As you’re well aware at this point, budget day has been and gone for 2023. Federal Treasurer Jim Chalmers stood up to make his budget speech, and Australia heard of upcoming changes that will impact the nation — unsurprisingly, with a focus on the cost of living. One question that many are asking off the back of budget night, however, is what is a budget surplus?
The term has been thrown around a fair bit with regard to this federal budget, so let’s take a look at what it actually refers to.
What is a budget surplus?
In the simplest terms, a budget surplus is the term used when the government brings in more money than it spends.
Federal Treasurer Jim Chalmers has shared that there is a forecast budget surplus of about $4 million for this year. What that means is that it is being predicted that there should be a budget surplus, but that depends on how things shake out.
In an interview with 2GB, Chalmers shared that “We’ll know in a couple of months if we got there. But what we already know is we wouldn’t be within cooee of a surplus this year were it not for the responsible approach that we’ve taken over two budgets.”
This all depends on how much money the government ends up spending, and what it winds up bringing in, the ABC highlights.
Notably, however, this is the first forecasted budget surplus since 2008.
What does this mean for Australia?
As our pals at Nine put it, it means a couple of things. It can mean money can be reinvested or used to pay down debts. It also reduces the amount of money floating around, which, Nine shares, can have a deflationary effect.
How this all works out for Australia will depend on how the coming months play out, so watch this space.
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