Q. What do you do when your budget surplus is going to turn into a budget deficit?
A. Move the fiscal goal posts! Just change the definition of a budget deficit and magically turn it back into a surplus!
Shadow Treasurer Rob Lucas said today that Kevin Foley’s claimed future budget surpluses were actually deficits if the same definition of a deficit as used by Mr Foley in all his previous budgets had been used.
Kevin Foley boasted yesterday that he had kept the budget in surplus over the forward estimates period till 2009. However this has only been achieved by Mr Foley completely changing the definition of what was a surplus and what was a deficit!
In his first three budgets Mr Foley said the health of a budget had to be measured by a measure called ‘Net Lending/Borrowing’.
However Treasury told Mr Foley that for three of the next four years the budget papers would show budget deficits as follows:
2005-06 $10m Surplus
2006-07 $141m Deficit
2007-08 $88m Deficit
2008-09 $50m Deficit
So Kevin Foley decided to change the definition of budget deficit to a new measure called ‘Net Operating Balance’ and instantly all of the above numbers turn into surpluses ranging from $51m to $109m!!