Budget update: Hockey continues class war

December 19, 2014

The Mid Year Economic and Fiscal Outlook, released by the federal Treasurer Joe Hockey on December 15, foreshadowed further major cuts to public sector jobs and services. The MYEFO updates the draconian federal budget brought down by the treasurer in May.

The centrepiece of the mini budget is Hockey's forecast of a massive $44 billion collapse in Commonwealth receipts over the next four years, leading to a delay in the Abbott government's much-trumpeted return to surplus to an unspecified date, and resulting in combined federal deficits totalling more than $100 billion.

Treasurer Hockey cited huge falls in international resource commodity prices, especially the near halving of the iron ore price and slow wages growth, for the fall in federal government revenue. These factors have together reduced Commonwealth income by around $70 billion over the past 15 months.

The government claims it is saving more than $3 billion by slashing 175 government agencies and making multi-billion further cuts to the foreign aid budget.

The Community and Public Sector Union (CPSU) says the way is now open for even harsher job cuts in the federal public service.

The CPSU has confirmed that the 16,500 public sector jobs slated to be reduced in the May budget will be gone by the end of this year, well ahead of forecast.

World Vision head Tim Costello has described the government's slashing of overseas aid as "immoral."

"The mini budget underlines the growing political and economic crisis facing the Abbott government", said Susan Price, Socialist Alliance candidate for Summer Hill on December 16.

"The May budget was a pre-emptive strike by the Coalition government against working people and the poor in the expectation of a looming international downturn.

"Now the government's neoliberal austerity policies, on behalf of big business, are in danger of throwing the so-called 'Lucky Country' into serious recession.

"Meanwhile, the Senate is holding up the government's cuts to Medicare, tertiary education, social welfare and other areas totalling almost $34 billion.

"It is the public's rejection of the inherent 'unfairness' of Abbott and Hockey's budget which has led to these brutal measures being stalled in the Senate.

"However, it is because of the massive public hostility to the government's savage May budget that the treasurer has been slightly more restrained in his cuts in MYEFO.

"But, the government's decision to cancel its commitment to introduce a 'targeted anti-tax avoidance provision', aimed at multi-national corporations which dodge Australian tax by sending profits offshore, is the most blatant hypocrisy. Hockey railed against tax avoidance by big companies at the G20," Price said.

"The Abbott government is waging class war against the workers and the poor, on behalf of big business," Price said.

"Unions and community groups will need to be vigilant in the new year when Abbott and Co. try to push through their program of cuts, with new incentives aimed at the cross benchers in the Senate.

"We will need to organise and unite our forces in 2015 to build a mass movement of opposition to the cuts. We need to halt the attacks and the privatizations. This will involve fighting the policies of both federal and state governments.

"In NSW, we need to follow the example of Victoria where a mass campaign against the East-West Link forced the incoming Labor goverment to tear up the contracts.

"I'm encouraged by the enormous turn outs at public meetings and actions to oppose West Connex over the last few weeks. This helps put pressure on both the Baird government and the ALP opposition which, so far, has not come out against the tollway. This also means fighting the Baird government's plans to sell off the NSW power industry", Price concluded.

Media release date: 
Friday, December 19, 2014