Deloitte Access Economics on Monday released its latest quarterly outlook on the economy,forecasting the recovery out of the COVID-19 pandemic had been delayed rather than derailed by recent lockdowns aimed at preventing the spread of the Delta strain of coronavirus.
It is tipping the economy to grow by 1.5 per cent in 2021-22,driven by a further lift from the mining and agriculture sectors,a lift in business investment and a 4.4 per cent step-up in public expenditure.
Growth is likely to be strongest in Tasmania and South Australia,with the NSW economy forecast to expand by 0.3 per cent and Victoria’s by 1.2 per cent.
But Deloitte director Chris Richardson said another issue beyond the recovery from the pandemic is the state of the federal budget.
He said the public sector deficit this year will be almost 2 per cent of national income higher than what is forecast by federal and state budgets combined.
“The budget isn’t bollocksed. Yes,it needs repair. But that repair isn’t due to the one-off costs of COVID crisis fighting,” he said.
“It’s needed mostly due to recent decisions to boost social spending. Those decisions were much needed,but they haven’t yet been funded. Budget repair is important for future crisis-fighting,so we’re keen to see it.”