Australia: 2008-09 Federal Budget Preview

Australia: 2008-09 Federal Budget Preview

* New Labor Treasurer Wayne Swan delivers his maiden Budget speech at 7pm on Tuesday, 13 May - this is the first budget by a Labor government for 13 years.

* Treasurer Swan has committed the government to delivering a Budget surplus equivalent to 1.5% of GDP (about $18 billion). The Budget surplus for 2008-09 is likely to be at least $20 billion.

* The Treasurer will have to appear to hand down an austere budget to show that the government is serious about fighting inflation, while also handing out buckets of cash to low and middle income earners via the tax cuts.

* The Treasurer must reinforce to financial markets and the electorate that the new government is a credible manager of the economy, traditionally the badge worn by the previous government, not by Labor.

* A potentially huge issue for markets would be any reference in the Budget speech to the government changing the RBA's inflation target range to, presumably, a higher range.

See... Budget_Preview_200809.pdf

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