From Santa Claus to Dr No: Dick’s billions in handouts backed by a tight fist

Queensland’s budget bottom line has returned a better-than-expected forecast for debt and deficits despite record spending on cost of living measures.

Jun 11, 2024, updated Jun 11, 2024
Deputy Premier, Treasurer and Minister for Trade and Investment Cameron Dick speaks to the media during the handing down of the 2024-25 Queensland State Budget in Brisbane. (AAP Image/Jono Searle)

Deputy Premier, Treasurer and Minister for Trade and Investment Cameron Dick speaks to the media during the handing down of the 2024-25 Queensland State Budget in Brisbane. (AAP Image/Jono Searle)

A coal-funded spending splurge will provide Queenslanders cost-of-living relief ahead of the state election after a record population jump.

But the state budget, handed down on Tuesday, revealed a $2.6 billion deficit for 2024-25, a $400 million improvement on forecasts before the papers were released.

Treasury forecast the state would further improve the deficit to $515 million in next year’s budget before a return to surplus.

Premier Steven Miles’ government has spent big in a bid to earn another term at the October election, with a 31 per cent rise in cost-of-living relief.

The government will pump an additional $3.8 billion into cost-of-living concessions off the back of coal royalty revenues, taking its total concessions to $11.2 billion.

A raft of measures designed to provide Queenslanders relief include a freeze on government fees and charges including the cost of driver’s licenses.

Other budget highlights include $1000 off household energy bills with the commonwealth chipping in another $300, 20 per cent off car registration and public transport being slashed to 50c for six months.

The budget will also help Queenslanders with increases to the first-home owner concession on stamp duty, with about 10,000 buyers a year set to benefit.

A $107.3 billion allocation over four years to the government’s total capital program was also unveiled, expected to support 72,000 jobs.

Despite the higher deficit, the budget papers revealed better than forecast bottom lines with general net debt reaching $59.8 billion in 2027-2028, $13 billion lower compared to forecasts in April.

The government also previously predicted that general borrowings would reach $128 billion but budget papers confirm it will be $17 billion better at $111 billion.

Treasurer and Deputy Premier Cameron Dick said the net debt to revenue ratio forecast in 2024-25 was 31 per cent compared to 88 per cent in NSW and 163 per cent in Victoria.

He attributed these better-than-expected figures to the government’s scrutiny over accepting proposals.

“We said no to things,” Dick said.

“We have to be very careful about public expenditure … which is why we have reshaped our fiscal position as tightly as we can, focusing on the things that matter.”

Dick did not elaborate on the proposals that were pushed aside by government but budget papers show health, cost of living and education are what mattered.

Queensland has had a population increase of about 144,000 since September 2023, including 88,000 from overseas.

“We’ve been going through and may still be going through the biggest influx of people that our state has ever seen,” Dick said.

“Across the three years to 2023-24 Queensland’s population growth is estimated to have exceeded budget forecasts by a total of 135,500 people.”

The billions of dollars in extra spending are promised to be funded by progressive coal royalties in Queensland, however, forecasts show the revenue from the mining tax is slowly dwindling.

Coal royalties will bring in $6.2 billion in revenue in 2024-25, a nearly 40 per cent fall on previously unprecedented gains.

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Budget papers said changes in commodity export volumes, global prices and improving supply conditions are the cause of the falling royalties.

Although there was a cost of living splurge in Dick’s fifth budget, the government has committed to cutting costs elsewhere in their own spending.

This will be delivered through the Smarter Spending, Better Jobs Plan – a repackaging of a plan introduced during the financial pressures of Covid-19 – to save $3 billion over four years.

“These savings will be a major part of underpinning the budget’s return to surplus,” Dick said.

The task force will reduce the government’s travel, advertising, and accommodation expenditure as well as decrease the use of external consultants, contractors and labour hire.

Dick reassured there would be no public sector job losses as a result of the task force.

“We spend at least $500 million a year on leasing offices, spend $3 billion in payments to contractors and consultants so these are areas where we will ask agencies to find a responsible level of savings,” Dick said.

However, the budget showed government expenses remain on the rise – by 2.5 per cent – thanks to a number of the promised programs.

These include higher operating costs at Queensland Health to address demand and support investment, the need to fix the state’s housing supply by delivering the Homes for Queenslanders plan and meeting student needs under the National School Reform Agreement.

There is good news for Queenslanders in the tax department, with residents paying $1052 less than NSW per capita.

Taxation does however remain a key contributor to the state’s economy, bringing in a forecast $24.7 billion in this budget from gambling, land tax, car registration, and more.

This is a rise from the previous year by 9 per cent.

“We remain committed to being a low tax state,” Dick said.

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