Labor says it will return the budget to balance in the same year as the Turnbull government before delivering larger surpluses over the forward estimates and the medium term in an effort to build a buffer against a global economic shock.



The shadow treasurer, Chris Bowen, will make the commitment during a speech to the National Press Club on Wednesday. Labor intends to stand toe to toe with the Coalition on fiscal management as the government moves to paint Labor as the party of tax and spend during the byelection season.

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At the time of the last federal election, the Turnbull government boasted a significantly stronger fiscal position over the forward estimates. There was a $16bn deficit gap between the Coalition and Labor over the four-year budget cycle.

Bowen on Wednesday will flag that Labor will go to the next federal election having closed the gap, and he will undertake that the majority of savings “raised from our revenue measures over the medium term will go towards budget repair and paying down debt”.

There is a caveat. According to a speech extract circulated in advance, Bowen will say Labor, in the event the “government decides to announce a new secret policy that is fundamentally unfair and is an attack on working people, then we reserve the right to address that”.

But he says based on the numbers revealed at last week’s budget, the net result of the government’s program and Labor’s alternative is “a better budget bottom line in the short term and bigger surpluses in the long term”.

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Labor will engage an external panel – Bob Officer, a finance academic, Mike Keating, a former departmental head, and businessman James Mackenzie – to oversee its pre-election costings and verify its bottomline both over the four year budget cycle and the medium term.

Bowen will argue on Wednesday that during a time of global uncertainty, budget repair has to be a priority: “The whiff of a surplus, not reaching at least 1% of GDP until 2026-27 does not adequately protect Australia against the potential roiling seas of international uncertainty.”

“Australia needs bigger surpluses, sooner than the government is scheduling. We can’t afford to let the next four years go to waste in the efforts for a healthier, safer budget surplus.”

He will argue the government’s decision to “bake in future tax cuts in six years time worth tens of billions of dollars” isn’t prudent when “the revenue may not turn up to fund them”.

Bowen will acknowledge that the global economy has strengthened, but will also note there are plenty of downside risks, including the probability of a trade war, the fact global debt is currently at historical highs and the global financial crisis exposed risks in the banking and financial services system.

He will say Labor will approach the coming period by sticking to fiscal principles which include repairing the budget “in a fair way that doesn’t ask the most vulnerable Australians to carry the heaviest burden”; “more than offsetting new spending with savings and revenue improvements”; and “banking changes in receipts and payments from changes in the economy, parameter variations, to the bottom line if this impact is positive”.

Bowen’s press club speech comes as the major parties are already campaigning, and setting up their ground infrastructure, in the marginal seats now in play courtesy of the high court’s decision last week in the Katy Gallagher case.

Turnbull government ministers have also fanned out around the country in an effort to sell last week’s budget and its centrepiece – the $140bn worth of income tax cuts over the next seven years.

The first run of post-budget opinion polls suggests the annual economic statement hasn’t delivered a significant boost to the Coalition, with Labor still leading in the Guardian Essential survey, the Newspoll and the Ipsos poll published by Fairfax.

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This week’s Guardian Essential poll suggests voters are more positive about last week’s budget than they were immediately after the 2017 budget, but it also suggests they are not sold on the third phase of the government’s proposed tax cuts, which delivers benefits to high-income earners.

A date for the byelections has not yet been set. Bill Shorten said on Tuesday he was “surprised” the writs had not yet been issued by the Speaker of the House of Representatives, and the Labor frontbencher Anthony Albanese declared the contests should be held in June.

The Liberals won’t contest the two West Australian seats. Georgina Downer, daughter of the former foreign minister, Alexander Downer, will run for the South Australian seat of Mayo against the Centre Alliance candidate Rebekha Sharkie, and the Liberal preselections in Longman and Braddon are yet to be resolved.

The coming period is a significant test for Shorten and the prime minister, Malcolm Turnbull. If the contests are held in July, the parliament will have already risen for the winter recess, which would delay any consequences for the leadership of either party associated with a super Saturday rout.