The Final Budget Outcome for 2009-10 shows Australia's budget is in far better condition than the budgets of other comparable nations, putting us in a strong position to deliver a surplus in 2012-13.
The outcome for 2009-10 shows a small fiscal improvement from the estimate at the May Budget, but also highlights the fiscal consequences of the global recession.
The Budget felt the full force of the global financial crisis in 2009-10, with revenues downgraded by almost $50 billion from its pre-crisis level, a loss of almost one-sixth of forecast tax receipts.
While Australia avoided recession and the large-scale job losses and business closures that occurred elsewhere in the world, the sharp falls in global commodity prices and business profits that accompanied the global recession had a big impact on revenues and the fiscal position.
The Australian Government general government sector recorded an underlying cash deficit of $54.8 billion (4.2 per cent of GDP) for 2009-10. This is an improvement of $2.3 billion compared to the estimate at the time of the 2010-11 Budget.
Total cash payments were $2.6 billion lower than estimated at Budget, with cash receipts (excluding Future Fund earnings) also lower than expected by $249 million. Total taxation receipts were $14 million higher than the estimate in the Budget.
Lower spending reflected in part, underspends across a range of demand-driven programs, the finalisation of some agreements with the States and Territories and reduced interest costs on borrowing.
Australian Government net debt was $42.3 billion or 3.3 per cent of GDP in 2009-10. This is dramatically lower than the net debt position for the major advanced economies, which averaged a collective 70 per cent of GDP in 2009.
The Government remains committed to its strict spending limits and fiscal strategy, which will see us return the budget to surplus in 2012-13, comfortably ahead of any major advanced economy.
An electronic version of the Final Budget Outcome 2009-10 can be found on the 2009-10 Budget website.
24 September 2010