п»їYear 11 Economics Research Task

Fiscal insurance plan: 2007- 2013

The government through the period from 2007- 2013 developed a powerful Fiscal insurance plan stance. In the years Prior to the Global Financial Crisis (GFC), the government made a decision to take a countercyclical approach to our economy through Money policy as they had found the shaky increase in levels of spending as well as the levels of saving. This is proven in plan 1, government spending was at low justification in the previous ten years of 23. 5 %. In the year of 2008, Australia entered the GFC a severe time of recession in the global economy this designated a period of expansionary insurance plan. This is also proven through plan 1, which shows the spike in government expenditure to 34. 1 % in 2009- 2010. The government started to run budget deficits; this is when costs exceeds their intake. Completely Australia changed their position and entered a period of contractionary Fiscal stance to try and bring the price range back by deficit into a budget excessive. This change was also brought on by the upcoming government election, since the time party got problems with their economic plans in the past. Despite the period of contractionary policy the fiscal posture of the Australian government produced little difference on the end consequence.

During the government's financial constraints for 3 years ago to 2013 there was a recorded $42 billion of expenditure mainly targeted at developing infrastructure, casing, education and infrastructure intended for the community? The government decided to concentrate on Infrastructure because the benefits it offers to the economic system. The government has additionally chosen to enhance expenditure intended for both education and handicap care sectors.

Diagram 1:

Budgetary Policy: 2007 – 2013

Prior to the GFC in 08, the RBA increased interest rates to up to and including level of six. 5% so they could slow down the economic activity. This was the RBA's a reaction to increasing prices of pumpiing;...

Bibliography: 1) http://parliamentflagpost.blogspot.com.au/2011/04/australias-current-debt-position.html

2) http://www.rebuildingthenation.com.au/finance/financing-infrastructure/

3) http://www.rba.gov.au/publications/smp/index.html

4) http://hsc.csu.edu.au/economics/policies_mgt/2592/Topic4Tutorial1.html

5) http://www.business.uwa.edu.au/__data/assets/pdf_file/0018/2254050/12-28-Australia-and-the-GFC,-Saved-by-Astute-Fiscal-Policy.pdf

6) http://www.budget.gov.au/2008-09/content/uefo/html/appendix_a.htm

7) http://archive.treasury.gov.au/documents/1033/HTML/docshell.asp?URL=TW_2005-04.htm

8) http://www.kewpid.net/notes/macro_reform.pdf

9) http://www.rba.gov.au/chart-pack/

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