS BENSON
WENDESDAY, 18 DECEMBER 2013
SUBJECT/S: MYEFO, Coalition spending decisions, Coalition spending cuts, National Disability Insurance Scheme.
MARIUS BENSON: Andrew Leigh, good morning.
ANDREW LEIGH: Good morning, Marius.
BENSON: The MYEFO statement from Joe Hockey yesterday showed that Federal Government spending is running at 25.9 per cent of Australia’s GDP, that is just below the only 26 per cent that was achieved during the GFC when the Rudd Government then was flooding the economy with cash to keep the economy going at a time when the world was contracting. Was 25.9 per cent just too high? Are cuts needed?
LEIGH: Well it depends on which particular programs you’re talking about Marius and politics is always –
BENSON: But before you go to individual programs, is that overall grounds for cuts? Are cuts needed at that level?
LEIGH: But my answer to your question Marius is that you need to think about how government spending is being done. Productive government spending, that’s on things like education, infrastructure like the National Broadband Network, that’s laying the foundations for future prosperity. Cutting that would be a bit like getting rid of your house because you’ve got a mortgage. But you want to think very carefully about items of spending, and one of the things we did in the last term was to achieve the first ever cut in nominal spending by an Australian government in Australian history. In other words, even after inflation, we were spending less in our last year in office than the year before that. That’s very difficult to do, you’ve got to go through the Budget line by line and look at your values and your priorities, and I think now, something like a paid parental leave, $75,000 for millionaires and billionaires to have children, is probably something that Mr Abbott and Mr Hockey ought to rethink. I think now is probably not the time to be going into a program which is going to have probably no impact on productivity or participation if you judge by, say, somebody like Saul Eslake.
BENSON: Ok well accepting you have to choose where you cut, can I go back to that original point, overall, if the federal government take is 25.9 per cent of GDP, is that too high historically?
LEIGH: But Marius, the question is how you spend that money, and households have exactly this analogy. We know bad spending, that’s going on a debt-fuelled gambling binge, and we know good spending, that’s fixing up the roof so you don’t get damage to the house later on. I think really the debate around the quality of the spending is the most important debate for us to be having.
BENSON: In that context, the NDIS has been isolated for a likely area for savings based on what Mathias Cormann was saying yesterday. Labor never really had it funded fully, did it?
LEIGH: Labor had funded the NDIS, and we’d built the NDIS based on advice from the Productivity Commission. This is reform which, when you ask people with disabilities, is just so overdue. I remember on polling day, I had a woman in a wheelchair come up to me, and just very simply say ‘Thank you for DisabilityCare.’ It was one of those moments that you just choke up immediately. Because people with disabilities and their carers have been waiting for far too long for a system that looks after their needs.
BENSON: But the merit of the scheme is not questioned by either side, it’s simply funding it, and the funding for Labor, it only kicks in fully in what, 2019 or something like that, and that was not something that Labor had dealt with.
LEIGH: Well the system ramps up, and it ramps up through the use of what we had referred to as launch sites in which the current government have now downgraded to trial sites. But you need to also of course, work in with states and territories. You need to make sure that they’re doing things like making sure the state insurance schemes are appropriately folded in. And that requires some difficult conversations, federalism is a tough beast, but a good prime minister, in the legacy of somebody like Bob Hawke or Julia Gillard works very hard with those states and territories to try and get reform happening. We look at the schools example, Mr Abbott doesn’t seem that interested in getting into the nitty-gritty of how to make policy work, and if he doesn’t do that on DisabilityCare, then yes he may well find it’s more expensive than if he did work with the states to achieve reform.
BENSON: Andrew Leigh, thank you very much.
LEIGH: Thank you Marius.
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