The need for difficult decisions to repair Queensland’s Budget is reinforced by news that, due to the drop in coal prices and a slower economy, revenue will be further written down by $1.5 billion over the next four years. The Government, however, does not have to look hard for budget savings—it only needs political courage—because potential savings measures have been identified by both the Queensland Competition Authority, in its recent Industry Assistance Inquiry, and the Department of Premier and Cabinet, in its controversial leaked Economic Action Plan.
Some of the identified savings measures include:
- removing transport subsidies, particularly for agricultural freight ($1.4 billion over five years according to QCA estimates), a measure which was identified by both the QCA and Premier’s Department,
- savings in Queensland Rail operations (e.g. cutting tilt train services),
- scrapping the desalination and recycled water plants.
Unfortunately I am not expecting bold savings to be announced in the Government’s Mid-Year Fiscal and Economic Review which will be released later this week. Obviously, the Government’s precarious position in the Parliament means we will not see any tough decisions in this term.