The Australian economy could risk falling $1 trillion into debt over the next decade unless welfare spending is reduced, Treasurer Scott Morrison says.
Speaking at a conference in Sydney on Thursday morning, Mr Morrison suggested too many Australians had grown used to a relatively successful economy and being beneficiaries of the welfare system.
“A generation has grown up in an environment where receiving payments from the government is not seen as the reserve of the disadvantaged, but a common and expected component of their income over their entire life cycle,” Mr Morrison said.
The treasurer said the Coalition inherited a $317 billion debt from Labor in 2013, a figure now standing at roughly $430 billion.
“The next generation will know how well and how quickly we answered these questions by the Australia we leave them, by how much debt they will have to repay, by the taxes they will be forced to endure and the standards and access to services they are able to afford, and therefore have to accept,” Mr Morrison said.
“A generation has grown up in an environment where receiving payments from the government is…a common and expected component of their income over their entire life cycle.” – Treasurer Scott Morrison
Though economic debt has increased since the Coalition took government, Mr Morrison pointed out it is lower than projections estimated at the time.
“As a government to date, we have acted to reduce that projected debt by $55 billion,” Mr Morrison said. “However we are still a long way from where we must be, and time is running out to get there.”
The Age economic editor Peter Martin was critical of Mr Morrison’s speech, particularly his reference to the potentially large debt the next generation of Australians would have to face.
“By setting out scary predictions for gross debt he is softening us up for more [debt],” Martin wrote on Thursday afternoon.
“He is also doing it by talking about the tragedy of saddling our grandchildren with debt, even though most of it be used to provide facilities such as roads, schools, hospitals and the national broadband network which those grandchildren will use.”
Welfare and social services expenditure is expected to grow by almost $20 million by 2020, as per Mr Morrison’s 2016-17 budget.
