PM's pledges ringing in his ears

By Greg Ansley

Opposition plays back to Tony Abbott pre-election promises he's broken with disastrous results in polls.

Tony Abbott can hear his old familiar mantras being repeated. Photo / AP
Tony Abbott can hear his old familiar mantras being repeated. Photo / AP

There's a scary echo in Prime Minister Tony Abbott's ear. As he weathers a storm of anger and protest before Tuesday's Budget - much of it within his own political bloc - he can hear his old familiar mantras repeating.

While he was in Opposition, his had been a simple pledge for a future Coalition government: "No great big new taxes ... no surprises ... no broken promises."

Abbott is hearing it all again now. But this time they're coming from Labor leader Bill Shorten, not slow to recognise the earlier devastating tactics of his rival.

Every Shorten interview reiterates the same theme of broken pledges, twisted priorities and new taxes: "Tony Abbott, Australians do not want your tax increases, full stop. Tony Abbott, Australians do not want your broken promises."

Opinion polls show that voters agree. Eight months into his first term, Abbott has led the Government on a steepening dive, trailing Labor and fully expecting the budget to do worse.

On the left flank, Labor, the Greens, unions, welfare and community groups and a brigade of special interest groups warn that Abbott is protecting business at the expense of the poor, widening the gap between haves and have-nots, and shaping a society that will ensnare many more Australians in a poverty trap.

"There is a clear ideological intent to delegitimise progressive policies," former Labor treasurer Wayne Swan said. "Ultimately it is about shifting the balance towards corporations and away from working people via less corporate tax and a higher GST for working people."

Corporate Australia, confident after the election of a clear, coherent economic path ahead, has been left reeling. It fears that both policy and the coming budget are a "dogsbody" marked by confused messages and uncertainty - anathema to business.

A survey of executives by the Institute of Company Directors showed most opposed to some key policies, 80 per cent saying a budget surplus was not a priority for the next three years, and less than 30 per cent believing the Abbott Government was having a positive impact on their business decision-making and consumer confidence.

Many Liberals, both MPs and long-term supporters, bitterly oppose measures such as the planned deficit reduction levy for higher income earners and the broader economic direction. They say that without doubt, Abbott has breached trust with the nation. At a recent dinner one diehard Liberal bemoaned: "What is Tony doing?"

As Abbott and Treasurer Joe Hockey portray it, they are saving the nation from the economic calamity they inherited from Labor maintaining, even against evidence to the contrary, that government debt is about to crush the economy to dust.

They deny breaking election promises, claim the new debt levy is not a tax and say all Australians will bear the pain through a fair and equitable Budget.

But as the razors slash elsewhere, Abbott will keep A$4 billion ($4.3 billion) in corporate tax breaks, will not touch the diesel fuel rebate extended to miners and farmers and will lash out with A$5 billion in new spending on infrastructure as a carrot to business, economists and others who warn that deep cuts will hew into economic growth.

Although pruned back with a lower income cap, Abbott's "signature", gold-plated, paid parental leave scheme will go ahead, despite widespread criticism.

Hockey will outrage millions of drivers and small business operators - especially in rural areas where travel distances can be vast - by increasing the excise on petrol, pushing up prices at the pump.

Critics warn that rising petrol prices will also feed into costs of production and distribution, further raising the cost of living.

Hockey is also expected to hit other sensitive targets: universal healthcare, aged and disability pensions, family benefits, education and university fees, the minimum wage, and youth access to bare-bones A$250-a-week dole payments.

Thousands of jobs will be slashed from the public service.

If gains from his strategy do not emerge in time, tough love is likely to become tough luck for Abbott at the next election.

- NZ Herald

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