ADELAIDE, Australia — Big infrastructure spending and more money for health will be the focus of the South Australian budget as the state looks to maintain the recovery from the Covid-19 pandemic and woo voters ahead of next year’s state election.
The state’s finances have been bolstered by better-than-expected Goods and Services Tax and stamp duty returns over the past 12 months but the debt will continue to loom large in the immediate future.
Treasurer Rob Lucas has revealed the deficit for 2020/21 will now come in at AU$1.8 billion ($1.3 billion), better than the AU$2.6 billion ($1.9 billion) forecast in November last year.
But the government has also been hit with some unexpected bills, including an AU$200 million ($149 million) blowout in health, AU$64 million ($47 million) extra to police for border and security duties, and up to AU$30 million ($22 million) to combat a spate of fruit fly outbreaks threatening the state’s horticulture industry.
Nevertheless, the Liberals will allocate AU$17.9 billion ($13.4 billion) on infrastructure over the next four years when Lucas on June 22 hands down the latest economic blueprint for the state, his last before retiring from politics next year.
Roads, rail, schools, hospitals, and sporting infrastructure will all feel the love as the government targets projects to “improve the daily lives of South Australians right across the state”.
The latest announcement on June 21 includes AU$49 million ($36 million) for a new home for the state’s sports institute.
“Our Budget for a stronger South Australia is creating jobs, building what matters and delivering better services to further secure our growing global reputation as one of the safest and most attractive places in the world to live, work and raise a family,” Premier Steven Marshall said.
“We are locking-in a significant pipeline of job-creating infrastructure projects that will transform local communities as we chart our path out of the pandemic.”
Much of the infrastructure spending will rely heavily on contributions from the federal government, especially big-ticket items including the completion of the South Road redevelopment through Adelaide and the electrification of the Gawler rail line.
The projects are expected to receive widespread support although Business SA said the government should develop a long-game strategy to future proof the state’s economic recovery to ensure it emerges from the pandemic with a sustainable growth trajectory.
“This is a once-in-a-generation opportunity to reset the state’s brand and one that Business SA will support with vigor,” it said in a pre-budget submission.
The Greens have also called on the government to use the budget to introduce a comprehensive electric vehicles policy, offering incentives to buyers.
“Offering incentives to increase the uptake of electric vehicles is essential if we are serious about combating climate change,” Greens Member of Parliament Robert Simms said.
“The future is electric mobility, alternative fuels, and public transport, and it’s time for the state government to invest in a cleaner, greener future for South Australia.”
In last year’s budget, the government announced a new tax on electric cars, to cover the loss of fuel excise, but later put that measure on hold until at least July 2022.
(Edited by Vaibhav Vishwanath Pawar and Nikita Nikhil. Map by Urvashi Makwana)
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