Australian workers face decades of debt with the nation hit with an $850 billion debt bomb in borrowings to fight the COVID-19 crisis.
It’s a debt and deficit challenge that the Morrison Government has warned voters will take more than a decade to repay, but is necessary to protect jobs and the economy.
Treasurer Josh Frydenberg has revealed the stunning cost of the COVID-19 crisis today in an economic update that shows Australia’s budget deficit will hit the $184 billion mark this financial year, in the biggest blowout since World War II.
Just months ago, he had hoped to hand down the first budget surplus in Australia in years.
As pandemic lockdowns deliver a once in a century hit to tax revenues, he has also confirmed the 2019-20 budget deficit – the difference between the government’s revenue and outlays in that year is $85.8 billion.
“These harsh numbers reflect the harsh reality we face the economic outlook remains very uncertain,” Mr Frydenberg said.
“Recent events in Victoria are a testament to this, a painful reminder, how a setback in combating the virus can impact the speed and the trajectory of our national economic recovery.”
Those figures reflect the $289 billion that the Morrison Government has dropped on stimulus measures including direct payments to people on welfare, increases to JobSeeker and the JobKeeper wage subsidy.
But it’s the debt levels that have blown out as the Prime Minister and Treasurer were forced to borrow more money to pay for those measures and were hit by lower tax revenues.
source – https://www.news.com.au/