EDITORIAL: Federal Budget set to leave Labor with a trust deficit
The Treasurer argued that breaking an election promise ‘for the right reason’ is a way to build trust. Bizarre.
The document to be delivered by Treasurer Jim Chalmers on Tuesday will be remembered as the Budget of broken promises.
Let’s go back a bit. Labor under former leader Bill Shorten lost the 2016 and 2019 elections — the latter considered unlosable — with a plan to limit negative gearing and dilute capital gains tax concessions.
It scarred the party deeply and next leader Anthony Albanese vowed ahead of the 2022 and 2025 elections the two tax treatments would not be changed.
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By continuing you agree to our Terms and Privacy Policy.Mr Albanese became Prime Minister in 2022 and was returned at the election held on May 3, 2025.
During the election campaign last year Mr Albanese became tetchy at times, as he can do, as he was repeatedly asked about his plans for capital gains tax and negative gearing.
“Yes. How hard is it? For the 50th time,” he told a reporter in Cairns mid-campaign who asked if he ruled out any changes to the two tax settings.
So, little more than a year later apparently things have changed so much that those promises will be broken.
The changes have been flagged for weeks and in trying to find a way to justify the shift while keeping a straight face, Mr Albanese and Dr Chalmers have tied themselves in knots.
Last week the Treasurer argued that breaking an election promise “for the right reason” is a way to build trust. Bizarre.
At the weekend the word broken popped up, but not in the sense of a broken promise.
It was linked to the wider theme that Labor is using to justify the capital gains tax and negative gearing changes — so-called “intergenerational equity” to help younger homebuyers compete with investors who have used the tax breaks.
Dr Chalmers argued the Government “recognises that the status quo in housing and tax is broken, it is unfair, it is unacceptable”.
On Monday Mr Albanese joined in. “People are frustrated with issues like intergenerational equity. People are worried that younger Australians are never going to get a crack at home ownership,” Mr Albanese said.
“The circumstances that are here now when it comes to intergenerational equity, how are they different from what they were before the last election? How they are different is that they continue to be entrenched without reform and that’s the point,” he said.
In essence, it sounds like the change is that they have decided to make a change — perhaps given comfort against any backlash by the massive majority they won at the last election after pledging there would be no such move.
These changes should have been put to voters before the last election. They were not. No amount of spin will save Mr Albanese and Dr Chalmers from what this is. A massive broken promise.
Mr Albanese and Dr Chalmers now have a trust deficit.
No doubt there will be plenty of justifications advanced.
But voters might well ask why should they believe anything the pair says now?
