STORY-TRÅD·politik

Queensland’s economy teeters on edge of ratings downgrade despite coal royalty windfall

Earnings from mining the fossil fuel set to increase to $6.9bn over financial year, up from $4.8bn, with budget deficit to reach $6.2bnFollow our Australia news live blog for latest updatesGet our breaking news email, free app or daily news podcastQueensland’s treasurer says he’s “not giving up” on halting a ratings downgrade of the state’s finances after handing down a budget full of red ink, amid predictions state borrowing will top $200bn in three years.David Janetzki promised a budget surplus in 2029-30, the year after the state’s next election – but only after years of billion-dollar deficits.The state is running a $6.2bn operating deficit this year.Government revenue will increase 5.1% over the forward estimates, driven by increases in government duties, payroll tax and royalties.Spending will grow, rising from $100.8bn in 2025-26 to $111.6bn in 2029-30.The government says it is committed to returning the budget to a “fiscally sustainable position through strong expenditure management”, with expense growth dropping from 4.9% in 2026-27 to an average of 2.6% over the four years to 2029-30.Half a billion dollars will be saved through better coordinating procurement, reducing the cap on senior executive positions and reduced spending on contractors and consultants.$119.2bn for new roads, transport projects and other infrastructure in the next four years.Construction funding for the long-awaited Borumba pumped hydro scheme, and no money for the multiple smaller hydroelectric projects promised by the LNP at the last election.Compared with Labor’s last budget, there’s limited short-term cost of living relief, with premier David Crisafulli saying there were no “sugar hits” in his budget.Exempting first home buyers from stamp duty when building or buying a new home. The state will also extend the $30,000 First Home Owner Grant.An increase in the Back to School payment by $50, now paying $150 for school supplies.A freeze of bulk water prices for two years, a saving of about $130 for residents in Southeast Queensland.A continuation of the state’s free kindergarten for another four years, paying fifteen hours of free kindy a week for all four-year-olds.Funding for the state’s 50 cent fare scheme, which will be legislated.Funding for the Queensland revenue office to pursue existing tax and penalty debt”, a scheme expected to raise about $220m in revenue and $612 in debt recovery in the next four years. Continue reading...