New south Wales It has been promised 30,000 new homes, including 8,400 public homes, under what Treasurer Daniel Mookhey says is the state’s biggest ever investment in housing.
He The Minns Labor government has revealed this in its second budget which will make what it describes as an “unprecedented intervention in the housing market” using surplus public land for 21,000 new homes and spending $5.1 billion on public housing to be built and managed by Homes NSW.
Mookhey had housing under the flag would be at the center of the state budget for the second year running, as the government races to meet its national commitment to build 377,000 new homes by 2029.
The government says at least half of new public housing will be reserved for victim-survivors of domestic violence, following an earlier promise of $230 million for domestic violence services.
Aside from housing, the other major announcement was that GP clinics in Sydney that bulk bill at least 80% of their patients (70% elsewhere in the state) will not have to pay payroll tax. the doctors they employ as contractors.
With bulk billing rates at their lowest level in 10 years, the government will spend $77 million on reimbursement in an effort to appease GPs and make doctor visits cheaper.
The treasurer had also warned New South Wales residents that record public debt and other economic pressures meant it would be necessary to limit public spending. The government’s hopes of a surplus have evaporated; The budget will have a deficit of $3.6 billion in 2024-2025 and is expected to remain in the red until at least 2027.
Stripped of what the treasurer says amounts to $11.9 billion from the GST “scam”, the NSW budget will remain in deficit at least until the 2027-28 financial year. Mookhey said if New South Wales had maintained its recent participation in the GST, the state would have returned to a modest $300 million surplus by the next financial year.
Mookhey described the budget as a “must-have” rather than a “nice-to-have” when he presented it to reporters Tuesday.
The government also agreed to write off $104 million in existing payroll tax debts accrued by doctors, ending a long-running dispute with peak bodies the Royal Australian College of General Practitioners and the Australian Medical Association.
A decision by Revenue NSW in 2018 that GPs were eligible for payroll tax prompted successive court appeals by doctors, as well as warnings from the RACGP that more than 400 clinics would have to close if forced to pay his outstanding debts.
The NSW government will spend about $8.7 billion in the next financial year on other “cost of living support measures”, including $10,000 grants for eligible first-home buyers, $350 rebates for bills of electricity from concession card holders, as well as a one-off aid payment. up to $300 to cover energy bills for all homes.
Mookhey told reporters on Tuesday that New South Wales’ financial pressures and ongoing inflation problem meant the government could not afford any “insensitive spending”.
The treasurer previously said the latest GST allocation would “almost certainly” result in the state losing its AAA credit rating.
The government says it is also dealing with the “consequences of record public debt,” which reached $132.9 billion, or 17.1% of the state’s gross domestic product, in June 2023. It says it is more than a 500% higher than the debt level. New South Wales reached during the global financial crisis of 2009-10.
The cost of capping the price of black coal at $125 a tonne will cost NSW taxpayers $884 million in the 18 months to the end of June, with the Commonwealth government contributing an equal amount. In the year ending this month, the bill for New South Wales alone will be $588.6 million, or more than double the $238.9 million allocated over four years in the 2024-25 budget for the strategy government energy consumption plan to encourage smarter energy use in homes.
Related: NSW Budget 2024: Biggest winners and losers
The government will spend on a 10.5% pay rise, including superannuation, for more than 400,000 public sector workers over the next three years after removing the Coalition-era pay cap in 2023.
It is based on containing general salary costs by cutting the number of executive staff within the public service. The total amount of public spending is projected to grow just 1.7% annually in the four years to 2027-28, well below Sydney’s estimated annual inflation rate of around 2.7%.
By contrast, the government estimates that the amount it spends on public sector salaries will grow by 3.2% annually.
A $10.7 billion increase in projected revenue over the next four years, compared with estimates made in the mid-year review, will help keep finances on track for repair. Additional stamp duty from a recovering property market and more land taxes from the lifting and freezing of the tax-free threshold will generate the bulk – $9.7bn – of that revenue improvement.
Higher thermal coal prices and export volumes are also forecast to increase royalties by almost $500 million, adding to additional revenue following last year’s royalty review.
Accounting adjustments to pool the state’s investment funds into a new “OneFund” are also expected to generate “higher risk-adjusted returns” of $1.6 billion relative to advance estimates.
Opposition leader Mark Speakman criticized Labor for “wasting” revenue growth on “union pay deals”.
He said he was not opposed to nurses and teachers getting a pay rise, but that they should have been funded through “productivity offsets.”
