Treasurer urges public to spend to avoid ‘fiscal cliff’

Federal Treasurer Josh Frydenberg has urged those who came out of the pandemic better off to spend their money across the economy.

A combination of extra government support and caution around spending means there are many Aussies who have saved in the past year.

“There’s now more than $200 billion, which is on household and business balance sheets, which was not there last January,” he told Tony Jones, filling for Neil Mitchell on 3AW.

“That is money that can be spent across the economy in the period ahead, and help us avoid a fiscal cliff when the temporary emergency economic supports taper off.”

JobKeeper, which supported up to 3.4 million Australians at it’s peak, is due to come to an end on March 28.

“What we have seen in previous economic downturns, like the GFC, is the savings ratio increases quite dramatically,” he said.

“That is just a function of people being cautious and being reluctant to spend.”

Click PLAY to hear the interview below