With the partial exception of Stephen Kirchner, the government’s spending-the-surplus extravaganza is receiving a positive reaction.

Yet there has been very little about what was going to happen to the surplus, particularly the planned contributins to the Education Investment Fund and the Health and Hospitals Fund. One of the Prime Minister’s media releases yesterday referred to speeding up spending from these funds, but this seems to be a separate issue from how much money will eventually find its way into them.

On that issue, the amount contributed to the special investment funds was to be ‘subject to final budget outcomes’, so presumably they are taking a double hit: lower surpluses or even deficits in the coming years, and the current surplus spent on handouts to families, pensioners, and home buyers.

It reinforces the need for universities to disconnect themselves from the budget cycle as much as possible, and to receive their income through markets.