Get out and spend
Australia’s 2020-21 Federal Budget was designed to get the private sector spending again.
The spending and initiatives announced – and there were many – were designed to get businesses to take some risk and spend some money. Tax incentives were added to the mix to encourage them to do so.
There are also tax cuts for those households who have managed to retain their jobs – previously flagged but now brought forward to expedite any impact. Unfortunately the bulk of these don't actually fall into the current financial year – one of the few disappointments with this budget.
There is a sense this budget doesn't throw money into the economy quite quickly enough - particularly when we have the JobKeeper payment, which has supported employment and households through the crisis, falling away.
Now, the JobKeeper payment is, of course, an enormous part of the initial COVID stimulus package. It can't last forever. And what the government's really trying to do is make sure the private sector can get back on its feet, start spending again, and drive itself into a recovery.
The government is looking for the budget to support a better economic situation with more opportunity for jobs and a better and healthier economic future.
Cherelle Murphy is Senior Economist at ANZ
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