The Federal Government is almost certain to get itself into trouble with voters a representative groups of various kinds if stays on its present course. For the past couple of months Ministers in the Government have had a standard response to a lot of policy inquiries. That response has been: all will be revealed in the Budget. Recent examples have been the question of the Medicare rebate; higher-education funding (to both institutions and arrangements for new students under HECS); and specific-purpose grants to the states.
A certain amount of secrecy is needed with the Budget to prevent speculative trading to avoid new taxes. Moreover, there is an argument that the Government’s the overall fiscal projection needs to be kept secret until announcement on Budget night to prevent currency speculation. However, when a large amount of both spending and revenue measures are kept secret until Budget night, there is cause for concern.
The essential difficulty with this approach is that it becomes policy by surprise. Invariably, it leads to poor policy or leads to knee-jerk reaction and people locking in to adversary position that defeats what might be good policy. Labor’s wine tax was a good example. Treasurer Peter Costello’s sales-tax surprise was another.
Some shift is needed in the balance between Budget secrecy, fulfilling election commitments and consulting to spending and revenue priorities. The last requires more attention by the new Government lest it run out of good will.