Next page . . . . Previous page . . . . Speeches . . . . Contents . . . . Debates(HTML) . . . .

Legislative Assembly for the ACT: 1997 Week 4 Hansard (6 May) . . Page.. 998 ..

This budget represents a concerted effort by the ACT Government to take a leading role in restructuring our economy by making the creation of new jobs and new business opportunities our primary focus. The Government is determined not to compound the ACT's economic problems. We will maintain spending and support our own public sector, but there will be an even greater emphasis on new jobs and business growth that will give us back some of the confidence that has been lost in Canberra's future.

Unlike the Commonwealth, under my Government restructuring within the ACT Public Service has largely been completed. We have therefore reduced our funding for redundancies and redirected $4.5m of these savings into new employment, business and tourism initiatives. Added to this $4.5m injection is a further $3.2m that has been committed in 1997-98 to continuing labour market programs and economic initiatives. It consolidates the approach taken in our previous two budgets. At its heart is a major boost to spending on employment programs, business assistance and promotion of the Territory. But there is also an emphasis on other important problems facing the Territory, like protecting our children, helping Canberrans with mental illnesses and making our community safer.

Mr Speaker, the ACT continues to face a difficult economic environment. The impact of Commonwealth policies has affected Canberra harder than any other State or Territory. As a direct result of the Federal Government's deficit reduction strategies, our economy contracted in each of the three quarters up to December 1996. We are therefore, in technical terms, in a recession, simply because the Commonwealth has reduced spending and employment in Canberra. However, while negative growth is forecast for this financial year, there are signs that our economy is stabilising. Leading ACT indicators support the view that there has been moderate improvement since late 1996. The ACT's unemployment rate has fallen steadily since October last year and was 7.4 per cent in March. Jobless numbers have dropped, whereas full-time employment has improved.

While building activity in the private residential sector has remained relatively weak, activity in the commercial and non-dwellings sector has been extremely resilient. Growth in retail turnover has remained almost double the national average for most of the past 12 months, private consumption expenditure has been buoyant, while there have been signs of improvement, too, in new car sales and tourism activity. Although a range of surveys have shown that business confidence in the ACT is subdued, the private sector is now forecasting modest improvements in sales, employment and profitability in the medium term. This budget therefore forecasts only limited economic growth of one per cent in 1997-98 in anticipation of further reductions in Commonwealth outlays and employment levels in Canberra. Inflation is also forecast to be only 1.75 per cent this year.

Mr Speaker, this is the first ACT budget that will be brought down and passed before the beginning of the next financial year - I hope. While the financial outcome for 1996-97 will therefore not be known until late July or early August, it will almost certainly vindicate the aggressive economic policies and improved management that this Government has displayed in its first two years. Only last month, Standard and Poor's reaffirmed the ACT's AAA credit rating and commented favourably on the economic direction being pursued by this Government.

Next page . . . . Previous page . . . . Speeches . . . . Contents . . . . Debates(HTML) . . . .