Australia still on track fo surplus: Swan

3 Dec 2008, 12:18 pm   -   Source: AAP
0 Comments
Share This
+ Comment
0

Treasurer Wayne Swan says Australia is still on track for a modest budget surplus next financial year, but will not rule out a deficit if it emerges as the "responsible" option.

RELATED

Treasurer Wayne Swan says Australia is still on track for a modest budget surplus next financial year, but will not rule out a deficit if it emerges as the "responsible" option.

Swan says quarterly national account figures due out today will prompt debate about the nation's economic standing.

But he told Fairfax radio the government and the Reserve Bank are working in tandem to strengthen the economy in the face of the global slowdown and if Australia does have to go into the red it should only be temporary.

Tuesday's announcement of a fourth successive Reserve Bank rate cut helped government moves to strengthen the Australian economy, he said.

"We are moving swiftly to strengthen the Australian economy. That's why we put the strategy in place and we are now working in tandem ... with the Reserve Bank," he said.

Mr Swan said the release of quarterly national account figures in Canberra on Wednesday would prompt debate about the nation's economic standing.
   
"Later today we'll have some growth numbers out there and there will be a debate about what they all mean, but what the Australian government is doing and has been alert to ... is that there has been international slowdown," he said.

"The good thing is you've now got monetary policy, you've got something like a three per cent cut on interest rate cuts over four Reserve Bank board meetings.

"That cut in monetary policy is now working in tandem with strengthening of fiscal stimulus in the economy. We've also got the exchange rate effect happening out there. We've also got lower petrol prices as well.
   
"All of those things will stimulate activity in the face of this profound slowdown in international activity."

Mr Swan would not commit to a budget surplus next year but said current projections should keep the government out of the red.

"We're currently projecting modest growth and modest surpluses," he said.

"If a temporary deficit was required to invest in the economy and to strengthen growth then that would be the responsible thing to do. But what we're doing through the economic security strategy and through the easing of monetary policy is everything to strengthen the economy and to take the rough edges off what's flowing through from the rest of the world."
   
Mr Swan added that if Australia should incur a deficit, the government would want it "to occur for the shortest possible period".
 

  • Follow us: 
  • Follow us on Facebook
  • Follow us on Twitter
  • Follow us on Youtube

Join the Discussion

Name
City / Suburb E.g. Artarmon, Sydney
Title
Comment
You have characters remaining.
Validation
What's this?
This is a captcha-picture. It is used to prevent mass-access by robots.
All submitted comments become the property of SBS. They are moderated, so we reserve the right to edit comments and remove HTML tags. Not all submitted comments will be published. Publication does not mean we endorse the opinions expressed. Please read our terms and conditions for more information.