Australia’s Treasurer said his government remains committed to returning the national budget to surplus next fiscal year despite the task becoming more difficult with slower than expected economic growth.

Australian prime minister Julia Gillard called a ballot on the leadership of the ruling Labour Party, bringing to a head an increasingly bitter and ugly row with her predecessor Kevin Rudd.

Australia’s prime minister Julia Gillard put her job on the line, announcing a leadership ballot in hopes of quashing a comeback by the premier she ousted in a Labour Party coup.

Australia’s foreign minister resigned yesterday, saying he was unable to continue without prime minister Julia Gillard’s support, paving the way for his leadership challenge.

The Australian government said it remains on target to return the budget to surplus in the next fiscal year despite the European debt crisis slashing revenue by AUS$20bn (US$20bn) a year.

A scandal that threatened to bring down the Australian government eased today when police announced they would not charge a politician accused of misusing an official credit card to pay prostitutes.

European governments need to restructure their economies to restore the confidence of financial markets as the global economy moves into a new danger zone, the head of the World Bank said today.

The leaders of Germany and France are meeting today to discuss how to get the eurozone’s 17 countries to work together to address Europe’s debt crisis.

The Australian stock market fell sharply today as concerns over the US economy and Europe’s debt woes battered stocks across the world.

AUSTRALIA’S government is reportedly considering a taxpayer levy to help pay for massive flood rebuilding, while preserving the budget’s path back to surplus in 2012-13, as one major bank warned yesterday the damage bill could reach AUD$20 billion (€14.9bn).

A WOODEN boat packed with asylum seekers smashed against jagged rocks in a storm off an Australian island yesterday, killing at least 27 people.

A wooden boat packed with dozens of asylum seekers smashed apart on jagged rocks in heavy seas off an Australian island today, flinging screaming women and children into churning water and sending many to their deaths.

Julia Gillard has been officially sworn in as Australian Prime Minister, the first woman ever elected to the post.

A sudden revolt within Australia's ruling party gave the country its first woman prime minister, who today promised to safeguard her government's reforms in education, health and industrial law.

Australian police say an email that challenged Prime Minister Kevin Rudd’s honesty and prompted calls for his resignation appears to be a forgery.

Australia’s first annual budget to sink the country into debt in almost a decade will focus on saving jobs and building new infrastructure in the face of the global economic downturn, the treasurer said.

A merger of Qantas and British Airways must involve control of the “Flying Kangaroo” remaining in Australia, officials in the country insisted today, as Qantas shares surged on hopes a deal would see it emerge a stronger competitor to big regional rivals like Singapore Airlines.

Prime Minister Kevin Rudd and his team were formally sworn in as Australia’s new government today, nine days after sweeping to power in elections that ended more than 11 years of conservative rule.