Discipline key to protecting Tasmania’s financial future

9 April 2019

Under the Hodgman Liberal Government, our State’s balance sheet and our economy are strong, and maintaining budget discipline is crucial to ensuring our state continues to thrive.

In stark contrast, under the Labor-Green Government, Tasmania was forecasting $1.1 billion in deficits and also having to borrow to pay operational expenses.

Under Labor, Tasmania’s economy went into recession, business conditions collapsed, business confidence fell to the lowest in the country, and 10,000 Tasmanians lost their jobs. Rebecca White, Michelle O’Byrne and Scott Bacon presided over the sacking of a nurse a day for nine months, a $500 million cut to health funding, and the sacking of 108 police officers.

Confirmation that Tasmania’s revenue will decline by around $560 million due to GST receipts reducing by around $280 million as a result of a lower than expected national GST pool and stamp duty receipts likewise reducing by $280 million over the forward estimates is a challenge to our budget that will require us to continue our financial discipline and maintain a sustainable wages policy.

Now is not the time for a lapse in fiscal discipline, and the Liberal Government will continue to manage the state’s finances responsibly and sensibly, whilst continuing to invest in infrastructure and the provision of essential services.

In contrast, Labor wants to add $280 million to our wages bill through an unaffordable and unsustainable 3 per public sector wages policy. The Government remains of the belief that our hard working public servants deserve a pay rise but it must be fair and affordable – and that’s exactly what the offer on the table of 7 per cent over three years delivers.

The Government always understood that due to our strong performing economy, over time our GST distribution would decline, and while our strong growing population has provided an offset, the fall in the national GST pool due to reduced consumer spending on the mainland will have an impact on our revenues. This, combined with reduced stamp duty revenues means that now is not the time for a lapse in financial discipline.

Tasmanians can rest assured that the Hodgman Liberal Government will not be pulling back on our record investment into infrastructure, nor will we be selling government businesses. It does mean, however, that we will have to cut our cloth to suit our circumstances and that we cannot afford the unfettered wage demands of unions and Labor.

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