Queensland budget 2025-26: Treasurer David Janetzki reveals $8.6bn deficit

David Janetzki has revealed Queensland’s budget will remain a sea of red for years to come as the government plugs a multi-billion dollar black hole.

Treasurer David Janetzki has handed down his first budget, revealing the deficit will reach a “significant” $8.6bn in the 2025-26 financial year. Picture: Dan Peled

• Analysis: As boring as Weet-Bix without milk

Debt will crack $205bn and the Queensland budget will remain a sea of red for the next four years as the government struggles to find savings and plug a multi-billion dollar black hole.

Cost blowouts and unfunded programs under the former Labor government coupled with billions of dollars in lost GST and lower coal royalty revenue is to blame for the challenging position facing the state, Treasurer David Janetzki said.

The budget deficit will reach a “significant” $8.6bn in the 2025-26 financial year – on par with that forecast at the height of the Covid-19 pandemic.

Despite the sea of red, the treasurer argued his budget was a “responsible pathway” out of deficit – and to surplus after the next state election.

Mr Janetzki said the government would “frontload” spending now so Queensland could reap the benefits sooner.

“The adults are back and we are running this budget process seriously,” he said.

In 2027-28 debt will reach $190.4bn, higher than the $171.9bn forecast by Labor in last year’s budget.

Premier David Crisafulli and Treasurer David Janetzki. Picture: NewsWire

Mr Janetzki maintains Labor failed to fund services and argues January’s mid-year budget update – which showed debt was on track to hit $217.8bn – is proof he has improved the bottom line.

Premier David Crisafulli insisted the government was fixing the budget and ending the “nonsense” claims of widespread cuts.

“If you’re talking about fiscal repair, the effort that the treasurer has done and that pathway shows that we are serious about that,” he said.

The government will freeze the number of non-frontline public service executive roles until 2028.

No widespread cost of living relief has been announced, but the government said a $1.6bn electricity maintenance guarantee would “properly maintain our generation assets and put downward pressure on power bills”.

Premier David Crisafulli speaks after delivering his first budget as Premier. Picture: NewsWire

Families will get $100 per primary school-aged student from January 1 to help cover back to school costs.

The measure, available to children in state, catholic and independent schools, will cost the budget $188m over four years.

The rebate for vulnerable households will increase with indexation – reducing power bills by some $386 next financial year.

The budget forecasts wages growth of between 3 and 3.75 per cent over the next four years – less than half the 8 per cent being asked by Queensland Police Union and lower than the increase pushed by other unions.

Mr Janetzki declined to say whether the budget position would get worse if the government – as expected – has to find more money for wages.

He said negotiations would continue in good faith.

Queensland faces a revenue downturn as the era of booming coal royalties ends and GST revenue falls $2.3bn next financial year – which Mr Janetzki noted was the largest single reduction to any state or territory in “history”.

“Cameron Dick collected more in coal royalties in two years than what I’ll collect in four,” he said.

“The former government absolutely creamed the coal royalties.”

There are no job cuts or widespread program crackdowns, with Mr Janetzki instead finding $27bn in savings by changing the scope and delaying some infrastructure projects – saving $15.7bn.

Making 50c fares permanent will cost the state budget $1.52bn over five years and $368.8m each year after 2029-30.

Cash for Queensland’s hospital build will hit $18.5bn over five years but there will be no funding to continue a state-of-the-art spinal injuries unit.

Mr Janetzki will also raid $3bn from the public servants’ defined benefits scheme to pay down debt.

Originally published as Queensland budget 2025-26: Treasurer David Janetzki reveals $8.6bn deficit