Treasurer Joe Hockey will have to slash $300bn out of government spending in the next 10 years if he is to meet his target surplus.
An analysis by the Sydney Morning Herald of the charts Hockey provided at his pre-budget presentation on Wednesday showed older Australians in particular will be hit hard if the Abbott Government remains committed to achieving a 1 per cent GDP surplus by 2023-24.
From the SMH today:
…the government expects Commonwealth receipts from all sources including taxes, fees for services, and dividends such as could accrue from the Reserve Bank, will climb from the current rate of just under 23 per cent of GDP to more than 25 per cent within the decade.
At the same time however, Commonwealth spending, which currently exceeds income, will be dramatically wound back mainly through tightening welfare expenditure.
That will take outlays from a current rate of 25.9 per cent of GDP – or $409 billion out of a total nominal GDP of $1,577 billion in 2013-14 – to just above 24 per cent in 2023-24.
Spending cuts will start slowly before climbing to $47 billion, $56 billion and $64 billion respectively in the three final years to 2023-24.
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