New South Wales Budget 2024-25

The second Budget of the Minns Government plants a sensible foundation for economic growth in New South Wales. Unlike other state budgets this year, the NSW Government  has shown relative spending restraint, rather than embarking on a cash-splash to ‘beat’ cost-of-living pressures and risking further fuelling inflation. New spending is on key areas of service need like disaster relief, housing and homelessness, and domestic and family violence programs. However, there was little new funding for the transition to net zero or other measures to drive investment and business productivity.

The Treasurer has made a lot of the goods and service tax (GST) carve up and the implications for overall government revenue. Much less noise was made about the positive impact from higher stamp duty and land tax revenues. The government has chosen to spend more than it planned even six months ago and hasn’t either identified major cuts or announced a plan for doing so. In the short term, support for the fragile economy is justified. But more fiscal consolidation work will be required in coming years, as rising debt sees the interest bill climbing to $10 billion a year by 2027-28.