Ms PURICK - 2012-05-01
In the budget papers released today, your income for 2011–12 has increased by almost $200m overall. Nevertheless, your deficit has actually increased by $100m to $491m. Why is it that your spending increases have continued to outstrip your income increases?
ANSWER
Madam Speaker, it is attributed to the infrastructure spend. We are keeping our operating expenses below our revenue. As I said in the budget speech, there is a genuine meeting of that fiscal strategy to keep the operating expenses below the revenue coming in. The impact of deficit is all capital spend. It is building the assets in the Territory to ensure we have better hospitals, better health clinics, better schools and better roads. That is a build right across the Territory. If you look at that $1.3bn, we have a $433m asset build in the bush alone. It is critical infrastructure. It is legacy. None of the deficit is coming off the operational spend, it is the capital spend embedded in there.
We have explained, again through the budget speech, we averaged $550m or thereabouts in an average capital spend prior to the global financial crisis hitting. As a result of the global financial crisis and private sector investment drying up we doubled our capital spend. We took it up to $1.7bn in 2010-11. It is at $1.6bn for 2011–12, stepping down to $1.3bn estimated for 2012-13. The deficit is out of assets out of the capital spend.
As I said previously, we have kept our operating expenses below our revenue. It is the capital infrastructure spend that is driving the deficit and adding to debt. They are genuine assets being delivered to improve the life of Territorians. Through that spend, we are gearing Territory businesses up for growth. Through that spend, we have delivered 13 000 jobs already, and the $1.3bn equates to another 2600 jobs.
In simple terms, we could slash the capital spend by 40%; that would equate to 1000 jobs lost. That would be Territory businesses closing the door in droves, just at the time in economic growth when they need to be gearing up to deliver the benefits of the economic opportunities of landing the major Ichthys project.
We will start to run countercyclical. We will start to step-down our capital spend as the private sector investment ramps up. However, there is a way to go and if you do not believe me talk to industry. There is a way to go before the full effect of the private investment spend starts to flow through to Territory businesses.
Yes, we have had some great tenders let already to Territory businesses, but the bulk of the spend is not going to be in the 2012-13 period. We need to maintain that $1.3bn strong capital spend to keep businesses open, to keep Territorians in jobs, and to create 2600 jobs off the back of the 13 000 jobs we have already created ...
Madam SPEAKER: Treasurer, your time has expired.
ANSWER
Madam Speaker, it is attributed to the infrastructure spend. We are keeping our operating expenses below our revenue. As I said in the budget speech, there is a genuine meeting of that fiscal strategy to keep the operating expenses below the revenue coming in. The impact of deficit is all capital spend. It is building the assets in the Territory to ensure we have better hospitals, better health clinics, better schools and better roads. That is a build right across the Territory. If you look at that $1.3bn, we have a $433m asset build in the bush alone. It is critical infrastructure. It is legacy. None of the deficit is coming off the operational spend, it is the capital spend embedded in there.
We have explained, again through the budget speech, we averaged $550m or thereabouts in an average capital spend prior to the global financial crisis hitting. As a result of the global financial crisis and private sector investment drying up we doubled our capital spend. We took it up to $1.7bn in 2010-11. It is at $1.6bn for 2011–12, stepping down to $1.3bn estimated for 2012-13. The deficit is out of assets out of the capital spend.
As I said previously, we have kept our operating expenses below our revenue. It is the capital infrastructure spend that is driving the deficit and adding to debt. They are genuine assets being delivered to improve the life of Territorians. Through that spend, we are gearing Territory businesses up for growth. Through that spend, we have delivered 13 000 jobs already, and the $1.3bn equates to another 2600 jobs.
In simple terms, we could slash the capital spend by 40%; that would equate to 1000 jobs lost. That would be Territory businesses closing the door in droves, just at the time in economic growth when they need to be gearing up to deliver the benefits of the economic opportunities of landing the major Ichthys project.
We will start to run countercyclical. We will start to step-down our capital spend as the private sector investment ramps up. However, there is a way to go and if you do not believe me talk to industry. There is a way to go before the full effect of the private investment spend starts to flow through to Territory businesses.
Yes, we have had some great tenders let already to Territory businesses, but the bulk of the spend is not going to be in the 2012-13 period. We need to maintain that $1.3bn strong capital spend to keep businesses open, to keep Territorians in jobs, and to create 2600 jobs off the back of the 13 000 jobs we have already created ...
Madam SPEAKER: Treasurer, your time has expired.
Last updated: 09 Aug 2016