There is nothing to celebrate in today’s Budget update.
Shadow Treasurer David O’Byrne said comparing today’s results to the assumptions contained in the May Economic and Fiscal Update gave a false illusion of Budget improvement.
“Treasury warned in May that the COVID-19 situation was volatile and other states avoided making economic forecasts in that environment,” Mr O’Byrne said.
Treasury said:
“This Economic and Fiscal Update Report has been prepared in a highly uncertain economic and fiscal environment.”
“As such, it is currently not possible to reliably measure the full impacts of COVID-19 on Tasmania’s economy and budget… some fiscal and economic information that would generally be taken into account in the preparation of estimates is not currently available.”
“The fact that the Budget is not as bad as predicted in May is nothing to celebrate. The March quarterly report showed the Budget was already $100 million in deficit and charging towards unsustainable debt before COVID-19 hit. Today’s report shows the Budget is now $273.1 million in deficit and we also remain on a collision course with over $1.5 billion in net debt.
“The truth is that the Liberal Government’s woeful track record of infrastructure underspending has continued, despite its rhetoric about a construction blitz.
“The Liberals spent $200 million less than budgeted on infrastructure, including $23 million on affordable housing and $22 million on TAFE and training, areas that should be front and centre of our economic recovery. Peter Gutwein’s promises to build Tasmania out of recession cannot be believed.
“The true state of the Budget has also been masked by yet another dividend raid on Hydro and TasNetworks to the tune of $40 million at a time when the Government is refusing to pass on a Winter Energy Supplement to struggling households.
“Peter Gutwein is also holding back money previously allocated to providing payroll tax relief and other support to businesses
“Many worthy businesses missed out on critical support would be appalled the Government is now using this money to make the Budget look better.”
David O’Byrne
Shadow Treasurer
