Labor says state will spend $500m a year to keep heads above water over net debt

The Tasmanian government will have to fork out more than $500m a year just to cover interest costs as net debt heads towards $10bn in the coming years, Labor says.

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The Tasmanian government will have to fork out more than $500m a year just to cover interest costs as net debt heads towards $10bn in the coming years, Labor says.

The state currently spends $223m a year on borrowing costs top service a net debt of $5.7bn.

The figure is $501m on $9.6bn in borrowings in 2027/28, according to the Revised Estimates Report.

Shadow Treasurer Josh Willie said the cost was staggering.

Labor's Josh Willie speaks to the media at Mawson Place in Hobart on Friday, February 7, 2025.

“By 2027-28 the Liberal Government plans to spend more than half a billion dollars a year on borrowing costs — this is not to pay down debt, it is simply paying the interest on the credit card, which they will fund by borrowing even more,” he said.

“For the cost of servicing the Liberals’ debt across the forward estimates, you could employ more than 1,500 experienced nurses, 1,000 senior teachers and 600 police sergeants combined.

Mr Willie said the government was ”burying its head in the sand about the debt issue.

“Future generations of Tasmanians will be paying off the Liberals’ debt for decades to come, and that will be this Government’s legacy,” he said.

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“The Liberals don’t even have anything to show for their record deficit and debt, the economy is flatlining, essential services are being cut back to the bone, and major projects like the Spirits have been bungled to the point of international embarrassment.

“Despite inheriting zero net debt from Labor in 2014, when Treasurer Barnett delivered his inaugural speech to the Tasmanian Parliament, he said that “there is a budget blowout which we now know to be in excess of $1 billion over the forward estimates – an irresponsible mortgage on our children’s future.”

Liberal minister Nick Duigan said Labor has failed to put up an alternative to the government’s financial blueprint.

Minister for Parks and Environment Nick Duigan speaks to the media in Hobart on Thursday, December 19, 2024.

“What is clear is that our budget has been published. It shows a pathway back to surplus “Labor has had 10 years to provide an alternative budget, and they never have.’ he said.

“They just chip away from the sidelines being negative about Tasmania, we will continue to provide the services Tasmanians need and we will plot a pathway back to surplus as is outlined in our budget.”

Originally published as Labor says state will spend $500m a year to keep heads above water over net debt