Aussie Budget is worth reading, if you want a steer to where Robertson will take us next week

New  Zealanders  who  want  a  preview   of  Finance  Minister  Grant   Robertson’s  budget  next week  need  only take a  quick  read   of the  latest  Australian   budget  presented  in Canberra  last  night.

The  Liberal-National  coalition  is  promising a  huge  spend-up,  with  the   Federal Treasurer, Josh  Frydenberg,  being immediately accused  of  delivering a  “Labor-lite” document.

As  in  NZ, Australia’s is a  deficit-laden budget as the leadership strives to sustain a recovery from a coronavirus-induced recession.

Setting  the scene, the Federal government  reminds  the voters:

“This  a  deadly pandemic and we are still in the midst  of it. We are  doing   what is needed  to keep the  economy  on track”.

Australia’s deficit will hit a record $A161 billion in the fiscal year ending 30 June 2021 though, as a strong economic rebound improves government finances, that is more than $A50 billion lower than a forecast made in December.

The government has pledged close to $A3.5 billion in Covid-related measures including vaccine procurement and funding for contact tracing and testing facilities.

Here’s a Frydenberg phrase that is almost  certain  to find  an echo  in NZ next  week

 “The economy is coming back. Australia is coming back”.

The quicker-than-expected pick-up in activity means the government is pulling in more tax receipts and making less welfare payments than had been previously forecast.  It is also enjoying a resurgence in the terms of trade.

The jobless rate is forecast to fall below 5% as early as next year, representing a remarkable turnaround from 2020, when measures to contain Covid-19 shut down swathes of the economy.

Among  the budget measures  is an extension of a tax rebate for more than 10 million low- and middle-income earners.

The budget is also pledged to increase childcare subsidies through a A$1.7 billion investment. The spending targets families with more than one child in daycare, giving more parents, especially women, the choice to take on extra work.

The Morrison  government  released a separate “Women’s Budget Statement” including measures designed to support women leaving violent relationships. More than $1.1bn is allocated to women’s  safety services.

An  extra $2.3bn   is  set  aside  for mental  health.

Frydenberg unveiled $A589 billion in spending measures for the fiscal year ending June 2022.

Budget papers showed the deficit is forecast to remain close to $A100 billion in the next two fiscal years. Large deficits are forecast every year until June 2025, the limit of the budget papers’ projections, with the debt load rising during that time to reach almost A$1 trillion.

Federal  PM  Scott  Morrison  the  morning  after  crowns  it  all:

“We  have  done  extraordinarily well. Now we  are in the recovery phase”.

With  the unspoken: “Re-elect us  for more of the same”.

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