![Finance Minister Katy Gallagher. Picture by Sitthixay Ditthavong Finance Minister Katy Gallagher. Picture by Sitthixay Ditthavong](/images/transform/v1/crop/frm/128375134/faab6694-90d7-4d40-89cd-afa48c0360cb.jpg/r0_288_5400_3324_w1200_h678_fmax.jpg)
Finance Minister Katy Gallagher has promised Labor's redo of the nation's books will be "good for Canberra" as the Albanese government eases off contractors and puts back jobs in the public service.
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It comes as the ACT representative reveals $21 billion worth of savings and redirected existing spending a day out of the federal budget and as the opposition, just five months out of office, has said it will be looking on Tuesday for spending discipline, no increased taxes and a "real focus" on labour supply, particularly pensioners.
Speculation remains that a flagged "significant" ACT infrastructure commitment will be funding for the next stage of light rail from Alinga Street to Commonwealth Park.
In an interview with The Canberra Times, Senator Gallagher has confirmed the $15 million election promise to reopen and rehabilitate the AIS Arena precinct in Bruce will be delivered in the budget, as well as the promised $750,000 for a scoping study into a home court for the Canberra Capitals WNBL team at the University of Canberra.
Senator Gallagher has flagged "quality" spending focusing on productivity, but warns the "family-friendly" framed budget "won't be everything to everybody".
"We've got those tricky economic circumstances at the moment with inflation, high rising interest rates, wages not keeping up, cost of living, the war in Ukraine, global instability, and a budget under enormous pressure," the minister said.
"This budget will be delivering on our election commitments many of which go to supporting some of those cost of living pressures."
Senator Gallagher said the Albanese government's continuing spending audit, which takes in the waste, rorts and mismanagement audit and a March budget review, has found - in its first phase - $21 billion in savings largely through reallocation and reprioritisation.
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There's $6.5 billion from "reprofiling" of infrastructure projects, $3.6 billion from reducing spending on external labour, advertising, travel and legal expenses and more than $2 billion from various grants programs across government.
Long targeted by Labor, regional infrastructure funding is a feature, according to the Minister, including spotting duplication and grants without business cases.
"It was the payoff for net zero. A deal that we never saw. Nobody ever knew. But it appeared kind of on the eve of the election with these big buckets of money going places," she said. "So that's part of it, but it's not exclusively."
"We've looked in every department and I think you'll see that in the budget that there's been saves where they can be returned to [the] budget. There's also been ways of realigning money that was going to be spent in certain ways to better align with some of the commitments we've made."
This includes the Labor commitment to reduce spending on consultants and contractors in the public service, abolish the APS staffing cap and re-invest in permanent staff.
The Finance Minister, who is also the Minister for the Public Service, told The Canberra Times it is a "rebalancing" act with more staff coming to bolster service delivery agencies such as Services Australia, Veterans Affairs and the administration of aged care, as well as additional public servants in other departments.
"It's actually probably worse than I had thought it was," the Minister said. "Not in terms of the skills of our workforce, but the kind of capability, that having enough people on deck to actually do the work they need to do."
She said reducing reliance on labour hire, consultants and contractors for permanent jobs is "going to be a long piece of work, but this budget gives it a pretty good kick along. And it has got the APS reform side of the business funded as well."
"That's good for Canberra," Senator Gallagher said.
Shadow Treasurer Angus Taylor has flagged the Coalition is looking out for broken election promises, including increasing real wages, reducing the cost of living, implementing the stage three tax cuts in full and the often cited pledge to reduce power bills by $275 by 2025.
He also wants action to not make inflation and interest rates worse "without increasing taxes."
"The Treasurer must avoid the temptation of handing down a traditional big spending, big taxing budget that puts Labor's big government agenda front and centre," he said. A budget like this will only make the current cost of living crisis worse."
Senator Gallagher's $15 million election promise to open and rehabilitate the mothballed AIS Arena will be honoured in the budget. The money is expected to trigger the ACT government to swing into the next stage of the project to reopen the indoor venue for sports, community events and concerts.
The budget will also confirm money to back the continuing quest for a home court for the Canberra Capitals WNBL team with the promised $750,000 for a feasibility study and to progress the business case for the Sports Hub 2 facility at the University of Canberra.
Some of the new spending is unavoidable for the government, such as the previously highlighted $8.8 billion blow out in the cost of the NDIS and extra $11 billion over ten years to keep the election commitment to keep the Morrison government's stage three tax cuts which kick in two year's time.
"It's not just the NDIS. It is defence, hospitals, aged care and managing the debt. They're the top five. So that's why the budget is in structural deficit and that's the challenge that remains," Senator Gallagher said.
"That's why this budget is the first in a part of a longer piece of work."