InDaily InDaily

Support independent Journalism Donate Subscribe
Support independent journalism

News

Two years or bust: “Watershed” budget’s recovery roadmap

News

Tomorrow’s state budget could be “the most important in South Australia’s history”, Treasurer Rob Lucas says, as he declares stimulus spending must stop within two years to avoid an economic disaster.

Print article

The Marshall Government will roll out a second round of cash grants for coronavirus-impacted small businesses, as well as introducing a new one-off payment for sole traders, as part of tomorrow’s economic blueprint – which is set to reach a record deficit as Lucas hands down a roadmap for recovery.

He told InDaily today: “I think this is probably one of the most important budgets in the state’s history – if not the most important.”

“We’re in a watershed moment, and the budget itself is going to a critical part of it,” he said.

Lucas has already declared the budget was set for successive deficits of around $1.9 billion, with debt spiralling to $30 billion over the forward estimates.

He told InDaily tomorrow’s deficit would now exceed $1.9 billion – already a state record.

He did not say whether that meant it would nudge past $2 billion for the first time, saying only it would be “more than $1.9 billion”.

An expected spend on COVID stimulus funding and projects to help secure government-led construction jobs will mark a different approach from Lucas, whose first two budgets since the Government was elected in 2018 have focussed on maintaining a surplus, however slim.

But the triple whammy of GST writedowns, last summer’s bushfires and the COVID-19 pandemic have ruled out another surplus – indeed, any one of those elements alone could have ruled it out.

The Treasurer insists, though, that the projected two years of deficit are inextricably linked to the Government’s stimulus program – with a two-year stimulus roadmap to be unveiled in detail tomorrow.

“We’ll continue to focus on spending as much money as we can to save as many jobs and businesses as we can, and try and create as many as we can over the next two year stimulus period,” he said.

He noted his assumption on the length of the program conformed to the federal government’s, adding the budget would not “lock in ongoing funding which is unsustainable”.

“We’re quite intent on the stimulus being limited for two years – we’re not looking at ongoing funding,” he said, adding that the budget would spell out a path back to surplus.

Asked if that meant the record deficits were a function of the stimulus spend, he said: “Very much so.”

But he noted if there was no vaccine widely available by the end of next year, “SA, Australia and the world will be in a whole lot of economic trouble”.

Labor has called on Lucas to freeze fees and charges – redundantly, since he already announced an average 1.9 per cent increase back in June.

But he insists a range of cost-of-living savings – citing water, power, CTP, ESL and sports vouchers – mean “the average household with two cars and two kids is about $800 a year better off under us than under Labor”.

Premier Steven Marshall today announced small businesses and not-for-profit organisations that continue to be hampered by the pandemic could be eligible for a second $10,000 cash grant, funded under an extension of stimulus spending announced at the weekend.

“Tomorrow’s budget will be the single biggest hit of economic adrenaline in the history of SA,” he told reporters.

“I genuinely think this is the most important budget in the history of SA… we’re moving away from broad brush strokes to a more nuanced approach.”

The Government’s stimulus commitment has doubled to $4 billion – although the Opposition has pointed to last month’s Auditor General’s report which showed only $282 million of the initial $1 billion stimulus announced in March had been spent by mid-year, with Shadow Treasurer Stephen Mullighan declaring “announcements means nothing unless this money is actually spent”.

But Marshall today unveiled plans to do just that, saying he expected 90 per cent of the funding to be allocated by year’s end, including to a new one-off cash grant of $3,000 for “eligible businesses that do not employ staff, including sole traders and partnerships, operating from a commercial premise and suffering financial hardship as a result of the pandemic”.

The Government says the measures announced today “will assist an estimated 10,000 small business and not-for-profits including eligible sporting and community organisations across the state”.

The largesse for sporting groups is unlikely to stop there, however, with the Government set to unveil its SA State Sport Infrastructure Plan as part of the budget.

Sports Minister Corey Wingard yesterday announced the allocation of $35 million for “new community sporting and recreational infrastructure”, including expanding the existing Grassroots Football, Cricket and Netball Facility Program to incorporate all sports.

But the budget is also expected to include funding for elite sports infrastructure, with neither Premier nor Treasurer dismissing the suggestion Adelaide United’s Hindmarsh home could be in line for a significant overhaul ahead of the Women’s World Cup.

“We’ve said we need to upgrade our sporting infrastructure,” Marshall said on Friday.

“We announced we were going to look at our stadia [and on] Tuesday we’ll be making an announcement in terms of how we’re going to spend that money… we do want to upgrade our sporting infrastructure, from grassroots right through to the elite level.”

Labor has already claimed to have been leaked the budget’s “centrepiece announcement” – documents the Opposition claims reveal details of the final stage of the North-South Corridor.

The documents, revealed last month and marked ‘Cabinet in Confidence’, suggest the favoured option for the long-debated roadway fix is a tunnel for the 5.8 kilometre Stage 1 section from Tonsley to near Anzac Highway, which will take four and a half years to build – after which construction of a lowered roadway and open road between Anzac Highway and the River Torrens would commence.

Lucas suggested the North-south corridor – to be completed by 2030 – and the new Women’s and Children’s Hospital – by 2025-26 – would remain the Government’s two key building works.

InDaily will have full budget coverage in a special afternoon edition from 3pm tomorrow.

Make a comment View comment guidelines

Make your contribution to independent news

A donation of any size to InDaily goes directly to helping our journalists uncover the facts. South Australia needs more than one voice to guide it forward, and we’d truly appreciate your contribution. Please click below to donate to InDaily.

Donate here
Powered by PressPatron

More News stories

Loading next article