Treasurer Jackie Trad has launched a defence of the state’s $90.72 billion debt invoice, arguing it’s “working debt” that can largely pay itself off through dividends.
Ms Trad handed down her second funds as Treasurer on Tuesday, unveiling extra debt, expanded taxes and continued surpluses.
Basic authorities sector debt, which incorporates authorities departments, was predicted to be $38.73 billion in 2019-20.
As compared, whole debt held by the “non-financial public sector”, which incorporates government-owned firms similar to Stanwell and the Port of Townsville, was anticipated to hit $78.72 billion subsequent 12 months.
These debt figures embody leases, similar to workplace lodging similar to 1 William Road and securities and derivatives, which should now be recognised on the stability sheet beneath new accounting requirements.
Addressing a Queensland Labor post-budget lunch on Wednesday, Ms Trad stated many of the debt was held by government-owned firms.
“They act commercially, they supply a dividend again to the state coffers and so they additionally pay down their very own debt,” she stated.
“Lots of the debt is definitely working debt for our government-owned firms, for power mills, for our ports, Townsville Port, Truthful North Queensland Ports, so these are all financial infrastructure and firms which might be paying their very own method.”
The sector was anticipated to generate $1.37 billion in dividends in 2019-20, which might be used to fund hospitals, faculties and police, based on the state funds papers.
Ms Trad insisted the state authorities was borrowing to construct infrastructure for Queensland.
EY Oceania chief economist Jo Masters stated there was “good debt and unhealthy debt” and borrowings may very well be efficiently used to help the economic system.
“It’s important that debt is used for tasks that construct productive capability sooner or later,” she stated.
“It is actually essential to not neglect that after we enhance [the] debt stage, after we use debt, we’re borrowing financial exercise from the long run.
“If we do not repay that debt and we do not construct productive capability, we are literally leaving a burden for younger Australians.”
On Tuesday, Ms Trad insisted the state authorities nonetheless had a debt discount technique and would proceed to seek out financial savings.
The general public service will likely be one space the place the state authorities will search to slash bills, with $700 million to be saved over the subsequent two years.
Worker bills and superannuation will make up virtually half of the state authorities’s whole bills in 2019-20, coming in at greater than $29 billion.
Ms Trad has dominated out pressured redundancies however voluntary redundancies will stay on the desk.