Treasurer Tom Koutsantonis to reveal $443m surplus in Mid Year Budget Review as state readies for three month run to SA election

TREASURER Tom Koutsantonis will post a bigger than expected surplus and lower debt in a Mid Year Budget Review today that gets SA’s finances in shape ahead of the March election.

TREASURER Tom Koutsantonis will post a bigger than expected surplus, and lower debt, in a Mid Year Budget Review today that gets SA’s finances in shape ahead of the election.

The Advertiser can reveal the final Budget update before voters go to the polls will show a total surplus of $443 million for the 2016-17 year, $204 million more than planned.

It follows huge windfall Budget injections flowing from the $1.6 billion privatisation of the Lands Titles Office and more than $2 billion gained from selling Motor Accident Commission assets. Part of those proceeds have been used to further cut SA’s debt liability, which has been reduced to just 25 per cent of expected Budget revenue in the coming year. Today’s Budget update is a key moment in the 12-week campaign toward the state election, and gives all sides a clear indication of how much money is left in the piggy bank as they plan spending announcements on infrastructure and cost of living to woo undecided voters.

SA Treasurer Tom Koutsantonis. Picture: AAP / Mark Brake

The higher than expected surplus has been attributed to a $211 million increase in revenue against expectations, which comes from sources including payments for health services that have been accessed by interstate patients and rising school fees paid by international students.

There has also been a rebound in payroll tax revenues, which have been hammered over recent years as slow wage growth and the unemployment crisis cut returns to the Government.

Mr Koutsantonis, above, has also confirmed no new taxes will be announced in today’s update.

He said the Upper House’s refusal to pass the state bank tax, worth about $400 million over four years, had thrown new uncertainty into the Budget process. However, Mr Koutsantonis said he was confident the state was now emerging strongly from a tough few years of economic bad news and positioned for strong growth as past reforms paid dividends.

“There is a bit of a myth around that the state has high debt and deficits,” he said. “SA has got a very low level of debt, quite healthy surpluses and is living within its means.

“There has been a lot of structural repair done to the Budget over the last three years. (But) the Budget has been battered pretty badly by the Liberal Party blocking the Budget (measures) bill ... and I can’t underestimate the impact that has had.”

Fitter and turners Ken Roesler and Paul Monaghan at the Whyalla Steelworks. Picture: Dylan Coker

Mr Koutsantonis said uncertainty around the impact of Holden’s closure and fears the Whyalla steelworks would close had dented confidence in recent years. However, he said SA’s fundamentals were strong and the economy was poised to grow well as sentiment rebalanced.

“I think you are about to see a real minerals boom,” he said. “Oil and gas guys are back. “There is a lot of investment in the key areas where we are trying to diversify the economy.

“I think tough reforms made over the last four years are having a real impact and the economy is ahead of people’s perceptions. “SA’s best years are ahead of it. I really do believe we are about to embark on some amazing things.”

Figures released by the Government show that debt levels will rise to almost 33 per cent of annual revenue by 2021, amounts he says are well below that carried by most other states.

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