Country Report Australia October 1996 Main report

Political scene: Federal gov't's pre-budget strategy pays off--

The lead-up to the new Liberal/National coalition government's first budget was characterised by the deliberate leaking of news on several sensitive subjects. Major changes so divulged included proposed cuts to university funding, higher student charges, cuts to business programmes and changes to taxation arrangements for superannuation (pensions). At a more general level, the government had stated many times that substantial spending cuts would be made, and these were therefore widely expected. As a result, most of the real news left for budget night was good news, particularly for families in receipt of the new support package promised during the election campaign.

--with the budget well-received by the electorate

Opinion surveys suggest that the Australian electorate responded positively to the budget. According to the Bulletin-Morgan poll, published on August 22, around 77% of those polled regarded the budget as "average" or "better", despite the spending cuts. Thanks in part to the government's constant hammering home of the theme, the population seems to be in favour of budgetary restraint, with almost 60% of those surveyed after the budget believing that funding cuts and increased charges were necessary to cut the deficit. The budget was even well-received by Labor voters, 60% of whom considered it to be "average" or "better".

The general public's willingness to endorse one of the toughest budgets ever proposed by an incoming government places both Labor and the minor parties in a difficult position, by leaving them with little of substance to attack.

© 1996 The Economist lntelligence Unit Ltd. All rights reserved
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