Australia Debt Ceiling Hit By June

13 Mar

On 2 November 2011 your humble blogger showed that the Green-Labor government was on target to hit the debt ceiling by mid-2012.

4 months later, that approximation is looking good (well, very bad, actually … but you know what I mean):

Commonwealth Government Securities Outstanding at end February | Source: AOFM

That new, increased, $250,000 million dollar debt ceiling was only set last year. Slipped into the Budget papers by the government, hoping noone would notice.

Barnaby did, of course. He was the first (and only) to rail against the government quietly sneaking in a budget provision to raise Australia’s debt ceiling by a whopping 25%:

As Treasurer Wayne Swan was congratulated by colleagues after Tuesday’s budget speech, Assistant Treasurer Bill Shorten introduced draft laws allowing the government to increase the amount it can borrow from $200 billion to $250 billion.

The proposed legislation would also remove a requirement that the Treasurer explain why the extra money is needed.

Great, isn’t it?

The government changed the law, so that it could rack up tens of billions more debt … for other people to pay back, for decades to come … and not even have to explain themselves.

What’s the bet that Wayne and Co will slip another provision into the May budget this year, to lift the debt ceiling again.

For the fourth time in five years.

After all, based on their current trajectory, they will run out of money by around June.

Time to ask Parliament for another extension on the next generation of taxpayers’ credit limit.

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5 Responses to “Australia Debt Ceiling Hit By June”

  1. Twodogs March 13, 2012 at 8:41 am #

    Will they even make May? At the current rate, they will have to withhold payment in the order of $billions to make it that far. It will be a major embarrassment and difficult to hide if they don’t.

  2. Warwick Hughes March 13, 2012 at 10:32 am #

    Currently Total Commonwealth Government Securities
    on Issue – $232,011m
    http://www.aofm.gov.au/
    next update Friday 16th.
    Sure they will find a way to blame toniiyabbitt

  3. Richo March 13, 2012 at 12:19 pm #

    The Coalition have stated in the past they will have numurous caveats upon agreeing to raising the debt ceiling again.

    Even Rob Oakshott has said it would be reluctant to support raising the ceiling again.

    I fear however this is all talk. I just hope they make a bigger song and dance about this time.

  4. Paul April 12, 2012 at 3:32 pm #

    http://www.aofm.gov.au/content/_download/Portfolio_11/Table_P8.1.pdf

    Historical data, maturity profiles of debt on issue, 15 April 2012 maturity 14.055 billion thats a big reduction of debt on issue, you guys may want to settle down on this issue

    • The Blissful Ignoramus April 12, 2012 at 4:44 pm #

      Business Spectator, 10 April – “The federal government could be just four months away from breaking through a $250 billion limit on commonwealth debt, as Canberra ramps up its borrowing to cover this year’s growing budget deficit”

      Two months vs four months. Hair splitting. The trend, and the outcome, remain the same.

      We are Ireland.

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