Stephen Anthony, chief economist at Industry Super Australia, has penned an article in The AFR today explaining why the Turnbull Government’s planned return to surplus is deluded and we should expect rising Budget deficits over the next decade:
Recall that if the 2017-18 budget outlook was “adjusted” slightly to reflect the evident slowdown in household and small business incomes and historic payments growth, the projected cash surplus in 2020-21 was more like a deficit in the order of $20-$30 billion. Much of the upswing in the domestic economy in 2017 has been driven by publicly funded employment (disability support, education and health) and infrastructure investment that will certainly not reduce budget pressures.
