State’s debt levels climb and could get worse
Debt-to-GDP metric is bad news ahead of finance minister’s medium-term budget policy statement
The state’s debt levels have overshot forecasts made in February’s budget and economists believe it could get worse without improvements in economic growth and greater commitment to spending cuts from the government.
The national government’s total gross loan debt increased “significantly” to 58.3% of annual GDP as at June 30, the Reserve Bank said in its quarterly bulletin on Wednesday. This was above the February budget’s projection of 56.2% for the full 2019/20 fiscal year.