As Christmas approaches, there are a few upcoming mid-year economic updates from federal and state governments that just might get lost in the holiday rush, well, pretty much. everybody.
It turns out that there are some updated figures from the Parliamentary Budget Office. Overall, the news is positive, with the economy recovering faster than expected, compared to February estimates.
Yet for those fleetingly wondering whether the current optimism about job and business growth (and house prices which are a quarter higher in the past year) implied that the Covid pandemic may not have been a bad thing, just look at the scale of the debt hole that we are still digging.
The net national debt is expected to rise from 38% of GDP ($ 774 billion) in 2020-2021 to 55% of GDP ($ 1.325 billion) in 2024-25, the PBO said. It’s less than expected but still quite ginormous.
The swelling of debt will lead to additional interest payments as rates rise. Assuming the increase is 0.8 percentage point over the four years to 2023-24 compared to the level expected in the 2021-2022 budget, this means that annual repayments will be $ 3.2 billion. additional over the period.
By 2024-25, $ 34 billion will have to come from state and federal budgets to pay down this debt. Higher rates, if that is what happens, could inflate that bill further.
Speaking of holes, there is a bit of a boring story about that of Scott Morrison visit to Snowy Hydro’s giant pumping hydroelectric project earlier today.
A second tunnel boring machine was put into operation, apparently nicknamed “Kirsten” for some reason. We don’t know what happened to the first one, or what his name was.
“Our $ 1.38 billion investment in this project is already creating a local job boom, with a current workforce of over 1,300 people and 4,000 direct jobs expected over the life of the project,” and plenty of opportunities for local Australian businesses and suppliers, â€he added. said the prime minister.