'Change of culture' needed due to falling revenues: Baird
AGAINST a background of falling revenues, the New South Wales Government plans to rein in debt by sacking more civil servants and cutting wages growth amid a new "change of culture", Treasurer Mike Baird said yesterday.
While the government has clawed back some of its original forecast deficit of $423million, the budget still estimated a $329million deficit for 2013-14.
Mr Baird said the falling revenues since the half-yearly review had "added to our revenue challenge".
"Despite this, we have done everything possible to protect the State's triple-A credit rating," he said.
A 30% fall in mining royalties, down $573million on the back of the Federal Government's mining tax, and a $406million drop in Commonwealth GST payments helped erode the state's budget position.
But with more job cuts, the $700million lease of the Port of Newcastle and a $58million rise in fines and fees, the state's finances are forecast to get back in the black by 2014-15.
In that year, Treasury has forecast an $829million surplus, down from the half-yearly forecast surplus of $1.3billion, primarily due to the revenue shortfall.
Mr Baird said to help overcome the shortfall, the state government would embark on another round of staff cuts and voluntary redundancies.
Up to 5000 more public service jobs could go in the next round of redundancies, while those staff left will deal with a new restriction on bureaucrats' pay rises to 1.2%.
"While we continue to face difficult financial circumstances, this budget demonstrates that the tough decisions we have made to clamp down on expenses and undertake critical reforms are now delivering rewards for the people of NSW," Mr Baird said.
He said a new change of culture within the public service meant under the O'Farrell Government; "budgets matter, expenses matter".
To that end, the state will also initiate an expanded "efficiency dividend" to shave more of the cost of government business. This is expected to save up to $750million in the next three years.
While Mr Baird said the third O'Farrell Government budget marked a record spend on infrastructure around the state, the majority of roads funding will go to Sydney-centric projects, including the WestConnex motorway.
To that end, just under $1billion was allocated to the Pacific Hway, although those funds had already been announced, while a further $178million will be provided for the Princes Hway.
Mr Baird said due to the tough economic conditions, the main aim of the budget was to "live within our means".
- 5000 public service jobs to go.
- Public service payrises restricted to 1.2%.
- $329million deficit forecast for 2013-14.
- $829million surplus forecast for 2014-15.
- $15,000 home grant to stay until 2016.
- $700million lease of Port of Newcastle.
- $573million fall in mining royalties.
- $406million fall in GST payments.