CANBERRA, ACT, Sept. 28 -- The Treasurer of Australia issued the following media release:
The Final Budget Outcome shows the 2025-26 deficit is billions of dollars better than forecast in the Budget.
We made a lot of progress in the Budget and we've continued to make even more progress since then.
This multi‑billion‑dollar improvement has been delivered despite months of more severe global volatility.
Responsible economic management is a defining feature of this Government and you can see that here.
The bottom line is better than what we inherited, better than what was forecast at the election and it's improved again since the Budget.
The deficit in 2025-26 was $22.3billion, which is $6billion better than the $28.3billion estimate in the 2026-27 Budget. It was $20.7billion lower than the $42.9billion forecast by our predecessors, which means the deficit is almost half what we inherited.
As a share of the economy, it was 0.8percent of GDP, exactly half the 1.6percent forecast by our predecessors and less than half the average deficit between the Global Financial Crisis and COVID‑19 pandemic.
The stronger budget position we have delivered is why the ratings agencies have endorsed the Government's responsible fiscal management by re‑affirming our AAA credit rating in recent weeks.
We have one of the strongest budgets in the G20 and much lower gross debt than every major advanced economy.
The FBO result is better than expected at Budget because of lower‑than‑expected payments and an improved outcome for receipts.
Payments were $1.4billion lower in 2025-26 than estimated at Budget. This meant that real payments growth moderated compared to the previous year.
Tax receipts were $4.6billion above the Budget forecast, driven by higher‑than‑expected collections from stronger super fund and investment income.
As a share of the economy, taxes remained below the historical high recorded under the Howard Government.
Taxes in 2025-26 were lower than they otherwise would have been due to the Government's tax cuts for every taxpayer and responsible temporary cut to the fuel excise.
Taxes on wages and salaries are down as a proportion of the economy compared to 2023-24, the year before our tax cuts for every taxpayer started rolling out.
We have limited real spending growth, delivered substantial savings and reprioritisations, and returned around 75percent of all tax receipt upgrades to the bottom line, compared to our predecessors who only returned around 40percent.
Today's figures show the Albanese Government has now delivered a stronger budget than we inherited in every year we have been in office.
Our predecessors had bigger deficits and more debt. They would have kept deficits well above onepercent of GDP well into the 2030s. All four of the budget outcomes delivered under this Government have been much stronger than that.
The budget over the last fouryears is $230billion or almost a quarter of a trillion dollars better than we inherited.
The stronger fiscal position means that gross debt in 2025-26 was $10.6billion lower than estimated at Budget and $197.6billion lower than estimated when we came to office, helping us avoid $70billion in interest costs over the 11years to 2031-32.
Gross debt as a share of the economy was 33.2percent in 2025-26, down from the 38.3percent in 2021-22.
If we had followed the trajectory of the Coalition, gross debt would have been well above a trillion dollars and closer to 45percent of GDP.
Almost two thirds of the debt in the Budget was added by the Coalition.
While debt as a share of the economy went up in almost every year before we came to office, it has come down every year so far under this Government.
The Coalition has made more than half a trillion dollars' worth of commitments since the 2025 election with no explanation of how they would pay for them.
By their own logic, deficits would be bigger, there would be much more debt, higher inflation and more pressure on interest rates if the Liberals and Nationals were in government.
Getting the Budget in better nick has enabled us to make room for more of the things Australians need and deserve like more investment in Medicare, aged care, housing and tax cuts for every taxpayer.
At the same time, public demand growth moderated in 2025-26. New public final demand grew 2.2percent in 2025-26, the slowest rate in 11years and half of a percentage point below Treasury's Budget forecast. In annual terms, four out of every five dollars of growth in domestic demand was from private demand, not public demand.
While we've delivered a substantial budget improvement, we recognise that structural pressures are intensifying rather than easing and we're taking decisive action to address some of the biggest spending pressures on the budget.
Last week's Intergenerational Report showed our responsible approach is helping to improve the bottom line, but the job's not done because the Budget is still under pressure.
The Government is focused on building a more productive and resilient economy and managing global uncertainty, and a big part of that is our responsible management of the Budget.
Disclaimer: Curated by HT Syndication.
