Wayne Swan is to deliver his Budget speech to a backdrop of a share market slump in Australia, with investors concerned over the eurozone economic situation and jobs data from the US.
More than $27 billion was wiped off the value of Australian shares yesterday, with strong anti-austerity voting patterns in France and Greece spooking investors.
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Big cuts needed to reach surplus: economist
The Federal Government will have to make $6 billion in cuts to bring Australia back to surplus, according to a leading economist.
Chris Richardson from Deloitte Access Economics said: “It will be tough, and tougher than we’ve seen in a while.”
“You’re talking about savings of $10 billion over two years. Canberra hasn’t had to do that sort of thing since the first budget of the Howard years [in] 1996.
“We know there’ll be a surplus – a small surplus of $1 billion or so. That’s probably going to take cuts of $5 billion or $6 billion and that money has to be saved fast.”
Google loses copyright case
Google has lost a key US court case brought by Oracle, which claimed the search giant breached its copyright over its Java programming language.
Oracle wants $1 billion in compensation over the case, although jurors were unable to agree as to whether Google had a “fair use” defence.
The Australian dollar rose to 101.98 US cents overnight.