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Australia’s budget deficit has fallen almost $4 billion short of where it was expected to be at this time, new figures show.

Finance Department figures released on Friday showed a deficit of $174.6 billion in the 12 months to October, or 8.8 per cent of gross domestic product.

CommSec chief economist Craig James said it was hard to say whether the smaller than expected deficit was due to government assistance not getting to businesses and households or that the economy was performing better than expected.

“It may be a mixture of the two,” he said.

He said “smoothed revenues” were down two per cent on a year ago, the biggest decline in more than 10 years.

Expenses were up 26 per cent, the fastest growth since monthly records were published.

Annual company tax collections fell 10.1 per cent over the year – the biggest fall in nine-and-a-half years – after recording double-digit annual results over 2017/18 and 2018/19.

Social security and welfare spending was up 24.8 per cent, the fastest rate in almost 11 years.