Cutting debt put on hold

QUEENSLAND’S debt will hit $83 billion in four years as the Palaszczuk Government ramps up infrastructure spending to meet booming population demand.

Despite promising to tackle the state’s burgeoning borrowing bill at November’s election, Labor’s Budget on Tuesday will unveil the extraordinary new debt trajectory.

Treasurer Jackie Trad said the Government was borrowing to build now and avoid a costly “infrastructure crisis”.

“It is either we actually borrow now to build the infrastructure, to fix the M1, to do all of those things that we know our community needs, or more people are going to be spending more time in congestion and traffic,” she said.

“They are the choices, and budgets are fundamentally about choices. We unashamedly chose the responsibility and the obligation of building the infrastructure that Queenslanders need.”

The Budget will show Queensland’s debt climbing at a similar rate outlined in last year’s fiscal blueprint before total government debt hits $83 billion in 2021-22.

Government-sector debt, which excludes the books of state-owned businesses, will jump $11 billion to $42 billion over the next four years.

Infrastructure being bankrolled by the Government includes the $5.4 billion Cross River Rail and a suite of projects being jointly funded with the federal administration, including major upgrades of the M1 between the Gold Coast and Brisbane.

Budget figures show government debt will remain $6 billion lower than the $48 billion Labor inherited from the Newman government.

Ms Trad insisted the debt was sustainable given borrowings would continue to track at 10 per cent of the economy while the interest bill would continue to track at less than 3 per cent of revenue.

She was critical of past governments for restraining infrastructure spending and then borrowing fast to clear the backlog.

“I think there was a very good reason why Queenslanders felt like it was infrastructure catch-up,” she said.

“And that is why we are very concerned about making sure that we are ahead of that infrastructure deficit, that infrastructure crisis.

“I mean, if you talk to most people who travel on the M1 each and every day they will say that we need to fix it now, and that is why we are getting on and do it.”

Ms Trad insisted restoring the AAA credit rating was still a goal and the bigger borrowing bill would not further imperil the current AA+ rating.