NSW Treasurer Dominic Perrottet has handed down his fifth Budget with a healthier than expected balance sheet showing that the deficit is just $7.9 billion, less than half the previously forecast $16 billion last November.
Today’s Budget shows the NSW economy is recovering more quickly than expected from the COVID-19 pandemic with some standouts like the property market which has returned over $9 billion in stamp duty, $1 billion more than expected.
In his speech, the Treasurer said that this Budget is about creating a better future, investing in people and transforming the State. Highlights include:
Transport and roads
Investment in transport and roads has reached $71.5 billion over forward estimates. Big ticket items include $4.8 billion to start construction of the Sydney Gateway project and extend the M6, $2 billion for the Great Western Highway, $3.1 billion to continue construction of Sydney Metro (City and Southwest) and $2.9 billion to progress Sydney Metro West.
The Treasurer has also set aside $50 million to develop a business case for Stage 2 of the Parramatta light rail.
Health and hospitals
The Budget puts $30.2 billion into health, with a focus on building capacity and futureproofing. Some $1.1 billion will support the NSW’s ongoing COVID-19 response.
The Government’s significant $10.8 billion health infrastructure spend will help build more hospitals and boost health services.
Education, schools and training
There is $20 billion for NSW schools, with $17.5 billion to lift standards, $2.1 billion to deliver 44 new and upgraded schools, $2 billion dedicated to Western Sydney and $125 million to increase the number of new teachers. The Government’s $2 billion investment in TAFE NSW is aimed at bolstering skills training.
Regional transport has been a priority with $9 billion of funding to expand affordable transport, improve roads, tackle congestion in growing regional centres and increase freight productivity.
Regional resilience has received a significant funding boost with $5 billion in joint Federal and State funding for bushfire response, recovery and preparedness efforts.
Water security remains a focus with nearly $1 billion to roll out 12 Regional Water Strategies and develop the first ever NSW Water Strategy.
The Government has committed $261.4 million to support businesses locally and overseas and to double the footprint of NSW’s international trade and investment network.
SMEs will benefit with new requirements to ensure companies with government contracts worth more than $7.5 million process payments to small business subcontractors within 20 business days.
A further $500 million will improve the State’s digital capabilities including the eConstruction project to develop digital platforms for certification registries.
The Electric Vehicle Strategy includes nearly $500 million in incentives for EV purchases, phases out stamp duty for EVs, funds charging infrastructure and will transition the NSW Government fleet to EVs.
The Government continues to address the waste crisis with a $700 million package that will fund NSW’s 20-year Waste and Sustainable Materials Strategy and the Plastics Action Plan that transitions away from single use plastics.
Arts, culture, sport and tourism
The Government has committed more than $1.3 billion to the arts, including $222.2 million for the Art Gallery of New South Wales and $156.2 million for the new Powerhouse Museum in Parramatta.
There is $373 million in initiatives to accelerate the visitor economy’s recovery, including a new $200 million State Significant Event Fund for securing high-impact events for Sydney and regional NSW.
The sport and active recreation sector will receive more than $450 million for new and improved sports facilities.
Planning, property and housing
The Government has recommitted to a third city centre in Sydney with $1.15 billion being allocated toward the Bradfield City Centre at Western Sydney Airport. Housing affordability remains on the radar with $139 million to unlock more housing in Western Sydney through the Accelerated Infrastructure Fund and a further $20 million to progress rezoning applications that will boost housing supply by 20,000. Some $5 million will be spent to recruit 30 new building inspectors and auditors to help lift confidence in residential construction.
While the Government would be pleased by the speed with which the NSW economy is recovering thanks to their sturdy handling of the pandemic, they will also be holding their breath given the recent COVID-19 cases and the potential economic impact should there be another lockdown.
This Budget has set the key priorities for the next 12 months and beyond, but this trajectory is also reliant on a steady phasing out of COVID-19. All eyes will now be on whether the Government can build on a strong 12 months to steer the State through the uncertainty of a slow vaccine rollout and transition to a new normal when the borders open to the rest of the world.