Labor Targets Consultant Cuts to Fund $10 Billion in Election Promises
A major reduction in spending on consultants will fund the majority of Labor’s $10 billion election commitments, according to pre-election costings released by the government on Monday — a move designed to pressure the Coalition into revealing its own financial plans.
Treasurer Jim Chalmers said the budget outlook had improved by about $1 billion over four years compared to March figures, which had projected deficits exceeding $150 billion over the same period.
Labor’s updated costings include $6.4 billion in savings from reduced reliance on consultants and $740 million in additional revenue through higher student visa application fees. These new savings build on $4 billion in offsets announced in last month’s budget.
The figures were released as ratings agency S&P Global warned both major parties that surging spending, reaching post-war highs, could jeopardize Australia’s prized AAA credit rating.
Despite the savings, Treasury projections confirm a decade of ongoing deficits driven by increased spending on welfare, defence, and tax incentives.
“We call on the Coalition to release their costs and cuts immediately,” Mr Chalmers said at a press conference in Brisbane.
“It’s long past time for the Coalition to come clean on their secret cuts to fund nuclear reactors. We’ve been clear about our commitments and how we’re paying for them.”
Finance Minister Katy Gallagher said the government spends about $100 billion annually on procurement and contracts, suggesting the consultant savings represent about 1.6 per cent of that outlay.
She described the reductions as “modest” and emphasised that they would not impact essential programs or public services — a contrast to the Coalition’s proposed $28 billion in cuts and 41,000 public service job losses.
Labor’s push for Coalition costings follows a familiar pattern late in election campaigns. Notably, Labor itself delayed releasing its costings until just days before polling day in 2022.
The Coalition has promised major spending and tax measures but has yet to publish full costings. Labor claims the Coalition’s pledges would amount to more than $62 billion, citing proposed mortgage interest deductions and fuel excise cuts.
Shadow Treasurer Angus Taylor criticised Labor’s costings, saying they showed “no plan for the budget and no plan for the economy.”
“There’s a better way. We can beat inflation by cutting waste and slashing red tape,” he said.
AAA Credit Rating Under Threat
Meanwhile, S&P warned that Australia’s triple-A rating could come under threat if election promises lead to larger deficits and ballooning debt.
S&P analyst Anthony Walker noted the budget was “already regressing to moderate deficits” amid growing global economic tensions and slowing growth.
He warned that how the next government funds its campaign pledges would be critical to preserving the nation’s credit rating.
The agency also flagged concerns about the growing use of “off-budget” financing for major projects, which could mask Australia’s true debt position.
Mr Chalmers insisted Labor had shown fiscal discipline in its updated costings.
“We’ve demonstrated we have found the room for our commitments. The budget is stronger at the end of the campaign than it was at the start,” he said.
He added: “The biggest risk to our triple-A rating is Peter Dutton and the Coalition.”
