Tasmania is risking needing a federal bailout due to escalating debt levels, according to a recent International Monetary Fund warning.
The IMF identified Tasmania as one of three Australian jurisdictions, including Queensland and Northern Territory, failing to meet fiscal targets.
It said the state’s gross debt per capita is forecast to exceed government targets every year through to 2032-33.
Shadow Treasurer Dean Winter said the IMF warning exposed “Liberal budget mismanagement” under Premier Jeremy Rockliff’s leadership.
“Tasmania’s net debt position will have quintupled in just four years, with net debt reaching $7 billion by 30 June this year,” Winter said.
The criticism follows Treasury’s Revised Estimates Report showing the government overspent its budget by $500 million within 55 days of setting it.
Winter warned debt servicing costs would exceed $600 million annually, impacting essential services.
“Every dollar spent on interest is a dollar that doesn’t deliver a hospital bed, keep a teacher in the classroom, or support a family doing it tough,” he said.
Government Minister Nick Duigan dismissed Labor’s criticism of the government’s budget management.
“I think it’s pretty extraordinary that Labor have got something to say on this, they have no credibility,” he said.
“Yesterday they were asking us to spend more money on childcare, which is obviously a federal responsibility.”
Duigan said the government would meet its fiscal targets through measured approaches rather than dramatic cuts.
“We won’t be slashing and burning.We’ve got fiscal targets, we’ll meet those fiscal targets,” he said.
“We will rise to meet the challenges in our budget, but we’ll do it in a measured way to deliver those outcomes.”
In response, Shadow Treasurer Dean Winter has accused Liberal Nick Duigan of having “no idea what his government’s fiscal targets are,” criticising remarks Duigan made this morning in response to the International Monetary Fund’s warning about the government’s financial management.
“In response to the IMF warning about Tasmania’s escalating debt, Nick Duigan claimed the Government would meet their fiscal targets,” Shadow treasurer Dean Winter said.
“Mr Duigan obviously has no idea what his government’s fiscal targets are because not one of them is being met.”
“The IMF explicitly points to debt per capita targets not being met and in fact, going in the wrong direction.”
