Australian Government, 2013-14 Budget
Budget

Part 1: Australian Government Budget Outcome

Overview

In 2013‑14, the Australian Government general government sector recorded an underlying cash deficit of $48.5 billion (3.1 per cent of gross domestic product (GDP)). The fiscal balance was in deficit by $43.7 billion (2.8 per cent of GDP).

In cash terms, the Final Budget Outcome for 2013‑14 was a $1.4 billion improvement compared with the underlying cash deficit estimated at the time of the 2014‑15 Budget. Total receipts were $3.2 billion lower than expected, more than offset by total payments which were $4.2 billion lower than expected. Net Future Fund earnings were $341 million lower than estimated at the time of the 2014‑15 Budget.

In fiscal balance terms, the Final Budget Outcome for 2013‑14 was a $1.3 billion improvement compared to the fiscal balance deficit estimated at the time of the 2014‑15 Budget, with revenue $317 million lower than expected, expenses $1.4 billion lower than expected, and net capital investment $177 million lower than expected.

Real GDP grew a little below trend in 2013‑14 and slightly higher than the 2014‑15 Budget forecast. The slightly higher than anticipated real GDP growth was largely driven by a stronger than expected contribution from net exports. With the resources sector transitioning from the investment to production phase, commodity export volumes increased at a faster pace than expected, while mining related capital imports fell. The decline in Australia's terms of trade in 2013‑14 was smaller than expected at the 2014‑15 Budget. The smaller than anticipated decline in the terms of trade was largely driven by higher than expected prices Australia receives for its commodities. Nominal GDP growth in 2013‑14 was in line with the 2014‑15 Budget forecast, but well below its long‑term average, reflecting the decline in the terms of trade and subdued domestic price growth.

Tax receipts for 2013‑14 were $3.3 billion lower (1.0 per cent) than forecast at the time of the 2014‑15 Budget.

Australian Government general government sector net debt was $202.5 billion (12.8 per cent of GDP), which is $4.6 billion higher than estimated at the time of the 2014‑15 Budget. The increase was primarily driven by the higher than expected market value of Commonwealth Government Securities (CGS), owing to lower than expected yields. Australian Government general government sector net financial worth was ‑$370.3 billion at the end of 2013‑14. Net worth was ‑$256.0 billion at the end of 2013‑14.

Table 1: Australian Government general government sector budget aggregates
  2012‑13
Outcome


$b
2013‑14
Estimate at
2014-15
Budget
$b
2013‑14
Outcome


$b
Change on
2014-15
Budget

$b
Receipts 351.1 363.5 360.3 -3.2
Per cent of GDP 23.0 23.0 22.7  
Payments(a) 367.2 410.7 406.4 -4.2
Per cent of GDP 24.1 25.9 25.6  
Net Future Fund earnings 2.7 2.7 2.3 -0.3
Underlying cash balance(b) -18.8 -49.9 -48.5 1.4
Per cent of GDP -1.2 -3.1 -3.1  
Revenue 360.2 374.3 373.9 -0.3
Per cent of GDP 23.6 23.6 23.6  
Expenses 382.6 415.3 413.8 -1.4
Per cent of GDP 25.1 26.2 26.1  
Net operating balance -22.5 -41.0 -39.9 1.1
Net capital investment 1.0 4.0 3.8 -0.2
Fiscal balance -23.5 -45.1 -43.7 1.3
Per cent of GDP -1.5 -2.8 -2.8  
Memorandum item:        
Headline cash balance -21.0 -53.7 -52.5 1.3

(a) Equivalent to cash payments for operating activities, purchases of non‑financial assets and net acquisition of assets under finance leases.

(b) Excludes net Future Fund earnings.

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