Record government spending props up GDP

Rapidly rising government spending was the single biggest driver of economic growth in the September quarter, as public servant pay rises and household energy bill subsidies pushed state and federal expenditure to a record share of gross domestic product.

Combined federal and state government spending hit $195.8 billion in the September quarter, the Australian Bureau of Statistics said on Tuesday. The figure, which was not adjusted for inflation, represented an 8 per cent increase on the same time last year – far higher than the 5.3 per cent average annual growth rate in the decade before the pandemic.