Federal budget facing $12bn hit: Penny Wong

By Mehroz Siraj

Federal Finance Minister Penny Wong has said that the government’s revenues had incurred a $12billion hit in the ongoing financial year.

She made these remarks while talking to ABC Radio on April 29.

She said that because of lower than expected tax receipts from the corporate sector, government revenues had shrunk and that the next financial year’s budget would be very tight on fiscal and monetary spending.

She said that tighter fiscal budgets were here to stay and that Australians would have to get used to this new economic reality.

“We are anticipating significant budget write downs in the years ahead,” she said, adding that whichever political party formed government after the next elections, would find budget making an extremely difficult task.

The minister’s revelation came hours after it was reported that Prime Minister Julia Gillard was to make a public announcement on April 29 saying that revenue targets for the current financial year would not be achieved by July 1.

The statement also comes only ten days after Treasurer Wayne Swan publicly remarked that tax forecasts for the current financial year would be missed by $7.5billion.

In the final months of 2012, citing lesser than expected tax receipts, Treasurer Swan had publicly reneged on the government’s promise of delivering a budget surplus for the current financial year.

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