Australian Economy – Too Tricky, That “Surplus”

Posted on Fri 12/23/2016 by

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Bolt New 01By Andrew Bolt ~

Are you  surprised?

The Australian Federal Coalition Government’s wafer-thin projected 2020-21 surplus, the linchpin of the nation’s AAA rating, is achieved entirely by a change in accounting for the Future Fund headed by Peter Costello — the man responsible for the last budget surplus in 2007-08.

AustralianEconomyThe projected budget surplus of about $1.1 billion will be achieved only because of a reclassification of about $4bn in Future Fund earnings in that year, not because of any improvement in under­lying budget performance.

An accounting change introduced in last year’s budget means the Future Fund profit will be included in the government’s accounts for the first time in 2020-21. The budget papers count on strong growth in ­Future Fund earnings, rising from $2.8bn this year to $3.9bn by 2019-20.

Deloitte Access Economics partner Chris Richardson said it appeared that much of the predicted improvement in the budget bottom line — from a $10bn deficit in 2019-20 to the small surplus in 2020-21 — would come from the change in treatment of Future Fund earnings…

“We need to be wary of the easy fix — the money that appears thanks to changed accounting treatment rather than genuine savings.”

Andrew Bolt writes for the Herald Sun, Daily Telegraph, and The Advertiser and runs Australia’s most-read political blog. On week nights he hosts The Bolt Report on Sky News at 7pm and his Macquarie Radio show at 8pm with Steve Price.

Read more excellent articles from Andrew Bolt’s Blog . http://blogs.news.com.au/heraldsun/andrewbolt/

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