Government Consumption Expenditure
Published: December 18, 2024This report analyses total government consumption expenditure. Government consumption expenditure includes any Federal Government spending on consumable products for defence and non-defence purposes and consumption expenditure by state and local governments. This is defined as net expenditure on goods and services by public authorities, but not public corporations, which does not result in the creation of fixed assets or the acquisition of land or second-hand assets. Consumption expenditure includes employee wages, the purchase of goods and services, the consumption of fixed capital (i.e. depreciation expenses), and the repair and maintenance of roads. The data for this report is sourced from the Australian Bureau of Statistics (ABS) and is measured in billions of seasonally adjusted, constant 2021-22 dollars that have been deflated using chain volume measures.
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Recent Trends – Government Consumption Expenditure
IBISWorld expects government consumption expenditure to climb by 3.7% in 2024-25, to reach $588.2 billion. Major budget initiatives include alleviating the cost-of-living crisis through cost-of-living tax cuts, energy bill relief and easier access to affordable medicines, building more homes to address the ongoing housing crisis, investing in Future Made in Australia to boost the economy through strengthening renewable energy capabilities, strengthening social security and welfare and providing support to promote equality. Expenditure is anticipated to spread across several sectors, including fuel and energy, mining, manufacturing, defence, housing and social security and welfare. Inflationary pressures in recent years are also expected to contribute to an upward trend in government consumption expenditure.
Government consumption expenditure expanded significantly from 2018-19 to 2021-22 due to pandemic-related measures. Income support measures, including the JobKeeper and JobSeeker payment schemes, helped eligible Australians remain in jobs and assisted businesses adversely affected by the pandemic. Income support packages are not classified as government consumption expenditure. They are only accounted for in GDP measurements once they are spent by households and are therefore classified under household consumption expenditure.
5-Year Outlook – Government Consumption Expenditure
IBISWorld forecasts government consumption expenditure to reach $60...
