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With the next Federal Budget to be handed down in May, it will be extremely interesting to discover what changes the Government will make to reduce the budgetary deficit and to encourage growth of the Australian economy.
With a number of measures from the 2014 Budget now in tatters, the position is now considerably worse than forecast.
Of course the current budget deficit was many years in the making. The contributors to the current position included a lack of forward planning during the mining boom and unsustainable handouts.
Whilst short term actions will help reduce the deficit, the best solution to repairing the budget requires some longer term planning including taxation reform, productivity increases and supporting economic growth generally across the nation.
Unfortunately we have a political history that lacks proper long term planning, often preferring to concentrate on short term, politically-driven band aid solutions.
The lack of vision from both sides of politics is failing the Australian economy and preventing the nation from achieving its full potential.
Look around the world and look at the success stories in sustainable economic growth. You will find a vision and a strategy that optimises the positioning of resources and creates the certainty that is required to attract long term investment.
The country is crying out for a 5/10/20 year vision that will help grow the economy and make it more resilient against external factors.
Politically there are several advantages. To begin with, the electorate would have a better idea of what the Government stands for and how they would like to see the country progress. At the moment most people don’t really understand what the major parties stand for or what their points of differentiation are – bad marketing! The presence of a positive plan would certainly be a breath of fresh air. Also if the electorate understands the bigger picture reasons for policy decisions, they will be more supportive.
Much of the electorate is actually willing to take some medicine if they can see the reasons and benefits for it.
As mentioned, the May Budget will be a critical step in addressing the budgetary deficit. It is hoped that it will not just contain short term measures but introduce reforms and longer term measures that will help strengthen the economy for years to come.