GOVERNMENT SPENDING POLICY – AUSTRALIA

S&P loses patience, warns of state downgrades

roymorgansocial Leave a comment

Original article by Michael Read, Jonathan Shapiro
The Australian Financial Review – Page: 3 : 5-Feb-25

A report from S&P Global Ratings has concluded that the expenditure of Australia’s state and territory governments was $212bn higher between 2020 and 2023 than had been forecast in their 2019 budgets. This significantly offset the $146bn in revenue over the same four-year period. S&P forecasts that the combined debt of the states and territories will top $780bn by 2027, and the firm has warned they may face credit ratings downgrades unless action is taken to rein in spending.

CORPORATES
S&P GLOBAL RATINGS

ACCI warns of need for cap on spending

roymorgansocial Leave a comment

Original article by Sarah Ison
The Australian – Page: 6 : 30-Jan-25

The Australian Chamber of Commerce & Industry will call for federal government spending to be capped at 25 per cent of GDP. The ACCI’s pre-election Agenda for Business policy blueprint will also advocate tax reform, the abolition of stamp duty and changing the definition of a small business to 25 employees or less, compared with the current threshold of 15 employees. CEO Andrew McKellar will use a speech on Thursday to argue that rising government spending is pushing up interest rates and adversely affecting productivity. Data released in late 2024 shows that government spending has risen to a record high of almost 28 per cent of GDP.

CORPORATES
AUSTRALIAN CHAMBER OF COMMERCE AND INDUSTRY

Living standards stagnant until 2030: Deloitte

roymorgansocial Leave a comment

Original article by Michael Read
The Australian Financial Review – Page: 3 : 29-Jan-25

Deloitte Access Economics has forecast that state and federal government spending will reach a record 28 per cent of real GDP by the end of 2025. This compares with an average of 22 per cent in the decade prior to the COVID-19 pandemic. The firm has warned that despite rising government expenditure, Australians’ living standards will not recover to pre-pandemic levels until 2030. Meanwhile, Deloitte partner Stephen Smith expects that CPI data to be released today will show that inflation is moving sustainably towards the Reserve Bank’s target range of 2-3 per cent. However, he says factors such as a resilient labour market, elevated government spending and a falling Australian dollar are complicating the central bank’s decision on interest rates.

CORPORATES
DELOITTE ACCESS ECONOMICS PTY LTD, RESERVE BANK OF AUSTRALIA

Labor’s $1bn for Rinehart-backed rare earths

roymorgansocial Leave a comment

Original article by Ronald Mizen
The Australian Financial Review – Page: 5 : 15-Jan-25

The federal government’s National Reconstruction Fund is set to become a cornerstone investor in Arafura Rare Earths. The fund is set to acquire $200 million worth of unsecured convertible notes in the rare earths miner, which can be converted into shares at a fixed price and after a specified period of time. The government has previously provided some $840m worth of loans and grants to Arafura, whose biggest shareholder is Gina Rinehart’s Hancock Prospecting. Arafura’s assets include the Nolans rare earths project in the Northern Territory.

CORPORATES
ARAFURA RARE EARTHS LIMITED – ASX ARU, AUSTRALIA. NATIONAL RECONSTRUCTION FUND, HANCOCK PROSPECTING PTY LTD

High-fibre plan: Labor tips another $3b into NBN

roymorgansocial Leave a comment

Original article by Ronald Mizen, Paul Smith
The Australian Financial Review – Page: 4 : 14-Jan-25

The federal government has announced that it will invest a further $3 billion in the National Broadband Network, with the funding to give an extra 622,000 premises the option of full fibre access. With an additional injection of $800 million from NBN Co to be included, Labor expects it to result in over 94 per cent of premises on the fixed-line network having access to speeds of up to 1GB per second on fibre to the premises or hybrid fibre coaxial connections. The new $3 billion in funding will increase the government’s total investment in the NBN to $35 billion.

CORPORATES
AUSTRALIAN LABOR PARTY, NBN CO LIMITED

High-fibre plan: Labor tips another $3b into NBN

roymorgansocial Leave a comment

Original article by Ronald Mizen, Paul Smith
The Australian Financial Review – Page: 4 : 14-Jan-25

The federal government has announced that it will invest a further $3 billion in the National Broadband Network, with the funding to give an extra 622,000 premises the option of full fibre access. With an additional injection of $800 million from NBN Co to be included, Labor expects it to result in over 94 per cent of premises on the fixed-line network having access to speeds of up to 1GB per second on fibre to the premises or hybrid fibre coaxial connections. The new $3 billion in funding will increase the government’s total investment in the NBN to $35 billion.

CORPORATES
AUSTRALIAN LABOR PARTY, NBN CO LIMITED

Chalmers’ budget update locks in extra $25bn of unavoidable expenditure

roymorgansocial Leave a comment

Original article by Jack Quail, Geoff Chambers
The Australian – Page: 1 & 4 : 17-Dec-24

Treasurer Jim Chalmers says that although global economic volatility is weighing on the federal budget, Labor has delivered two surpluses and lower debt since taking office in May 2022. Meanwhile, the Mid-Year Economic and Fiscal Outlook on Wednesday will feature some $25.1bn worth of additional government spending; this will include $16.3bn for increased welfare payments, childcare subsidies and cost of living relief. The government describes this as ‘automatic spending increases’, while Finance Minister Katy Gallagher has flagged $8.8bn of ‘unavoidable spending’. Independent economic Chris Richardson refutes suggestions that some expenditure cannot be avoided.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. DEPT OF FINANCE

ABC to get extra $126m funding after election

roymorgansocial Leave a comment

Original article by Ronald Mizen
The Australian Financial Review – Page: 4 : 17-Dec-24

The federal government will boost funding for the ABC in its Mid-Year Economic and Fiscal Outlook statement. Communications Minister Michelle Rowland has advised that the public broadcaster will receive an additional $40.9m in 2026-27, $42.2m in the following financial year and $43m in 2028-29. Rowland has also indicated that the government will legislate five-year funding agreements for the ABC. The former Coalition government had significantly reduced the ABC’s funding.

CORPORATES
AUSTRALIAN BROADCASTING CORPORATION, AUSTRALIA. DEPT OF INFRASTRUCTURE, TRANSPORT, REGIONAL DEVELOPMENT, COMMUNICATIONS AND THE ARTS

Chalmers’ budget update locks in extra $25bn of unavoidable expenditure

roymorgansocial Leave a comment

Original article by Jack Quail, Geoff Chambers
The Australian – Page: 1 & 4 : 17-Dec-24

Treasurer Jim Chalmers says that although global economic volatility is weighing on the federal budget, Labor has delivered two surpluses and lower debt since taking office in May 2022. Meanwhile, the Mid-Year Economic and Fiscal Outlook on Wednesday will feature some $25.1bn worth of additional government spending; this will include $16.3bn for increased welfare payments, childcare subsidies and cost of living relief. The government describes this as ‘automatic spending increases’, while Finance Minister Katy Gallagher has flagged $8.8bn of ‘unavoidable spending’. Independent economic Chris Richardson refutes suggestions that some expenditure cannot be avoided.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. DEPT OF FINANCE

ABC to get extra $126m funding after election

roymorgansocial Leave a comment

Original article by Ronald Mizen
The Australian Financial Review – Page: 4 : 17-Dec-24

The federal government will boost funding for the ABC in its Mid-Year Economic and Fiscal Outlook statement. Communications Minister Michelle Rowland has advised that the public broadcaster will receive an additional $40.9m in 2026-27, $42.2m in the following financial year and $43m in 2028-29. Rowland has also indicated that the government will legislate five-year funding agreements for the ABC. The former Coalition government had significantly reduced the ABC’s funding.

CORPORATES
AUSTRALIAN BROADCASTING CORPORATION, AUSTRALIA. DEPT OF INFRASTRUCTURE, TRANSPORT, REGIONAL DEVELOPMENT, COMMUNICATIONS AND THE ARTS