Construction blitz to kickstart recovery, rebuild Tasmania finances

Tasmania will try to kickstart its economy and rebuild state finances through a $3.1bn ‘construction blitz’ targeting housing, roads and irrigation.

Tasmanian Premier Peter Gutwein in Hobart on Thursday. Picture: Richard Jupe

Tasmania will try to kickstart its economy and rebuild state finances through a $3.1bn “construction blitz” targeting housing, roads and irrigation.

Premier Peter Gutwein said his Liberal government would spend $1.8bn over two years to support a $3.1bn spend overall, including private­-sector involvement.

“The best way to get our budget back on track and grow business confidence and create jobs is to grow the economy, and that is what we are doing,” he said.

“These are challenging times, but now is not the time to sit idle; now is the time to unleash the greatest stimulus program we can, to kickstart the recovery process and help get Tasmania back on track and back in business.”

An extension of the state $20,000 home owners grant, combined with the federal government $25,000 scheme, meant up to $45,000 would be available to those building a new house.

Other highlights of the package, designed to repair economic damage caused by the coronavirus pandemic, include:

● Some 2295 new homes, includi­ng $100m for an extra 1000 social housing units; a further 220 “affordable” homes; and $20m to extend the $20,000 first-home owners grant to all building appli­c­ations in 2020;

● About $55m for road and irrig­ation infrastructure and about $42m to upgrade health centres, ambulance stations and police stations­ and houses;

● About $167.5m for community infrastructure, including $68.5m to upgrade the Derwent Entertainment Centre, in Hobart’s north, to allow Tasmania to have a team in the National Basketball League;

● Redirection of $200m in capit­al held by the state Retirement Benefits Fund superannuation scheme to local investments.

With the state’s vital $3.2bn-a-year tourism trade still suffering from closed borders, the construction stimulus is certainly needed.

Last month, a state Treasury economic and fiscal update forecast a $1bn deficit and $2.35bn net debt in 2020-21.

It estimated Tasmania’s jobless rate this month would be 12.25 per cent and gross state product would fall 1.75 per cent in 2019-20, the steepest decline in recent history.

Civil Contractors Federation chief executive Rachael Matheson said the infrastructure announce­ment was a “missed ­opportunity … The government has recommitted to its existing budget and announc­ed a few other projects, but the reality is we need a plan for how (it) is going to bring forward investment in civil construction to ensure there is an adequate pipeline of projects now.”

State Labor leader Rebecca White welcomed the focus on ­social housing but said the package failed to improve Tasmanians’ “quality of life”.