Michael Ferguson and Josh Willie clash over the accuracy of Liberal government’s budget

Treasurer Michael Ferguson and his Labor shadow Josh Willie have clashed over the accuracy of the Liberal minority government’s budget forecasts.

Labor’s treasury spokesman Josh Willie and treasurer Michael Ferguson

Treasurer Michael Ferguson and his Labor shadow counterpart Josh Willie have clashed over the accuracy of the Liberal minority government’s budget forecasts.

In a feisty budget estimates committee hearing on Tuesday, Mr Willie honed in on the forecast that the government would spend less this financial year than last financial year.

The government blew its budget by $1.3bn to spend $10bn in 2023/24.

It has budgeted to spend $9.7bn in 2024/25 — a three per cent reduction before inflation is taken into account.

The $300m in spending cuts includes $96m in employee costs.

Labor says no government in two decades has delivered a budget which ended up spending less than the expenditure of the year before.

Mr Willie asked Mr Ferguson whether his numbers would be closer to the mark this year.

“Are you going to blow the budget or will this be one of the most austerity-motivated budgets in decades?” he asked.

“If you meet your targets in the forward estimates, it’s going to be savage cuts — or are you going to blow the budget?”

Mr Ferguson denied the government had delivered an austerity budget.

“We’re investing in our state and we are delivering our plan,” Mr Ferguson responded.

Treasurer and deputy premier, Michael Ferguson at the budget estimates in parliament on Monday 23rd September 2024. Picture: Linda Higginson

“We’ve chosen a path that we think is the most acceptable for both the government and the economy and the delivery of stronger public services, and I admit that it’s been difficult.”

The government says employee expenses in the 2023/24 budget was significantly affected by one-off items, including $50m of back pay for doctors and nurses.

“When you ask that question, you need to acknowledge that health made a significant overspend and you could explore that with Health if you wish,” Mr Ferguson said.

And the Treasurer accused Mr Willie of not having asked him a question all year.

“You’re so negative, you’ve been a coward in the parliament. You’ve not been prepared to ask me a single question because you’re a coward,” he said.

Mr Willie was unimpressed by the accusation.

“I hoping to have a reasonable conversation and his trademark arrogance is already writ large,” he said.

Mr Ferguson withdrew, then repeated, the comment.

“I’d like to withdraw it because it obviously does cause offence, but it is cowardly,” he said.

“You want a negative outcome but we have a budget that is prepared on best advice.”

Health minister won’t rule out involuntary redundancies

Health Minister Guy Barnett has failed to rule out involuntary redundancies in the Health Department as it seeks to cut employee expenses by $130m next financial year.

The Department of Health went more than $300m over budget on staff costs in 2023/24. While its budget has been increased this year, the target is less than what was actually spent last financial year.

The government says costs were significantly inflated by one-off spending in 2023/24, including back pay for doctors and nurses as well as increased patient demand, but Mr Barnett did not directly answer a question from Labor’s Ella Haddad about possible redundancies.

“I am just explicitly trying to seek an assurance from you that you will rule out involuntary redundancies across your department,” she asked during budget estimates committee hearings.

Ella Haddad Labor member for Clark. Picture: Nikki Davis-Jones

Mr Barnett said the health workforce would grow.

“Let’s be very clear, I’m certainly ruling out any cuts to the frontline,” he said.

“And we are growing the healthcare workforce in the Tasmanian health system and we’re going to deliver more healthcare services faster.”

Ms Haddad earlier said a budgeted reduction in staff expenses this financial year seemed to be an unrealistic goal.

“How else do you spend less on salaries but get more staff?” she said. “Either you’ve got it wrong in this year’s budget or you know you’re going to blow your budget again.”

In addition to reining in its salary costs, the Department of Health is seeking to save more than $200m over four years to meet “efficiency dividend” targets set by the government.

Acting Secretary Dale Webster said the department would use a range of measures to meet those targets.

“I’ll give examples … in terms of combining roles to make savings, for instance the chief medical officer is also now the chief psychiatrist, the deputy secretary for mental health and wellbeing … is also the chief executive of mental health services.

“We believe that we can save in excess of $3m across pharmaceuticals by changing the contracts for pharmaceuticals.

“Consumables is in excess of $600m within the health budget, so a small saving in that space can actually mean that the budget efficiency dividend is met.”

“The standard ones of consultancies and travel will be targeted as well”

Mr Barnett said he was taking the issues in the portfolio seriously.

Minister Guy Barnett at the budget estimates in parliament on Monday 23rd September 2024. Picture: Linda Higginson

“I think it’s fair to say there are challenges but also opportunities in the health sector and that’s why we’re spending record funding to provide the support and services that Tasmanians need when they need it,” he said.

“The budget makes it very clear there’s increased funding from $12.1bn to $12.9bn over the forward estimates and will always respond as and where required to meet the needs of the Tasmanian people wherever possible and appropriate.”