The Australian’s alternative budget facts: how spending ‘ballooned’ under Labor

Congratulations to The Australian and esteemed journo Patrick Commins, who have “exclusively” discovered that “government spending has ballooned to its highest share of the economy in history”.

“Evidence of the expanding scope of government in the economy comes as the Albanese government on Monday announced an extra $1.4bn to extend COVID response measures,” Commins warned in a story published Sunday.

Thank goodness for the valiant journalists of the Murdoch press, fearlessly warning that a new era of big government is upon us.

And who is to blame? Experts are apparently “warning more public expenditure is on the way as Labor prepares its first budget, including promises on child care and wages … The Albanese government has ambitious goals to increase spending on key social services.”

Commins even has a graph — sourced, it seems, from the ABS — that suggests that it’s Labor’s fault.

It was enough for The Australian’s sub-editors to slap a headline on the piece: “Government spending balloons to highest share of economy ever as Labor prepares first budget.”

There’s something odd about the graph, though. The last few years have been fudged into a kind of blob up at 28%. Why would that be?

Let’s consult the government’s own numbers, not some vague “ABS” source — and not the current government, but the Morrison government. Here is Commonwealth spending as a proportion of GDP from Budget Paper No.1, Statement 10, from the March budget. We’ve gone back a mere 20 years, but it serves its purpose well enough: government spending has hardly “ballooned” to its highest share of economy ever as Labor prepares first budget.

It “ballooned” under the Coalition in 2019, to 27.7% of GDP, then to 31% of GDP in the pandemic year of 2020-21. It was 27.8% of GDP the next year and still, in the March budget, over 27%, and forecast to stay above 26% until 2026 at least — higher than it has been in the modern budget papers since 1970.

It was the Coalition that not merely responded to the pandemic with a massive increase in government spending, but locked in a permanent, and significant, expansion in the size of government in Australia to over 26% of GDP. As Crikey has been pointing out for years.

Only at The Australian could they blame Labor for something so plainly the responsibility of the Coalition. No wonder they slapped “exclusive” on it.