BENSON: Penny Wong, one of the headline items in the Budget is that you are going to return the Budget to surplus youre predicting $1.5 billion this year. But if you look at the past year, this time last year you were saying the deficit would be $22 billion, it turned out to be $44 billion. Theres a big variation over the year, and how can you guarantee this $1.5 billion will be there at the end of proceedings?
WONG: What I can say to you is that were a Government thats, as a result of the global financial crisis, seen about a $150 billion write down in revenue over a number of budgets. And what we have done, if you look at last years Budget, if you look at the mid-year update and you look at this years Budget, is we have not only offset new spending, but we have made savings to protect the bottom line.
So, for the last four budgets we made about $100 billion worth of savings. We made another $11 billion of savings in the mid-year review. And weve made just under $34 billion worth of savings in this Budget.
BENSON: You do have some control over your spending as a Government, but you dont control revenue coming in to the same extent; there are infinite variables on that. Given the variables, how can you guarantee, down to the decimal place, a $1.5 billion surplus?
WONG: What we can do is demonstrate again our determination, for the reasons Ive just outlined to you. We have demonstrated that determination to protect the bottom line and to return the Budget to surplus. And the reason is its the right thing to do for the economy. Its a buffer in an uncertain global economy, and it gives the Reserve Bank room to move, just as it has done recently, should it choose to do so. And we know that those interest rate cuts are very welcome.
BENSON: Penny Wong, the Schoolkids Bonus the payment is coming in next month, in June. Is it going to be the full-year bonus? That would be, say, $820 for a high school student, for the parents of the high school student, or will it be half that amount?
WONG: No, on this occasion it will be the full lump-sum payment for all eligible families. And the reason is that we want families to have this payment up front. Weve made the decision not to pay this as a tax refund and consistent with that were bringing the payment forward.
BENSON: The point being made universally is that this cash going to families is arriving just as the carbon tax kicks in, the initial payment. That is not a coincidence.
WONG: Weve already provided substantial assistance for the carbon price impact very substantial assistance to pensioners, people on family tax benefits, and of course were lifting the tax-free threshold.
What this Budget is about is spreading the benefits of the boom. Its about recognising that this is not everybodys mining boom. We were not able to get the company tax cut that we were intending to provide through the Parliament, because it was very clear that Tony Abbott was going to block it. We dont want his intransigence to stop people receiving the benefits of the boom, and thats why weve put in place this assistance package.
BENSON: Four thousand public service jobs will go. Will people be sacked?
WONG: The intention, as I said when we made the announcement about whats called the efficiency dividend, is that we want agencies to look first to non-staffing costs and we want them also to look to voluntary redundancies. We want people to avoid forced redundancies. There is a lot of natural attrition in the public service.
This is a significant reduction, I recognise that. We take no pleasure in this, but regrettably if were going to achieve the Budget surplus and the fiscal strategy over the long term then we have to apply discipline across Government, and that includes to the public service.
BENSON: Unemployment is going up in the Budget forecast. How bad will it be?
WONG: Unemployment, youll recall, at the moment is at 5.2 per cent and extraordinarily low by comparison with most major advanced economies. We will continue to see jobs growth, not quite as fast jobs growth as weve previously seen. But remember weve seen about three quarters of a million jobs created since we came to Government. But the Treasury forecasts are that youll see a very slight drifting up of the unemployment rate to 5.5 per cent. Thats still very, very low by international standards and by historical standards.
BENSON: And just summarising the whole drift of the Budget, The Australians headline this morning is Smash the rich, save the base. Is that an accurate summary of your strategy?
WONG: Well, some people might say its a Budget about fairness. Its a Budget about a strong economy but also a fair community. That says we want to provide more support to low- and middle-income Australians. And thats very consistent with Labor values.
BENSON: Penny Wong, thanks very much.
WONG: Thanks very much Marius.
ENDS