The spending reforms we have to have EXACTLY a year ago, Wayne Swan conceded that the Labor government would not achieve its much touted budget surplus. Since then, the $5.4 billion surplus Swan promised in 2010-11 for 2012-13 has melted into a $47bn deficit. As for the benign outlook Swan's 2012-13 budget projected, its cumulative surplus of $16.3bn to 2015-16 has become a $123.8bn sea of red ink. Nor is the bad news over. From spending on children to retirement incomes, the pressures on public expenditure keep rising. Labor committed to increase outlays by no more than 2 per cent annually in real terms; in fact, they have been growing at about 3.5 per cent.