GST BLUES FOR NSW BUDGET; UNI CAPS LOOM
NSW Treasurer hits out at GST distribution in deficit budget
New South Wales will halve its budget deficit in 2024-25 but will not produce a budget surplus in the next four years, according to Treasurer Daniel Mookhey. Delivering his second State Budget, the Treasurer said the budget deficit would fall from $9.7 billion this financial year to $3.6 billion in 2024-25, while net debt would hit $110.5 billion. Mr Mookhey said the state’s budget position had been hit by weaker payroll tax collections, and changes to the carve-up of revenue from the Goods and Services Tax; the Treasurer said the GST distribution would cost Australia’s largest state about $11.9 billion over four years. Budget papers show that NSW has committed $5.7 billion over four years for disaster response, and $8.7 billion in 2024-25 for cost-of-living measures.
RBA warns on public spending risk to inflation fight
As Federal and State governments step up measures to address cost of living, the Reserve Bank of Australia has warned that budget spending may feed inflationary pressures. The RBA Board said unit labour costs remained high and productivity growth needed to pick up in a sustained way if inflation were to continue to decline. It said recent budget outcomes may have an impact on demand, but that federal and state energy rebates would temporarily reduce headline inflation. The RBA Board said persistence of high services price inflation was a key uncertainty, while recent data had demonstrated that the process of returning inflation to target was unlikely to be smooth.
Universities face funding caps on domestic student enrolments
Education Minister Jason Clare has proposed a major shake-up in the funding of Commonwealth-supported places (CSPs) in Australia’s university sector. Under the proposed new Managed Growth Funding system, the Government will set a whole-of-system allocation of the number of enrolments in CSPs. Proposed caps on domestic enrolments would come into effect on January 1, 2026. A consultation paper for the new funding model says the current model does not provide sufficient fully-funded growth in domestic student enrolments and is overly complex, fragmented and difficult to understand. It says that at present, universities are allowed to enrol students over the funding cap and receive only marginal funding for additional students.
Farrell backs trade diversification, after China lifts barriers
Trade and Tourism Minister Don Farrell says Australia can service restored export markets in China while developing trade with new and emerging markets. In the wake of Chinese Premier Li Qiang’s visit to Australia, Senator Farrell implied the nation would not be as dependent on the Chinese market as it was prior to the imposition of trade bans. Australia could increase the volume of sales to China at the same time as diversifying its export markets to places like India and the United Kingdom. In a media interview, Senator Farrell said Australia produced food to feed 90 million people; he said a new trade agreement with India had resulted in a 60 per cent increase in agricultural products in the first year, while a new trade agreement had doubled the level of trade with the United Kingdom.
Treasurer’s roadmap to guide investment in sustainable energy
Treasurer Jim Chalmers has released the latest plank in the Federal Government’s bid to attract more private investment into renewable energy ventures. Dr Chalmers said the ‘Sustainable Finance Roadmap’ would identify the next steps to be taken on climate-related financial disclosure by companies, and enable and incentivise private investment through capital markets. Addressing an energy forum, the Treasurer said the roadmap would also identify additional priorities, such as dealing with ‘greenwashing’, understanding climate risks, and assessing and improving access to climate and emissions data. The roadmap will complement the Future Made in Australia legislation, which the Treasurer said would impose a ‘Treasury-style rigour’ on sustainable finance initiatives.
Nuclear-powered submarine training at Pearl Harbor
Australia has sent its first cohort of skilled workers to the United States for comprehensive training in the maintenance of nuclear-powered submarines, Defence Minister Richard Marles has announced. Around 30 Australian Submarine Corporation (ASC) workers have been deployed to the Pearl Harbor Naval Shipyard to train on the US Virginia class submarines, under the AUKUS partnership. More than 100 Australian shipyard workers at ASC will undertake naval propulsion training over the next year at Pearl Harbor. Returning workers will take up positions in Western Australia, where they will lead sustainment of rotating US and UK nuclear-powered submarines.