For the last decades government all over the country have not had to cut funding to anything and as budgets waxed fat the question has been “What do we spend the extra money on?”.
Andrew Barr has today announced the outcomes of the mid-year budget review and it’s not looking good for those reliant on ever growing government funding:
The main fiscal changes since the Budget are:
— A $62 million loss in GST revenue grants to the Territory across the Budget and forward estimates, including $12 million this year.
— Superannuation expenses are up more than $22 million due to bond rate variations.
— Revenues associated with property market activity are forecast to decline, in particular:
— Land release revenues are down more than $39 million due to restricted land supply in a number of areas. Anticipated returns are expected to be maintained over the four-year budget cycle.
— Conveyancing revenue is down more than $20 million due to lower than average prices in the residential sector, and reduced activity in commercial sectors.
— A $33 million reduction in dividends and income tax equivalent returns from ACTEW has been forecast, mainly due to reduced water usage.
— Recent enterprise bargaining outcomes for Territory public servants.
— A decline in investments due largely to volatility in financial markets. However, there have been some gains from the high Australian dollar.
The bottom line is the projected $37 million dollar deficit is not out to $181 but Andrew still says he can balance the books by 2013-14 (putting the pain beyond the next election).
Politically the new environment gets more interesting because, absent tax rises, all new spending initiatives imperil someone else’s pet project.