It was the new leader of the opposition Sussan Ley, as she gave her first major economic speech. Ley’s remarks, delivered on a significant platform, highlighted concerns about Australians’ increasing dependence on government welfare and subsidies. Her party’s shockingly bad performance in the previous election set this process of re-evaluation in motion. They have combined this with a more pessimistic budget trajectory than the Lamble government’s for the next two years.
Ley also very directly rebut the Coalition’s last election strategy in her speech, that featured costly pledges galore. These pledges were clearly aimed at tackling the cost-of-living crisis. She noted how these pledges added up to a budget bottom line that long-term threatened fiscal sustainability. Ley promised to address these concerns head-on. She further announced that the Coalition would conduct an internal review of its election policies.
Economic Accountability and Government Spending
Ley also noted that government spending is now a record high of 27 percent of GDP for this financial year. That’s a higher level than before the last three crises of the 1980s. She maintained that this amount of spending is not sustainable and should be held to a high level of scrutiny.
“We are essentially running a peacetime economy on emergency fiscal settings. That is obviously not sustainable,” – Sussan Ley
In line with this vision, Ley provided a vision for targeted welfare programs rather than universal benefits. She argued that the recent approach is not in the best interest of the people who need help the most. She underscored a sad reality. Over 60 percent of the population relies on the federal government for more than half of their income.
Ley expressed her belief that the existing welfare system may contribute to a culture of dependency, stating, “It has become almost taboo in politics to suggest that not everyone is entitled to every government benefit.” This quote neatly sums up her belief that moving to more targeted support would lead to more personal responsibility from Australians.
Future Policies and Fiscal Rules
In terms of future policy direction, Ley indicated her desire to stick to the Coalition’s fiscal rules. These guidelines include a non-binding limit on the federal government’s tax take, set at 23.9 percent of the economy’s size—a threshold not exceeded since the Howard government era. In her recent speech, she suggested that any proposed increases in spending would have to be matched by carefully considered spending cuts.
Ley doubled down on her opposition to Labor’s expanded National Disability Insurance Scheme (NDIS). She announced that addressing costs will be key to its long-term sustainability. In a follow up, she confirmed that her government does not intend to lower the JobSeeker unemployment payment back down. Her vision to advocate for those living in economic despair still rings true.
As she charts her party’s course ahead, Ley admitted the Coalition’s election commitments were a work in progress. The DCCC’s internal assessment is an honest attempt to present a more coherent strategy as they head into the next election. We will continue to develop our policies as the political landscape shifts.
Challenges Ahead for the Coalition
Ley faces huge challenges in her mission to guide her party through dark days. The era is marked by electoral frustration and shifting public opinion. On a related note, the Coalition’s last federal election campaign severely undercut its fiscal credibility. Its terrible budget bottom lines, in comparisons to Labor, were what drove voters most crazy.
Looking ahead, Ley will be seriously tested on her leadership. We know that she’ll need to reconcile her fiscal conservatism with the immediate pressure of constituents clamoring for help as the cost of living continues to soar. Her clarity of purpose towards an inclusive and prudent economic vision might appeal to voters hungry for surety in tumultuous times.
