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1370.0 - Measures of Australia's Progress, 2010  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 15/09/2010   
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National income

National net saving as a proportion of GDP(a)
Graph Image for National net saving as a proportion of GDP(a)

Footnote(s): (a) Year ending 30 June.

Source(s): ABS Australian System of National Accounts, 2008-09 (cat. no. 5204.0)

National net saving as a proportion of GDP - by sector(a)
Graph Image for National net saving as a proportion of GDP - by sector(a)

Footnote(s): (a) Year ending 30 June.

Source(s): ABS Australian System of National Accounts, 2008-09 (cat. no. 5204.0)

SAVINGS

Saving is one means of funding investment, which is the formation of fixed capital used in the production of goods and services (see the National wealth section for a more detailed discussion of the concept of investment). Income that is saved rather than spent on current consumption can be used to accumulate assets (wealth) that will generate future income and support future consumption.

Saving cannot be measured directly. It is calculated as a residual item by deducting final consumption expenditure from disposable income. Because it is estimated as the (relatively small) difference between two large national aggregates, saving is subject to any measurement error in, or revisions to, either aggregate.

Net saving represents the resources available for investment (capital formation) including replacement of fixed capital, but subtracting depreciation (consumption of fixed capital).

During the past decade, there was a 3.0 percentage point rise in the ratio of national net saving to GDP (from 4.9% to 7.9%). But the longer term trend has been downward; between 1960–61 and 1998-99 the ratio fell from 15.9% to 4.9%.

Sectors within a nation can have different saving behaviour, and national net saving can be dissected to show the trends in saving by the following sectors – households, general government and corporations.

Over the longer term (from the 1960s onward), the household sector has been the main contributor to national saving. However, since the mid 1970s, the net saving of the household sector relative to GDP has fallen.

The general government sector went from being a net saver during the 1960s to a net dissaver between the mid 1970s and mid 1990s. During the 1990s, government dissaving was progressively reduced and from 1996-97 onward the government sector was again a net saver, except during 2008-09. The corporate sector has been a net saver since the 1960s.

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