2017 Budget — Fiscal strategy and outlook
The 2017-18 Budget continues the Government’s economic plan to boost growth to support more and better paying jobs and create more opportunities for small businesses. The Government is also taking action to tackle cost pressures facing households and businesses and to guarantee the provision of key government services that Australians rely on.
The 2017-18 Budget charts a fair and responsible pathway back to balance. The underlying cash balance is expected to improve across each year of the forward estimates. The underlying cash balance is expected to improve from a deficit of $29.4 billion (1.6 per cent of GDP) in 2017-18 to a projected surplus of $7.4 billion (0.4 per cent of GDP) in 2020-21. The net operating balance, which focuses on recurrent expenses and revenue, is presented alongside the underlying cash balance to emphasise the share of Government expenses that relate to operating activities, such as ongoing health, welfare and education programs.
The net operating balance is also expected to improve from a deficit of $19.8 billion (1.1 per cent of GDP) in 2017-18, returning to projected surpluses of $7.6 billion (0.4 per cent of GDP) in 2019-20 and $17.5 billion (0.8 per cent of GDP) in 2020-21
The 2017-18 Budget forecasts for tax receipts have been revised up by $6.4 billion over the four years to 2019-20, as a result of policy decisions including increasing the Medicare levy, introducing a major bank levy, improving the integrity of GST on property transactions and introducing a Skilling Australians Fund levy.
Since the 2016 Pre-election Economic and Fiscal Outlook (PEFO), the Government has made significant progress in implementing unlegislated budget repair measures. The total impact over the forward estimates of budget repair measures implemented since the 2016 PEFO is more than $25 billion. Since the 2013 election, the Government has implemented more than $100 billion in budget repair measures.
While the Government’s preference for achieving a path to balance was predominantly through expenditure restraint, the Parliament has been unwilling to pass all the legislation required. Given the continuing rejection by the Parliament of significant government savings measures from the 2014-15 Budget and later budget updates, they have been reversed. The impact of these reversals on the underlying cash balance is more than offset by budget repair and other policy measures included in this Budget.
The Government’s commitment to returning the budget to balance remains. The average annual pace of fiscal consolidation across the forward estimates is a responsible 0.6 per cent of GDP, slightly higher than the average pace of consolidation in the 2016-17 MYEFO.
Over the medium term, the underlying cash balance is projected to peak at 0.5 per cent of GDP in 2024-25, before moderating to 0.4 per cent of GDP by 2027-28.
Budget Briefing —
Stakeholders from across the dental industry are encouraged to attend the 2017 ADIA Australian Government Budget Briefing that will be held on 24 May 2017 in Sydney. It will be presented by Bill Evans, the Chief Economist at Westpac. [Register Today]
Member Engagement —
ADIA provides leadership, strategy, advocacy and support. Our members set our agenda, fund our activities and directly benefit from the results. With respect to the Association's work to ensure that the initiatives within the 2017 Australian Government budget support the dental industry, the team in the ADIA national office receive advice and guidance from members serving on the ADIA-BAC Business Affairs Committee.
Further Information —
To keep up to date with how ADIA is working to ensure that the Australian Government budget supports the dental industry, subscribe to the Twitter feed @AusDental or follow us on Facebook at www.facebook.com/dental.industry. Alternatively, you can contact the Association via email at firstname.lastname@example.org or by telephone on 1300 943 094.
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