Crisafulli government accused of inflating state debt projections

Rating agency S&P Global has accused the Queensland government of exaggerating the state’s debt position for political reasons.

Queensland Treasurer David Janetzki unveiling the mid-year fiscal and economic review. Picture: John Gass

Queensland Treasurer David Janetzki has stood by his debt forecast assessment after ratings agency S&P Global accused the government of exaggerating the state’s position for political point-scoring.

The agency is yet to make a call on the state’s credit rating following last month’s mid-year financial and economic review, which projected debt would balloon $45.84bn to $217.83bn by mid-2028.

Mr Janetzki accused the former Miles government of painting a “deceitful” picture of the state’s finances before the October election. But S&P analyst Anthony Walker said the “eye-opening” figure was likely too high, with the agency still trying to establish the actual figure ­beyond the “political narrative”. He believed the final debt figure would not rise above $200bn.

“We now are going through the mid-year update to try and figure out what that document means and how much of that is real versus how much of that was political, and when we get an ­answer to that we’ll update the rating,” Mr Walker told the ABC.

“Those numbers were quite eye-opening when you saw them at a high level, significantly worse than anything we actually thought Queensland would deliver. If you look at the media release attached to that (MYFER), it was all about Labor’s last budget deficits and lies, so we know there is a political narrative within that document. We think it (the $217.83bn debt forecast) is too high. We don’t think that Queensland will deliver that.”

But Mr Janetzki said the MYFER showed the “true state of the books”.

“Queenslanders have been left to pay a high price for a decade of Labor budget blowouts, expensive failures and chaos and crisis,” he said. “Improving the budget position is now our challenge and we are up for it.”

However, Labor Treasury spokeswoman Shannon Fentiman said the inflated figure had cost the state after the market responded to the projections with an immediate 0.1 per cent increase to interest.

“David Janetzki juiced up the budget figures and ratings agencies are calling him out,” she said. “This chaotic and undisciplined approach to the budget immediately increased Queensland’s interest payments by about $5.2m this financial year.”

S&P Global Ratings is likely to wait until the June budget to make a call on whether it will downgrade Queensland’s AA+ credit rating.