Swan unveils $48b deficit
, On Friday 30 September 2011, 12:18 EST
Wayne Swan says the Government is "determined" to deliver a budget surplus next financial year despite taking a $130 billion hit from the global financial crisis.The Federal Treasurer has revealed a deficit of nearly $48 billion for the 2010-11 financial year.
Final budget outcome figures from last financial year released today show tax receipts came in $1.7 billion below the prediction of this year's budget, which will make the forecast surplus hard to achieve.
The Government also blames the flooding and cyclone natural disasters early this year for pruning GDP growth by 0.75 per cent.
Mr Swan warned the current volatility in global markets will "weigh heavily" on budget revenues adding to the pressures of the global financial crisis.
"We'll have softer revenues going forward as a consequence of the global instability," he told journalists in Canberra.
"All of that will make it more difficult to reach surplus in 2012-13 but we are absolutely determined to do that." Documents released by Treasury today say despite weakness in company tax revenue, the budget is expected to show a surplus in 2012-13 in line with this year's budget prediction.
In May, the Government forecast a budget surplus of $3.5 billion for 2012/13 after four consecutive deficits. Tax from individuals actually rose, however, driven by stronger-than-expected receipts from capital gains taxes.
Net debt is $84.6 billion dollars or 6.1 per cent of GDP - far lower than most other advanced economies.
Mr Swan said the high Australian dollar is hitting the nation's economy but despite the pressures, Australia's budget position "remains amongst the strongest in the developed world".
"These figures demonstrate that the budget is in good shape particularly with low debt and that is one of the reasons Australians can be so confident that our economic fundamentals are strong," he said.
He said it is too early to forecast what Australia will do if the world economy tanks.
"We will deal with the cards when they're dealt.
These events have got some way to play out," he said.
"We have shown in the past that if conditions change dramatically we have the ability, capacity and the proven record to deal with those circumstances." And Mr Swan played down the importance of next week's tax forum between the Government, unions and business, saying no hard decisions on tax policy will be made.
"We're going to have a yarn with a couple of hundred people about tax.
That's a good thing.
It's a healthy thing," he said.
"But a substantial reform to the tax system is not something that is made in one or two days of discussion.
"What they are made in is pretty healthy discussion and debate, then considered government policy over time - and that's how we are going to proceed." Acting shadow treasurer Andrew Robb has accused Mr Swan of trying to hide the figures from the public by releasing them in the run-up to the grand finals weekend.
"If I was Wayne Swan I would be deeply embarrassed and I would try to bury these numbers in the midst of the grand finals," Mr Robb told reporters in Melbourne.
"These are the two worst consecutive budget deficits in the nation's history.
"We've got a situation where this government has never delivered a surplus, and I don't think it will ever deliver a surplus." Mr Robb warned that Australia would have a "a real problem" and could face "endemic budget deficits" if commodity prices fall.
He said Australia's debt would take many years to pay off "whoever is in government".
164 comments
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0 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentRoy Report Abuse"How Australia Compares." The true perspective with the Howard surplus myth. Government debt became public debt.
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In 1996 the Liberal opposition was in no doubt that the current account deficit was Labor’s fault. Part of its campaign was to drive a “debt truck” around with big billboards highlighting that Australia owed $93 billion dollars. By the time of Howard’s defeat in 2007 that figure had grown to $544 billion. Similarly, at first the Howard government thought that rising home prices was good news: “I haven’t found anybody stopping me in the streets, shaking their fists and saying John, I’m angry that the value of my house has gone up,” said Howard during the first years of the housing boom, a tone that would change later as housing affordability became a vexed political issue. - 0 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 1 users disliked this commentRobert Report Abuse
Now that Wayne Swan has delivered his fourth consecutive billion dollar deficit since becoming the worlds best finance minister what's going to happen when the global economies turn nasty again and we have GFC mark 11. This time around their is no budget surplus to start with just a 46 billion dollar debt plus he says about 85 billion in net debt. Even with a supposed resources boom they still won't be able to deliver a surplus of any kind.
Reply - 1 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentBeady Eyed Big Eared Brib ... Report Abuse
Swannie has us on track to get the budget back to surplus..even though there are disasters around the world he still has the foresight and macro economical management to see us through any crisis..no wonder he is treasurer of the universe..Well done mate
Replies (1) - 1 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentBeady Eyed Big Eared Brib ... Report Abuse
Swannie has us on track to get the budget back to deficit..even though there are disasters around the world he still has the foresight and macro economical management to see us through any crisis..no wonder he is treasurer of the universe..Well done mate
Replies (1) - 0 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 0 users disliked this commentCosmo Report Abuse
It looks like the Labor administration is putting all their hopes on raising money through the carbon tax to create a picture of them being financially credible.
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My God, realistically a person just has to look at NZ and the cost of living over there and the terrible employment situation to see where we're heading, there is little truth in the mining jobs, or the chance of anyone over forty five getting a job, regardless of the attention one person receives to play out a story. .
Fair enough. there are only a few million NZ but the Bureaucratic overheads are mounting up everywhere and nothing is done to rein in the costs, I'm not talking about the cops and fireies and whatever but the double handling, unnecessary red tape, over regulation and over governed aspects of today's world.
We don't need any more Maternal and Paternal Pedagogic policies on how to wipe our bum, how to climb a ladder, when to drink, smoke, gamble, or generally think.
We have more than enough taxes, rules on animals, the environment, motor vehicles, how to behave already, the experts have been in charge for many years with their political correctness on the kids shows, the childminding, the alcohol and drug problems and it's all getting worse in spite of the propaganda, when is it going to sink in that we pay a fortune to be told that the only thing that can be done is to tax us more, maybe if those getting paid a great deal of money became more accountable and responsible things would change.
When you pay five hundred bucks for a fifteen minute consultation with a specialist something is definity out of whack. - 0 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 1 users disliked this commentRoy Report Abuse
It's hard to ignore Andrew Robb, he may be a bizarre-looking, rather unstable gnome-like character but he is quite capable of explaining to Joe Hockey in simple language where we are heading economically in the medium term, I believe that he even provides notes occasionally for Tony when he has a big one on.
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The Coalition for all their bravado would have to be secretly grateful that for at least at this juncture they have Wayne Swan guiding Australia through the tough times, just as we all are.
Thank you Wayne. :) - 1 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 1 users disliked this commentA Yahoo!7 User Report Abuse
So the world's greatest goose is blaming global instability for his inability to meet budget surplus promises. Guess what Wayne, when you promised a surplus it was obvious that a second economic downturn was coming. You were just too dumb to see it.
Reply - 0 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 1 users disliked this commentlily Report Abuse
Ron it is the sinking Swan along with juliar
Reply - 1 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 1 users disliked this commentRon Report Abuse
Is this the ugly duckling or the dying swan?
Reply - 1 users liked this comment Please sign in to rate this comment up. Please sign in to rate this comment down. 1 users disliked this commentA Yahoo!7 User Report Abuse
why is swan talking of natural disasters while we are all paying
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levi for same. please someone help and get rid of this mob
sick and tired of their stunts.
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