Australia’s opposition Labor on Friday unveiled its economic blueprint for the May 18 election, promising bigger budget surpluses than the government in an attempt to undermine Prime Minister Scott Morrison’s attacks on its economic management.
Publishing figures from Australia’s Parliamentary Budget Office, the country’s independent body that analyses fiscal policy, Labor said it will match the government’s A$7.5 billion ($5.25 billion) surplus in 2019-20.
But by cutting what Labor said were generous tax concessions aimed at the country’s wealthiest, it could deliver a surplus of A$13 billion in 2020-21 — $2 billion more than what the conservative government promised in April.
“We will pay down debt faster,” Labor’s shadow treasurer Chris Bowen told reporters in Canberra.
“We will provide more capability to invest in education. We are providing a remedy, not a replica. That is what the election is all about.”
Labor’s budget forecast comes amid a barrage of attacks by Morrison who has argued that a change in government would threaten the country’s economy. Australia has posted a record 28 years of economic growth.
A major political poll last week pegged Morrison’s coalition government trailing by just 2% heading into the May 18 election.
The estimates include Labor’s announced policies, including abolishing tax concessions for people who invest in property and tax rebates for dividends paid out from after-tax corporate profits.
However, the fiscal estimates do not include pledges from Labor that have yet to be finalised, the centrepiece of which is raising the minimum wage.
Morrison, who has centred his re-election bid on delivering Australia’s first budget surplus in a decade, said Labor lacks credibility in sticking to spending plans.
“Australians can’t trust a Labor party when every time they have had the opportunity they’ve fallen over when it comes to financial management,” Morrison told reporters while campaigning in the state of Queensland.
Labor will hope its fiscal outlook will blunt the government’s attack on its economic credentials, analysts said.
“Labor will have neutralised the government’s attack,” said Haydon Manning, professor of political science at Flinders University.
“Labor will now be able to credibly bat away attacks from the prime minister that the that the budget will be ripped apart under Labor.”
While each political party argues over their economic plan, Australia’s central bank on Friday cut its forecasts for domestic growth to 2.75 percent this year, threatening fiscal policies of the major political parties.
The Reserve Bank of Australia previously expected growth of 3 percent.