The Treasurer, Wayne Swan, has released the Mid-Year Economic and Fiscal Outlook (MYEFO). It forecasts an increased budget deficit for 2011-12 and a small surplus in 2012-13.
Key points from MYEFO:
- 2011-12 budget deficit has increased to $37 billion from the budget forecast of $23 billion.
- The budget surplus for 2012-13 has been downgraded from $3.5 billion to $1.5 billion.
- Deteriorating economic conditions have cut $20 billion from revenue over the four-year forward estimates.
- Additional savings of $11.5 billion over four years have been announced.
- The baby bonus has been cut from $5400 to $5000.
- A 2.5% efficiency dividend, on top of an existing 1.5%, will produce savings across government departments of $1.5 billion.
- The federal and High Courts, and cultural institutions such as the Australian War Memorial have been been protected from cuts.
- There will be a crackdown on living away from home tax concessions, an increase in the eligibility age for the dependent spouse offset.
- Gross Domestic Product is now forecast to grow by 3.25%, down from 4.25%.
- Unemployment is expected to be 5.5% in 2011-12 and 2012-13, slightly up on budget forecasts.