In a speech to the Australian Council of Social Services, Treasurer Joe Hockey attributed the tough decisions made in the budget to Australia’s future "quality of life".
Discussing the future deterioration of these standards, he pointed to a single graph from Secretary of the Treasury Martin Parkinson.
He identified it as the "most alarming single piece of information" he had seen about Australia’s future economic prospects, adding that it created a "stunned silence" when he presented it to both the state treasurers and cabinet.
So here it is: the graph that stunned the Coalition, possibly into breaking some election promises and making the policy changes that were announced last week.
The chart may look familiar; it was included in this year’s budget. We’ve confirmed with Treasury that this is indeed the chart Hockey was talking about in his ACOSS address. Treasury offered this explanation:
"The key message drawn from the chart is that, in the context of a declining terms of trade and an aging population, Australia will require a significant improvement in our productivity growth performance over the next decade to sustain growth in material living standards at the pace that we have enjoyed in the past."
Otherwise, what do you think? This chart may not clarify individual policy decisions, but does it justify the overall 'crackdown' theme of the budget?
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