Treasurer Josh Frydenberg has detailed the Coalition’s plan to cover the cost of every policy it has announced during the campaign should it be re-elected on 21 May.
Mr Frydenberg told the media in Melbourne on Tuesday that the efficiency dividend – introduced by the Hawke Labor government in 1987 – will be boosted from the current 1.5 per cent to 2 per cent, raising over $2 billion.
“What we are doing is offsetting that spending with an increase in the efficiency dividend by half a per cent, which will raise more than $2.3 billion,” he said.
“The annual departmental bill across the Commonwealth is about $327 billion. What we’re saying is it will be reduced to about $324 billion, as a result of this additional measure.”
The efficiency dividend is expected to save $2.7 billion over the forward estimate. This – coupled with further savings of $653 million through tweaks to the defined benefits scheme for public servants – is expected to pay for the Coalition’s commitments made since the March budget, while also boosting the budget bottom line by a billion dollars.
Joining Josh Frydenberg on Tuesday, Finance Minister Simon Birmingham said the Coalition “can demonstrate [that] we have fully paid for our election promises and improved that budget bottom line further to the tune of another $1 billion”.
In his address to media in Queensland, shadow treasurer Jim Chalmers slammed the Coalition’s policy costings, accusing the Morrison government of delivering a “full-blown cost of living crisis”.
“This Morrison government has become a laughing stock on the budget and the economy given the failures over almost a decade in office now. Now, what we see in the budget and what we see in the government’s costings today is a budget which is absolutely heaving with rorts and waste, and $1 trillion in Liberal debt,” Mr Chalmers said.
Labor is expected to reveal its policy costings this Thursday.
