Public servants have been asked by Treasury to model larger than usual increases to government fees and charges ahead of the State Budget.
These increases, while annual, are usually around or slightly above the CPI – but this year, they are likely to be much higher.
In response to questions from InDaily, Treasurer Rob Lucas confirmed that substantial increases were being considered for the coming budget year.
“Fees and fines for about 20 years have increased every year by the Treasury Indexation Rate, which in most years is a little higher than the CPI,” he said in a statement.
“Due to the massive $517 million cut in expected GST revenue next year, the Government is considering a range of options including further savings measures and a possible one-off larger increase in fees and fines.
“As part of the budget process all departments have been asked to consider and model impacts of possible savings measures and increases in fees and fines.
“However, final decisions on the extent of increases in fees and fines will not be taken finally until May in the lead-up to the State Budget.”
Last September’s State Budget, the first under the new Liberal Government, flagged an increase in the annual indexation rate for fees and charges of 2.2 per cent for 2018-19.
This rate covers public transport tickets, motor vehicle registration, driver licences, traffic fines and water and sewage charges.
South Australia has some of the highest expiation fees in Australia for traffic infringements after the previous Labor administration increased fines in advance of CPI to shore up its budget bottom line.
Lucas has already flagged cuts to spending after last month’s federal Budget delivered a much worse GST outcome than anticipated.
The federal Budget showed the state’s share of national GST would drop from the $7.3 billion predicted in the state budget to an expected $6.8 billion – a $500 million hole.
“Next year’s budget, with a $500 million write-down in the GST, is going to be a real challenge and we’ll have to consider what our response is over the next couple of months,” Lucas said early this month, in the wake of the Federal Budget.
“The size of the national GST pie is actually smaller than predicted, and South Australia’s share is going to be smaller because of a decision of the independent Grants Commission.”
South Australian departments and agencies are bracing for deep cuts in this year’s Budget.
Last month, Chief Justice Chris Kourakis told InDaily the State Government had warned him there may be a large funding cut to the Courts Administration Authority in the upcoming State Budget.
“We’ve been told that there will be a substantial budget cut in this year’s budget,” he said.
“If it comes to pass … we will have to substantially reduce services, starting in the next financial year.”
The chief justice said the courts were already expected to absorb $7.7 million in cuts from out of previous budgets, and “we consider the combination of the $7.7 million … and what we’re about to get now as being unprecedented in terms of the size of the budget cut and the sorts of services that will have to be reduced”.
Lucas stressed at the time that no final decisions had been made.
“We’ve discussed a range of … savings for all agencies including the Courts Administration Authority,” he said.
“(But) this is all part of budget discussions. No final decisions have been taken.”
– with AAP
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