Invest
‘This will be another pandemic budget’: Frydenberg
The Australian government will use next month’s budget to target Australia’s unemployment rate and reduce taxes paid as it looks to support the economy post the COVID-19 downturn.
‘This will be another pandemic budget’: Frydenberg
The Australian government will use next month’s budget to target Australia’s unemployment rate and reduce taxes paid as it looks to support the economy post the COVID-19 downturn.
In a speech made ahead of the 11 May federal budget, Treasurer Josh Frydenberg said he plans to delay budget repairs to instead focus on the unemployment rate.
“We will not move to the second phase of our fiscal strategy until we are confident that we have secured our economic recovery,” Mr Frydenberg said.
The Treasurer discussed Australia’s need to drive unemployment down to below 5 per cent for the first time since 2008.
Mr Frydenberg has been adamant that in order to fix the budget deficit, Australia must first fix the economy. He noted on Thursday that for inflation to lift, “the unemployment rate will have to have a 4 in front of it”.
“Just as recently as the mid-year economic and fiscal update in December last year, we thought the unemployment rate would be 7.5 per cent, it is now at 5.6 per cent,”
“That means 200,000 more Australians are in work, and that can improve the budget bottom line by around $5 billion because you have $3 billion less in welfare payments going out and $2 billion more in revenue through taxes coming in,” the Treasurer said.
The Treasurer had previously said that once unemployment was “comfortably below” 6 per cent, the government would shift from providing temporary support to stabilising debt. But tactics appear to have changed, with the government said to be less afraid of the mounting debt, now stating “we won’t be undertaking any sharp pivots towards austerity”.
However, the government will refuse to bring back key policies, including the JobKeeper stimulus, instead aiming for more targeted support.
Tax cuts on the way?
While Mr Frydenberg refused to commit to any major changes to the tax policy, he said the government remains “committed to lowering taxes”.
The next stage of the government’s tax plan is stage three tax cuts, which are due to commence in 1 July 2024, with the Treasurer alluding on Thursday to bringing these forward.
The stage three tax cuts are the largest and most controversial reform to the current system, with all Australian workers earning between $45,000 and $200,000 set to receive the same flat 30 per cent tax rate.
“We will continue to drive lower taxes, whether it’s for businesses or individuals; these are announcements that have already been made and policies that are currently being implemented,” he concluded.
RELATED ARTICLES
About the author
About the author
Economy
Navigating the inflation maze: How CFOs can outsmart economic hurdles in Australia
Fresh inflation data have cooled expectations of near-term rate cuts in Australia, intensifying pressure on margins, capital allocation and demand. Rather than wait for monetary relief that may not ...Read more
Economy
Inflation concerns rise as Australia's CPI climbs to 3.8% in October
Australia's latest Consumer Price Index (CPI) figures have sent ripples through the economy, with headline inflation accelerating to 3.8% year-on-year in October, up from 3.6% in September. The data, ...Read more
Economy
October CPI results pose challenges for RBA’s monetary policy stance
In a surprising turn of events, the October Consumer Price Index (CPI) data has raised eyebrows among economists and market strategists, revealing stronger-than-expected inflationary pressures in ...Read more
Economy
Global deal activity declines by 6% amid economic uncertainty, reports GlobalData
In a year characterised by economic turbulence and evolving market conditions, global deal activity has witnessed a notable downturn during the first ten months of 2025. According to GlobalData, a ...Read more
Economy
Australia’s softening labour market puts another RBA cut in play — here’s what business should do now
A four-year high in unemployment has revived expectations the Reserve Bank could deliver another rate cut as soon as November. With quarterly GDP growth running at 0.6 per cent and annual growth at ...Read more
Economy
Rising CPI reinforces RBA’s stance as rate cut expectations remain: State Street
State Street Global Advisors says the Reserve Bank of Australia (RBA) is likely to hold its current policy outlook following the release of September quarter inflation data, which showed an unexpected ...Read more
Economy
NSW SES boosts tsunami preparedness ahead of World Tsunami Awareness Day
As World Tsunami Awareness Day approaches on 5 November, the New South Wales State Emergency Service (NSW SES) is ramping up efforts to enhance tsunami preparedness along the east coastRead more
Economy
Lifesaving Regional Response Strengthened with New NSW SES Vehicles
In a significant boost to regional emergency services, the NSW State Emergency Service (SES) has unveiled 11 new Community First Response (CFR) vehicles, designed to enhance the speed and safety of ...Read more
Economy
Navigating the inflation maze: How CFOs can outsmart economic hurdles in Australia
Fresh inflation data have cooled expectations of near-term rate cuts in Australia, intensifying pressure on margins, capital allocation and demand. Rather than wait for monetary relief that may not ...Read more
Economy
Inflation concerns rise as Australia's CPI climbs to 3.8% in October
Australia's latest Consumer Price Index (CPI) figures have sent ripples through the economy, with headline inflation accelerating to 3.8% year-on-year in October, up from 3.6% in September. The data, ...Read more
Economy
October CPI results pose challenges for RBA’s monetary policy stance
In a surprising turn of events, the October Consumer Price Index (CPI) data has raised eyebrows among economists and market strategists, revealing stronger-than-expected inflationary pressures in ...Read more
Economy
Global deal activity declines by 6% amid economic uncertainty, reports GlobalData
In a year characterised by economic turbulence and evolving market conditions, global deal activity has witnessed a notable downturn during the first ten months of 2025. According to GlobalData, a ...Read more
Economy
Australia’s softening labour market puts another RBA cut in play — here’s what business should do now
A four-year high in unemployment has revived expectations the Reserve Bank could deliver another rate cut as soon as November. With quarterly GDP growth running at 0.6 per cent and annual growth at ...Read more
Economy
Rising CPI reinforces RBA’s stance as rate cut expectations remain: State Street
State Street Global Advisors says the Reserve Bank of Australia (RBA) is likely to hold its current policy outlook following the release of September quarter inflation data, which showed an unexpected ...Read more
Economy
NSW SES boosts tsunami preparedness ahead of World Tsunami Awareness Day
As World Tsunami Awareness Day approaches on 5 November, the New South Wales State Emergency Service (NSW SES) is ramping up efforts to enhance tsunami preparedness along the east coastRead more
Economy
Lifesaving Regional Response Strengthened with New NSW SES Vehicles
In a significant boost to regional emergency services, the NSW State Emergency Service (SES) has unveiled 11 new Community First Response (CFR) vehicles, designed to enhance the speed and safety of ...Read more
