AUSTRALIA will report a smaller revenue upgrade in its federal budget for the year ended Jun 30 than it posted the prior year due to falling commodity prices and a softening labour market, the country’s Treasurer said on Thursday (Mar 14).

Booming commodity prices saw major minerals exporter Australia upgrade its budget revenue by more than A$100 billion (S$88.1 billion) in 2022 to 2023, a feat that is unlikely to be repeated this year, Treasurer Jim Chalmers said.

“The revenue upgrades will be smaller,” he said.

“In each of our first two budgets, we benefited from more than A$100 billion in revenue upgrades. This year, we will not see anything like that.

“In fact we are even looking at much less than the A$69 billion we booked in the latest mid-year budget update.”

Weaker commodity prices, in particular for major export iron ore, and rising unemployment were behind the change, said Chalmers. Australia’s jobless rate hit a two-year high in January.

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Chalmers said the government was still aiming for a second consecutive budget surplus, although a greater portion of the revenue upgrades would be spent compared to last year, when roughly four-fifths was saved.

“We are still committed to banking as much as we can,” he said. REUTERS