Budget projections are dependent on assumptions about the performance of the economy. Variations in key economic parameters affect national income and therefore the budget projections. This report analyses the sensitivity of the 2014–15 Budget medium-term projections to variations in labour productivity growth, the labour force participation rate and the terms of trade. It highlights the importance of labour productivity growth, in particular as a driver of economic growth and fiscal sustainability, and includes an assessment of the likely balance of risks.
(593 KB) (436 KB)
Date issued: 26 November 2014
Independent Economics report: Economic impact of selected macroeconomic shocks, 23 September 2014
Supplementary table: High labour productivity
Supplementary table: Low labour productivity
Supplementary table: High labour force participation rate
Supplementary table: Low labour force participation rate
Supplementary table: High terms of trade
Supplementary table: Low terms of trade
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