Westpac Senior Economist Pat Bustamante estimates that “high nominal income growth on the back of elevated commodity prices, strong wages growth and high inflation, along with record population growth, have combined to deliver a budget windfall of $252.1 billion over the six years to 2027-28, since the October 2022 budget”.
Bustamante estimates that “elevated commodity prices alone will deliver a windfall of around $121.9bn over the three years to 2024-25, compared with the Treasury estimates in the 2022 Preelection Economic and Fiscal Outlook (PEFO)”.
The following chart from Bustamante shows that much of the revenue windfall has been channelled into record public spending.
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