Linda White (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

My question as to the Minister for Finance and the minister representing the Treasurer, Senator Gallagher. Can the minister update the Senate on the 2021-22 final budget outcome tabled earlier today?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

Thank you for the question. The final budget outcome shows that we have booked a substantial but temporary lift in revenues, mainly due to much higher than expected commodity prices.

No, it's not misleading the Senate.

Sue Lines (President) Share this | Link to this | Hansard source

Order! Interjections across the chamber are disorderly.

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

President, I've been accused of misleading the Senate. I can assure you I am not misleading the Senate. If I could project my voice over those shouting at me I could go through and explain. We have booked in revenues—I'm not talking about payments—related to higher than expected commodity prices. However, many of the factors driving that improved end result will not be replicated over the medium term. You don't have to dig too deep into the data to get a good sense of the complex and confronting set of challenges we face in the nearer term. We know that the budget is facing sustained pressure into the future, with those opposite leaving Australia with a budget in structural deficit. Despite what they might say, an improved deficit alone is not proof of a strong and thriving economy or budget. We have a budget weighed down by a mountain of debt that's becoming more expensive to service. In this financial year, $17.9 billion was spent servicing a trillion dollars of Liberal debt. That's more expensive than the PBS. It's more expensive than child care. More than we spend on a range of government programs is just going into servicing the debt, and that was as of March. That was before the interest rates increased, which, of course, will add a significant cost to the budget. That is what we are dealing with— (Time expired)

Honourable senators interjecting—

Sue Lines (President) Share this | Link to this | Hansard source

Before I call Senator White, I am once again going to call the chamber to order. Interjections are disorderly. Interjections across the chamber while the minister is on her feet or while a senator is asking a question are absolutely disorderly, and I would ask you not to do that. Senator White, a first supplementary question?

Linda White (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Can the minister provide more detail on the debt inherited from the previous government and its impact for future budgets?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

Yes, I can. The government inherited a budget heaving with a trillion dollars of debt and with ongoing budget deficits stretching beyond a decade. As much as those opposite would like to rewrite history on debt and make it all about the pandemic, it had been doubled before the pandemic hit. It had been doubled after making commitments about lowering debt. They doubled it; that went on before the pandemic. The facts are very clear on that. We know that the increase in interest rates could add more than $16 billion in costs across the forward estimates and over $120 billion over the coming decade, just because of the increasing interest rate impact on debt. At the moment, servicing the debt burden that was forecast in the March budget is costing more than the PBS, more than child care, more than higher education and more than government schools. That's what's going on. (Time expired)

Sue Lines (President) Share this | Link to this | Hansard source

Senator White, a second supplementary question?

Linda White (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Can the minister provide more detail on the delayed spending from 2021 and its impacts on future budget capacity?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I have heard those opposite talking about this $50 billion windfall that's hit the budget. I would say that is looking backwards as well, as the final budget outcome does. About $20 billion of the improvement to the budget bottom line was through lower payments or underspends. These were moneys that the previous government had committed to getting out the door in the last financial year, which they didn't get out the door.

Jane Hume (Victoria, Liberal Party, Shadow Minister for the Public Service) Share this | Link to this | Hansard source

You're so selective, Katy!

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I'm talking about a proportion of it, Senator Hume, if you listen to me. A significant proportion of the lower payments is programs that are not going out the door. They will move into this financial year and the financial years beyond. That spending will hit the future budget deficits that we're having to manage against a backdrop of increasing pressure in those five programs that I spoke about to Senator Steele-John. The budget is in structural deficit, and we are working hard to repair it.