The heavily indebted Northern Territory government has released a budget promising severe spending cuts that put the brakes on nearly two decades of expenditure growth.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
Treasurer Nicole Manison is asking Territorians to trust that "bright and exciting" times are ahead, chiefly through a pipeline of major projects.
However government net debt will climb to a record $6.2 billion in 2019/20 - equivalent to 93 per cent of revenue - when the budget deficit reaches $1.1 billion.
The budget is not predicted to be back in surplus until 2027/28, which assumes success in its harsh controls on spending, with debt to peak at $8.8 billion.
The budget includes a two per cent cut in operating expenses in 2019/20 to $7.2 billion, from $7.4 billion the previous year.
That assumes it can change a trend over the past 15 years for operating expenses to grow six per cent a year on average.
Since last year's budget the government has approved an extra $700 million spending.
Ms Manison and NT Treasury admit it will be a challenging task cutting spending while public servants' wages increase 2.5 per cent a year and big spending departments such as health and education grow four per cent-plus.
More than 50 senior public sector executives will lose jobs and there is a cap on public servants which will include 300 job cuts.
The health budget is tipped to blow out by $146 million to $1.68 billion in 2019-20.
"But we're absolutely determined to get there," Ms Manison said.
She pointed to forecast average growth in the territory economy of 3.2 per cent over the next four years in her budget speech.
"Because the future of the Northern Territory is bright and exciting, Budget 2019 makes sure we capitalise on the economic opportunities ahead and invests in Territorians," she told parliament.
The growth over the next few years will be driven by growth in exports from the $50 billion-plus Inpex gas project, not new investment or jobs.
The NT economy has struggled since the end of the construction of Inpex and subsequent outflow of workers, while its share of GST revenue has fallen.
The brighter times depend on projects going ahead as planned, including the extension of the ConocoPhillips Darwin LNG project, the $1.5 billion Sea Dragon prawn farm and an onshore gas industry after Labor lifted its two-year ban on fracking.
Federal Resources and Northern Australia Minister Matt Canavan, who was in Darwin campaigning for Liberal Solomon candidate Kathy Ganley, said the NT Labor government was out of touch if it thought economic conditions were improving.
"The first two years of the Gunner government was spent doing a review and conducting a moratorium on gas opportunities they now spruik in today's budget," he told reporters.
Country Liberal Opposition Leader Gary Higgins also criticised the comments, saying the NT was Australia's worst performing economy.
"If this is their record, how can we trust them on their promise to deliver in the next decade?"
Australian Associated Press
