Qld credit rating downgraded from AA+ stable to AA+ negative

Queensland’s credit rating outlook has been downgraded, adding to the cost of borrowing and putting pressure on the state’s infrastructure build in the lead-up to the 2032 Games.

Treasurer David Janetzki in Parliament on Wednesday. Picture: John Gass/NCA NewsWire

Queensland’s credit rating outlook has been downgraded, it has been revealed – adding to the cost of borrowing and putting pressure on the state’s infrastructure build in the lead-up to the 2032 Olympic and Paralympic Games.

Treasurer David Janetzki on Wednesday revealed S&P Global had revised Queensland’s credit rating outlook from AA+ stable to AA+ negative.

The downgrade will add to the cost of borrowings to fund the state’s capital infrastructure program.

Mr Janetzki said it had been predicted, and laid the blame at the former state government’s handling of the economy.

“Labor was warned repeatedly about their reckless fiscal management, but they repeatedly ignored it, leaving Queenslanders to pay a high price for their expensive failures,” he said.

“Labor’s last budget update revealed their $218bn path of debt, deficit and deception.

“After a decade of lies, debt and deficit, Labor can never be trusted to manage the budget again.”

However, S&P Global revealed “elevated uncertainty” around the LNP government’s fiscal strategy – its ability to arrest high spending and mounting debt – contributed to the downgrade.

“The negative outlook reflects our view that Queensland’s financial management or fiscal and debt ratios could weaken in the next year,” it said.

“We see elevated uncertainty over Queensland’s fiscal outlook.

“We believe several projects may be cancelled deferred or changed in scope to reduce the state’s infrastructure spending over the next three years compared with MYFER.”

Shadow Treasurer Shannon Fentiman argued the government was “softening up” Queenslanders to cut projects.

“S&P Global has downgraded Queensland’s credit rating becasue David Janetzki juiced up the mid-year budget update and failed to provide any fiscal strategy,” she said.

“David Janetzki’s cheap political points have become very expensive for Queenslanders.”

S&P noted the state government described its mid-year budget update as Labor’s “last budget update” without incorporating a strategy nor revealing its future financial decisions .

“The government has promised to address spending pressures and escalating capital costs in its June 2025-2026 budget to ensure debt will be lower than that forecast in MYFER,” the statement said.

“It is unclear how the government will address spending pressures and how much lower expenditure and debt will be in the upcoming budget. This uncertainty is captured in our negative outlook.

“We could revise the outlook on Queensland to stable if we are confident the state will deliver strong operating surpluses and contain growth in its deficits after capital accounts. This would ensure debt levels consistent with those of ‘AA+’ peers.”

Originally published as Qld credit rating downgraded from AA+ stable to AA+ negative