SYDNEY, New South Wales: Australia’s likely next government said it would massively slash the foreign aid budget to pay for infrastructure projects as it pledged A$40 billion (US$36.7 billion) of savings if it wins office.
The economy has been a key battleground ahead of Saturday’s election and the Tony Abbott-led conservative opposition, which polls suggest is heading for victory over Kevin Rudd’s Labor, said it would pay down A$16 billion of debt.
It also pledged A$33 billion of proposed spending and said the budget bottom line would be improved by A$6.4 billion in its long-awaited policy costings, which Rudd has slammed for being released two days out from the election.
“We will put in place the tools necessary to grow the Australian economy, to give Australian families job security. Importantly give them more control of their lives,” a visibly nervous opposition finance spokesman Joe Hockey said.
“We are going to do this by improving the budget bottom line, by over US$6 billion.
“And we’re going to start paying down Labor’s mountain of debt by more than US$16 billion. The coalition has already announced over US$31 billion of savings. Today I’m announcing a further US$9 billion of savings.”
Abbott’s key policies include repealing a corporate pollution tax and another on mining profits, along with a signature paid parental leave scheme which would cost A$5.5 billion per year.
Part of the savings include cutting the foreign aid budget by A$4.5 billion, with Hockey saying “we can only be a more generous nation to the rest of the world if we have a strong Australian economy”.
“And so we are reducing the growth in foreign aid by US$4.5 billion over the forward estimates to fund essential infrastructure here in Australia.” More than A$1 billion in savings over four years are also forecast to come from the party’s ‘Stop the Boats’ policy, referring to its plan to turn back asylum-seeker boats and force those arriving onto welfare-for-work programmes.
The Abbott-led conservatives said they would save A$1.2 billion by axing Australia’s humanitarian refugee intake by 6,250 places to 13,750 and find A$5.2 billion by sacking 12,000 public servants.
Last month, the government revealed its budget deficit has blown out to A$30 billion and revenues were shrinking as the mining-driven economy grapples with a slowdown in China that has seen commodities prices tumble.
The opposition has been pushing the line that after six years of Labor ‘waste’, the conservatives would be better managers of the economy, something Rudd denied yesterday. — AFP