A modestly smaller than previously expected budget bottom line in 2009/10 means the federal government is on course for a surplus in 2012/13, Treasurer Wayne Swan says.
Mr Swan and new Finance Minister Penny Wong today released the final budget outcome for the past financial year, which showed a $54.8 billion deficit, or 4.2 per cent of gross domestic product (GDP).
The result was a $2.3 billion improvement on the $57.1 billion deficit estimated at the time of the May budget.
Mr Swan and Senator Wong said the budget outcome was in ‘‘far better condition’’ than other comparable nations.
‘‘(It puts) us in a strong position to deliver a surplus in 2012/13,’’ they said in a joint statement.
Earlier surplus?
But Mr Swan refused to speculate about returning the budget back to surplus even earlier on the back of surging commodity prices and the end of a long-running drought.
‘‘We have put our forecast out there, we stick with our forecasts,’’ he later told reporters in Canberra.
Mr Swan said recent economic commentary had suggested the government was being too optimistic about forecasts for commodity prices.
‘‘We don’t count on commodity prices staying high forever,’’ he said, noting that the government’s commodities forecaster had predicted a rise in iron ore prices.
The Australian Bureau of Agricultural and Resource Economics (ABARE) said in its September quarter report on Tuesday that commodity export earnings are forecast to reach a record high $215 billion in 2010/11, on the back of higher prices for crops, iron ore and coal.
Mr Swan noted the irony of questions about an earlier return to budget surplus, given that many commentators had questioned the government’s ability to achieve a surplus in 2012/13.
‘‘It’s a new paradigm,’’ Senator Wong quipped during the press conference with Mr Swan.
The government