Andrew Barr MLA

DEPUTY CHIEF MINISTER

TREASURER MINISTER FOR ECONOMIC DEVELOPMENT MINISTER FOR COMMUNITY SERVICES MINISTER FOR SPORT AND RECREATION MINISTER FOR TOURISM AND EVENTS MEMBER FOR MOLONGLO

MEDIA

RELEASE
12 February 2014

2013-14 ACT Budget Review

The 2013-14 Budget Review provides an update against the forecast estimates published in the 201314 ACT Government Budget, and takes into account the current economic conditions as well as the impact of policy and parameter changes against activity up to 31 December 2013. The ACT Budget remains in a strong position with a return to a balanced budget in the forward estimates. Economic conditions remain strong although uncertainty around continuing contractions of the Commonwealth Public Sector is leading to softening of some conditions, particularly ahead of the 2014-15 Commonwealth Budget and the recommendations from the Commission of Audit. The economic growth forecasts for 2013-14 remain unchanged from those of the Budget. Some positive factors for the Territorys economic outlook include population growth and low interest rates, which combined are anticipated to lead to improved household consumption and housing demand in the longer term. However, job security concerns are likely to see cautious consumer spending in the short term. The Budget Review forecasts a General Government Sector Headline Net Operating Balance for 201314 is estimated to be a deficit of $360.6 million. The outlook improves in 2014-15 with a deficit of $109.5 million forecast and balanced budgets thereafter in 2015-16 (-$20.5 million) and 2016-17 ($11.2 million). The revised deficit of $360.6 million in 2013-14 represents a decline of $107.0 million from the estimated deficit at the time of the 2013-14 Budget. This increase in the deficit is due to: Commonwealth Government grants being brought forward from 2013-14 to 2012-13 ($22.7 million). the release of the Independent Competition and Regulatory Commissions (ICRC) water and sewerage pricing determination, resulting in a downwards revision of the dividend and income tax equivalents paid to Government by $22.4 million and $10.1 million, respectively, in 2013-14, and by $120.7 million and $54.3 million, respectively, over four years. Changes in the valuation of superannuation liabilities ($50.4 million)

ACT Legislative Assembly

Phone: (02) 6205 0011 Email: barr@act.gov.au @ABarrMLA Andrew.Barr.MLA

Future expenditure decisions will be considered concurrently with responsible offsetting savings and a continuing focus on efficiently delivering government services. This approach will enable the budget to return to balance as soon as practicable, whilst ensuring a flexible approach to allow decisions to be aligned to economic circumstances. However, the ACT Government, in contrast to the Liberal Commonwealth and State Governments, remains committed to not making deep cuts that would seriously effect service delivery to the ACT community. The Government reiterates that it remains committed to transforming our city to meet the challenges of our second century and that it will continue to maintain a prudent approach to managing the Territorys budget. The ACT Government will review its economic growth forecasts in 2014-15 Budget which will be released on 3rd June 2014 - following an assessment of the impact the May Commonwealth Budget and Commission of Audit.
Statement ends Media contact: Kurt Steel (02) 6205 2775 0423 212 943 kurt.steel@act.gov.au

ACT Legislative Assembly

Phone: (02) 6205 0011 Email: barr@act.gov.au @ABarrMLA Andrew.Barr.MLA