12.00am June 28 2016
David Crowe – Political Correspondent
Bill Shorten has sparked a furious brawl over budget repair by banking $4.9 billion in Coalition savings on superannuation and public service cuts without revealing how he will achieve the gains, while admitting he cannot restore all the “brutal and cruel” hospital cuts he has railed against for two years.
Australians will go to the polls without any certainty over the Opposition Leader’s plans for superannuation, as he claims the $3bn saving included in last month’s budget, but at the same time vows to “revisit” the changes by consulting experts after the election.
The cloud over retirement savings deepened the dispute over election policy costings after Labor also claimed a $1.9bn saving from Coalition cuts to the public service, while rejecting the specific “efficiency dividend” meant to produce the gain.
With only four days until the election, Labor and the Coalition are in an escalating dispute over the budget as Mr Shorten promises to reduce the deficit without “smashing household budgets”, while Scott Morrison warns of higher deficits, debt and taxes if Labor takes power on Saturday.
The row has extended to health as Mr Shorten fends off questions about whether Labor would restore all the state hospital funding that was removed in the Coalition’s 2014 budget — a cut he has campaigned against ever since. While the Opposition Leader denounced the Abbott government’s $57bn cut to state hospital funding over a decade as “brutal and cruel” when it was unveiled, he conceded yesterday he could not return the spending to its old trajectory. This was despite Labor Treasury spokesman Chris Bowen telling the ABC in November 2014: “We want to see the $80bn cut to health and education scrapped.”
Labor’s election costings confirm it will offer about $2bn in hospital funding over four years on top of the $2.9bn boost outlined by Malcolm Turnbull in last month’s budget, making it clear that Mr Shorten’s commitment falls short of restoring all the lost funding over a decade.
“I can go to every hospital in Australia and say vote Labor because we’ll provide for more funding for hospitals,” Mr Shorten said yesterday.
“I can go to every Australian who is currently on an elective surgery waiting list for hip replacements, for knee reconstructions and say vote Labor because we’re actually going to make it more possible for you to have your surgery more quickly.”
Labor financial services spokesman Jim Chalmers vowed on May 26 to reveal the opposition’s policy on super before July 2 in response to the budget changes, which raise $6bn but use about half of this by funding more generous rules while using the remainder to improve the budget bottom line. “People will know by the time they go into the polling booth where we stand on superannuation,” Dr Chalmers said four weeks ago.
Mr Shorten stared down requests for detail yesterday, arguing Labor would need to consult industry experts and senior officials before deciding which of the Coalition’s policies it would adopt. “When we form a government, if we win the election, we will revisit these measures to see their workability, to fully understand if they can actually be done,” he said. “There’s plenty of people who are saying that these changes will be very hard to implement.”
The Labor stance throws doubt over changes including a $1.6 million transfer cap that imposes an earnings tax on super accounts over that limit, a cut in the concessional contribution cap to $25,000 and controversial changes to the Transition to Retirement Income Stream rules.
Mr Bowen said he had “grave concerns” about another change, a $500,000 “lifetime cap” that is backdated to 2007 and is at the centre of a dispute about whether it is retrospective, while Labor assistant Treasury spokesman Andrew Leigh said the Coalition’s policies were a “dog’s breakfast” and needed to be fixed.
“We’ve committed, if we win office, to using the resources of Treasury, consulting quickly on that, coming up with a measure which achieves the same impact on the budget bottom line, but ideally without the retrospectivity of the government’s changes,” Mr Leigh told Sky News.
Labor’s approach has frustrated industry experts who want certainty over the competing policies before polling day, particularly after Mr Shorten and Mr Bowen had launched a broadside against the Coalition earlier in the election campaign.
“We have urged Labor to adopt the same or similar measures as the government, which would achieve the same savings or more,” said Ian Yates, chief executive of the Council of the Ageing.
“There are other measures that you could take to make super more effective.”
Others said voters deserved to know the detail of Labor’s changes to super rather than being told they would be decided after the election.