Federal Government Forecasts Its First Budget Surplus In 15 Years

Although, it will be short-lived

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The Federal Government is forecasting its first budget surplus in 15 years – a small $4 billion.

If fulfilled, Jim Chalmers would deliver the first budget surplus since Treasurer Peter Costello, thanks to a surge in revenue driven by coal, gas and iron ore prices.

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It comes as Mr Chalmers prepares to deliver what his government has call a “substantial cost of living package” worth billions.

Although, the $36.9 billion deficit turnaround projected in October is expected to be short-lived, with debt projected to return in next year’s Federal Budget due to rising welfare payments and increased costs from the NDIS and aged care. 

The shortfalls anticipated though are smaller than in the past, with the budget showing an improvement of $143 billion over the next four years compared to the Coalition’s March 2022 budget delivered before losing the election.

Mr Chalmers said the Federal Budget was about "spending restraint, substantial savings redirected to other priorities, and modest but meaningful tax changes". 

"What's absolutely clear is that this outcome would never have been possible without our decision to return most of the upward revisions to revenue to the bottom line," Mr Chalmers said. 

"Debt and deficits would be bigger and the inflation challenge even more serious if we'd followed the path taken by our predecessors.

"Despite the substantial progress we've made, it will take more than one budget or one term to clean up the mess we inherited."

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Tricia Mifsud

9 May 2023

Article by:

Tricia Mifsud

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