Up to $15bn in Budget stimulus likely to be spent on infrastructure
April 22, 2009 08:08am
THE Federal Government's third round of economic stimulus is unlikely to end up in personal bank accounts, an economic analyst says.
The Federal Government is preparing a third round of stimulus spending in next month's Budget to help steer the economy out of recession.
Access Economics says the Government would be justified to spend an extra $10 billion to $15 billion.
Spokesman Chris Richardson says it is unlikely that the next stimulus will be in the form of $900 cash payments, as in the last stimulus package.
"I don't think we'll see another round of cash payments, tax bonuses or the welfare handouts,'' Mr Richardson said.
The money would likely be spent on infrastructure projects like roads and bridges, he said.
"These are things that help more in a downturn.''
Mr Richardson said he was worried that too much spending would add to long-term national debt.
"This financial year ... we are looking down the barrel of a $50 billion Budget deficit.
"It's not actually this Budget that worries me so much, it's the Budget beyond it.
"Three or four years from now the crisis is history but we will still have very large Budget deficits.''
Opposition treasury spokesman Joe Hockey said the Government must ensure Budget spending would create jobs.
"For every dollar the Government spends it needs to prove that it is creating or preserving real jobs,'' Mr Hockey said.