The Albanese government

[mullokintyre]

Never assume anything you read in the media.

Future fund earnings have been added to the budget since day dot.

The only change in 2020 was money being drawn down.

It would have been more helpful if you had provided the links for the screen shot, as what you have provided tells us nothing.
I suspect that the screen shot is a list of assets, as distinct from an inclusion in the cash projections, but am happy to be proved wrong.
As to the FF earnings being added to the budget since day dot, i would humbly dispute that.
According to An earlier AFR story , the FF fund was not included in the budget until the then treasurer, Penny Wong put out a change in the 2012 budget.

Under a budget accounting shake-up by Labor's then-finance minister Penny Wong in 2012, from July 2020 onwards the Future Fund's net earnings will top up the federal budget's underlying cash balance for the first time.

The accounting alteration highlights the strong investment performance of the Future Fund.

Its latest portfolio update to be released on Monday shows an average 10.4 per cent annual return over the past decade – significantly above its 6.5 per cent target.

The treasury paper where ithe Wong induced changes can be found here.
Incidently, the same AFR article made the following statement:

The fund's profits will not count towards the Morrison government's acclaimed return to surplus, forecast to be $7.1 billion in 2019-20.

But beyond that, the little-noticed accounting change by the former Labor government and adopted by the Coalition is anticipated to boost the budget bottom line by more than $5 billion each year.

Mick

 

[PZ99]

It would have been more helpful if you had provided the links for the screen shot, as what you have provided tells us nothing.

Look harder.

Budget 2019‑20

archive.budget.gov.au

Scroll down to "Final Budget Outcome" and download the pdf

Then do a ctrl + F for "2007"

Then you'll see what you claim as "nothing" whilst anyone who can read a budget statement accurately will see Future fund earnings have been added to the budget since day dot

 

[sptrawler]

Consultation paper

The Treatment of Future Fund Earnings Post-2020 The Future Fund Act 2006 stipulates that money may not be withdrawn from the Future Fund until 1 July 2020 unless the balance exceeds the target asset level, which is broadly equivalent to the amount of the Commonwealth’s superannuation liability. The year 2020 was chosen as this was the point by which, according to the Government’s 2002 Intergenerational Report, the Commonwealth Government’s finances were expected to be significantly affected by the costs of an ageing population. After 2020, the assets of the Future Fund can only be drawn upon to meet the unfunded superannuation liability in a particular financial year. Once payments are made from the Future Fund, the earnings and future costs of the Future Fund will be included in the underlying cash balance, as the annual drawdown of the Future Fund will be used to meet recurrent superannuation costs each year (already included in the underlying cash balance).

https://www.finance.gov.au/sites/default/files/2019-11/budget_treatment_of_future_fund_costs_consultation_paper.pdf

Both Labor and the Coalition seem reluctant to access the future fund, which is good IMO, no doubt it will eventually get to an amount where there will be excess funds, as I think the very generous Commonwealth pension scheme was closed and members eventually stop withdrawing from the fund.
I may be wrong as I'm only going from memory, someone who is familiar with the scheme will no doubt correct me.

https://www.futurefund.gov.au/en/About-us/faqs#collapse_548a069a-69b4-428b-be3a-41126ee6c706

While legislation permits drawdowns from the Future Fund from 1 July 2020, the Government announced in the 2017-18 budget that it will refrain from making withdrawals until at least 2026-27.

Drawing down later on the Fund is projected to strengthen the Government’s financial position over the long term.

Arrangements for withdrawals for the other funds are set out in their respective legislation.

 

[mullokintyre]

Look harder.

Budget 2019‑20

archive.budget.gov.au

Scroll down to "Final Budget Outcome" and download the pdf

Then do a ctrl + F for "2007"

Then you'll see what you claim as "nothing" whilst anyone who can read a budget statement accurately will see Future fund earnings have been added to the budget since day dot

Don't want to be finicky, but the Final Budget Outcome is not the budget.
From Budget.gov.au

The Charter of Budget Honesty Act 1998 requires that a Final Budget Outcome be released no later than three months after the end of the relevant financial year. The financial statements in the Final Budget Outcome are similar to those in the budget but provide actual outcomes rather than estimates.

The original budget is long gone when this is released.
For the FF returns to be included in the budget, there would have to be an entry as to what the treasury expected the FF returns to be, which I could not find in the budget papers, but once again, am happy to be proved wrong.
Mick

 

[PZ99]

It's a budget historical statement - AFR says "2018-19, then-treasurer Josh Frydenberg and then prime minister Scott Morrison restored the budget to balance with a $690 million deficit "... exactly as per the screenshot in that year In other words... it's an "actual outcome"

More relevant is the column that says "Net Future Fund Earnings" and if you do the calculations you'll see they been added to the budgets since day dot (2005 or whatever it was)...

 

[mullokintyre]

It's a budget historical statement - AFR says "2018-19, then-treasurer Josh Frydenberg and then prime minister Scott Morrison restored the budget to balance with a $690 million deficit "... exactly as per the screenshot in that year In other words... it's an "actual outcome"

More relevant is the column that says "Net Future Fund Earnings" and if you do the calculations you'll see they been added to the budgets since day dot (2005 or whatever it was)...

Josh Fredenberg may well have considered himself the greatest treasurer Australia ever had since Swan, but not even he could have predicted the net earnings from the FF.
They were included in the real outcomes, NOT the original budget.
We will just have to disagree
Mick

 

[PZ99]

The figures don't lie but happy for you to disagree

 

[sptrawler]

Josh Fredenberg may well have considered himself the greatest treasurer Australia ever had since Swan, but not even he could have predicted the net earnings from the FF.
They were included in the real outcomes, NOT the original budget.
We will just have to disagree
Mick

https://www.finance.gov.au/government/australian-government-investment-funds/future-fund#:~:text=Budget%20treatment%20of%20Future%20Fund%20earnings%20and%20costs&text=While%20the%20Future%20Fund's%20gross,in%20the%20underlying%20cash

https://www.finance.gov.au/sites/default/files/2019-11/budget_treatment_of_future_fund_costs_consultation_paper.pdf

 

[sptrawler]

Further to the above post @mullokintyre , your posts got me interested so I googled some more.
The above post was a bit ambiguous, this seems to clarify it.

updated: 08 August 2019

https://www.finance.gov.au/about-us/glossary/pgpa/term-underlying-cash-balance#:~:text=The%20underlying%20cash%20balance%20is,non%2Dfinancial%20assets%20worsens%20underlying

Underlying cash balance​

A cash measure that shows whether the Government has to borrow from financial markets to cover its activities. The underlying cash balance is calculated as net cash receipts from operations (excluding Future Fund earnings), plus financing adjustments (to remove cash flows more appropriately viewed as financing in GFS), plus net cash flows from capital investment (net cash investment in non-financial assets worsens underlying cash balance as such investment is integral to the operation of Government). Related term:fiscal balance.


From Post #768 which I thought read ambiguously:

https://www.finance.gov.au/government/australian-government-investment-funds/future-fund#:~:text=Budget%20treatment%20of%20Future%20Fund%20earnings%20and%20costs&text=While%20the%20Future%20Fund's%20gross,in%20the%20underlying%20cash

Drawdown (debits) from the Future Fund​

On 25 May 2017, the Government announced its decision to defer drawing down from the Future Fund until at least 2026-27.

Budget treatment of Future Fund earnings and costs​

The Future Fund's gross earnings were excluded from the underlying cash balance from its establishment in 2006 until 2012-13. Gross earnings were excluded on the basis that Future Fund earnings, while accounted for as Government receipts, were not available for recurrent spending but were instead quarantined and reinvested to meet the Government’s unfunded superannuation liabilities.

While the Future Fund’s gross earnings were excluded from the underlying cash balance, its operational costs were included in the underlying cash balance.

In the 2012-13 Budget, the Government announced a review of the budget treatment of the Future Fund regarding the issue of whether net earnings should be excluded from the calculation of the underlying cash balance. The review questioned whether both Future Fund’s earnings and costs should be excluded from the underlying cash balance. Previously gross earnings only had been excluded.

Following consultation with stakeholders, the Government announced in the 2012-13 Mid-Year Economic and Fiscal Outlook that the Future Fund’s net earnings would be excluded from the calculation of the underlying cash balance. This was considered appropriate as the Fund’s earnings are required to be reinvested to meet future superannuation payments, and the Future Fund is required to meet all of its operating costs from its earnings. This means Future Fund earnings and costs are treated consistently in the calculation of the underlying cash balance.

As a result of this change in budget treatment, the historical series for the Australian Government fiscal aggregates was revised to account for Future Fund net earnings in the underlying cash balance.

A summary of the outcomes of the review conducted in 2012-13 is available at Budget Treatment of Future Fund Costs in the Australian Government Budget and Financial Documents.

The net earnings of the Future Fund will be included in the underlying cash balance regardless of whether drawdowns to meet unfunded superannuation liabilities have commenced at that time.


The last sentence, sounds like it is in relation to the Future Funds accounts, not the Governments accounts.

 

[PZ99]

For us folks wanting to know what the stage 3 tax cuts will be...

https://www.news.com.au/finance/economy/australian-economy/prime-minister-anthony-albanese-promises-tax-cuts-from-july/news-story/927bae137a45f596587d2909b12cdf8b

 

[basilio]

Will/should the Government fiddle with the promised Stage 3 Tax cuts ? They offer an exceptional deal for top end tax payers and almost nothing for lower and middle level income earners.

Some options are explored here.

The stage 3 tax cuts are only months away, but here's what could change in the meantime

Ahead of Labor's cost-of-living caucus, the crosshairs have again settled on the stage 3 tax cuts that are months away from handing more than $20 billion a year from the government back to (mainly) higher income earners.

www.abc.net.au

 

[sptrawler]

One would think, that is what the early return to Canberra was all about, maybe the ABC has been given a pre release briefing.

 

[SirRumpole]

One would think, that is what the early return to Canberra was all about, maybe the ABC has been given a pre release briefing.

Albo may reveal all at the National Press Club on Thursday.

 

[basilio]

Seems as if the Government will be reworking the tax cuts to ensure a better balance of benefits to low and middle class tax payers.
Naturally the Opposition and Big Business is going to be pearl clutching at such perfidy.

I suppose the Libs could go to the next election vowing to reverse these cuts and return them to the top tax bracket income earners. That should go down well.

Labor poised to alter stage-three tax cuts for cost of living relief as bitter stoush with Coaltion looms​

Caucus meeting in Canberra on Wednesday to hammer out ‘substantial’ cost of living relief to low and middle income earners

• Get our morning and afternoon news emails, free app or daily news podcast

Paul Karp Chief political correspondent
@Paul_Karp
Tue 23 Jan 2024 20.39 AEDTLast modified on Tue 23 Jan 2024 20.41 AEDT


The prime minister, Anthony Albanese, is poised to amend the controversial stage-three tax cuts after a crucial caucus meeting in Canberra on Wednesday in a move designed to offer “substantial” cost of living relief to low and middle income earners.
However, any tinkering of the agreed-to stage-three package sets the stage for a bitter political brawl with the opposition to claim a broken election promise.

Ahead of a cabinet meeting on Tuesday Albanese, promised that “everyone will be getting a tax cut”, comments that MPs noted did not rule out making the stage-three tax cuts less generous for some.

Labor poised to alter stage-three tax cuts for cost-of-living relief as bitter stoush with Coalition looms

Caucus meeting in Canberra on Wednesday to hammer out ‘substantial’ cost-of-living relief to low- and middle-income earners

www.theguardian.com

 

[mullokintyre]

Will/should the Government fiddle with the promised Stage 3 Tax cuts ? They offer an exceptional deal for top end tax payers and almost nothing for lower and middle level income earners.

Some options are explored here.

The stage 3 tax cuts are only months away, but here's what could change in the meantime

Ahead of Labor's cost-of-living caucus, the crosshairs have again settled on the stage 3 tax cuts that are months away from handing more than $20 billion a year from the government back to (mainly) higher income earners.

www.abc.net.au

Thats probably because the lower and middle level income earners do not pay much tax to be relieved from.
The lower/middle group get screwed by bracket creep, assuming they qualify for the threshold.
Mick

 

[basilio]

Thats probably because the lower and middle level income earners do not pay much tax to be relieved from.
The lower/middle group get screwed by bracket creep, assuming they qualify for the threshold.
Mick

View attachment 169421

Mick, which country are you referring to with your graph ? When I look at the source on the bottom line it seems to be US data.
Not a valid comparison.

 

[sptrawler]

I think this is the info you are after.

ATO reveals how much tax the rich pay

New data released by the Australian Taxation Office has revealed exactly how much tax it has collected from those in the top bracket. The results may surprise you.

au.finance.yahoo.com

On the left number of individuals,--------------------------------------------- on the right net tax paid

 

[farmerge]

Albo may reveal all at the National Press Club on Thursday.

Isn't Airbus due to fly somewhere overseas.

 

[farmerge]

I think this is the info you are after.

ATO reveals how much tax the rich pay

New data released by the Australian Taxation Office has revealed exactly how much tax it has collected from those in the top bracket. The results may surprise you.

au.finance.yahoo.com

On the left number of individuals,--------------------------------------------- on the right net tax paid
View attachment 169424

I think that looks "pretty fair" the wealthy can't be expected to give up their "hard earned" too easily.

 

[mullokintyre]

Mick, which country are you referring to with your graph ? When I look at the source on the bottom line it seems to be US data.
Not a valid comparison.

My Appologies Bas, is it is the USA,
The data from Australia is similar.
As can be seen from the stats below, the top half of the population by income pay 98% of the tax.
Source Morning Star

The data is old at 2015, but the data supplied by @sptrawler at 2022 is similar, but the breakup is in quintiles rather than deciles, and I could not validly extract Deciles from that data.
The bottom line is, as time goes on, inflation in income, together with bracket creep pushes the percentage of the top 50% tax higher.
And as been noted many times, the increase in income of the top 50% is always greater than the bottom 50%.
It is entirely possible that we could reach a situation where the bottom 50% pay no tax at all.
Mick