Politics to the fore in Australia budget

Treasurer Peter Costello is widely tipped to succeed John Howard as Australia's next prime minister

CANBERRA, Australia (CNN) -- Australian Treasurer Peter Costello's seventh budget, to be delivered Tuesday, seems destined to be more a political agenda statement than a national balance sheet.

While Costello is expected to hand down a comfortable financial surplus -- between $250 million to $500 million -- it will be the government's new spending priorities that will hog the media spotlight.

A $300 million-plus defense and "border protection" package will form the centerpiece of the document, serving to reinforce the government's election-winning focus on Australian "security" issues.

The strategy of playing to Australians' fears in the post-September 11 environment will also help establish Costello's credentials with conservative voters.

While Costello is widely tipped to succeed John Howard as Australian prime minister -- possibly as soon as mid 2003 -- political observers suggest he lacks the broad appeal of the incumbent.

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Among supporters of the conservative coalition government, Costello is perceived as leaning a little too far to the left of the political spectrum, particularly given his support for Australia becoming a republic.

A strong endorsement and substantial injection of funds for the politically popular "border protection" strategy by Costello may go some way to redressing this.

Howard has in the past indicated he would review his political career on his 64th birthday, which falls in July next year.

Many observers consider that review will foreshadow a speedy handover of the reins to Costello, who has served loyally and long as Treasurer.

But both Howard and Costello are coy when the question of a succession plan is raised.

Credentials

Howard says he hasn't decided what his plans are and Costello says the leadership is not an issue currently occupying his mind.

But certainly the Treasurer is going to some pains to sell his conservative credentials and align himself with Howard's tough stance on illegal immigration.

The 2003 budget would show the government had an active plan for the next couple of years to make Australia "safe and secure", Costello told television viewers earlier this week.

"What I'm going to lay down on Tuesday night is a five-year plan to upgrade Australia's border protection facilities, including some new measures, some quite expensive measures, which will lay down a build up for a period of five years," he said.

"Now, a lot of people said ... that this policy wouldn't work, and I think the evidence is that it's beginning to work."

Popular

Howard's focus on border security was a key factor in November's election victory

The zero-tolerance policy on asylum-seekers was introduced in August last year after a Norwegian freighter carrying hundreds of rescued asylum-seekers was denied entry to Australian waters.

Since then, all boats carrying asylum-seekers have been intercepted by the Australian navy or customs boats.

The boats are either turned back into international waters or those on board are transferred to Australian-run detention camps on the Pacific island nations of Nauru or Papua New Guinea.

While the policy has been roundly attacked by international human rights groups, the stance was popular in Australia and proved a key factor in gaining a third term in government for Howard's administration.

The strong defense policy in this budget may also help deflect attention from the politically unpopular cuts that are also likely to feature.

These include cuts to education programs such as the teaching of Asian languages in schools, tighter social security rules and reductions in subsidies for pharmaceuticals.