Opposition Leader Sussan Ley to attack government ‘dependence,’ and Labor’s spending spree in major economic address

Sussan Ley will pin the Coalition’s economic strategy on slashing government spending and putting the brakes on tightening welfare payments, with the Opposition Leader set to outline her vision in a major speech on Wednesday. Ms Ley will seek to reset the opposition’s agenda following a week of bitter party infighting which resulted in the demotion of Northern Territory senator Jacinta Nampijinpa Price to the backbench. The cornerstone of her address to the Committee for Economic Development of Australia in Melbourne will be to challenge Labor’s increased spending which is tipped to reach 27 per cent of GDP, the highest outside of a recession. Instead Ms Ley says Australia must “move from a time of dependency to empowerment”, and said government should not be expected to “provide for every need and solve every problem by spending more”. “My message is that we must put guardrails around government spending, not as an end in itself, but so that we can strengthen our economy, preserve our capacity to help those truly in need and ensure the next generation inherits opportunity, not debt,” she is expected to say. “Because debt is an issue of intergenerational fairness.” Ms Ley will say that while government must create a “fair social safety net”, the welfare system has “swung too far toward dependence”. In doing so she will lean on research from the Centre for Independent Studies which found 50 per cent of voters relied on the government for most of their income, either through welfare payments, subsidies or public-sector employment. Ms Ley says the high-spending during the Coalition’s management of the Covid-19 pandemic has “normalised and extended the era of big government” and “actively encouraged” the “mindset of ‘government will take care of everything’”. According to May budget papers, federal coffers are forecast to return steady deficits until 2034-35. Gross debt is also expected to hit $1.22 trillion in the 2028-29 financial year. “We are essentially running a peacetime economy on emergency fiscal settings. That is obviously not sustainable,” she will warn. “Yet the current government appears in no hurry to adjust. In fact, they proudly tout any new spending as evidence of their generosity. The problem is they are being generous with borrowed money.” While the next federal election doesn’t need to be held until May 20, 2028, Ms Ley says a Coalition government would restrain spending growth” and not rely on “volatile revenue booms (like iron ore exports) that may not last. Welfare programs would also be targeted, with Ms Ley saying that “as a government, we cannot, and should not, shield everyone from every cost of living pressure by writing a cheque”. She also flagged cuts to programs that were not means-tested, saying that while “universal free everything might sound nice … in reality it drains resources from those who need help most”. Ms Ley will use the fringe benefit tax exemptions for EVs as an example which has exceeded budget modelling from $55m to $560m a year, and primarily benefits high-income earners. “We owe it to taxpayers to squeeze maximum value from each dollar the government spends,” she will say. “Waste and mismanagement are the enemies of sustainability and they all add up.” Ahead of the speech, Ms Ley announced a reshuffle of her shadow ministry, which included promoting finance spokesman James Paterson to the senior leadership team to help develop the party’s economic agenda. Simon Kennedy, MP for Scott Morrison’s former seat of Cook in Sydney, was also promoted to the newly created assistant spokesman position for scrutiny of government waste and the digital economy.