The Queensland Treasurer, the Hon. Curtis Pitt MP, has handed down that State’s Budget for 2015-16. In keeping with its election commitments, the Palaszczuk government has implemented key measures to revitalise the state economy. Weaker commodity prices and a subdued labour market present challenges for the State Budget.
Queensland was the first of the four states to lose its triple-A credit rating, however Queensland’s economic growth is forecast to rise from 2% to 4½% in 2015-16, the strongest economic growth of any state or territory across Australia.
The General Government Sector is forecast to deliver a net operating surplus of $962 million in 2014-15, rising to $1.213 billion in 2015-16. As a result of certain reprioritisations and election commitments, across the period 2014-15 to 2018-19, there is a net budget improvement of $340 million.
- Election Commitments ($1.975 billion in total)
- Reduction of General Government Sector debt of $5.4 billion over six years, with a target of
- Paying off $12 billion of General Government Sector debt over 10 years, while retaining
- Keep assets in public hands
- Implementing election commitments, reprioritisations and specific measures that deliver an improvement in the net operating balance
- Bolstering frontline service delivery, particularly in the key areas of health and education
- Boosting skills and training to provide improved employment and economic outcomes
- Commissioning Queensland Treasury to prepare a full review of the State’s finances
- To not increase royalties, tax rates, or the rate of growth of fees and charges
Debt Action Plan
The Debt Action Plan will reduce General Government debt by approximately $7.5 billion in 2015-16. Ongoing reductions in Queensland’s relative debt burden, by ensuring that any new capital investment is funded primarily through recurrent revenues rather than from borrowing.
- Revising of the capital structure of the Government’s energy network businesses
- Funding long service leave on an emergent basis
- Temporary suspension of investment of defined benefit employer contributions, whilst maintaining fully-funded status
- Government sector own-source revenue remains at or below 8.5% of gross state product
Advance Queensland
The Queensland Government is investing $180 million over 4 years to create the knowledge based jobs of the future through a program titled Advanced Queensland. The program will focus on ensuring young people will have the skills in demand for the jobs of the future such as coding abilities and engineering. The program will also seek to work with the private sector to better support and encourage start-up businesses.
- $50 million Advance Queensland Best and Brightest Fund
- $46 million Advance Queensland Future Jobs Strategy
- $76 million Business Investment Attraction package
- $8 million will be set aside to give flexibility to respond to changing circumstances.
Infrastructure
- New independent statutory body to provide a whole-of-government perspective to infrastructure planning and investment
- Collaboration with private sector for innovation and market led proposals
- $500 million State wide Schools and Hospitals Fund
- $100m for development of a new Townsville sports stadium
Commonwealth Games Gold Coast Roads Upgrades
- $668.4m to continue rail network improvements, including between Lawnton and Petrie stations and parts of the Gold Coast line
- Western roads upgrade program, $40 million over two years
- $3.931 billion for transport and main roads in 2015-16
Rural and regional Queensland
- $90 million over four years a new primary school in Townsville
- Drought Relief Package $48.4 million over four years
- Great Artesian Basin Sustainability Initiative (GABSI) $5.8 million over two years
- Queensland Agricultural Training College Improvements $3.4 million to continue upgrading infrastructure at the Longreach Pastoral College and the Emerald Agricultural College
- Food and Fibre Plan $8.1 million over three years, to ensure the growth of a productive and prosperous food and fibre sector in Queensland
Queensland Health
The Queensland Government will inject an extra $2.3 billion for frontline services and improved health outcomes for all Queenslanders. In 2015-16, the Queensland Health Budget will increase by over 4% to a record $14.2 billion.
- $101.6 million over four years, for the Nursing Guarantee policy
- $27.2 million over four years for Health for Life! Taking Action on Diabetes, a Type 2 diabetes prevention program
- $46.1 million over four years for the Healthier Queensland Action Plan.
- $193.5 million for the start-up of the Sunshine Coast Public University Hospital
- $180 million over four years for the Enhancing Regional Hospitals Program.
- $39 million increase in ambulance expenditure in 2015-16
- $361.2 million over four years for the Outpatient Long Wait Strategy
Education
- $248.7 million over four years towards initiatives to lower class sizes and hire additional teachers
- $439.2 million in 2015-16 for the building of education, training, early childhood education, and pre-prep learning facilities.
- $300 million over four years in new education maintenance funding
- $6 million over three years to develop an enhanced and rigorous new teacher classification system and pay structure
- $123.6 million over three years in additional capital funding to the non-state schooling sector.
Environment and Tourism
The Queensland Tourism industry accounts for 3.5% of the state’s economic output and employs 131,000 people directly. The Budget delivers:
- $20 million over five years to develop the North Stradbroke Island Economic Transition Strategy
- $15 million over three years for climate change adaptation
- $7.3 million over four years to provide for the continued employment of 15 Indigenous rangers.
- $7.4 million over four years to manage approximately 2.6 million hectares of park estate on Cape York Peninsula.
- Establishment of the Great barrier Reef Water Science Taskforce
- An additional $100 million over five years for water quality initiatives, scientific research and helping businesses transition to better environmental practices.
- $10 million over three years for the Attracting Aviation Investment Fund (AAIF).
- $40 million over four years to assist Tourism and Events Queensland to grow and promote events for Queensland.
Boosting Skills and Training
- Reintroduction of the Skilling Queenslanders for work program
- $240 million over four years to support 32,000 Queenslanders back into work
- Creation of Jobs Queensland, an independent statutory authority providing advice to the Government on skills demand and long term workforce planning in Queensland.
- $34.5 million over the next four years to restore TAFE Queensland
Supporting Business
- Red Tape Reduction Advisory Council
- Queensland Small Business Advisory Council
- $1 million over three years for the Home Based Business Program
- Payroll tax rebate of 25% for apprentices and trainees.
- Proposed biofuel mandate, the Government will provide certainty to the biofuel industry so that it can invest, innovate, grow and create jobs.
It may be of interest to companies and organisations exposed to Queensland (or considering investment in the Sunshine State) that the Treasurer has foreshadowed the Government working with Treasury to “examine ways for Queenslanders to invest in Queensland” over the next six months. Does this mean asset sales by another name may be on the cards?
More Information
To download the 2015 Budget Highlights paper, click here.
To read the Budget Speech delivered by Treasurer Curtis Pitt, click here.
