NSW Treasurer Daniel Mookhey used the occasion of his first ever economic statement to State Parliament to position the Minns Government as administering tough but necessary cuts to protect the State amid increasing economic headwinds.
Mr Mookhey highlighted the challenging and high risk global economic landscape and flagged that the state’s budget balance sheet would deteriorate further in the lead up to the September budget and emphasised the ‘looming need to re-evaluate state non-financial assets to the tune of more than $3 million’. By June 2026, he said, the Premier State will owe creditors some $7 billion a year in annual interest payments.
Strongly criticising the previous Coalition government, Mr Mookhey said Labor was dealing with “the largest debt any incoming statement government has inherited from its predecessor in more than three decades … more money on interest bills leave us with less money for vital public services like our schools and hospitals.”
The Treasurer highlighted inflation as the ‘key challenge’, pledging to get Government spending under control to take the cost of living pressure off families and save essential services and expenditure. ‘Nice to have schemes’ would be first to get the chop, he said, flagging that spending cuts should be expected across the board.
Continuing recent critiques of the previous Coalition Government’s accounting practices, he took particular aim at the Debt Recovery Fund which he said had led to misleading figures in the State’s books. For example, he said, the 2023 Pre-Election Budget Update had ‘showed a $328 million surplus for 2024-25, which would have been a $911m deficit without the DRF’s returns’. He promised the September Budget would reflect accurate but bleaker debt figures.
The Treasurer reaffirmed the Premier’s intent to create its stamp duty concession scheme for first home buyers, ensuring 84% or 5 out of every 6 of future first home buyers will pay no or reduced tax. Legislation will be introduced to the parliament this week, with the scheme starting from Saturday 1 July 2023.
In partnership with the Federal Government, around 1.6 million NSW households and 320,000 small businesses are eligible for a new National Energy Bill Relief payment in financial year 2023-24, in line with election commitments.
The Treasurer will hand down the Minns Government’s first Budget for 2023-24 on Tuesday 19 September. In the interim, all Ministers and their departments will be looking for savings.
If you’d like to discuss the NSW Economic statement further, please contact:
Jodie Brough, Partner and Sydney Office Head – [email protected]
Amy Smith, Associate Partner – [email protected]