$12 billion budget crisis


Prime Minister Julia Gillard today put a price tag on her Government’s financial woes, confirming that there’ll be a $12-billion hole in the upcoming Federal budget.

Battling against lower than expected revenue returns, the PM says key programs like Gonski and the National Disabilty Insurance Scheme will not be jettisoned.

Anna Wall reports.

TRANSCRIPT

Julia Gillard laid out the government’s broad economic strategy during a speech in Canberra today.

She described Australia’s economy as stable and resilient, saying key investments will be affordable with the right planning.

Julia Gillard, Prime Minister: “Put simply, spending is controlled but the amount of tax money coming to the government is growing much slower than expected.”

Opposition leader Tony Abbott doesn’t agree.

Tony Abbott, Opposition Leader: “I think that everybody knows that this is a government that’s been spending like a drunken sailor.”

Ms Gillard says the tax revenue collected so far this financial year is already 7.5 billion dollars less than predicted.

And there’s more to lose.

Julia Gillard, Prime Minister: “Treasury now estimates that this reduction will increase to around 12 billion by the end of the financial year.”

But she’s adamant the budget will not fail.

The Prime Minister says the Disability Care Scheme and increased school funding will not be cut.

She says they’re necessary investments for Australia’s economic future.

Julia Gillard, Prime Minister: “We won’t during this time of reduced revenue fail the future by not making the wise investments that will make us a stronger, smarter nation.”

The Budget will be handed down on May 14.

Anna Wall, QUT News.