The Albanese government is spruiking a drop in gross debt to $906.9 billion for the 2023/24 fiscal year, an improvement of $149.1 billion over the decade compared with a 2022 forecast.
Some $80 million in savings on interest repayments - including $4 billion in that financial year alone - provided wiggle room to address structural pressures within the budget, Finance Minister Katy Gallagher said.Â
Finance Minister Katy Gallagher says savings in interest repayments can be put towards other areas. (Mick Tsikas/AAP PHOTOS)
The government is working to rein in spending in areas such as the NDIS and aged care, which are ballooning significantly.
"That just gives you a bit of a sense of why we're having to look at how we get the budget in much better shape," Senator Gallagher told reporters in Canberra on Monday.
"The debt is lower, we're paying less interest, and because we're paying less interest it gives more room in the budget to fund some of those big pressures that we've got coming at us."
The final budget outcomes will further show a surplus for 2023/24 in the mid-teen billions, compared with a $9.3 billion prediction.
The larger surplus was due to less spending, Treasurer Jim Chalmers said, adding the spending restraint doubled as a handbrake on inflation.
Crucial inflation figures will be released on Wednesday, a day after the central bank meets to determine whether interest rates should be slashed from 4.35 per cent.
The cash rate is largely tipped to stay the same, with the RBA governor flagging no interest rate relief before 2025.
Opposition Leader Peter Dutton said government spending was keeping inflation higher. (Lukas Coch/AAP PHOTOS)
Opposition Leader Peter Dutton blamed sticky inflation - which remains slightly higher than the federal government wants - on Labor's spending.
"I really hope for Australians with a mortgage that rates go down, but the Reserve Bank can only respond to the economic settings," he told Sydney radio station 2GB.
"The extra money that's being pumped into the economy, by the migration program, through government spending, all of that is working to keep inflation higher for longer."
The Greens want the treasurer to steamroll the central bank and force an interest rate cut with a legal power that has never been used before, and is threatening to withhold support for RBA reforms until the cash rate comes down.
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