Newly-elected Greens leader Christine Milne says political pressure to reach a budget surplus in 2012/13 needs to “ease off”.
“What I’m asking is for the Coalition and the community to create the space to ease off on the budget surplus – too much contraction will really hurt south-eastern Australia,” Milne told ABC Radio today.
Milne said Prime Minister Julia Gillard didn’t feel she could change her mind on a commitment to deliver the surplus in 2012-13.
“Of course you have to get to a surplus in the budget cycle but you have to consider when and how you do that so that you don’t do it in such a severe way that you lead to a contraction that has adverse outcomes for the community,” Milne said.
Get daily business news.
The latest stories, funding information, and expert advice. Free to sign up.
The Greens have declared in the past they will fight any cuts to government service made simply to return to surplus.
“The Prime Minister gave an undertaking in 2009 that we’d return to a budget surplus in 2012-13 and she doesn’t feel like she can change her mind, in spite of these changed economic circumstances, because of the relentless campaign out there by (Opposition leader) Tony Abbott.”
The Greens want higher unemployment allowances, a dental health scheme and more funding for schools.
But Trade Minister Craig Emerson told ABC Radio Labor had “fundamentally different” policies to the Greens, including on the budget surplus.
“Ratings agencies are relevant here. We are rated AAA by all three ratings agencies – the first time in Australia’s history that has happened – and it’s in no small part due to fiscal consolidation,” Emerson said.
“We want to create the capacity for the Reserve Bank to further reduce its cash rate,” he said.