Government discovers $321m budget bonus

It’s a financial trick akin to every Tasmanian household finding $1400 down the back of the couch. How did Treasurer Peter Gutwein pull it off?

IT’S the equivalent of every Tasmanian household finding $1600 down the back of the couch. Premier Gutwein has found $321m in the budget. Picture: MATT THOMPSON

IT’S the equivalent of every Tasmanian household finding $1600 down the back of the couch – the State Government says it has discovered it has $321 million more in the bank than it thought it had.

Revised budget figures released this week show a dramatic improvement in the state’s net debt figures.

Treasurer Peter Gutwein thought the state would have $545 million in cash and investments at the end of the 2018-19 financial year, but revised calculations revealed the real figure was $774 million.

It means that this financial year, instead of ending up $284 million in debt, the state will remain $36 million in the black.

For those keen to check the Government’s arithmetic, Treasury says the improved result is in part due to $157 million less in borrowings thanks to the Commonwealth-State Housing Debt Waiver, a decrease in the estimated 2019-20 Net Operating Balance by $46.6 million and increased infrastructure spending of $24 million in 2019-20.

Mr Gutwein put the change down to good management.

“Because of the Government’s strong budget management, the 2019-20 Revised Estimates Report (RER) outlines an improvement in net debt of around $321 million,” he said.

“To be clear, the Government is not in net debt, the RER projects that we will have net cash and investments by the end of the financial year of $36.9 million.

“The large variation is due to holding more cash and lower borrowings than forecast in the Budget.”

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But the state’s accounts don’t stay in positive territory for long as the Government spends big on infrastructure – largely roads and bridges.

Tasmania goes from having $774 million in the bank last July, to being $1.3 billion in debt by 2022-23 – equal to every Tasmanian household running up a $10,000 credit card debt.

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