Page 3591 - Week 10 - Wednesday, 13 September 2017
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In conclusion, I support this motion and the Greens support the motion, but, as even Mr Coe said, surpluses and credit ratings are not the whole point of this; it is what the government can deliver that is more important. Credit ratings are demonstrably not a brilliant indicator of financial sustainability, and we seek a sustainable Canberra—sustainable environmentally, socially and economically—more than one that is growing potentially unsustainably.
MR BARR (Kurrajong—Chief Minister, Treasurer, Minister for Economic Development and Minister for Tourism and Major Events) (10.36): I thank Mr Steel for moving this important motion this morning, recognising that the independent international ratings agency Standard & Poor’s has reaffirmed the territory’s AAA credit rating after reviewing the fiscal plans the government laid out in the 2017 budget.
Madam Speaker, I will be the first to acknowledge that for some people prudent fiscal management is not seen as a particularly sexy topic. I acknowledge this. Despite the lack of razzle-dazzle that can come at times with budget management, it is critically important to manage our budget well so that we can deliver high quality services today and into the future; support local jobs through tough times and encourage their rapid expansion in periods of economic growth; and ensure that we are catering to an increased population, which will continue to be a factor in our city’s lived experience. I have said before in this place that I do not think that the business of making babies is going to go out of style any time soon, so our population is going to continue to increase and the government needs to focus on sound fiscal management to invest in this city for the years to come. It is a task that has been my focus for the past six years as Treasurer and will continue to be a focus for the government over this term of the Assembly.
The AAA credit rating is the highest possible credit rating assigned by international ratings agencies. Whilst we have heard in contributions from Mr Coe and Ms Le Couteur that to a certain extent it does not matter, I am relatively certain that, were the territory’s fiscal position to slip to the extent that credit rating agencies were to downgrade the ACT’s credit rating, and were that downgrade as a result of actions of the territory government, we would be hearing quite a lot about the importance of our credit rating. In this instance, it is one of those circumstances where, in the context of continued vigilance and sound fiscal management, the reward is that there is not a debate in relation to this matter.
I am absolutely certain that, had the opposition won the election last year and ripped up the contract with the light rail consortium, that would have triggered a credit rating downgrade. In addition to prudent fiscal management and the state of the territory’s finances, ripping up contracts is not something that is consistent with a AAA-rated jurisdiction. That would have put the ACT at extreme risk of losing its credit rating, and that certainly would have had a big impact on investment in the ACT.
The government has worked very hard to ensure that the AAA credit rating, the highest possible rating, one that is only assigned to an entity that has an “extremely strong capacity to meet its financial commitments”, remains the case for the territory.
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