The Tasmanian Government is forging ahead with a significant infrastructure investment of $5.1 billion in the upcoming budget, despite calls to reduce spending and rein in the state’s deficit.
Treasurer Michael Ferguson believes cutting back on infrastructure spending would “be a mistake” and insists it is necessary to maintain a steady flow of work in the construction sector and ensure job security.
“We’re about bolstering that pipeline of works, making sure that it’s a smooth and reliable pipeline of works that our contractors can work with and continue to provide job security,” he said.
However, independent economist Saul Eslake recently warned that the state’s net debt could reach $16 billion by 2034 unless the government alters its spending habits.
“At this particular point in time, given what mismanagement is occurring at the national level … we’ve made the balanced decision that this isn’t the right time to step down,” Ferguson said.
“We need to maintain that pipeline of works, it supports jobs for men and women across civil, commercial, domestic, residential sectors right around the state.”
“We need to keep the project pipeline going, even with the economic challenges.”
Labor’s treasury spokesman Josh Willie criticised the government’s approach, predicting that the budget will lead to record debt levels and unfunded election promises.
“When Treasurer Michael Ferguson delivers the state budget on Thursday, there will be no way for him to spin out of what a disaster it really is,” he said.
“This will be the worst and most unsustainable budget in Tasmanian history.”
Ferguson has indicated that health, education and public safety will receive increased funding in the upcoming budget, with plans to hire more frontline staff in key areas.
