Drought and volatility in the housing market have contributed to a more than $300 million dent in the NSW budget surplus, state treasurer Dominic Perrottet says.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
A $702 million surplus for 2019/20 was unveiled by Mr Perrottet in the NSW mid-year budget update on Thursday. This was down $314 million from earlier budget forecasts.
"We run a strong financial position here in NSW so we can invest in things that matter," Mr Perrottet told reporters on Thursday.
"We are seeing the housing market return but we've gone through a very volatile period.
"We've written down more than $10 million in stamp duty. We've also seen a softening when it comes to GST revenues."
Economic indicators for state's the future were bright, Mr Perrottet said.
"As we start to see the housing market improve, those increased wealth effects should flow into greater discretionary spending and that will improve GST receipts."
Mr Perrottet said the NSW economy can't continue propping up "lazy states" such as Queensland, which also delivered its half-year budget update on Thursday.
"The people of NSW should not have to subsidise inefficient, lazy states like Queensland. We continue to subsidise states that don't reform.
"I'd like to see Queensland's budget position today."
NSW Treasury is forecasting increased average surpluses of $1.9 billion over the four years to 2022/23, compared with the $1.7 billion figure given in June.
A $702 million surplus is forecast for 2019/20 in the half-year review, down from the $1.016 billion forecast at the budget earlier this year.
The government says increased expenditure, including on drought funding and infrastructure, has been partially offset by higher forecast stamp duty receipts.
A strong surplus would allow the government to take on more debt to meet infrastructure needs, Mr Perrottet said.
"Our population is due to continue to grow and we need infrastructure investment on the back of that," he said.
"That means our debt position will also grow, but there is no better time to borrow than today.
"Given our debt position is lower than other states we are ready to capitalise on that."
Opposition small business spokesman Daniel Mookhey says the government's figures are "worrying".
"We are seeing the impact of (Reserve Bank of Australia) interest rate cuts and the impact on the NSW economy through rising stamp duty revenues," he said in a statement.
"Sadly, the Berejiklian government does not have a plan. It has a prayer built on the property market and the current low interest rates."
Australian Associated Press
