Factbox: budget basics

28 Apr 2010, 10:03 am   -   Source: SBS - Shalailah Medhora
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The federal budget will be delivered to parliament on May 12 (SBS)

The federal budget will be delivered to parliament on May 12 (SBS)

All the basic information you need to get a grasp of the federal budget.

Q: What is the Commonwealth budget?
A: The budget an announcement of how the federal government will spend it revenue in the upcoming financial year and beyond. It sets out the government's main social and political priorities, and includes projected expenditure and income for the next fiscal period.

Q: Where does the government gets it money?
A: The vast majority of the government's revenue comes from taxation, but it also receives funds from dividends, interest and sales of goods and services.

Q: What areas receive the most funding?
A: The government consistantly spends the most of social security, healthcare, education and defence.

Q: What is a budget surplus?
A: A surplus is when the government forecasts spending will not exceed its revenue in the upcoming financial year. The remainder of the funds are often used to pay off foreign debt, or are allocated if and when there is national or international emergency.

Q: What is a budget deficit?
A: A deficit is when government spending exceeds revenue received from taxation and other revenue. Governments may go into deficit during times of financial hardship in order to kickstart the economy.

Q: Does the government have final control of how the budget is allocated?
A: No. The budget must be passed by parliament. If parliament fails to pass the budget, it becomes a trigger for a double dissolution election.

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