Breaking News Today

Australia’s biggest deficit since World War II: Budget numbers explained simply

Published: (Updated: ) in Australian News by .

The budget will be in a deficit of more than $85 billion for the 2019-2020 financial year.

Australia is set to face the largest budget deficit since World War II when the federal government hands down the country's economic standing on October 6.

During a special budget and fiscal update today, Treasurer Josh Frydenberg said forecasts show the coronavirus's financial impact on the nation will result in a deficit of more than $85 billion for the 2019-2020 financial year.

That will blow out to $184.5 billion the following financial year.

READ MORE: Australia's unemployment rate rises to 7.4 per cent, with nearly 1 million people out of work

To date, COVID-19 has caused the loss of $11 trillion from the world's economy.

"Today we stand in a very different world," Mr Frydenberg told reporters.

"Australia and the world is now experiencing the most severe economic crisis since the Great Depression."

READ MORE: 'Harsh numbers' predicted for Australian economy

QUICK BUDGET NUMBERS AT A GLANCE

- The government's COVID-19 spending has totalled $289 billion, or 14.6 per cent of GDP

- Our national deficit in FY 2019-2020 is $85.8 billion

- Our forecast national deficit for FY 2020-2021 is $184.5 billion

- Australia's net debt is forecast to reach $677.1 billion by June 30, 2021

- The unemployment rate is expected to hit 9.25 per cent by Christmas

SPENDING SAVED 700,000 JOBS

Mr Frydenberg offset the numbers broadcast today by demonstrating that no economic intervention would have cost the country far more.

In the December quarter – effectively up until Christmas – Australia's unemployment rate is expected to hit 9.25 per cent.

In the months of March and May this year, approximately 870,000 Australians lost their jobs.

READ:  Large-scale ocean search launched for missing teenage kayaker

READ MORE: How coronavirus has affected the finances of everyday Australians

Without government intervention with programs such as JobKeeper and JobSeeker, Mr Frydenberg said Treasury estimated an additional 700,000 jobs would have been lost.

Since the unemployment rate has been tracked monthly from February 1978, the highest unemployment rate ever recorded in the country was 11.2 per cent in December 1992.

It's estimated if tracked like it were today, the unemployment rate would have hit 32 per cent during the peak of the Great Depression in Australia in 1932.

The unemployment rate has gone down slightly in February.

You can  get up-to-date information from the Federal Government's Coronavirus Australia app, available on the App Store, Google Play and the Government's WhatsApp channel.

Beyond Blue's Coronavirus Mental Wellbeing Support Service is a 24/7 service free of charge to all Australians. Visit the site here or call 1800512348

For coronavirus breaking news alerts and livestreams straight to your smartphone sign up to the 9News app and set notifications to on at the App Store or Google Play.

The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website you should consider the appropriateness of the information having regard to your objectives, financial situation and needs.

Source: 9News https://www.9news.com.au/national/coronavirus-australia-budget-update-numbers-explained-simply/59ef7b0c-9dff-4338-a973-d04a8c89bce1

Shares
Share This
Finance Advice 2021