When Joe Hockey delivered his first fiscal statement in December 2013, it painted a much bleaker picture than the PEFO produced by Treasury and Finance in August based on Labor’s policies.
This was in part due to the Coalition’s decisions, foregoing $7.4 billion in revenue from the carbon tax and unnecessarily gifting $8.8 billion to the RBA for example, and partly due to Hockey changing forecasts, assuming a sustained unemployment rate of 6.25 per cent over the forward estimates for example.
“We have inherited from the Labor Party budget deficits totalling $123 billion over the next four years, and unless we take immediate action, we’ll be in deficit for more than a decade,” Mr Hockey said.
Whatever action they have taken doesn’t seem to have worked because the deficits over the four years since the Coalition took government have added to $159.2 billion with another $20 billion to the end of February this year.
Hockey’s 2013 MYEFO also warned of ballooning debt suggesting that Labor’s profligate spending would see gross debt hit $460 billion by the end of 2016-17.
Under the Coalition’s supposed superior economic management, gross debt was actually $501 billion by the end of 2016-17.