The rivers of gold from high commodity prices and a strong job market have beefed up the budget. But Jim Chalmers says the rivers are starting to run dry.
Treasurer Jim Chalmers is dampening expectations of a revenue surprise delivering the government another record-breaking budget surplus, warning a softening economy and a fall in commodity prices are hitting the nation’s finances.
The stronger economy delivered $200 billion in extra revenue, spread across five years, to Chalmers’ first two budgets. It helped him deliver a surplus of $22.1 billion in 2022-23, the first surplus in 15 years and the largest in cash terms on record. “In fact, we are even looking at much less than the $69 billion we booked in the latest mid-year budget update.”Chalmers will note the jobs market has been one of the sources of the biggest upgrades to the budget. At the end of last year, 14.2 million Australians were in work, about 500,000 more than Treasury had forecast before the 2022 election.
Chalmers will say global uncertainty, persistent cost-of-living pressures and slowing growth meant a focus on restraint would remain central to the budget. The bank’s figures, collated from its network of credit and debit cards and home lending data, showed a 1.9 per cent drop in spending on household goods, a 1.6 per cent fall in transport, a 0.5 per cent slip in food and beverages and a 0.5 per decline in education.
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