Joe Hockey has a point about spending. It’s a shame he’s a bad salesman

When the history books tell the story of the Coalition’s nine years in power between 2013 and 2022, Joe Hockey’s disastrous May 2014 budget will be recorded as a defining moment of self-inflicted political harm.

The Abbott government’s first budget blew up in its face, inflicting enormous reputational damage which the Coalition struggled to recover from. An unprecedented $80 billion cut to health and education spending led a list of savings measures affecting age pensioners, seniors concession cardholders, family payments and people on the disability support pension.

Former treasurer Joe Hockey.Credit: Peter Rae

Hockey argued that without change, the budget would never get to surplus and debt would never be repaid. “So the time to fix the budget is now,” he told parliament at the time. “The time to strengthen the economy is now. The time for everyone to contribute is now.”

The key problem with Hockey’s budget was not that it sought to rein in government spending. The flaws were that the strategy asked certain people to contribute more than others, particularly those who could least afford it, and that the economic statement was built on a litany of broken election promises.

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As the Herald’s economics editor Ross Gittins wrote at the time, Hockey’s first budgetary exam delivered a distinction on management of the macro-economy, a credit on micro-economic reform and a fail on fairness.

Before handing down the 2014 budget, Hockey was hard at work paving the way for some tough love, including via a landmark speech in which he argued the age of entitlement was over and need to be replaced by the age of personal responsibility.

Nearly a decade on, the former treasurer who went on to serve as Australia’s ambassador to the United States has renewed his call for fiscal restraint and attacked politicians who shun cutting government spending to stay popular with voters. Politicians were afraid of making hard decisions when cheap borrowing was available, Hockey said, and populism was rampant and uncontrollable.

“That sense of entitlement, that you can give people everything they want, is a cancer in our community,” he told London’s Institute for Economic Affairs. “We will all pay a price.”