PM Transcripts

j', AUS TALIALFOR
MEDIA Monday 22 April 1985
Cabinet decided today that the Government would present a major
statement on expenditure to the Parliament in May.
The statement will cover major expenditure savings decisions,
contributing to a reduction of at least one billion dollars in
1985-86 Commonwealth outlays.
The statement is to be made in May rather than in the August
Budget to secure savings over the full financial year commencing
1 July 1985.
The statement will not cover matters related to Federal-State
financial relations, which will be the subject of Premiers'
Conferences in May and June.
Together with further savings to be announced in the August
Budget, and the outcome of the Premiers' Conferences, the
measures covered by the May statement will allow the Government
to meet its trilogy commitments for 1985-86.
The trilogy commitments require us to reduce the deficit in money
terms and Commonwealth outlays and tax revenue as shares of Gross
Domestic Product.
It is likely that the recent depreciation of the Australian
dollar will lead to upward revisions * of expected revenue for
1985-86, in excess of upward revisions of the costs of on-going
priority programmes.
Part of this net revenue benefit to the budget will occur through
the crude oil pricing decision taken today.
The Cabinet today decided that none of any increased crude oil
excise revenue resulting from today's decision will be used to
support new spending programs, or to avoid spending cuts which
would otherwise have been made. These receipts, and any other
net revenue benefits flowing from the $ A depreciation, will be
applied to strengthening the economy and preserving the
advantages won by the depreciation, through either the reduction
of the deficit or subsequent reductions in taxes and charges.
The recent depreciation provides Australia with a great
opportunity to boost production and employment in export and
import-competing industries. To seize this opportunity, we must
avoid the dissipation of our improved competitiveness through a
new inflationary cycle.
The Government is determined that a firm fiscal policy will play
its full part in the national effort to sustain recovery and
preserve the benefits of depreciation.