Coverage of 2022-23 Federal Budget Night commences at 7.30pm tonight Tuesday, 29 March 2022 . Following of this a cash splash announcement....

David Rowe, 28 March 2022

The Australian Treasurer & Liberal MP for the Kooyong electorate in Victoria Josh Frydenberg will deliver the 2022-23 Federal Budget at approximately 7.30 pm (AEDT) on Tuesday 29 March 2022. 

Budget Papers will be posted on https://budget.gov.au/ on the night. 

The Treasurer's Speech will be shown on ABC TV Live at 7.30pm and a Budget Night 2022 News Special, Analysis & Reaction will be aired from 8 to 10pm.

Budget Night lockup of select journalists will begin at 1.30pm on Tuesday afternoon. Access to embargoed Budget Papers will be further restricted again this year using the pandemic as an excuse. This in turn will limit the degree to which initial analysis of this election year national budget can escape the ideological control of the Murdoch-Costello-Stokes media triumvirate. 

To ensure that most journalists would use Morrison Government budget talking points over the next news cycle rather than in-depth analysis, the following promises contained in tonight's budget papers were released yesterday in a joint media release (with suitable quotes) by the Treasurer, Prime Minister, Deputy Prime Minister & Minister for Communications, Urban Infrastructure, Cities and the Arts:

Infrastructure promises made in that media release with no timeframe context

• $3.1 billion in new commitments to deliver the $3.6 billion Melbourne Intermodal Terminal Package (VIC), including:
• $1.2 billion for the Beveridge Interstate Freight Terminal in Beveridge, taking the total investment to $1.62 billion;
• $280 million for Road Connections, including Camerons Lane Interchange, to the Beveridge Interstate Freight Terminal;
• $740 million for the Western Interstate Freight Terminal in Truganina;
• $920 million for the Outer Metropolitan Ring - South Rail connection to the Western Interstate Freight Terminal.
• $1.6 billion for the Brisbane to the Sunshine Coast (Beerwah-Maroochydore) rail extension (QLD)
• $1.121 billion for the Brisbane to the Gold Coast (Kuraby – Beenleigh) faster rail upgrade (QLD)
• $1 billion for the Sydney to Newcastle – (Tuggerah to Wyong) faster rail upgrade (NSW)
• $678 million for Outback Way (NT, WA, QLD)
• $336 million for the Pacific Highway - Wyong Town Centre (NSW)
• $336 million for the Tasmanian Roads Package – Northern Roads Package – Stage 2 (TAS)
• $200 million for the Marion Road – Anzac Highway to Cross Road (SA)
• $145 million for the Thomas Road – Dual Carriageway – South Western Highway to Tonkin Highway and interchange at Tonkin Highway (WA)
• $140 million for Regional Road Safety upgrades (WA)
• $132 million for Central Australian Tourism Roads (NT)
• $120 million for the Adelaide Hills Productivity and Road Safety Package (SA)
• $46.7 million towards the Athllon Drive Duplication (ACT)

Additional promises for existing projects

• $2.264 billion for the North South Corridor - Torrens to Darlington (SA)
• $352 million for the Milton Ulladulla Bypass (NSW)
• $320 million for the Bunbury Outer Ring Road (Stages 2 and 3) (WA)
• $200 million for the Tonkin Highway Stage 3 Extension (WA)
• $45 million for the Ballarat to Ouyen – Future Priorities (VIC)
• $68.5 million for the Cooktown to Weipa Corridor Upgrade

  

Ahead of the week's Budget 2022-23 announcements, a brief look at how the federal government remains afloat

Budget Papers 2022-23 are expected to be presented to the Australian Parliament this sitting week.

This budget - like all other Morrison budgets since 2016 - comes with a background of increasing public debt. This fourth Morrison-Frydenberg budget can be no different, whatever clever accounting tricks are employed.

Financial Review, excerpt, 9 February 2022:

Commonwealth budgets and mid-year reviews have been ramping up spending, right up to the last mid-year review in December. As a result, spending in 2023/24 is estimated to be $41 billion higher than when it was first estimated in 2020. This increase has little to do with the pandemic.

The fiscal outlook is further clouded by the approach of a federal election. In recent weeks, the Prime Minister has been out and about sprinkling more fiscal largesse, which sits uneasily with his Treasurer’s “lines in the sand”.

Australian Office of Financial Management, Annual Report 2020-21 Financial Statements excerpt, 25 October 2021:

The cost and risk of the debt portfolio is managed through debt issuance and (where appropriate) investment activities. Since early 2009, budget deficits have required debt issuance volumes that have exceeded those necessary to maintain liquidity in Treasury Bond and Treasury Bond futures markets, affording the AOFM with a greater level of flexibility in setting its issuance program. In recent years the AOFM has lengthened the duration of its Treasury Bond portfolio through longer term issuance as a means of reducing refinancing risk and the variability of debt servicing costs over time.

Australian Office of Financial Management, 2021-22 Issuance Program, 7 January 2022:

This notice provides updated details of planned issuance of Australian Government Securities by the Australian Office of Financial Management (AOFM) for the remainder of 2021-22.

At MYEFO the AOFM indicated planned Treasury Bond issuance of around $105 billion (of which $44.3 billion has been completed). Two tenders will be conducted most weeks. A new November 2033 Treasury Bond will be issued by syndication in the final quarter of 2021-22 (subject to market conditions).

Planned issuance of Treasury Indexed Bonds is $5-5.5 billion (of which $4.1 billion has been completed). Two tenders will be held most months.

Regular issuance of Treasury Notes will continue. Weekly issuance volumes will depend on the timing and size of government receipts and outlays and the AOFM’s assessment of its cash portfolio requirements.

Details of weekly transactions will be announced at midday on the preceding Friday.

As at 28 February 2022 the total of Commonwealth borrowings liability was $859,702,529,974 (calculated in Australian dollars). That is an eyewatering amount of billions in anyone's language.

Two Treasury Bond tenders and a Treasury Note tender with a combined value of $2.8 billion were announced on Friday, 25 March 2022.

The next tender for the issue of Treasury Indexed Bonds is planned to be held on Tuesday, 12 April 2022.

Commonwealth gross debt has been rising since the Global Financial Crisis, but in the last three and a half years as the country lurched though mega bushfires, pandemic, catastrophic flooding and a significant loss of export market share in China, the Morrison Government budget papers have been exercises in hopeful fiction. Next Tuesday night's budget papers might possibly be accompanied by glittering unicorns.

A fact sociologists worth their salt know, the better economists remember & conservative politicians can never accept – it is units of labour which drive production & productivity in any economy

The Conversation, 12 January 2022:

Australians are getting a stark reminder about how value is actually created in an economy, and how supply chains truly work.

Ask chief executives where value comes from and they will credit their own smart decisions that inflate shareholder wealth. Ask logistics experts how supply chains work and they will wax eloquent about ports, terminals and trucks. Politicians, meanwhile, highlight nebulous intangibles like “investor confidence” – enhanced, presumably, by their own steady hands on the tiller.

The reality of value-added production and supply is much more human than all of this. It is people who are the driving force behind production, distribution and supply.

Labour – human beings getting out of bed and going to work, using their brains and brawn to produce actual goods and services – is the only thing that adds value to the “free gifts” we harvest from nature. It’s the only thing that puts food on supermarket shelves, cares for sick people and teaches our children.

Even the technology used to enhance workers’ productivity – or sometimes even replace them – is ultimately the culmination of other human beings doing their jobs. The glorious complexity of the whole economy boils down to human beings, using raw materials extracted and tools built by other human beings, working to produce goods and services.

A narrow, distorted economic lens

The economy doesn’t work if people can’t work. So the first economic priority during a pandemic must be to keep people healthy enough to keep working, producing, delivering and buying.

That some political and business leaders have, from the outset of COVID-19, consistently downplayed the economic costs of mass illness, reflects a narrow, distorted economic lens. We’re now seeing the result – one of the worst public policy failures in Australia’s history.

The Omicron variant is tearing through Australia’s workforce, from health care and child care, to agriculture and manufacturing, to transportation and logistics, to emergency services.

The result is an unprecedented, and preventable, economic catastrophe. This catastrophe was visited upon us by leaders – NSW Premier Dom Perrotet and Prime Minister Scott Morrison in particular – on the grounds they were protecting the economy. Like a Mafia kingpin extorting money, this is the kind of “protection” that can kill you…...

Read full article here.

There is a question now hanging over Morrison & Frydenberg's 2022-23 Budget, geared as it is to fulfill the Coalition's yet to be revealed election promises rather than buttressing the nation against the adverse economic winds blowing through countless CBDs around the country. 

An estimated 50 per cent of the national workforce are currently absent from their employment on any given day due to COVID-19 - either workers have contracted the virus, are home looking after a dependent family member/s who is ill with it, have become a "close contact" and are isolating because of it, or their place of employment has temporarily closed due to lack of customers who are afraid of catching it.

It's not just a question of how far household consumption is likely to fall as this situation continues through at least another six weeks. 

Note: as an example, two previous Household Final Consumption Expenditure falls during the pandemic have been 12.2% June Qtr 2020 & 4.8% September Qtr 2021. Periods in which infection growth intensified. 

Neither is it all about the financial pain being felt by small businesses after every Coalition public policy error compounds economic distress at community level, sweeping away hope and income.

It is also about how much will the inevitable loss of production and productivity carve off the value bottom line of states and territories' State Domestic Product (SDP) and what impact that has on Australia's Gross Domestic Product (GDP) or the level of eyewatering public debt government has to service. 

Does the Australian economy have the resilience to withstand a full year of  SARS-CoV-2 running unchecked in the general population due to the Coalition's political policy of 'living with COVID'?