Another burst of smoke, mirrors, spin and – POOF! – the ACT Budget appears. In deficit, of course. It’s another “Seven Days” with IAN MEIKLE
I PREDICT that in the lifetime of Andrew James Barr (born April 29, 1973) the ACT economy will never return to surplus.
And that history will record his years as Treasurer as the worst in Australia. In fact, hold the history, he quite possibly already is. Ten budgets so far, all in deficit and at least another three to come, if he goes full term. For perspective, Labor’s ridiculed federal Treasurer Wayne Swan could manage only six.
When Jon Stanhope left office as Chief Minister, his government had a surplus in 2011-12 of $736 million and an operating surplus that year of $42 million. For the record, Katy Gallagher was the Treasurer.
Now, 10 years later the cumulative ACT deficit this financial year will come in at $5.7 billion (about $2100 for every ACT resident) and the operating deficit at $951.5 million. According to the Budget papers, the deficit will hit $9.6 billion by the time they ask us to vote for them again in 2024.
Now, we can boo-hoo about the biting costs of covid, but the ACT was already shouldering more than $4 billion in debt before a single tonsil was tickled at the EPIC covid testing hub last year.
Not to worry. Transport and City Services Minister Chris Steel has been chugging the Kool-Aid, and turned up on television, wide-eyed and telling us “debt has never been this cheap” in response to his leader’s assertion that: “Interest rates are the lowest since Federation, this provides a once-in-a-century opportunity for the government”.
“No, really, all the stable hands are saying this horse can’t lose…” Someone call Gamblers Anonymous.
Too late; Andrew’s telling the Assembly about his “turbo-charged” Budget and how we’re going to use “emergency spending” to get out of this mess. To wit: “This Budget sets out our largest ever infrastructure program at $5 billion over five years – a program that will make Canberra an even better city to live in and create thousands of good, local jobs.”
Let’s get the calculator out: new works announced amount to around $750 million and there’s $2.3 billion that relates to works in progress (i.e. previously announced projects, such as the tram to Woden, the hospital redevelopment and the CIT and education infrastructure).
Not quite five big ones. The Budget papers account for the absence of specifically identified projects as “provisions”, which seems like a giant hollow log or slush fund for future announcements.
But not so fast Mr Chief Minister, Opposition Leader Elizabeth Lee is on to you. She reckons it’s a “Band-Aid Budget”.
“The Chief Minister’s $5 billion infrastructure pipeline is a flashy headline, but when you start to drill down into the numbers it is only a four per cent increase on what was promised last year,” she says.
“Hyperbole and announcements do not create jobs; we know this government is great at announcements but their track record of delivering on those promises has been lacking.
“This is highlighted by a massive $250 million underspend in infrastructure projects last year which the Chief Minister attempted to blame on industry.
“There has been a chronic underfunding of skills and training in the ACT and in this Budget, there is no material commitment to improving and boosting skills and apprenticeships to deliver on these infrastructure projects.”
And it’s here she may be on to something.
Master Builders ACT CEO Michael Hopkins says the Budget set out a big building plan, but failed to give local businesses the tools needed to build it.
“The government is going full-throttle on infrastructure spending, but has put the handbrake on apprenticeship funding,” he says.
“Spending on infrastructure is a strategic and sensible investment by the ACT government, but without the necessary skilled workers to build these projects they are destined to remain plans on a shelf.”
Likewise Adina Cirson, the Property Council’s local barker: “The pandemic is hitting hard on the community, and in particular the ACT business sector.
“We welcome the focus on job creation and infrastructure investment, but heading into 2022 we face major housing affordability and land supply issues, coupled with a tightening employment market as our population growth falls through the floor.”
Graham Catt, of the Canberra Business Chamber, was listening carefully and detected only two mentions for business in the Budget speech, but “no specific mention of the thousands of small businesses who are critical to the territory’s recovery and growth”.
Numbers from the Australian Bureau of Statistics show how hard it’s been locally for small business: retail trade in the ACT fell 19.9 per cent from July to August; while NSW and Victoria recorded declines of 3.5 and 3 per cent respectively.
Meanwhile, in the parallel universe that is the ACT Greens, leader Shane Rattenbury (“the nation’s first and only Greens attorney-general”) was almost apoplectic, describing the Budget as “beyond our wildest dream” and, and, and… the greenest budget in Australian history!
“With a third of seats in the ACT’s cabinet, Greens values shine brightly in every corner of this Budget,” he purred.
As he should, he snagged $795,000 to develop, cost and consult in leading the national push to raise the age of criminal responsibility.
Only nine months until we do this all again, covid permitting. So with apologies to Tennessee Ernie Ford:
You load 10 def’cits, what do you get?
Another day older and deeper in debt.
- Ian Meikle is the editor of “CityNews” and can be heard on the “CityNews Sunday Roast” news and interview program, 2CC, 9am-noon.
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Ian Meikle, editor