The Coalition has secured the first budget surplus projection since John Howard was prime minister.
The government released the Mid-Year Economic and Fiscal Outlook (MYEFO) on Monday, unveiling the best bottom line the country has seen since 2007-08. Treasurer Josh Frydenberg revealed the budget is expected to reach a surplus of $4.1 billion in 2019-20, rising to an enormous $30 billion over the next four years.
Frydenberg, along with Finance Minister Mathias Cormann, also announced that the deficit has been slashed from $14.5 billion when the budget was announced back in May to $5.2 billion in 2018-19.
“Returning to surplus is no accident,” Frydenberg said on Monday. “We’ve spent five years cleaning up Labor’s mess.”
The mid-year budget papers also showed a sum of $10.8 billion that has been earmarked by the government for “decisions taken but not yet announced”, which is said to include more than $9 billion which could be used for further tax cuts, along with cash to boost Prime Minister Scott Morrison’s war chest in the run-up to May’s federal election.
“The Australian economy is strong, it’s growing and the budget is coming back to surplus,” Frydenberg told reporters on Monday. “Our first job is to deliver our surplus. Our second job is to pay back Labor’s debt.
“We have cut taxes and created more than one million new jobs and we have provided the essential services that the public needs with record spending on health and education and infrastructure. You can only do this with a strong economy and we can deliver a strong economy without increasing taxes.”
Shadow Treasurer Chris Bowen was quick to dispute the government’s claims though saying the report actually shows that investment and economic growth have fallen.
“Actually it shows growth down, investment down, wages growth down and consumption growth down,” he tweeted. “The only thing that is up is terms of trade which is a sign of the strength of the global economy, not Australia’s.”
The MYEFO also outlined a $553 million boost to aged care funding, following an announcement on Sunday by Aged Care Minister Ken Wyatt, alongside the prime minister and Minister for Health Greg Hunt.
The additional funding includes the release of 10,000 high-level home care packages which will be available in early 2019 and split evenly across level three and level four care packages.