MYEFO 2012

In considering this year's Mid-Year Economic and Fiscal Outlook statement from the Government, it is worth thinking about the government's forecast performance since the global financial crisis.

First, however, let's look at the fiscal policy headlines. The revenue projection for the current financial year is down by $2.4b, and projected expenses are down by $1.4b. The projected fiscal balance is down from $2.5b to $1.2b.

In cash terms: receipt projections are down $1.8b. Payments are down by $1b. The projected underlying cash balance is down from $1.5b to $1.1b.

Now back to looking at the performance of past forecasts. For expenses, since 2007, there is a long-standing tradition of underestimation.

For revenue, with the exception of UEFO and the Budget in 2009, there is a long-standing tradition of overestimation.

The balance projections have not much moved.