First look: The ACT Budget
While we recover from the shock of niceness that formed the recent federal budget, the ACT Government is taking its turn to count pennies and try to bring the accounts back into balance.
Treasurer and Chief Minister, Andrew Barr, is promising to make good on the promises from last year's election, and to build on a number of the initiatives that were put in place during the first two years of his leadership.
The promo video sees Barr standing on the runway at Canberra Airport, clearly signalling a further push for the ‘Coolest Little Capital’. However, as Singapore Airlines cancels flights and Turnbull’s Innovation Agenda hides into the bottom drawer, there is a real challenge to maintain the momentum of these initiatives to deliver actual economic benefits.
From a business point of view, the news looks to be good, with tax reductions in several areas (insurance tax has now been totally removed). Most impressive is the growth prediction which stands at 3.25% for the fiscal period 2017/18.
That's a full point higher than last year's projection, and the sort of number that would make Scott Morrison green with envy. The great news is that this growth is largely a result of the private sector, given the public service remains under pressure from the Feds.
Not that the spending of the ACT Government is insignificant. There is still strong spending on infrastructure. The light rail project will be completed in the financial year, while Phase Two will go into development. Let’s not forget the 500m extension to the West Basin boardwalk: $34.8 million has been budgeted for those works… a staggering $75,000 per metre!
Other numbers look strong. Over 3,200 jobs were added to the economy, and another 5,778 people moved to Canberra. Unemployment is the second lowest in the country (3.6%) and the Treasury forecasts a Territory deficit of just $79 million for the 2016/17 period. Mr Barr claims that the ACT remains on track for a surplus in next year’s budget.
The stage is set for a successful term barring any external shocks. The urban renewal along Northbourne Avenue is giving Canberrans a real sense that the city is on the move (despite some frustrations during the construction phase).
The light rail corridor has been swept upon by developers to create real urban renewal. Phase two of the project could change the Southside in a similar way.
With these headline numbers, the Barr Government is in the perfect position to deliver its agenda. We’d certainly encourage it to push even harder to harness this momentum and realise even more of the potential of business, the arts and our broader community.