01-05-2025
Federal election 2025: Coalition loads up on early spending but promises savings down the track
The Coalition intends to shave $40 billion off Australia's long term debt if it wins the election on Saturday, announcing $14b in savings over the next four years.
But election promises will see the Budget bottom line worsen over the next two years than forecast under its Pre-Election and Fiscal Outlook, due to $7.8b in spending commitments.
Over the longer term the Coalition plan is to improve the Budget bottom line by almost $14b by scrapping Labor's $17b in income tax cuts, the $20b Rewiring the Nation program and the $10b Housing Australia Future Fund — as well as banking savings from a plan to reduce the public service by 41,000 people over five years.
The Coalition has said it would 'guarantee the growing funding of Medicare', committing $9.4b in funding, including upping the number of bulk billed psychology sessions from 10 to 20.
Shadow treasurer Angus Taylor said the Budget costings demonstrated the Coalition's commitment to good economic management.
'This is a $14 billion improvement here, the biggest improvement you've seen since the current costing conventions went into place,' Mr Taylor said.
'We need to be focused on making sure we've got a stronger Budget position than Labor's, which we do, that we are not racking up unnecessary government debt. And most importantly, we're growing the economy, encouraging investment, getting growth and investment by backing small business. That's what we're doing in this economic plan.'
The Coalition costings follow Labor's economic numbers released Monday that tallied $35b in new measures since Christmas. Those commitments would be offset by $6.4b in savings by slashing the use of consultants by the public service.
The savings offset to commitments that had not been budgeted before would meant the deficit would be a forecast $41.9 billion next financial year, down from $42.2 billion predicted in PEFO.
By contrast, the Coalition has a big savings plans from reducing the size of the public service, cutting 41,000 jobs out of an estimated 110,000 Canberra-based bureaucrats via 'natural attrition' or a hiring freeze. The Coalition forecasts it would save $17.2b over the next four years.
'We have worked very closely with Parliamentary Budget Office on this. Without threatening essential services, national security, frontline services, we can reduce the size of the public service by 41,000 over a period to five years, simply through natural attrition,' shadow minister for finance Jane Hume said.
The Coalition also revealed it had set aside $400m for its nuclear energy ambitions.
It has also budgeted an additional $3.5b from taxing e-cigarettes.
Treasurer Jim Chalmers described it as a money making exercise at the expense of health outcomes.
'We want to get the kids off the vapes, the Coaltion wants to tax kids on vapes,' Mr Chalmers said.
