Infrastructure has emerged a winner in the Queensland Budget, with the government spending $45 billion over the next four years. Queensland will rack up a hefty debt to pay for it, but the state treasurer says this will be worth it.
Queensland was left with the crumbs in the recent federal budget, according to state treasurer Jackie Trad.
On face value, Queensland did pretty well – receiving $5.2 billion for infrastructure projects, the second highest amount in Australia.
But dig a little deeper and it doesn’t look so good, critics say.
Ms Trad accused the federal government of recycling old money from previous announcements, rather than lifting spending. She added that a large chunk of money won’t be released for another five years.
“So what this means, is that if we want to see these congestion-busting projects get off the ground, then it has to happen on the Queensland credit card,” Ms Trad told the media.
Did Jackie Trad live up to her promise to invest big in construction, when delivering her first state budget earlier this month?
In certain areas, definitely.
Infrastructure has emerged a winner in the Queensland budget 2018.
Queensland budget 2018 – strong infrastructure focus:
Over the next four years, the state government is expected to create 38 000 jobs by spending
$45 billion on infrastructure projects. These include:
- Rockwood Weir in Rockhampton
- Cairns Convention Centre redevelopment
- Townsville’s new North Queensland stadium
- $733 million for planning and procurement of the Cross River Rail
- $4.9 billion on roads and transport
- $161 million for the duplication of the Sunshine Coast rail line
- $487 million for upgrades to the M1
An $11.6 billion chunk of the infrastructure pie will be dedicated to major projects in the capital works program over the year ahead (2018-19). This is $1.5 billion more than funding for the current financial year.
Almost half of this amount will be allocated to the Cross River Rail.
Cross River Rail benefits from Queensland budget 2018:
The $5.4 billion Cross River Rail has attracted $733 million, which is its greatest funding commitment so far. This is the most the state government has spent on an infrastructure project since the 2011 floods.
This project is a sore point between the Queensland and Turnbull government, since the federal budget allocated zero funds to the underground Brisbane rail line.
The state government has now committed to fully funding the project, which it pledged to do after failing to secure federal support.
The 10.2km rail line between Dutton Park and Bowen hills will feature five new stations. It’s expected to benefit all of South East Queensland when completed.
“Cross River Rail is a once-in-a-generation project that will change Brisbane and South-East Queensland forever, enabling a turn-up-and-go public transport system and easing pressure on our road network.”
Ms Trad says the project will unlock new career pathways for hundreds of young Queenslanders, who will benefit from a training guarantee set out by the Palaszczuk government.
“I’m thrilled that 450 young people will directly benefit from this project by securing an apprenticeship or traineeship connected to the Project’s construction,” she said.
“That means hundreds of opportunities for aspiring builders, electricians, welders and high-tech trades like signalling, telecommunications, electrical controls and specialists in mechanical works like escalators, elevators and air conditioning.”
Rising state debt in Queensland budget 2018
The Sunshine State will wade deeper into debt, as a result of infrastructure spending in the Queensland budget.
This will lift the total amount the state owes to $83 billion over the next four years.
Treasurer Jackie Trad insists Queensland is borrowing at responsible levels and this budget will stimulate the economy and create jobs.
“Debt is stable, it is sustainable, and it is responsibly funding much-needed infrastructure for our communities and for our economy,” she told the media.
The state economy is strong and there’s an expected surge of $1.5 billion to this year’s surplus, largely owing to incoming mining royalties.
There will also be five new taxes and the money raised will be funnelled into infrastructure projects.
These taxes are:
- Waste levy: the government will compensate local councils with $32 million upfront from the start of 2019
- Land tax on properties worth more than $10 million will rise by 0.5 per cent
- 2 per cent increase to taxes on luxury cars worth more than $100 000
- Foreign ownership penalties will rise from 3 per cent to 7 per cent
- An increase in car registration taxes by 3.5 per cent
State Opposition Leader Deb Frecklington called the Queensland budget a breach of trust.
“This is a budget of taxes, debt and unemployment,” Ms Frecklington said.
“Five new taxes, an $83 billion debt bomb and the worst unemployment rate in Australia is Labor’s plan for Queensland.”
When it comes to the impact on the construction sector, Master Builders have criticised various elements of the Queensland budget, such as the introduction of a waste levy and property tax increases.
But they’ve welcomed the boost to infrastructure spending over the next four years.
“We’ve been calling on the State Government to increase expenditure on public sector building and construction – residential and non-residential buildings together with engineering construction – to reach the 25-year average as a proportion of GSP. This budget is a step towards that goal.”