Revised Budget Estimates

Media report – Peter Gutwein, Premier, 15 February 2021

Revised Estimates Report 2020-21

The release of the Revised Estimates Report 2020-21 confirms our economic recovery is well underway in Tasmania.

When compared to the 2020-21 Budget released in November last year, our economy and employment levels have both recovered more quickly than forecast.

Almost 80 per cent of Tasmanians have now returned to work since the height of the pandemic in May 2020 and our participation rate has returned to pre-pandemic levels.

Whereas the 2020-21 Budget anticipated an unemployment rate of 8½ per cent this year, the Midyear Review now forecasts 7 per cent unemployment in year-average terms, and employment is forecast to continue growing.

As Tasmanians return to work, our economy is now expected to grow this year rather than contract. Increasing economic activity is underpinned by growing consumer and business confidence, retail trade, and housing investment across the State supported by our successful HomeBuilder program. Dwelling approvals are at unprecedented levels, and in December were the highest since the series began nearly forty years ago.

A stronger economy strengthens our budget, through increased revenues, including GST receipts and state revenues including conveyance duty. Compared to the Budget, the Net Operating Balance this year is estimated to have improved by $157.3 million and Net Debt is also expected to be around $150 million lower.

The 2020-21 Budget is our plan for economic recovery and includes an ambitious and landmark $5 billion infrastructure program across the next four years that will support around 25,000 jobs.

Given the extraordinary activity in our building and construction sector, including through the HomeBuilder grants scheme, we have a very busy market, and our plan is doing exactly what we need it to – underpinning confidence and providing a strong pipeline and foundation for economic growth over the next four years. The Report identifies a number of risks for infrastructure delivery, however, it is pleasing to see that despite the pandemic, year-to-December infrastructure expenditure has been 10.4 per cent higher than this time last year.

Once again, the report demonstrates that our recovery is well underway but we know that there is more to do. That’s why we will continue to focus on the health and safety of Tasmanians as we manage this pandemic, and we will continue our focus on growing our economy, creating jobs, and getting more Tasmanians back into work.

The Report handed down today is proof that we’re delivering on our plan and rebuilding a stronger Tasmania.

Media release – David O’Byrne MP, Shadow Treasurer, 15 February 2021

Tasmania continues to fall behind the rest of the nation

The Gutwein Government’s budget update confirms that Tasmania will have lower economic growth and higher unemployment than the rest of the nation. And the government’s much-hyped infrastructure program is nearly $600 million behind schedule.

Shadow Treasurer David O’Byrne said Tasmania’s unemployment rate is forecast to be 6.75 per cent in 2022, compared to the RBA forecast of 5.5 per cent for the rest of the country.

Mr O’Byrne said Tasmania’s predicted jobs growth in 2022 would only be 0.5 per cent compared to the national RBA forecast of 1.5 per cent and Tasmania’s economic growth of three per cent in 2022 will lag well behind the mainland at 3.5 per cent.

“Already the government’s much-touted infrastructure program is falling further behind schedule which put simply means the Premier cannot reach his promised target of 25,000 jobs,” Mr O’Byrne said.

“Peter Gutwein seems satisfied that the mid-year budget update he delivered today sees Tasmania lag behind the rest of the country on most measures when in fact that is not good enough.

“The fact is the Liberal Government does not have a genuine, workable plan to lead Tasmania out of the COVID pandemic.

“Mr Gutwein has confirmed today that his deeply flawed plan for an infrastructure-only led recovery is one dimensional and is not working.

“This government underspent its 2019-20 infrastructure budget by $202 million and is on track to be nearly $600 million behind on this year’s infrastructure spending.

“Over the last four Budget years, the Liberals will have underspent on infrastructure by nearly $1 billion.

“Almost 60 infrastructure projects remain dangerously behind schedule, some by up to three years.

“If your one strategy is to build and you cannot build it means you have no strategy.

“The Premier’s claim that his infrastructure program will generate 25,000 jobs is just not believable when it is plagued by delay, incompetence and complacency.

“Tasmanian needs more than tunnel vision for economic recovery and only Labor’s multi-faceted, fully costed Jobs Plan will deliver 35,000 jobs, lower unemployment and higher economic growth.”