I had a nice chat with Ben Davis from 4BC’s Drive program yesterday afternoon on the economic plans the major parties are taking to today’s Queensland election. You can find the audio for the interview if you scroll down on this page:
Consistent with my previous comments, I was critical of both the Government’s and Opposition’s plans.
As I discussed with Steve Austin on 612 ABC Brisbane on Wednesday (see Media commentary on Qld Government election costings), the Government’s election costings have not addressed the Quiggin critique. That is, largely because it is proposing to spend one-third of lease proceeds on infrastructure and subsidising electricity prices, the Government will not get sufficient savings on its interest bill to fully offset the loss of income from the government-owned enterprises (e.g. Energex, Ergon) whose assets are leased out. Based on John Quiggin’s estimates, this could make the State Budget worse off by around $1 billion per annum.
Regarding the Opposition’s plan, which I posted on yesterday morning (Consultancies are an easy target, but more cost-effective than maintaining bloated public service), I told Ben that the Opposition is asking us to take a lot on faith:
- first, that they will find sufficient savings in consultancies, advertising and public sector inefficiencies to pay for their election commitments; and
- second, that they will manage the Budget well enough that, eventually, they will start paying down the debt.
Regrettably, the Opposition doesn’t appear to offer any real plan to pay down Queensland’s debt to the level necessary to regain our AAA rating.