State governments have defended their record on fiscal restraint after ratings agency S&P warned some will face credit downgrades for failing to rein in pandemic-level spending.

The treasurers of NSW and South Australia pointed to a reduced growth trajectory for debt while Victoria defended its cost-of-living support, despite S&P’s suggestion that governments were too focused on vote-buying rather than saving money. Labor in NSW and the newly-elected Liberal National government in Queensland blamed predecessors for their states’ trajectory.