Leading economist Saul Eslake disappointed in state budget repair report response
The state government has rejected or ignored the bulk of the recommendations of an independent report it commissioned into the state’s finances, a response its author has described as “disappointing”.
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The state government has rejected or ignored the bulk of the recommendations of an independent report it commissioned into the state’s finances, a response its author has described as “disappointing”.
Leading independent economist Saul Eslake conducted his independent Review of Tasmania’s State Finances last year after a request to the government by Jacqui Lambie Network MPs.
He found that rising government debt and the resulting interest payments were putting the state budget on the path of becoming unsustainable, and made 26 recommendations for reform.
They included tighter targets for government spending, tax reform, reeling in infrastructure spending and the establishment of a Parliamentary Budget Office.
Treasurer Guy Barnett released the government’s response on Monday.
None of the recommendations were explicitly endorsed, although the response claims some have already been achieved or are underway.
“We’ve worked through many of those recommendations, we think it’s very broadly, very similar to our fiscal strategy, which is a ten-year strategy,” Mr Barnett said.
“The independent Review was wide-ranging and informative, and the Tasmanian Government thanks Mr Eslake for his significant contribution.
“We will continue our commitment to Tasmanian businesses and households of no new or increased taxes.
“It is clear that Tasmania is not immune to the challenges associated with increased demand on health and hospitals and this is having a material impact on Tasmania’s fiscal position, but we recognise that these impacts are not unique to Tasmania.
Mr Eslake said he was disappointed at the lack of substance in the response.
“In effect they have rejected every recommendation – including ones that I would have thought fairly innocuous such as providing more comprehensive information in the Budget Papers about the Tasmanian economy, and amending the Charter of Budget Honesty to include more meaningful fiscal strategy targets,” he said.
“What I was critical of in my report – and what I continue to be critical of – is the Government’s resolute refusal to give any consideration as to how that spending should be paid for, other than with borrowed money,” he said.
“The consequences of that unwillingness to consider how spending should be paid for is evident in the deterioration in the Forward Estimates detailed in the Revised Estimates Report released today.
“It shows that the Government hasn’t taken a single decision designed to put Tasmania’s finances on a more stable trajectory since last year’s Budget.”
Deputy Greens leader Vica Bayley said the Treasurer was “delusional” if he thought the government was on a sustainable path to surplus budgets.
“The Liberal government’s response to Saul Eslake’s report is a shocking exercise in delusion.
I think this is a completely wasted exercise.
“The recommendations that Mr. Eslake has put on the table are sensible and they paint a positive way forward that the government has completely rejected them … at the same time, announcing that net debt is going to increase over the coming year by $500m.
“This is a shocking indictment on the government.”
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Originally published as Leading economist Saul Eslake disappointed in state budget repair report response
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