Premier Annastacia Palaszczuk and Treasurer Curtis Pitt. Picture: Adam ArmstrongSource: News Corp Australia Queensland’s Palaszczuk government has kept its promise in delivering a “real Labor budget’’ with big spending increases in health, education and training as it moves to cut spiralling debt on paper with the redirection of public service entitlements and superannuation payments.
In Labor’s first budget since its boilover election defeat of the one-term Liberal National government in January, tyro Treasurer Curtis Pitt has delivered a surprise $962 million operating surplus on the back of optimistic growth forecasts over the next few years.
After three years of LNP government cuts in public service jobs and programs — slashing average spending growth under previous Labor governments from 9 per cent to just 2 per cent — the rate of public expenditure is now set to blowout by 4.3 per cent.
The boosts are concentrated in a 4 per cent increase in health funding, seven per cent increase in education and a $1.6 billion new jobs and training scheme.
But despite premier Annastacia Palaszczuk campaigning on the need to alleviate cost-of-living pressure, the budget failed to deliver any relief from government charges or levies.
Ms Palaszczuk and Mr Pitt has defended the decision not to offer any sweeteners to households, saying their focus is to create new jobs and boost frontline services.
“This is a responsible and measured budget—– pro-growth and pro-jobs — which delivers vital funding for health and education,’’ he said.
“The budget demonstrates our responsible fiscal management.
“It is the first budget in 16 years to reduce debt every year of the forward estimates.’’
Despite a $3.6bn fall in royalties and payroll tax revenues and the increase in spending, Mr Pitt said the government will deliver an operating surplus of $962m this financial year.
The previous LNP government had forecast a slender surplus of just $188m.
M Pitt surplus said the bottom line is now forecasted to steadily improve over the next three years, with an operating surplus of $1.2bn next financial year, and $2bn surpluses for each of the following years.
The turnaround has built on forecasted revenue growth of 3.2 per cent, a $923m increase in GST payments from the Commonwealth this year, lower interest rate payments and $2.31bn in savings through “offsets and reprioritisations’’ of largely Newman government programs.
Economic growth, which currently sits at 2 per cent for this financial year, is estimated to more than double to 4.5 per cent for the two following years, largely on the back of a ramp-up of production in the liquefied natural gas sector.
The growth forecasts are set to outstrip the rest of Australia.
Despite Labor campaigning on job creation ahead of the last election and spending $1.6bn in jobs and training in this budget, employment growth has slowed to just 0.5 per cent this year with predictions that unemployment will remain at 6 per cent over the next few years.
Mr Pitt said a three-pronged attacked would cut government debt by $9.6 billion over the forward estimates.
The January state election was largely fought over how to tackle almost $80 government debt — racked up by the previous Labor governments.
Under the Labor budget plan, $4.1bn will not be paid down but shifted to the books of the state owned energy companies to pay-off in a move that is estimated to spare the state $600m in interest rate payments over four years.
Mr Pitt said the move would not affect electricity prices.
The second part of the debt reduction plan involves raiding an existing $3.4bn pool of funds — set-aside to pay public service leave entitlements — to pay debt, again to save $600 million over the forward estimates.
Mr Pitt defended the move, saying Queensland was the only remaining state to fund long service liabilities with an existing fund.
“The government considers the current approach of holding significant financial assets — at the same time as significant levels of debt — is no longer appropriate,’’ he said.
The third part of the debt reduction strategy is to freeze payments for five years to one of the state’s superannuation schemes for public servants.
The scheme, which has liabilities of $30bn, is in surplus by an estimated $10bn. http://www.theaustralian.com.au/nat...alian&utm_medium=email&utm_campaign=editorial
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A surplus just like Wayne swan...........................speechless!
