SYDNEY – The Australian government will announce “significant” cuts at a budget update tomorrow as it remains committed to restoring a surplus, according to Treasurer Wayne Swan.

“The toughest conditions in the global economy in generations have cut a swathe through traditional sources of revenues,” Swan said today in his weekly economic note. “This will require more savings to be found. The savings will be significant.”
The govt is preparing to reveal A$4b in spending cuts and other measures, the Sydney Morning Herald said yesterday. Increased charges for visa applications will boost revenue by about A$500m, the Sunday Telegraph reported, without saying where it got the information.
Prime Minister Julia Gillard’s government has committed to restoring a budget surplus this fiscal year after four years of deficits even as growth slows. Australia’s economy is succumbing to a slowdown in world growth that the International Monetary Fund predicted this month would decelerate to the weakest pace since the 2009 recession. “I have no doubts whatsoever about the critical importance of our budget strategy,” Swan said. Returning to surplus was “appropriate” because of the Australian economy’s strong fundamentals including low unemployment, inflation in check and a robust investment pipeline, he said.