So my criticism of bleep head gets under your skin. i could start on about barnett mucking up the WA economy if you like.. 'better fiscal managers' 'interest rates will always be lower under a liberal govt' 'we have have an an understanding with indonesia' on and on it goes
try this one.
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The downgrade of Western Australiaโs credit rating illustrates how governments canโt merely talk about fiscal discipline, they need to show it. Glenn Dyer and Bernard Keane report.
There was a decided air of delusion in Canberra yesterday. While Tony Abbott was kicking off his Prime Ministership by refighting the climate wars and displaying how extraordinarily petty he can be, reality was mugging his economic agenda.
Standard & Poorโs downgrading of Western Australiaโs AAA rating carries one big message for the new federal governmentโโโespecially Abbott and Treasurer Joe Hockeyโโโand thatโs all about political will.
WA was put on a negative outlook in 2012. Yesterday S&P moved to trim the rating to AA-plus (stable) because of fears about the governmentโs commitment to bring down the stateโs $28.4 billion debt, despite previously pledging itself to do just that. Premier Colin Barnett has recently reversed a number of revenue-raising measures contained in the 2013-14 budget.
As we noted a few weeks back, Barnettโs budget problems reflect those of other Australian governments, including the difficulties Labor facedโโโand which Abbott and Hockey now face. S&P said in a statement:
โThe lowering of WAโs long-term issuer credit rating reflects our view that while the fiscal action plan announced in WAโs fiscal 2014 budget improves the Stateโs path, in our view there is likely to be slippage, reflecting our view of limited political will, as evidenced by the early revision of some budget revenue and expenditure measures. The ratings are constrained by our view of moderate budgetary flexibility and budgetary performance. WAโs debt burden is now at the high end of the domestic peer group, and in our view is likely to continue rising.โ
Even the stateโs stable outlook is at risk unless the government came up with a more convincing plan to cut debt, the agency said:
โThe rating could be pressured if WAโs consolidated cash operating balance looked likely to fall into deficit without a convincing plan to return to surplus.โ
Like Campbell Newmanโs Queensland government, which was further downgraded last year after the state lost its triple-A rating under Labor, the Barnett government is giving the lie to Abbottโs claim that better fiscal management is somehow in the Liberalsโ DNA. And thatโs despite both states enjoying resources booms and both governments boosting mining royalties ahead of the introduction of the ALP governmentโs mining tax, thinking themselves very clever by undermining the federal mining tax for revenue and partisan reasons.
The problem is, while the Labor government in Canberra copped so much criticism for its fiscal management, it was doing the hard yards while Barnett was sitting on his backside.'' http://www.crikey.com.au/2013/09/19/economic-reality-mugs-the-liberal-economic-agenda/
