NSW Treasurer Daniel Mookhey confirms Sydney’s housing ‘Plan B’ won’t be in Tuesday’s budget

NSW Treasurer Daniel Mookhey says the state’s budget will be about the “future of essential services” and the economy, but one key question about housing will go unanswered.

NSW Treasurer Daniel Mookhey will hand down his third state budget on Tuesday June 24. Picture: NewsWire / John Appleyard

NSW Treasurer Daniel Mookhey has definitely ruled out any announcement on the government’s “Plan B” for housing in next week’s budget, after a $5bn proposal to turn Rosehill racecourse into 25,000 homes was shot down.

Mr Mookhey will hand down his third budget since Labor’s 2022 election on Tuesday, as NSW continues to grapple with a worsening housing crisis and the fallout from a summer marred by anti-Semitic attacks.

Billions of dollars in spending has already been announced ahead of the budget, expected to feature the same fiscal restraint as the previous two years, including in housing, justice reform, and Western Sydney airport.

The budget comes after a majority of members from the Australian Turf Club voted down plans in May to turn the historic Rosehill racecourse in Sydney’s west into a first-of-its-kind mini-city with a Metro station.

Premier Chris Minns has since said the state government was working on its “Plan B”, with reports the port of Glebe Island was being eyed for housing, but has so far remained mum on what that project would be.

NSW Treasurer Daniel Mookhey will hand down his third state budget on Tuesday June 24. Picture: NewsWire / John Appleyard

Asked about whether the “Plan B” for housing near Sydney's CBD would feature in the budget, Mr Mookhey on Friday told NewsWire “(in) next week’s budget, we will make progress in dealing with the housing challenge”.

“We will not be sort of announcing Plan B on budget day. But we’re pretty clear that we need to build more homes.”

Mr Mookhey said he was “disappointed” in the failed sale of Rosehill.

“What it means for the state is that we do need to build more homes,” he said.

A raft of policy measures has already been announced ahead of the budget to target housing, including making tax cuts to build-to-rent schemes indefinite and draft guidelines for the “build-in-kind” scheme.

Despite a damaging few weeks for the Treasurer, whose workers compensation reform measures were sent back for another inquiry amid fierce push back from the Liberals, Greens, and the unions, Mr Mookhey was optimistic.

Asked about the message of the 2025-26 budget, Mr Mookhey said it was about the “future of our essential services and the future of our economy”, and touted the work of the NSW Labor government until now.

The ATC voted in May not to sell Rosehill Gardens Racecourse. Picture: NewsWire / Monique Harmer

“It is about making sure that we are making the right investments to deliver the world class public services that people will expect, and to make sure that the NSW economy continues to grow so we can lift people’s living standards, improve their wages and create jobs,” Mr Mookhey said.

“That’s been what this budget has been about, and the reason why we can now make these investments is because we’ve made real progress in stabilising the state’s finances.

“We’ve inherited a $15bn deficit, which we’ve made good progress in turning around. We can report now for the first time in years, the NSW government is back into cash surplus.

“We can say that the debt is stabilising. We’ve kept our promise to keep debt at below $187bn at this point in time. So, that gives us that platform for more progress.”

The budget comes after the Western Australian budget on Thursday reported a $2.5bn surplus off the back of a 2018 deal that gave it an guaranteed share of the country’s GST carve-up.

Premier Chris Minns, left, with Treasurer Daniel Mookhey. Picture: NewsWire/ Gaye Gerard

Mr Mookhey previously said he would advocate to the Albanese government to reform the tax allocation, which he said cost the state government $12.6bn last year – for which the state was “still recovering”.

“It’s undoubtedly the case that that remains a challenge for NSW, and it doesn’t matter whether there’s a Labor treasurer or a Liberal treasurer, the state would have to be dealing with that.

“Which is why I am glad that here in NSW, we do have bipartisanship about the need for GST reform.

“But, in arguing for NSW’s position, I don’t talk down any other states and I accept the fact that every state will always argue for what they consider to be their interest.

“I’m simply saying that there’s a simpler system, that more predictable system, a more certain system that is available, and we’ll continue to argue our case for change.”