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No scope for an easier budget



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V sal*X John Hewson Leader of the O pposition M edia R elease

237/92 16 August 1992 .

NO SCOPE FOR AN EASIER BUDGET

The latest National Accounts figures show that total public sector saving slumped by almost $13 billion in 1991/92. This is equivalent to a fall of about 3.4 per cent of GDP. In contrast, public sector saving fell by only just over one per cent of GDP after the 1982-83 recession.

This makes a joke of the Government's attempts to portray a further Budget blow-out as "responsible" in the current economic climate.

Along with low productivity, poor national savings is a major constraint to sustainable growth in Australia. Higher savings will enable more investment to be funded without deterioration in the current account deficit and higher foreign debt.

The latest figures also show that the current account deficit (which is equivalent to the gap between national savings and investment) in 1991-92 was more than equal to the fall in public sector saving. In the private sector, total saving exceeded total investment.

Strong growth in investment is essential for long-term

productivity growth.

The Government's prospective huge Budget deficits will require a massive borrowing programme that will push our already high real interest rates higher and further discourage private investment.

The Government's opportunistic vote-buying Budget will harm investment and long-term job prospects. ,

FOR FURTHER INFORMATION CONTACT 06 277 4022

COMMONWEALTH

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