Home Australia Federal Budget 2024: Massive deficits ahead after Anthony Albanese’s cash splash as Treasury predicts a staggering $122billion dive into the red over the next four years

Federal Budget 2024: Massive deficits ahead after Anthony Albanese’s cash splash as Treasury predicts a staggering $122billion dive into the red over the next four years

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Treasurer Jim Chalmers delivered the 2024-25 federal budget Tuesday night

The Albanian government has announced a surplus of $9.3 billion in the federal budget, but the deficits mean the figure will fall by $122 billion over the next four years.

Jim Chalmers unveiled his third budget on Tuesday night, marking Labour’s second consecutive surplus in almost two decades.

However, with inevitable spending pressures from the National Disability Insurance Scheme, the aged care sector and cost of living relief measures, the balance will fall sharply towards a deficit until 2028.

The surplus will shift into the 2024-25 budget, with finances in the red by $28.3 billion and rising to $42.8 billion in 2025-26.

Deficits will coincide with a fall in iron ore Prices, which fell to just $60 a ton (below levels above $100), as thermal coal prices plummeted to $70 a ton.

Treasurer Jim Chalmers delivered the 2024-25 federal budget Tuesday night

A drop in key raw material prices means the government has less revenue from corporate taxes, and every $10 per tonne drop in iron ore prices will reduce gross domestic product by $5.3 billion in 2024. -25.

That figure will rise to around $11 billion in 2027-28.

The NDIS is the government’s third-largest expenditure, Budget documents show, and will cost about $48 billion next financial year and $60 billion by 2027-28.

Over the four years of forward estimates, it will cost $218 billion, with average annual increases of 9.2 percent.

According to federal budget documents for 2024-25, payments to the plan, which supports 600,000 people, are expected to increase by $15.9 billion between 2023-24 and 2027-28.

If parliament approves a reform of the plan, it will reduce that figure by $14.4 billion over the next four years, bringing the figure down to $1.5 billion.

A major expense for the government is the National Disability Insurance Scheme (file image of nurses in Sydney)

A major expense for the government is the National Disability Insurance Scheme (file image of nurses in Sydney)

BUDGET DEFICIT PROJECTIONS

2023-24: $9.3 billion surplus

2024-25: $28.3 billion deficit

2025-26: $42.8 billion deficit

2026-27: $26 billion deficit

2027-28: $24.3 billion deficit

NDIS Minister Bill Shorten said that some new measures funded in the Budget, including anti-fraud support, would “ensure every dollar of funding goes to those who need it most”.

Cost-of-living relief measures include a $300 energy bill credit for each household, increased rental assistance and waiving $3 billion in student debt indexation.

The new relief comes on top of the Stage Three tax reduction changes announced in January. The average household will receive an annual tax cut of $1,888, or $36 per week.

On Tuesday night, Dr Chalmers presented his third consecutive budget as “a budget for the here and now, and a budget for decades to come”.

“It is a responsible budget that helps people who are under pressure today and invests in the promise and potential of a more prosperous future that we can build together,” he told Parliament.

“The comprehensive cost of living plan included in this Budget delivers a tax cut for all taxpayers and provides new energy bill relief for individuals and small businesses.”

Federal Treasurer Jim Chalmers kisses his wife Laura after delivering the 2024-25 budget

Federal Treasurer Jim Chalmers kisses his wife Laura after delivering the 2024-25 budget

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