Treasurer Peter Gutwein says state can absorb cut in GST funding

Tasmania will lose more than $140 million in Commonwealth payments over the next two financial years — but Treasurer Peter Gutwein has hailed the Federal Budget as “good”.

TASMANIA will lose more than $140 million in Commonwealth payments in the next financial year and receive significantly less in GST revenue than previously anticipated — but Treasurer Peter Gutwein has hailed the federal Budget as “good”.

Tuesday’s Budget showed GST revenue to Tasmania would increase in the next financial year — but special purpose payments will decline.

This will see total payments from the Commonwealth drop from about $3.89 billion in 2018-19 to about $3.7 billion in 2019-20. GST payments were more than $100 million lower than previously forecast across this financial year and 2019-20.

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Mr Gutwein said the state could absorb the forecast reducing in funding, but said it illustrated why the Government was holding firm on its wages offer to public sector workers.

“We have a strong financial position and we’ll be able to manage it,” Mr Gutwein said.

“Importantly, revenue streams can rise and fall, and it’s important that not only can we afford this today but that we can afford to pay wages into the future.”

The broader Budget — which provided mostly infrastructure funding for this state — was a “good Budget for Tasmania”, Mr Gutwein said.

State Treasurer Peter Gutwein described the Federal Budget as “good” for Tasmania.

He pointed to the infrastructure spending, money for the Hobart City Deal, tax breaks and assets write-offs for small to medium-sized businesses as positives for Tasmanians.

In the latest State Government revised estimates — which predict a surplus of $7.3 million in the current fiscal year — $20 million of that $40 million had been accounted for.

Mr Gutwein said this year’s Budget would remain in surplus despite having to make adjustments to account for a further $20 million in lost GST revenues.

“The Budget is in good shape. We have a strong financial position and we’ll be able to manage it,” he said.

“We’re going through the process at this very late stage in the current financial year putting together the Budget for the next financial year, and obviously we’ll take these matters into account.”

Mr Gutwein said the lost GST revenue was an example of why the Government had been firm in its response to the public sector wages negotiation, as hundreds of teachers walked out of school on Wednesday to protest for better pay and conditions.

But the opposition parties lashed the federal Budget as failing the state.

Opposition leader Rebecca White blamed Mr Gutwein for the reduction in Commonwealth funding.

“The fact that Tasmania faces a bad deal from this federal Budget is because of his inability and the Premier’s inability to argue for Tasmania and to make sure that Tasmania gets its fair share,” Ms White said.

The Greens said the federal Budget failed people with disabilities and did not promise action on climate change.

Greens climate change spokeswoman Rosalie Woodruff questioned why there was no extra funding for the Tasmanian Wilderness World Heritage Area — 6 per cent of which was burned in the summer bushfires.

“There was no money at all put into the World Heritage Area and rehabilitation,” Dr Woodruff said.

“This is a Government that thinks that business as usual will change the climate and is the response that we need.

“The Liberals need to understand we need urgent action on climate change.”