Arthur Sinodinos (NSW, Liberal Party, Assistant Treasurer) Share this | Hansard source

I invite Senator Wong to perhaps refresh and remind us of the specific measures that were going to be taken that were going to offset these initiatives. In recent days, when it comes to the so-called Gonski reforms, we are now being told that the opposition will oppose one of its own savings measures to do with tertiary education. What this government is doing, I can assure Senator Wong, is we will be providing full information on offsets. There has been a very rigorous process through the Expenditure Review Committee to look at offsetting savings for new spending and also to review spending commitments of the previous government and measures announced in the economic statement. I can assure the senator that that will be a very rigorous process.

With regard to infrastructure spending, when we put our proposals together before the election we also identified how we would pay for them. The Parliamentary Budget Office made it very clear that on the whole that savings exercise on our behalf was very credible. So we come into government and into this debate in this chamber with a lot of budget and economic credibility. I want to remind people that the budget emergency we are talking about is an emergency that does build up further over time, over the medium term, including with the ageing of the population and the drivers of spending that that will unleash particularly in the health and aged-care areas. So there is more work before us to be done. This is not an excuse just to spend, spend, spend. We have to do so in a judicious way, conscious that, notwithstanding our size as a G20 economy, we remain by world standards a small, open economy and therefore we cannot afford to carry great levels of debt. Adverse external economic shocks can have a major impact on our economy, and we have to make sure we have flexibility in the structure of our capital flows to accommodate that.