Tasmania 2022 budget reveals growing debt, cost of living concessions and millions for digital health services

For the first time in nine years, there’s a new Treasurer holding Tasmania’s purse strings.

Michael Ferguson has unveiled the priorities, problems and prices facing Tasmania’s $8.3 billion budget less than two months after taking the reins from former premier and treasurer Peter Gutwein.

So, what are the key figures?

Well, economic growth is predicted to remain strong over the next few years, and revenue has been growing too.

But next financial year there is an expected deficit of $474.6 million — the government says that will turn into modest surpluses for the next few years after that.

But when you remove one-off payments from the federal government (for things like the Bridgewater Bridge and the Royal Hobart Hospital redevelopment) the picture looks slightly less rosy, with a deficit of $940.3 million in 2022-23, and deficits for each of the following three years.

Tasmania’s debt is increasing too — and more significantly than predicted in last year’s budget.

Net debt is expected to double in just one year to almost $3 billion by June 2023 and then rise again to more than $5 billion in 2026.

The unemployment rate is expected to stay at 4.5 per cent.

In this year’s budget, health spending will increase to $11.2 billion.(ABC News: Luke Bowden )

Where is the money coming from, and where is it going?

The biggest chunk of revenue feeding into Tasmania’s coffers comes from the GST, which is divvied up amongst the states by the federal government.

Payments from the federal government, including from GST, make up 65 per cent of Tasmania’s revenue.

The rest comes from things like conveyance duty raised from the sale of property, land tax and payroll tax.

Almost a third of budget spending goes into the state’s health system (32 per cent) with a quarter going into education and 10 per cent spent on public order and safety.

The budget includes a $5.6 billion infrastructure spend.

More than half of that (54 per cent) will be spent on roads and bridges.

Several lanes of traffic driving in both directions on the highway in Hobart, TAS, March 2022
Roads and bridge upgrades are receiving $2.7 billion in this budget.(ABC News: Luke Bowden)

What’s being promised?

Many of the budget measures have already been announced.

There’s a promised $305 million in concessions to help vulnerable Tasmanians meet the cost of living, including for water bills, electricity and council rates.

The government is also committing to what it calls the “most comprehensive and ambitious affordable housing strategy in Tasmania’s history”.

That strategy sees $538 million being invested into social and affordable housing and homelessness initiatives over four years – more than $200 million of that next year alone.

An aerial view of houses in Hobart, Tasmania.
In 2022-23, $204 million is allocated for social and affordable housing and homelessness initiatives.(ABC News: Luke Bowden)

The government has promised to build 10,000 new homes over the next decade.

It’s ambitious – the budget papers show just 1,254 homes have been built under the Affordable Housing Strategy since 2015.

A big overhaul is also on the way to transform Tasmania’s health services — there’s $150 million for what the government calls a “game-changing” investment into digital health to improve access to care.

After the coronavirus pandemic forced a big shift into online learning, there’s $4 million for more laptops and tablets for students.

Lots of small children walking to class.
The government will spend $69.7 million in 2022-23 – and a total of $250 million over four years — on school upgrades.(ABC News: Cason Ho)

There’s a GST storm cloud on the horizon

The budget outlines what the government expects money to be spent on but relies on forecasts to decide how things might look over the next few years.

Posted , updated 

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