S&P Global says state governments cannot keep blaming the COVID-19 pandemic for mounting debts, with borrowing increasing rapidly over the next four years due to infrastructure spending and household handouts.

The high-profile credit ratings agency said that, by 2029, debt will rise to more than 44 per cent of Tasmania’s annual economic output. Debt as a share of gross state product, a widely used measure that shows the size of a government’s liabilities relative to the size of its local economy, will reach 35.2 per cent in Victoria and 32.2 per cent in Queensland in that time.