Australia’s army of workers will carry more of the federal budget with company tax collections tipped to suffer their first fall since the COVID pandemic as China’s economic slowdown and the ramifications of the Trump presidency hit the government’s bottom line.
Only the surprising strength of the jobs market is preventing the budget from sinking further into the red. Unemployment unexpectedly fell to 3.9 per cent in November to be lower now than it was at the start of the year. “Challenges in the Chinese economy will have flow-on effects for our own budget, and that will be clear in Treasury’s forecasts,” he said.“The global economy is uncertain, the global outlook is unsettling, and that’s weighing heavily on our economy.”
Growth has slowed sharply over the past 12 months but remains positive. Annual growth in 2023-24 was 1.2 per cent, compared with 2.4 per cent in 2022-23. Without population growth and government spending, the economy would have slipped into recession. On Monday, Housing Minister Clare O’Neil will announce the second round of funding from its Housing Australia Future Fund, which will fast-track the construction of 5000 new social homes nationwide.