Territory suffers a Moody’s credit rating hit

The Territory’s ailing economy has suffered another hit with key credit rating agency Moody’s downgrading the NT

Treasurer Nicole Manison said the Moody’s downgrade highlighted the impact of reduced GST funding. Picture: Ramin Talaie/Bloomberg

The Territory’s ailing economy has suffered another hit with key credit rating agency Moody’s downgrading the NT from Aa2 to Aa3.

Moody’s said the rating action reflects the Territory’s deteriorating stand-alone credit profile.

It said this was due to weakening revenue in the wake of slower economic growth and lower Goods and Services Tax (GST) receipts.

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“The main cause of the weakening fiscal position is the cumulative effect of the lower GST grants from the Commonwealth Government of Australia (the Commonwealth, Aaa stable) as announced in the fiscal 2018, 2019 and 2020 budgets,” Moody’s said.

Treasurer Nicole Manison said the Moody’s downgrade highlighted the impact of reduced GST funding on the Territory Government’s Budget.

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Ms Manison said the new rating will still see the Territory retain a Prime 1 investment grade, with Moody’s also changing the Territory’s outlook from ‘negative’ to ‘stable’.

“Our plan to fix the budget is already underway and will see the budget return to surplus in 2027/28,” she said.

“The plan provides a sensible way forward for the Territory finances — that will continue to support Territorians by creating local jobs and growing the economy, and we will continue to invest in education, health, housing and community safety.”