State Budget 2018: Treasurer Peter Gutwein delivers on election policies and infrastructure boom

ANALYSIS: SURF’S up for Gutwein, but for how long? Peter Gutwein is on a surfboard called the State Budget and he’s hanging ten. The economy is pumping and he’s riding a wave.

Treasurer Peter Gutwein says he believes Tasmania is on the cusp of a golden age. Picture: MATHEW FARRELL

SURF’S up for Gutwein, but for how long? Peter Gutwein is on a surfboard called the State Budget and he’s hanging ten.

The economy is pumping and he’s riding a wave.

Gross state product growth is set to triple this year to 3.5 per cent, exports are up 35 per cent and tourists spent $2.3 billion last year.

In non-economic terms, the surf’s up.

“There is a buzz in the air, the confidence is contagious, and people are excited about what the future will bring,” Mr Gutwein told State Parliament today.

“I believe that Tasmania is on the cusp of a golden age.”

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The Treasurer is predicting the big swell will continue for another four years, bolstered by a $2.6b infrastructure spend.

But a good surf depends on a host of economic weather conditions, most of them out of the control of the Treasurer.

A wipe-out is always a possibility, particularly when cash reserves are left in a precarious state.

Federal Government payments, chief among them GST receipts, account for nearly two thirds of Tasmania’s $6b budget.

Prime Minister Malcolm Turnbull says Tasmania has little to fear from the Productivity Commission’s review into GST distribution. Mr Gutwein hasn’t been told what the changes will be but is taking Mr Turnbull at his word.

A 2 per cent cap on public service wage rises is yet to be agreed by unions and the State Government will face a fight, if not a blowout, as negotiations get underway.

Tasmania’s tourism and exports boom relies on a favourable exchange rate – and on China’s economy travelling well. An ill wind from either direction could have Mr Gutwein mashed by a rogue wave.

Treasurer Peter Gutwein (left) and Tasmanian Premier Will Hodgman speak with reporters about the State Budget. Picture: AAP IMAGE/ROB BLAKERS

The shark in the water remains the state’s $7.4b superannuation liability, which the Treasurer remains confident can be funded as needed.

The Liberals promised big during the campaign, blowing Labor out of the water with pledges like their $757m health package.

That was to be delivered over six years, beyond the budget’s four-year forward estimates period.

Infrastructure spending of $1.6b was promised during the campaign.

Premier Will Hodgman and Mr Gutwein are both adamant the budget delivers on their election promises, with $335m of recurrent and $1.1b of infrastructure spending in this budget.

“We wanted to ensure that we could look at the horizon in terms of the work that would be in front of the state,” Mr Gutwein said.

“That sends a really good message to people.

“Tasmania has not just four years’ worth of work in front of it - it has six, 10 and beyond that now.

“It will help grow our population, it will provide confidence.”

Confidence is something Mr Gutwein is full of already as he banks on more than 9000 jobs being created by government investment over the next four years.

Future budgets will reveal whether he’s found the perfect wave.