Budget figures to help keep lid on rates, says Labor

The Federal Opposition says today's revised budget figures allow it more than $3 billion to spend before it dips into the surplus.

Federal Treasurer Peter Costello has revealed an $8 billion surplus for the last financial year.

The announcement comes in the wake of a revised Treasury surplus forecast for this financial year, required at the start of an election campaign.

The surplus for the last financial year is $3.5 billion more than expected.

Mr Costello says the $8 billion will go to retiring debt but he has announced that surpluses in the future will go to a new fund to pay for the Commonwealth superannuation liabilities.

"Having now repaid $73 billion of the Labor debt, it's time to invest in the future," he said.

Mr Costello says net debt is at its lowest level since 1977.

Treasury figures also out today have predicted a $5.3 billion surplus for the 2004-2005 financial year, double initial indications.

I suspect the splat we just heard was the Great Interest Rate Scare of 2004 splattering on the foot path. Labor has no plans to spend anything approaching the surplus so the issue of higher interests rates, insofar as they depend on aggregate government spending, is dead. This also emphasises the big difference between the Man of Steel and the Great and Powerful Dubya. The Man of Steel is much better at economic management.