Key forecasts in Intergenerational Report

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2021 INTERGENERATIONAL REPORT - 40-YEAR OUTLOOK

BUDGET - Underlying cash balance to be in deficit over the next 40 years and to be 2.3 per cent of GDP by 2060/61. It was forecast to be 5.0 per cent of GDP ($106.6 billion) in 2020/21 as per May budget.

GROWTH - Real GDP to grow by an average annual rate of 2.6 per cent from 2020/21 to 2060/61, 0.4 percentage points lower than the past 40 years.

GROWTH PER PERSON - Real GDP to grow at an average annual rate of 1.5 per cent per person compared with 1.6 per cent over past 40 years.

POPULATION - 38.8 million by 2060/61 compared to previous prediction of almost 40 million by 2054/55. This is the first time there has been a downward revision for population growth in the IGR.

AGEING - By 2060/61, for each person aged over 65, there will be only 2.7 people working, compared with four people now and 6.6 people in 1981/82.

NET DEBT - Projected to peak at 40.9 per cent of GDP in 2024/25, before falling to 28.2 per cent in 2044/45 and then increasing to 34.4 per cent by 2060/61. It was forecast to be 34.2 per cent for 2021/22 ($729 billion) in the May budget.

PRODUCTIVITY - Labour productivity to converge to 1.5 per cent annually, consistent with the 30-year historical average to 2018/19. Productivity averaged 1.2 per cent over the most recent cycle.

GOVERNMENT SPENDING:

Health - 26 per cent of total spending by 2060/61

Aged care - to double by 2060/61

Age pension/Super tax concessions - to grow to 5.0 per cent of GDP in 2060/61 from around 4.5 per cent in 2020/21.

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