Hockey Leapfrogs Swan as Better Australia Treasurer After Budget

Shadow Treasurer Joe Hockey overtook incumbent Wayne Swan in a poll on who is more capable of managing Australia’s economy, as the government failed to gain a boost from its last budget before a Sept. 14 election.

Hockey surpassed Swan for the first time since he became Treasury spokesman for the opposition Liberal-National coalition in February 2009, leading 39 percent to 35 percent, a Newspoll published in the Australian today showed. The ruling Labor party trailed the opposition by 12 percentage points on a two-party preferred basis that reflects the likely distribution of votes on election day, unchanged from two weeks earlier.

Swan on May 14 delivered his sixth budget that projected Australia will remain in deficit until 2016, and recorded a A$19.4 billion ($18.9 billion) shortfall this fiscal year, compared with a A$1.1 billion surplus forecast in the government’s mid-year review released seven months ago. Swan blamed the stronger currency slowing growth for the deficit and pledged to fight an election on jobs rather than slash spending.

“They painted themselves into a corner by saying they would be delivering a surplus this year,” said Zareh Ghazarian, a politics lecturer at Monash University in Melbourne. “Now that they haven’t delivered, that’s reflecting very poorly on Mr. Swan. There’s also the issue of the extra revenue they were expecting just not being there, so voters are starting to think Swan just mightn’t be across the details in his portfolio.”

Revenue Shortfall

To make up for the tax revenue shortfall, the government announced in the budget it would scrap a cash payment to the parents of newborns and cap family payments for a saving of A$2.4 billion. It is also seeking to save more than A$4.2 billion through June 2017 by closing tax loopholes for multinational and other large companies. The measures include addressing “aggressive tax minimization strategies” that shift profits by artificially loading debt into Australian units.

The Newspoll of 1,143 people conducted May 17-19 showed voters almost evenly split on whether the budget was positive or negative: 35 percent rated it good and 37 percent bad, with 7 percent responding neither and 21 percent uncommitted. Prime Minister Julia Gillard’s satisfaction rating increased 2 percentage points to 31 percent, while opposition leader Tony Abbott’s climbed 1 percentage point to 37 percent, it showed.

The survey’s margin of error was plus or minus 3 percentage points.

To contact the editor responsible for this story: Stephanie Phang at sphang@bloomberg.net

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