NSW budget: Government to post deficit of $7.9 billion on Tuesday

Easing the cost of living for people in NSW will be the focus of Treasurer Dominic Perrottet’s fifth state budget, to be handed down today. Find out what we know so far.

A high-spending sugar hit NSW budget will focus on cost of living pressures with special sweeteners for families, as the government posts a smaller than expected deficit of $7.9 billion.

There will also be a direct boost for the state’s digital capabilities in an acknowledgment of how NSW led the nation with QR codes and check-in apps in the pandemic.

Better than expected GST receipts, stamp duty and payroll tax revenue have improved the NSW budget position, Treasurer Dominic Perrottet will confirm today as he hands down his fifth budget.

NSW Treasurer Dominic Perrottet holding the budget outside Parliament House in Sydney. Picture: NCA NewsWire / Dylan Coker

Mr Perrottet will announce the budget is on track to return to a surplus of almost $500 million by 2024-25.

This takes into account a 2.5 per cent pay rise for all public servants and front line workers, a record spend on health, the abolition of stamp duty on electric vehicles and free $100 lunch vouchers to use in the CBD as revealed by The Telegraph on Friday.

“We know how hard it can be for families to get by, let alone get ahead,” Mr Perrottet told The Daily Telegraph.

“Today’s Budget will offer more hip pocket relief for young families across a range of areas.

“We will also be putting millions more into building and improve the type of infrastructure that sits at the heart of our communities.”

He confirmed the state’s digital infrastructure would get a financial boost.

Families such as Jessica and Andrew Bryan and their three kids Audrey (3), Wally (2) and newborn Theo will get sweetners in the budget. Picture: Richard Dobson

“We have seen during Covid just how vital this area has been for NSW and how other states have had to play catch-up.”

NSW will post a slimmed-down 2020-21 deficit of $7.9 billion – well below the $16 billion which was forecast in ­November.

It is also an improvement on the $13.3 billion forecast in the half year review this year.

The budget is on track to achieve a reduction in net debt towards 7 per cent of GSP in the medium term.

“We will continue to invest big in our gold-plated Covid defence – there will be hundreds of millions more and as we have seen this past week that is necessary,’’ Mr Perrottet said. “We’re still in an uncertain economic environment, so it’s important to keep supporting families to fuel confidence, and this budget offers record hip-pocket help.

“This is a recovery budget, but it is also a productivity budget, packed with reform from education and skills to housing affordability, to lift ­living standards, lift wages, and create better opportunities for current and future ­generations.”