Commonwealth Government net lenders for first time since June 2019

Media Release

A $7.3 billion increase in net saving has seen the Commonwealth Government become a net lender during the March quarter 2023, according to new data released today by the Australian Bureau of Statistics (ABS).

The Commonwealth Government has lent a total of $6.4 billion in this quarter, the Government’s first net lending position since June 2019.

Dr Mish Tan, ABS head of finance statistics, said: “This quarter, a large increase in income tax receipts from individuals helped the Commonwealth Government into a net lending position."

“Essentially this means that the growth in the Government’s income was greater than its growth in spending, and because of that, the Government has acquired more assets than debt."

“Individual income tax and company tax have been high over the past year, in line with the strong labour market and company profits.”

This shift to being a net lender has been helped by typical seasonal decreases in social assistance benefits and government consumption, as well as a reduction in outlays to state and territory governments.

This was reflected in the Commonwealth’s balance sheet through a $15.7 billion increase in deposit assets, a $4.9 billion rise in accounts receivable, and $4.7 billion growth in equity assets.

Other includes: derivatives, loans, monetary gold and SDRs, currency, bills of exchange and unfunded superannuation claims.

Household wealth increased this quarter, after a revised growth in December quarter. This was driven by growth in households’ superannuation assets and deposits, as well as the value of residential land and dwellings.

Despite this quarter’s increase, overall household wealth still fell by 0.8 per cent over the year as household wealth decreased in the middle of 2022 due to falls in the value of residential land and dwellings and superannuation assets.

Households deposited $26.3 billion in the quarter, with a record $655.1 billion now invested in non-transferable deposit accounts such as savings and fixed-term deposits.

“Households saw significant investment in high interest savings deposit accounts for the first time since the beginning of the Reserve Bank of Australia’s increases to the cash rate target, as banks offered interest rates comparable to those on term deposits,” Dr Tan said.

Media notes

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