Chalmers acknowledges deficit approach to tough times

The Federal Government has confirmed the Budget is moving into deficit but claims it is less than forecast and almost half what it inherited from the former LNP Coalition Government.

“The Government has delivered the biggest Budget turnaround in a Parliamentary term – improving the Budget by $207 billion – while delivering responsible cost of living relief to millions of Australians to ease pressures on households,” Treasurer Jim Chalmers said.

“We’ve turned two big Liberal deficits into two Labor surpluses and the deficit in our third year, of $27.6 billion, is almost half of what we inherited from the Coalition.”

“This Budget improves the bottom line by $1.6 billion over the forward estimates compared to MYEFO, and the deficit in 2025–26 is forecast to be $42.1 billion – lower than MYEFO and lower than what we inherited,” the Treasurer said.

Chalmers acknowledged heightened uncertainty in the global economy including from escalating trade tensions, a slowdown in China and the ongoing war in Europe and said that Australia had not been immune from the fall-out.

“But we are one of the placed economies to navigate the challenges,” he said.

“The world has thrown a lot of challenges at Australia over the past few years,” Chalmers said.  “It’s clear the rules that underpinned global economic engagement for more than 40 years are being rewritten. Our economic plan is all about ensuring Australians are beneficiaries, not victims, of this churn and change.

Budget commitments to build a stronger economy include:

• Investing more than $3 billion to support local green metals production, to help build a Future Made in Australia.
• Unlocking an expected $6 billion of additional private investment in renewable energy and low emissions technologies through a $2 billion expansion of the Clean Energy Finance Corporation.
• Support for small businesses, including extending energy bill relief for around one million small businesses and cracking down on unfair trading practices.
• $7.1 million over two years to strengthen enforcement of the Franchising Code.
• $165 million in tax relief for hospitality venues, brewers, distillers and wine producers including a two-year freeze on the indexation on draught beer excise.
• Supporting local businesses including $20 million to encourage consumers to buy Australian made products through the Buy Australian campaign.
• $17.1 billion over 10 years for road and rail projects to improve the productivity and resilience, liveability and sustainability of our cities, regions and communities.
• Up to $3 billion to complete the National Broadband Network to deliver access to faster and more reliable broadband services to a further 622,000 premises nationwide.