The biggest surprise to come from this year's Australian federal budget was the announcement by treasurer Peter Costello on May 14 of an A$1.2 billion ($6.68 million) cash deficit in 2001-2002, attributed mainly to the war on terrorism along with disappointing tax revenues. As such, this year's budget provides for an underlying cash surplus of A$2.1 billion and lays the foundations for surpluses right across the forward estimates. Much of this will continue to fund further defence spending, which the treasurer says will rise by A$1.3 billion to A$14.1 billion in the financial year starting July. A further A$2.54 billion is to be allocated to border protection and domestic security. A large part of this will be funded by extra costs on Pharmaceutical Benefits Scheme (PBS) drugs, and tougher eligibility tests for disability pensions.
May 31 2002