Jun 17, 2014

No love for Canberra as NSW budget makes up federal shortfall

There were no surprises in the budget, with the state government forced to do the heavy lifting in the wake of the federal budget.

Paddy Manning

Crikey business editor

Reporting an almost-miraculous turnaround in NSW, new Treasurer Andrew Constance has thrown a harsh spotlight on the future impact of the recent federal budget on the state's finances. Constance said the federal budget would cost NSW $2 billion over the next four years, and while the state could bear the impact in the short term, the impact of cuts to health and education spending -- particularly, a reversal of the National Health Reform Agreement from 2017-18 -- would be unsustainable long term unless there were a complete of overhaul of Commonwealth-state finances. Over the 36 years to 2050-51, projections in the budget papers show the federal budget will blow out the "fiscal gap" between state revenues and expenditure, which the NSW government has managed to reel in slightly, from 1.5% to 2.9% of gross state product, with abolition of the NHRA alone accounting for 1.3% of the increase.

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One thought on “No love for Canberra as NSW budget makes up federal shortfall

  1. Jason Moore

    What a stupid, naive and populist comment; “If it weren’t for Canberra, it would be all good news.” Canberra is a city, it is comprised of 300,000 citizens of Australia who are not the elected representatives of the rest of Australia. It does not govern the country, it does not determine Federal Government policy. The elected representatives who very occasionally meet in Canberra do all of that. Indeed both The Treasurer Joe Hockey and The Prime Minister Tony Abbott reside in Sydney. So I’d say; “If it weren’t for Sydney, it would be all good news”.

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