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Strategy to secure future QUEENSLAND'S Treasurer, Andrew Fraser, said the 2009-10 State Budget puts in place a clear strategy to restore Queensland's finances to balance while creating jobs and maintaining the services required to cater for a growing population.Mr Fraser said the effects of the global recession have driven the budget into deficit with a AU$15 billion wipeout in revenues. "In the face of the global recession, the State Government has introduced the longer term reforms needed to chart a course back to Budget surplus and begin the path to recovering our AAA credit rating over the medium term. "At a time of global recession, facing AU$15 billion in lost revenues, Queensland still has to cater for increasing service delivery demands and rapid population growth," Mr Fraser said. "We have taken tough decisions to put in place important planks of long term structural reform to secure a strong future for Queensland." Renewing Queensland Mr Fraser said the State Premier's Renewing Queensland plan, announced last month, was the start of the process. "Renewing Queensland outlined the priorities of a modern government, and a willingness to see Queensland assets reach their potential through the involvement of the private sector," Mr Fraser said. "This plan will enable the state to pay down debt by around AU$15 billion and alleviate further capital expenditure of up to AU$12 billion." Abolition of the fuel subsidy "On the same day, the Premier announced the end of the State's fuel subsidy, which was a one of a kind in Australia and ultimately no longer affordable in the current economic climate. "It would be irresponsible to borrow money to pay for the fuel subsidy. "This was a tough decision but one necessary for the state's financial sustainability." Wages policy Mr Fraser said Queensland's wages policy needs to suit the current economic circumstances. "This is a responsible decision, and an essential element in our fiscal strategy. "From January 1, 2009, all wage agreements will be set around the new framework of 2.5 per cent per year. "Any agreements already in place or due to be completed by December 31, 2009 will have until 1 September this year to be completed. "This is a long-term measure that reflects the challenges and the reality of what lies ahead. "The 2.5 per cent framework sits at the mid-point of the Reserve Bank target band of inflation and is a responsible measure that matches economic reality." Public service efficiencies The Government has announced a new savings target of AU$280 million to be achieved by streamlining the public service. "In the last Budget, the Government set a savings target of AU$60 million and achieved it. "In 2009-10, we have lifted that target to AU$280 million, which will see a reduction in spending in areas such as travel, supplies and services, advertising and consultancies. "This is about reining in unnecessary spending that can be redirected towards job-creating initiatives." Local government reform The Government will continue its structural reform task with reform to local government subsidy programs. "We have in place a five year AU$700m funding program, which we will honour. "We are honouring all commitments and increasing funding for projects in the next two years to bring this to a total commitment of AU$880m. "Local government reform was all about making councils stronger and we will implement a new program in 2011 that provides AU$45 million annually that will target infrastructure projects planned by councils who require financial assistance." Fiscal sustainability Mr Fraser announced state expenditure would be capped under a zero real per capita growth regime. "Fiscal discipline is a necessity. We will cap expenditure growth to what's required for population growth and inflation," Mr Fraser said. "Any new initiatives brought forward for further consideration will only be funded through identified savings by agencies. "This is a key part of the discipline need to build the path back to surplus." |
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