Newman Government delays surplus due to revenue losses

Tough economic circumstances, coupled with significant write downs in government revenue, mean the Queensland budget will not return to surplus until 2015-16, Treasurer Tim Nicholls said today.

Mr Nicholls said governments across Australia were being hit by the massive falls in revenue.

“As an example, land tax is down 6.4 per cent in Queensland- the first time a fall has been recorded since 1996-97,” he said.

“Gaming revenue from casinos has also fallen by 2.8 per cent since the last budget.”

Mr Nicholls said the Government had experienced falls in revenue of $4.5 billion since coming to office.

He said royalties and tax revenue would be written down by a further $1.2 billion for the 2013-14 year, and GST would be $531 million less over the next four years.

“Adding to this, the demands on the Government for the rebuilding task after the January natural disasters, means there will be little spending outside the core services of education, health and community services,” Mr Nicholls said.

Mr Nicholls said next week's 2013-14 State Budget would be in deficit by more than $7 billion.

“Instead of returning to fiscal surplus in 2014-15 as we had aimed, a small deficit of about $300 million will also be projected,” he said.

“Given the loss of revenue and the rebuilding task, we are making the balanced and responsible decision is to delay reaching a fiscal surplus in 2014-15.

“The delay will mean the Government won't have to raise taxes or cut spending by as much and it will support further economic growth.

“The budget will get the balance right between repairing the State's finances, rebuilding after natural disasters, funding core services and growing the economy.

“With two budget deficits totalling more than $16 billion in just over 12 months (2012-13 and 2013-14), no one can deny the budget position is unsustainable.

“No one can deny there is a debt and deficit problem. Nor can they claim that business as usual is an option or that reform is not necessary.”

[ENDS] 26 May 2013

Media contact: Larine Statham 0419 565 694