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Fed: Treasurer announces record deficit in budget

12 May 2009 8:11 PM

Treasurer WAYNE SWAN has announced a record deficit of nearly 58 billion dollars .. in a budget he says has been forged in the fire of the most challenging global conditions since the Great Depression.

At its core is the biggest plan for nation-building investment in infrastructure since the Snowy Hydro scheme .. to return the budget to surplus in six years time.

There's 22 billion dollars for spending on roads .. rail and other infrastructure .. and a 32 dollar a week increase in the single aged pension and a 10 dollar increase for couples.

But to pay for the rise .. the pension age is to be lifted by two years to 67 .. a move Mr SWAN acknowledges will be unpopular.

There's also a six-month extension for the boosted first home buyers' grant but there's pain for families .. with the private health insurance to be slashed .. the Medicare Levy Surcharge to rise .. and other changes to health funding in areas like IVF.

The jobless rate is forecast to soar to 8.25 per cent next year and 8.5 per cent in 2011 .. but Mr SWAN says that without the government's early and decisive action when the global economic crisis hit .. it'd be much worse.