The responsible budget management of the Turnbull Government has brought the 2016-17 Final Budget Outcome (FBO) in at $4.4 billion better than the underlying cash balance forecast in the 2017-18 Budget.
At $33.2 billion, the underlying cash deficit is 1.9 per cent of gross domestic product, the first time in four years it has fallen below 2 per cent of GDP. The improvement in the bottom line was driven by $4.1 billion in higher total receipts than expected at the time of the 2017-18 Budget, as well as an improvement of $1.2 billion from payments being lower than expected.
For the second year in a row government payments were below their initial forecast, $4.3 billion lower than the 2013-14 Budget estimate.
In net operating terms, the FBO for 2016-17 improved by $6.6 billion compared with the net operating deficit estimated at the time of the 2017-18 Budget, with revenue $3.6 billion higher and expenses $3.0 billion lower than expected at the time of the 2017-18 Budget.
Real GDP grew by 1.9 per cent in 2016-17, slightly stronger than the 1¾ per cent growth forecast in the 2017-18 Budget. Nominal GDP grew by 6.0 per cent, consistent with the 2017-18 Budget forecast, driven by a strong rise in Australia’s terms of trade.
Almost 250,000 jobs were created over 2016-17 resulting in employment growing by 1.9 per cent through the year to the June quarter 2017, which was stronger than the 2017-18 Budget forecast of 1 per cent.
Australian Government general government sector net debt was $322.3 billion (18.4 per cent of GDP), which was $2.8 billion better than estimated at the time of the 2017-18 Budget.
The Final Budget Outcome 2016-17 can be found on the Budget website.