Just like you, the Government has to work out where its income is coming from and what expenses it has to pay.
The Albanese Government just released their federal budget, and with a cost of living crisis on us, this budget’s going to be a big one.
The federal budget is our opportunity to see what the government will be delivering based on what it promised in its election campaign.
But first up - a refresher on what the budget is
Just like you’ve got a budget at home tracking your income and expenses, the government has one too
Just like you (hopefully) run your own personal budget every year, the government shares an update on where they’re earning their money, and where they’re spending it.
The government earns most of its income through taxes on everyday individuals (like us) and companies. It takes all that income and then spends it on services like welfare, health, and education.
What’s the current budget sitch?
When the government earns more than it spends for the year, the budget is in ‘surplus’. When the government spends more than it earns, the budget is in ‘deficit’.
Now, that sounds a lot scarier than it is - our debt levels are pretty stable compared to the past and compared to other countries.
But, as we know, interest rates have been going up.
In the same way interest on our personal debts like mortgages and HECS have become more expensive, the government’s debt has become more expensive too.
And this is an important consideration in the federal government’s 2023-24 budget.
Sweet, so you're all over the budget now! Head to our article on Federal Budget 2023-24: Winners and Losers and impress your friends with your knowledge.
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