Page 2827 - Week 08 - Tuesday, 13 August 2019
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you are talking about a combined rates and land tax bill of $100 a week. That is $100 of the rent of every rented household that is going to the ACT government in the form of a rent tax, that being rates and land tax.
With all that revenue—with the rates, the land tax, the stamp duty and the commercial rates—you would think that they would at least be able to balance the books. You would think that with commonwealth revenue increasing to $2.4 billion the Labor government would finally be in a position to balance the books and get on top of their debt. Instead, we are going to see an interest bill of $60 million this year alone. An interest bill of $60 million! The amount that gets paid to the light rail consortium each year we are also paying for our debt. And that is at a time when we have some of the lowest interest rates on record.
It makes you wonder just how exposed we would be, should interest rates increase or should our credit be squeezed. The Chief Minister may well say, “We have 10-year bonds.” Yes, there is a 10-year bond at 2.25 per cent.
Mr Barr: It is going lower.
MR COE: You would hope that they are going lower. You would hope so. But at some point it has to be repaid. In budget paper 3, I do not see anywhere showing interest-bearing liabilities going down. If we have a time with two per cent interest rates, surely there is the ability to pay down some of this debt as well. That is not happening. The interest-bearing liabilities increase in each of the outyears of this budget. The territory’s fiscal deficit in 2019-20 will exceed $1 billion for the first time. A fiscal deficit! Total money in and total money out will exceed $1 billion. It goes to $1,055 million in this financial year.
We know that the government that this Chief Minister leads is a different government from the ones that previous chief ministers, such as Jon Stanhope, led. (Second speaking period taken.) If Mr Stanhope was still here, there would at least be some financial discipline. It was under Jon Stanhope that we had the last surplus.
Mr Barr: No; we had a surplus last year.
MR COE: It was not a structural surplus and it was not a fiscal surplus. The last fiscal surplus was under Jon Stanhope. The territory’s deficit in 2017-18 was $158 million. The estimated deficit for 2018-19 is $447 million. The budget deficit for 2019-20 is $1,055 million. The last fiscal surplus was in 2007-08.
The lower deficits in 2016-17 and 2017-18 were built on a $722 million increase in revenue that will not last. The 2019-20 budget shows deficits returning to the levels that were pretty much those of the Chief Minister’s first four budgets. For the first time, in 2019-20 the deficit will exceed $1 billion. The return to surplus in 2022-23 is built on an unlikely control of expenses and a very optimistic increase in revenue. It also banks on an increase in land sales of $359 million in 2019-20.
In three years time, this government is expecting to get $359 million more in land sales. If we are running out of land while this government is doing all it can to
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