Industry Super Australia has welcomed news that the budget is on track to surplus but warned against implementing tax cuts on the back of economic gains that are yet to be realised.
“The 2017-18 MYEFO charts a more positive outlook than was expected six months ago,” said Industry Super chief economist Stephen Anthony.
“The overall path back to surplus relies on ‘Made in China’ strong terms of trade and employee compensation that could be realised over the next two to three years”.
“The Government would be advised to show some caution in offering up permanent income tax cuts against parameters which may not prove as strong as currently forecast,” he said.
Mid-Year Economic and Fiscal Outlook (MYEFO) shows:
- The budget is on track to return to balance in 2020-21;
- An underlying cash deficit of $23.6 billion is expected in 2017-18, an improvement of $5.8 billion compared to the deficit reported at the 2017-18 Budget;
- The projected surplus of $10.2 billion in 2020-21 is an improvement of $2.7 billion compared to the May Budget estimate;
- Since the 2017-18 Budget, the underlying cash balance has improved by $9.3 billion over the forward estimates;
- The net operating balance is expected to improve from a deficit of $18.2 billion in 2017-18 to a surplus of $6.8 billion in 2019-20, and a surplus of $20.9 billion in 2020-21.
Chief economist Stephen Anthony is available for interview. Media contact Phil Davey 0414 867 188.
Industry Super Australia provides policy, research and advocacy on behalf of 16 not-for-profit Industry SuperFunds who are the custodians of the retirement savings of six million Australians.