Anthony Albanese reassures Labor faithful on budget eve

Prime Minister Anthony Albanese says voters can expect a solidly Labor budget on Tuesday as the government tries to avoid spending money in an overheated economy while fulfilling its headline campaign promise: “No one left behind”.

Critics have asked whether the government can, or will, balance inflation while spending money to reduce poverty.

But the PM told the Labor caucus they had struck the right balance.

“It’s in the best of Labor traditions,” Mr Albanese told MPs on Monday, before Tuesday night’s budget release.

Mr Albanese, who is still riding high in the polls on a strategy of displacing the Opposition from the centre of politics, even broke out the campaign promise that he rode to power last year (but remixed slightly for FM radio – his new political frequency).

“We don’t leave people behind,” he said.

“But we also don’t hold people back. And tomorrow night is about the aspiration of people for a better life.”

The budget will show a $143 billion improvement over four years compared to forecasts under the Coalition, and Treasurer Jim Chalmers will hand down a first-year $4 billion surplus, the first in 15 years.

Opposition Leader Peter Dutton has been preparing an attack if the government does heed the calls of economists and many on its benches and raises the rate of the JobSeeker allowance, which is currently less than $50 a day.

Dutton’s focus on long-term jobless

Mr Dutton has taken to the airwaves calling for a return of the work for the dole – a policy that currently exists – which appears to be the road testing of a campaign aimed at the long-term unemployed.

Liberal deputy Sussan Ley, by contrast, called the JobSeeker rate too low; the government had been criticised widely for circulating a proposal to increase the daily payment by only $2.85.

The New Daily understands that the actual rise to be announced on Tuesday will be north of that figure but less than the $20-a-day rise called for by advocates such as Ken Henry, the former Treasury secretary.

Mr Albanese announced another welfare reform on Monday – the overturning of a Gillard government decision that cut single parents from the single parenting payment and put them on JobSeeker when their youngest child turned eight – the cut-off will be 14 years.

As for other income support payments, details will be forthcoming on Tuesday.

The budget will include $14.6 billion in cost-of-living policy measures, targeted, Mr Albanese said, “for those who need it most”.

Between already announced energy subsidies, the parenting payment change and a policy for cheaper medicines, that leaves more than half of that billion-dollar sum hanging in the balance.

Treasurer Jim Chalmers’ rare budget surplus comes mostly thanks to revenue and taxation windfalls courtesy of the global economy.

Dr Chalmers, once a chief adviser to Wayne Swan, wrote a book in which he candidly acknowledged the subtleties of managing inflation as a treasurer. A new Labor government cutting a Liberal government’s programs early builds credibility and room for its future promises, he wrote.

‘As good as it gets’

Canberra economist Chris Richardson says that a constellation of favourable circumstances not seen since the gold rush have flooded government coffers with cash this year.

It’s a one-off benefit, but the long-term structural problems with the budget remain and leave it about $40 billion a year in the red.

“There’s lots to celebrate.  And we should celebrate it – it’s stunningly welcome,” Dr Richardson said.

“Yet we’re very close to the moment at which you’d declare ‘this is as good as it gets’.”

Just over 80 per cent of the extra revenue will go towards paying off debt, Dr Chalmers’ office said.

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