Federal Treasurer Joe Hockey is set to hand down a “shocking” budget deficit for this financial year in his update next Tuesday.
Federal coalition MPs have been told to brace for a “shocking” deficit when Treasurer Joe Hockey hands down his mid-year budget review.
Deputy Liberal leader Julie Bishop warned coalition members on Thursday that the review will show the legacy of Labor’s debt and deficits.
Mr Hockey later told parliament next Tuesday’s budget update will be “based on the facts”.
“It will tell the truth about the budget, which Labor never did; it will tell the truth about the economy, which Labor never did,” he said.
The 2013/14 budget deficit is widely expected to blow out from the $30.1 billion estimated by Treasury in August, possibly to $40 billion, or even more.
Treasury’s updated forecasts are also expected to show economic growth locked below trend and rising unemployment.
New figures on Thursday showed the jobless rate edged up to three-month high of 5.8 per cent in November from 5.7 per cent the previous month.
The number of people employed rose by 21,000, double the number forecast by economists, but that was largely ignored by politicians.
Instead, Employment Minister Eric Abetz said the jobless rate highlighted the need for an urgent abolition of the “job destroying” carbon and mining taxes – legislation that is stuck in the Senate.
“Labor and the Greens must stop their stalling and sabotage and allow the coalition government to get on with the job it was elected to do,” the senator said in a statement.
Opposition employment spokesman Brendan O’Connor said the jobless rate rise should be a wake-up call for the government given recent high-profile job losses, including those announced by Rio Tinto, Qantas and Holden.
Other data showed the manufacturing sector is showing signs of improvement outside the motor vehicle industry.
The latest Australian Chamber of Commerce and Industry (ACCI)-Westpac survey of industrial trends shows the manufacturing sector expanding for only the third quarter in the past two years.
“Overall, the picture for Australia’s manufacturing is not one of sackcloth and ashes,” ACCI chief executive Peter Anderson told reporters in Canberra.
Westpac senior economist Elliot Clarke said the survey indicates manufacturers continue to be hit by a high Australian dollar, a force that could be around for a while yet.
Prime Minister Tony Abbott acknowledged a higher dollar has made it “extremely difficult” for many manufacturers and exporters to compete.
But he also noted the $8.8 billion granted to the Reserve Bank of Australia (RBA) to recapitalise its reserves.
“That enables the Reserve Bank to intervene prudently and appropriately in the market to try to insure that the Australian dollar is at the best possible level,” Mr Abbott told parliament.
His comments come on the 30th anniversary of the dollar being floated.
Former prime minister and treasurer Paul Keating and instigator of a floating currency marked the occasion with a special federal caucus meeting in Canberra.
The policy not only marked Australia’s coming of age, but “the Labor party coming of age”, he said.