Costello Budgets For Seat At The Top

by Malcolm Farr - Daily Telegraph

This Budget will be Peter Costello's alone to defend against attackers or revel in should it win the confidence of taxpayers.

It will be a test of his ability to carry voters with him at a time when the Government's reputation for solid economic management is being questioned.

Of added significance, the measures in the Budget are expected to project the Government's priorities ahead to the years in which Costello would expect to be Liberal leader and Prime Minister.

John Howard won't be on stage much to share post-Budget duties with his Treasurer. He won't even be in the country.

Immediately after it is delivered by Costello tomorrow night, the Prime Minister will prepare for his Friday departure on a two-week trip to the US, Canada and Ireland.

During his visits Howard will be particularly honoured at functions in Washington and Ottawa and it is shaping up to be a trip honouring past loyalties to allies, not necessarily future commitments.

There is a symbolism here which won't escape those watching for hints of Howard's departure from politics and Costello's succession.

The pre-Budget billing has been that it will be a financial statement to reinforce the future with capital works and investment in other community assets, such as a skilled workforce and secure families.

"I believe the Budget will be described as first and foremost forward-looking -- a very responsible one that continues to strengthen the Australian economy," Howard said on Friday.

It will be a future Costello would expect to be involved in as Prime Minister after Howard seeks other jobs. So it would seem appropriate and significant that he gets unchallenged carriage of selling the Budget.

Treasurers always have to do the bulk of the work in explaining and supporting Budgets, because they put them together during long nights in the Treasury building.

After last year's statement Costello gave 21 media interviews in seven days, quite a turnover.

Howard deferred to his Treasurer. He gave just eight interviews in that time and by day seven was talking more about whales and Schapelle Corby rather than the economic statement.

It should be remembered that the May 10 Budget last year was less than a fortnight after the Athens Declaration in which Howard appeared to say he would lead the party into the election expected late next year.

He denied this was the import of his comments to The Daily Telegraph and The Australian in an Athens interview, but it was a rough time for relations between the two.

Again Howard has made sure Costello will have almost sole possession of praise for a Budget certain to contain substantial spending and most probably tax cuts and financial relief for families.

It's highly unlikely Howard would want to give his younger colleague a hospital pass.

Certainly voters are looking for a patch of brightness after the dark clumps of bad news from high petrol prices, an interest rate jump and a fall in property values.

At worst, families are sitting around because they can't afford to drive anywhere, wondering how they can pay off an increasingly expensive mortgage on a home which in real terms is worth less than when they bought it.

Further, Labor and the trade unions are stimulating a sense of family financial insecurity by insisting new workplace laws will cost income -- such as overtime payments -- and possibly jobs.

It won't be Costello's job in the Budget to argue industrial relations policy, but it will be his task to implant a sense of hope for the future.

The Budget comes at what the Treasurer believes is a turning point in the economy, an economic peak after which there will be a decline.

Growth will continue to be strong but not as robust as when China and India and other rapidly expanding economies were paying top dollar for our resources.

Australian exports for March were worth more than $16.1 billion and climbed by about 17 per cent over the previous nine months. The March level was down on February, but Trade Minister Mark Vaile expects a record export year.

Trouble is, we are importing more than we earn in exports and Costello will have to address this tomorrow night.

It will be his 11th Budget and while unlikely to say it publicly, one could imagine he would be keen to move to another job before making it an even dozen.

His chances of doing that and moving to the leadership will be shaped by his handling of the Budget.