Waste of space: Joe Hockey’s budget megafail all Abbott’s fault

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Why has the Abbott Government’s first budget crashed so spectacularly? Can the damage be repaired? In the first part of a two part series, Alan Austin examines the Government's wasteful spending.

Treasurer Joe Hockey’s first budget has failed on several levels. It has not generated enough revenue. It has allowed extraordinary waste. It has attempted to shift the burden from the middle and the wealthy to the poor. And it has invited global derision.

These failures are entirely the Government’s fault. Attempts to blame Labor, Greens, PUP, independents or anyone else are spurious.

Here is a wasteful spending Top 40. It is not exhaustive:

1. $8.8 billion given to the Reserve Bank

 The Bank said this was not needed. Treasury said it was not advisable. Michael Pascoe claims this was a trick to make Hockey look good.

2. Border protection

The excessive cost, including of disposable orange life boats, is impossible to measure precisely. It is multiple tens of millions per year.

3. Offshore refugee processing

According to the government's own Commission of Audit, it costs $400,000 a year to hold an asylum seeker offshore, $239,000 in detention in Australia, but only around $40,000 on a bridging visa in the community while claims are processed.

This is the fastest growing area of government expenditure with costs over the forward estimates projected above $10 billion. About 90 per cent is wasted. 

4. High Court case on eligibility for a protection visa

The Government comprehensively lost last week. The exercise was a monumental waste of time, money and human resources.

5. Profligate Cambodia refugee deal

Australia pays $40 million per year plus all extra costs. For what? Cambodia ‘might take in between two and five people under the pilot phase’. Resettlement in Australia would be far less expensive and more humane.

6. Military engagement in Iraq

Annual cost at least $500 million.

7. Anti-terrorism

An extra $630 million has gone to security agencies to deal with the threat of "home-grown terrorism" which Australia’s involvement in Iraq foments.

8. F-35 joint strike fighters

$12.4 billion has been allocated for these problem-plagued American stealth jets. Not the most cost effective option.

9. Marble for Canberra buildings

Defence is spending more than $500,000 on marble panelling. Carrara marble, from Italy.

10. Other bizarre defence outlays

These include celebrity speakers and a full tendering process to acquire a multipurpose knife for camping out.

11. Futile search for missing Malaysian aircraft 370

 Estimated at $1 million per day.

12. Royal commission into the pink batts

This vindictive political witch-hunt cost an estimated $20 million, discovered nothing new and failed completely to explore the real questions demanding answers.

13. Royal commission into trade unions

Another political vendetta squandered an estimated $61 million.

14. Direct Action Plan

This pays some businesses to reduce carbon emissions but frees others to increase theirs. The waste is about $2.55 billion over four years, plus costs incurred thereafter.

15. Religion

Money is now available to train priests and other religious workers and for school chaplains, while funding for non-religious counsellors is cut.

16. Pseudo-sciences

Federal funds are now available for homeopathy and Bach flower therapy.

17. Abbott’s new car

His $500,000 bullet-proof BMW is part of a $6.2 million outlay, vastly more than for Australian-made alternatives.

18. Travel expenses for ministers, staff and families

These have been rorted shamelessly, with flights to a wedding claimed. Total blow-out is unknown because the Government is withholding the information.

19. VIP jets instead of commercial flights

Ministers spent about $900,000 in just two months in late 2013. Education Minister Christopher Pyne’s blithe assertion that VIP jets were “probably cheaper” was shown to be blatantly false by an ABC fact check.

20. Jobs for Liberal mates

High salaries were secured for Sophie Mirabella, Tim Wilson, Alexander Downer and others.

21. Salary for nothing

A department axed by the Government continued to pay the top bureaucrat $7,000 a week for months until another role was eventually found.

22. Public service hand-outs

Fat cats receive outrageous bonuses on top of already bloated salaries.

23. Lease termination

Charges of $65,000 were incurred when Abbott refused to live in the Forrest house rented for him during the 2013 election caretaker period.

24. The Lodge

Lavish renovations costing a staggering $6.38 million were approved in December. That is double the original estimate and more than the cost of demolition and rebuild.

25. Department of Industry and Science

$10,827 went on a coffee table.

26. G20 table

Treasury spent $36,005 on a conference table for the November summit in Brisbane.

27. Table transport

That conference table was made in the ACT. So the Government spent another $26,298 shipping it to Brisbane. Why did the tender not stipulate assembly in Brisbane?

28. Chairs

After the table had been built and transported to Queensland, chairs were also bought in the ACT – for a staggering $68,525.

29. Koalas

$24,000 was then blown in a few minutes of G20 koala diplomacy.

30. High tech theatrette

Taxpayers paid almost $330,000 in September 2013 for a Canberra space for Scott Morrison’s border protection briefings. It was fitted out, including with an $800 door knob, but not used. Briefings were held in Sydney until discontinued in December 2013.

31. Perks for MPs

These include $15,442 for Attorney-General George Brandis’ bookcase.

32. ‘Obscene’ long lunches

Joe Hockey spent $50,000 to fly a celebrity chef to Washington to cook one meal.

George Brandis is among other offenders.

33. Abbott’s 3-day PR exercise in Arnhem Land

This cost a fortune but achieved only disruption to an already stressed community. The Yolngu would have benefitted far more had Abbott stayed in Canberra and not slashed $534 million from their meagre programs.

34. Asset sell-offs

$11.7 million is available to prepare privatisation of Defence Housing Australia, the Canberra mint and other income-generating assets. With interest rates so low, this is the time to buy and build assets, not sell them off. A double waste.

35. Focus groups

$500,000 was spent to help sell – unsuccessfully – changes to higher education funding.

36. Media blitz

Trying to defend the widely resented university changes cost $14.6 million.

37. Damage control

The strategic communications branch of the PM’s department employs 37 spin doctors in a forlorn attempt to polish the PM’s image. Cost to the taxpayer: $4.3 million per year. That is on top of the 95 communications staff engaged on border control, costing at least $8 million annually, and many other spin merchants elsewhere.

38. News media monitoring

According to Fairfax, just seven departments spent $1.2 million on "market research" in four months last year.

39. Interest on government debt

This is up from $12.2 billion in 2012-13 to $14.7 billion in 2014. With more to come.

40. Commission of Audit

And finally, as if to underscore this administration’s grinding incompetence, the commission set up to help cut Government waste not only utterly failed there, but blew out its own $1 million budget by 150%.

They are just some areas of waste on the spending side. Outcomes have been just as dismal on the revenue side, perhaps even more destructive. Those failures and whether this Government can possibly fix things will be examined in part two, coming soon.

Alan thanks colleagues Sandi Keane and Lyn Bender for valuable input into this series. You can follow Alan on Twitter @AlanTheAmazing.

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