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Dunne Speaks on the 2015 Budget

Dunne Speaks on the 2015 Budget

The 2015 Budget has been presented, and while Parliament settles down for the next day or so to debate some of the consequential legislation, the public will begin to pick over the entrails to determine their assessment of it. Essentially, it will boil down to one thing – do they feel personally better or worse off as a consequence. They may take account of the small projected Budget surplus, with bigger surpluses to come in the years ahead, but they will also remember there was to be a surplus this year which has not eventuated, so they will take that promise with a grain of salt. They will look at the social assistance package, noting with quiet approval the rise in benefit levels (for some, their anxious consciences will be salved by that) but then they will quickly check to see if they are one of the losers because of the consequential adjustments to Working for Families payments. In most cases, they will conclude that the Government has probably got it “about right” with little real impact on their own circumstances, and so they will just carry on with their lives.

Not that they really expected anything different. The days of Budgets being the year’s “Big Bang” have long since passed, with much of the detail announced by Ministers in the weeks immediately beforehand, even though as the Minister of Finance has shown in this Budget the odd surprise can still be delivered on the day.

All of this is a far cry from the Budgets of old, when people would listen in intently, waiting for the feared words, “As of midnight tonight …”, which usually presaged the introduction of new taxes, levies or reductions in some form or other of government services. Gone too are the old traditions of the pre-Budget stock-up of alcohol, and tobacco products to avoid Budget tax increases – even these are indexed now, and movements in rates announced well in advance, so no-one is caught by surprise. Few truly lament the passage of all that drama.

There is another reason why the Budgets of old should be forgotten. Their fundamental purpose was different – they were the politicians’ version of Scrooge’s Christmas, the one time in the year when goodies were dished out to those whom the Government liked, or wanted to like it, while those whom it did not like or care much about were either ignored or scapegoated. An economic and political morality play, if you like.

Today, the Budget is much more a statement of the Government’s plan of action for the year ahead, a politically and economically strategic document, rather than just handing out the loot. One thing that not has changed in the transition is the attitude of the Opposition. Be they of the left or the right, be the circumstances adverse or more propitious, Oppositions always oppose the Budget, with as much and fire and passion as they can muster, even though changes of government over the years have led to very few changes in Budget settings. Benefit levels are a good example – the last significant uplift in basic levels was when Sir John Marshall was Prime Minister, 43 years ago. When benefits were slashed by National in late 1990, despite its outrage and fury at the time, the Labour-led Government after 1999 did not restore the cuts. Now that a basic adjustment has been made, the Opposition are predictably saying it is not enough.

This is the sort of thing that makes Budget watching such fun – so long as no-one takes it too seriously. Debate will rage in Parliament over the next few days; the pontificating commentariat will have its worthy say; and then, by early next week or so, life will settle back to pretty much what it was beforehand.

Until we go through it all over again next year.

ENDS


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