The Federal Treasurer, Peter Costello announced today that the Government was about to pay off the last of it’s foreign debt, which total of $96 billion it inherited when it came into office in 1996.
$46.1 billion has been funded from the sale of government owned asset sales since 1996, with all of those proceeds going towards retiring debt. The balance having been funded from prudent fiscal policy that has seen the Australian budget consistently remain in surplus through the majority of their term in office.
Mr Costello said this was having a direct benefit to taxpayers.
"With the retirement of all government net debt next year we are forecasting net interest payments of $300 million," he said.
"This means every year, year after year, the taxpayer is saving billions in debt servicing costs."
The retirement of the debt now sets Australia in good stead for the future as government revenues can remain focused on spending that continues to improve the overall economic performance and stability of Australia.
This all goes well for ongoing investment in Australia and underpins the reputation of stable and reliable growth and an ongoing strong property market driven by the lifestyle advantages Australia offers.
With the next budget due on the 9th May we can expect to see the flow on effects of the debt reduction in tax cuts, improved social spending and a level of development spending that continues the economic expansion Australia has enjoyed over the past decade.
