Australia Sees Higher Debt, Deficits Even as Spending Curbed
- Spending growth limited to annual average of 0.3% over 4 years
- Budget forecasts a resumption of real wages growth in 2024
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Australia faces mounting debt and deficits in the years ahead even as Treasurer Jim Chalmers scrimped and saved in his first budget to hold down spending and avoid further fueling inflation.
The budget deficit will widen from 1.5% of gross domestic product this fiscal year to 2% of GDP in 2024-25, driven by higher spending on the nation’s disability insurance program and rising borrowing costs, Treasury figures showed. That comes at a time when high commodity prices and an ultra-tight labor market are bringing windfall revenue to government coffers.