2015-16 NSW Budget

NSW Treasurer Gladys Berejiklian today handed down her first budget announcing a record surplus of $2.1 billion for the year 2014-15. The surplus was largely underpinned by higher than anticipated stamp duty receipts from the booming residential property market which surged to $7.29 billion, $1.2 billion more than budgeted. The Government has committed to allocating this amount directly to the Restart NSW infrastructure fund. The Budget predicts the surplus to grow to $2.5 billion in the coming year and to $3.2 billion in 2016-17.Infrastructure remains the key theme of the Baird Government and this was strongly reflected in today’s budget. Infrastructure spending will average $10.3 billion a year, amounting to more than $68.6 billion over the forward estimates when the $20 billion Rebuilding NSW package, funded by the 49 per cent lease of the State’s electricity network, is included. Transport will receive the largest chunk of this money, with $9 billion invested in the State’s transport network in 2015-16 alone.

Following the passage of the Poles and Wires legislation, the Treasurer announced the Government will bring forward $591 million of spending on infrastructure so that development of major projects such as, the second Harbour rail crossing and the Parramatta Light Rail, can start as soon as possible. The Treasurer also confirmed the Sydney Metro project will include a station at the new Barangaroo development.

A further $1.4 billion will be spent to build a number of new hospitals and upgrade facilities at Westmead, Blacktown, Armidale, Bega, Lismore, Tamworth and Wagga Wagga. While in Education, the Department’s capital works budget will total $456 million in 2015-16. The Government has also committed $400 million to the Housing Acceleration Fund for the construction of new roads, water and electricity infrastructure necessary to facilitate the construction of new dwellings, building on the 160,000 blocks already delivered since 2011, in an attempt to address housing affordability.

The Treasurer said today’s budget was fiscally responsible, delivering record investment in infrastructure whilst maintaining the State’s AAA credit rating. The budget outlines an additional $1.1 billion in savings over the forward estimates as the Government seeks to contain expenditure growth to 2.8 per cent per annum, in line with anticipated growth in revenues. The Treasurer said the Government would continue to prioritise frontline services with the Budget allocating an additional 5 per cent to each of the key portfolio areas of health, education and services.

In her speech, the Treasurer described the State as ‘buzzing’, noting there are currently 162 cranes building new projects across Sydney, a clear sign of the strength of the NSW economy. Economic growth is projected at 3.5 per cent over the next two years, with unemployment falling to 5.5 per cent by the June quarter of 2017.