‘Action needed’: all eyes on debt for state’s budget
Ethan James |
Tasmania’s government will release an interim budget amid warnings immediate “corrective action” is needed to address ballooning debt.
The island state’s original 2025/26 budget, handed down in May, never passed parliament because a snap election was called.
It forecast net debt more than doubling from $5.3 billion in 2024/25 to $10.8 billion in 2028/29, a steeper trajectory than tipped in the previous budget.
Treasury in June flagged a more severe scenario, saying net debt would hit $13 billion by 2027/28 unless the government undertook immediate corrective action.
Tasmania was spending more than it earned and more revenue raising and decreases in expenditure were required, Treasury said.
The government, however, has said it won’t increase taxes but remains committed to cutting 2500 public service jobs.
Treasurer Eric Abetz will on Thursday release the 11-year Liberal government’s interim budget, his first since taking the role in August.
The Liberals are dealing with several financial headaches, including a $75 million bailout announced in October for embattled Spirit of Tasmania ferry operator TT-Line.
Minority Premier Jeremy Rockliff hasn’t ruled out pouring further money into the state-owned business.
“We will work with TT-Line to ensure their financial sustainability,” he told parliament on Wednesday.
The Liberals are at loggerheads with public sector unions, who are fighting for better pay and conditions and say the government’s one-year, three-per-cent offer isn’t good enough.
Mass stop-work actions were held across the state in October, with further industrial action on the cards.
A proposed $1.13 billion stadium in Hobart, a condition of Tasmania entering the AFL and AFLW, also hangs over the budget ahead of a parliamentary vote in December to decide its fate.
Mr Abetz has said not all funding commitments in the original 2025/26 budget would be included in the interim budget.
Community service organisations have concerns about funding cuts as the government tries to balance the books.
Further “repair measures” would be worked through after the interim budget ahead of the 2026/27 budget to be delivered in May, Mr Abetz said.
Tasmania was plunged into an early election in July after Mr Rockliff lost a no-confidence motion in parliament that was critical of his budget management.
AAP
