Australia's debt projected to rise to $940 billion
Australia's treasurer, Jim Chalmers, is feeling positive ahead of the upcoming budget, despite concerns about rising national debt. New estimates show the country's gross debt is expected to increase from $906.9 billion this year to $940 billion next year. This marks a significant rise since the Albanese government took office, as debt has grown by about $45 billion from $895.2 billion in mid-2022. In the budget to be released on Tuesday, the Labor government will show that their previous budget surpluses are giving way to a decade of expected deficits. Chalmers noted that while debt is climbing, the fiscal outlook is better than anticipated prior to the last election. He mentioned that pre-election forecasts suggested debt could reach $1.1 trillion by mid-2025, a figure much higher than the current projections. Chalmers credited the stronger fiscal position to an unexpected economic recovery and rising commodity prices since the pandemic. He pointed out that the previous government oversaw significant borrowing to fund COVID-19 support programs. The current government's approach has resulted in a smaller rise in debt compared to the previous administration. Despite concerns about future spending capabilities, Australia’s debt remains lower than that of many other advanced economies. Experts are worried, however, that future governments may struggle to respond to crises due to this growing debt and increasing global uncertainties.