Joint media release with Senator the Hon Katy Gallagher, Minister for Finance

The Final Budget Outcome for 2022-23 shows the Albanese Government’s responsible economic management and spending restraint has delivered the first budget surplus in 15 years.

The underlying cash balance was a surplus of $22.1 billion (0.9 per cent of GDP) in 2022-23, a dramatic improvement from the forecast $77.9 billion deficit we inherited from the previous government.

The $100 billion turnaround achieved in our first year in office is the biggest nominal budget improvement in Australian history. 

Our responsible approach helped lower gross debt by $87.2 billion by the end of the financial year compared to the estimate before the Albanese Government was elected, which will avoid around $12 billion in interest payments over five years.

A big driver of the improvement in the budget position has been the strong labour market and getting wages moving again after a decade of stagnation. More than 550,000 jobs have been created since the election, the most for any new Australian government on record.

The Albanese Government has delivered the surplus at the same time as providing billions of dollars in cost-of-living relief to Australians doing it tough, including energy bill rebates, cheaper medicines and cheaper childcare.

This surplus has been made possible because of our responsible approach to managing the budget that includes spending restraint and banking revenue upgrades.

We’ve returned 95 per cent of revenue upgrades to the bottom line in 2022-23, compared to the 40 per cent average of the previous government.

Across two budgets, we have found $40 billion in savings and spending reprioritisations, compared to zero savings in the last budget of our predecessors.

If the Albanese Government had continued on the same path as the former government, we would be nowhere near a surplus.

Our budget strategy has been exactly right for the times and suited to the challenges we confront.

By banking most of the revenue upgrade when the inflation challenge was at its peak, our responsible economic management has reduced pressure on the cost of living and interest rates.

The surplus is not an end in itself rather it’s a stronger foundation which puts us in a better position to confront the uncertainties ahead.

Despite the improvements in the fiscal position, we know the structural pressures are intensifying rather than easing on the budget. 

The nation’s finances face growing structural spending pressures, including the NDIS, health, aged care, defence and the interest bill on a trillion dollars of Liberal debt.

It will take more than one year or one parliamentary term to put the nation’s finances back on a more long-term sustainable footing, but we are making progress.

The Albanese Government remains focused on dealing with the immediate challenges Australians are facing, while at the same time building a stronger, more productive, and more resilient budget and economy.

As at 22 September 2023.