This brief provides an overview of the key fiscal and economic numbers from the 2018–19 Budget.\
A substantial improvement in the forecast economic and fiscal position since the 2017–18 MidYear Economic and Fiscal Outlook (MYEFO) is due largely to upward revisions to tax receipts driven by employment and GDP growth.
The Government is now forecasting that the Budget will return to an underlying cash balance surplus of $2.2 billion (0.1 per cent of GDP) in 2019–20. This is one year earlier than was forecast in the 2017–18 MYEFO. The surplus is expected to grow to $16.6 billion (0.8 per cent of GDP) in 2020-21 and build to at least 1 per cent of GDP over the medium term.
This improved fiscal position is primarily the result of improvements in underlying economic parameters (parameter variations)—most notably higher GDP and employment forecasts, which are expected to result in higher taxation receipts and lower payments over the forward estimates period.
Additional policy decisions taken by the Government in the 2018–19 Budget are expected to have a net negative impact on the Budget over the forward estimates period, offsetting some of the improvement in the underlying fiscal position as a result of parameter variations.