O75 Public Administration

Almost back in black as $126bn sliced off debt

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Original article by Adam Creighton
The Australian – Page: 1 & 6 : 9-May-18

The Federal Government has forecast a modest Budget surplus of $A2.2bn in 2019-20. The Budget had previously been expected to return to surplus in 2020-21, compared with a likely deficit of $A18.2bn in 2017-18. Meanwhile, Australia’s gross debt is now slated to be $A558bn in 2027-28, compared with expectations of $A684bn in the mid-year Budget update in December. Net debt is expected to fall to 3.8 per cent of GDP by 2029, down from a peak of 18.6 per cent in 2017-18.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY, STANDARD AND POOR’S FINANCIAL SERVICES LLC

ScoMo’s in the money, so the shout’s on him

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Original article by Phillip Coorey
The Australian Financial Review – Page: B1 & B2 : 9-May-18

The Federal Government’s May 2018 Budget is underpinned by plans to progressively phase in personal income tax cuts over seven years. The threshold for the 37 per cent marginal tax rate will be increased from $A87,000 to $A90,000 on 1 July. This will in turn be increased to $120,000 from 1 July 2022, with all income below this threshold to be taxed at 32.5 per cent. This tax rate will then apply to incomes between $A41,000 and $A200,000 from 1 July 2024. The income tax cuts are forecast to cost $13.4bn in the first four years and $A140bn in total over 10 years.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY, STANDARD AND POOR’S FINANCIAL SERVICES LLC

Corporate take will hit $100b in 2021-22

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Original article by Ben Potter
The Australian Financial Review – Page: B6 : 9-May-18

The May 2018 Budget papers show that company tax revenue is forecast to be $A100.7bn in 2021-22, compared with $A83.5bn in 2017-18. The rally in commodity prices has bolstered company tax revenue, although economists caution that this may not be sustainable. In addition, the corporate tax take could fall in future years if the government passes legislation for an across-the-board reduction in the company tax rate. The government expects companies to increase capital investment as a result of the tax cuts, but factors such as a recession could dampen investment intentions.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, DELOITTE ACCESS ECONOMICS PTY LTD

ANZ-Roy Morgan Consumer Confidence remains elevated at 119.6 pre-Budget

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Original article by Roy Morgan
Market Research Update – Page: Online : 9-May-18

ANZ-Roy Morgan Australian Consumer Confidence rose 0.3% to 119.6 in the week ended 5 May, to its highest level in 13 weeks. The details were mixed, with a solid rise in "time to buy a household item" offset by falls in three of the remaining sub-indices. Households’ views toward current financial conditions eased 0.8%, following a 1.7% rise previously. Views towards future conditions declined 3.2%, after three straight weekly gains. Both sub-indices remain above their long term averages. Consumers were less optimistic about year-ahead economic conditions, with sentiment dipping 0.9%, ending the streak of five consecutive weekly gains. Meanwhile, views towards future conditions rose 1.2%, entirely reversing the previous week’s 0.7% decline.

CORPORATES
ROY MORGAN LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Budget to fail debt test

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Original article by Bevan Shields
The Sydney Morning Herald – Page: 1 : 8-May-18

Former federal treasurer Peter Costello says the Coalition government has not done enough to reduce government debt. Costello claims it would require the Budget to be in surplus for 10 years in a row for it to be paid off, and he has urged the government to cut spending by at least $A18 billion to address the debt issue. Costello supports Treasurer Scott Morrison’s goal of setting the government’s overall tax collection rate at 23.9 per cent of GDP, but says it should apply the same target to government spending.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. FUTURE FUND MANAGEMENT AGENCY, LIBERAL PARTY OF AUSTRALIA, AUSTRALIAN LABOR PARTY

Hold-out senators set test for tax bill

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Original article by Ben Packham
The Australian – Page: 4 : 8-May-18

Centre Alliance senator Rex ­Patrick says the contents of the May 2018 Budget may determine whether himself and colleague Stirling Griff hold further talks with the Federal Government regarding its corporate tax cuts package. Factors such as a clear strategy for a return to surplus and assurances that spending on social services will not be reduced in future years to finance the tax cuts are among Centre Alliance’s priorities in the Budget. The company tax package requires an additional two votes in the Senate.

CORPORATES
CENTRE ALLIANCE, NICK XENOPHON TEAM, ONE NATION PARTY, AUSTRALIAN LABOR PARTY, HIGH COURT OF AUSTRALIA

Seniors big winners in budget lift

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Original article by Simon Benson, Rick Morton, David Uren
The Australian – Page: 1 & 6 : 8-May-18

The Federal Government’s May 2018 Budget will feature a range of measures targeted at older Australians. Amongst other things, the government is expected to provide funding for an additional 20,000 people to receive in-home care, while a scheme that enables retirees to remain in the workforce without affecting their pension entitlements is tipped to be expanded. Meanwhile, people on low and middle incomes are expected to receive a tax cut of about $A10 a week.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY, AUSTRALIAN GREENS, AUSTRALIA. DEPT OF SOCIAL SERVICES

Morrison locks in tax limits

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Original article by Simon Benson
The Australian – Page: 1 & 4 : 7-May-18

The Federal Government’s May 2018 Budget is expected to restrict tax cuts to people with taxable income of less than $A87,000. The tax cuts are likely to be delivered via the low-income tax offset, while Treasurer Scott Morrison has indicated that people on higher incomes are likely to receive tax cuts by 2024. Morrison stresses that the tax cuts in the 2018 Budget will be real and affordable. Meanwhile, the Government will use the Budget to formally adopt a tax-to-GDP ratio of 23.9 per cent, while it is tipped to forecast a modest surplus in 2019-20, which is one year ahead of schedule.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. DEPT OF FINANCE, AUSTRALIAN LABOR PARTY

Business Confidence strengthens to 118.6 before Federal Budget

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Original article by Roy Morgan
Market Research Update – Page: Online : 7-May-18

In Australia, Business Confidence rose 3.2pts (+2.8%) to 118.6 in April 2018, according to the latest Roy Morgan Business Single Source survey. Business Confidence is now 2pts higher than a year ago, continuing its best start to a year since 2014. Business Confidence traditionally increases in April in the run-up to a Federal Budget, and it has now increased in five out of eight years in April. However, recent history shows that expectations are not generally met and Business Confidence has declined in six out of seven years in May. Now a record high 52.3% (up 13.6ppts) of businesses say their business is "better off" financially than this time last year, and a record high 59.4% (up 8.2ppts) say the business will be "better off" financially this time next year. Meanwhile, 52.6% (up 0.3ppts) of businesses expect "good times" for the Australian economy over the next year, and 51.6% (up 2.6ppts) expect "good times" for the economy over the next five years.

CORPORATES
ROY MORGAN LIMITED

Part-time employment hits record high and 1.35m now under-employed

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Original article by Roy Morgan
Market Research Update – Page: Online : 7-May-18

A Roy Morgan survey shows that 11,962,000 Australians were employed in April 2018 – an increase of 46,000 over the last year. The increase was driven by part-time employment, which rose 154,000 to a record 4,454,000; full-time employment was down 108,000 to 7,508,000. The figures also show that 1,196,000 million Australians were unemployed (9.1% of the workforce) in April, a decrease of 88,000 (down 0.7%) on a year ago. In addition, 1,349,000 Australians (10.2% of the workforce) are now under-employed, working part-time and looking for more work, a rise of 259,000 in a year (up 1.9%). Roy Morgan’s real unemployment figure of 9.1% for April is substantially higher than the current ABS estimate for March of 5.5%. Roy Morgan CEO Michele Levine says the continuing strength in part-time employment is causing under-employment levels to spike from already high levels, and it is imperative that the May 2018 Federal Budget seriously considers the continuing high levels of unemployment and under-employment.

CORPORATES
ROY MORGAN LIMITED, AUSTRALIAN BUREAU OF STATISTICS