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Treasurer doubles down on debt, saying it paid public service wages

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Before Opposition leader David Crisafulli could formally reply to the budget, Treasurer Cameron Dick again sought to justify his alternative to cutting expenses.

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The Palaszczuk Government failed to reach previous savings targets and Dick today acknowledged that it also borrowed to cover operational expenditure during the pandemic.

That is a departure from normal budget custom, which is to go into debt to build infrastructure capable of boosting services and the economy, or even generating a financial return. A new fiscal principle outlined this week looks for sustainability of debt levels in the short-term, only seeking reductions over the longer term.

But ahead of question time today, Dick told parliament he did not agree with the commentators who suggested debt should never be used to fund operational expenses because it had sustained the government during the pandemic.

“We borrowed to pay the wages of frontline workers,” Dick said.

“If we had not done that, if we had not gone into deficit, tens of thousands of nurses, police and other frontline staff would have lost their jobs in order to bring expenses down to match revenue.”

Dick seized on a recent interview in which Crisafulli was asked whether an LNP government would again cut to make the budget sustainability, and replied that any cuts would not be “savage”.

Pressure from the LNP led Dick to dump an additional health efficiency measure in the budget, however he has kept a public service hiring freeze, for 12 months at least, and a requirement for agencies to pay efficiency dividends.

Crisafulli used his official budget reply to argue Labor had mismanaged health and failed patients and their families. He began by critiquing its performance on service delivery, portrayed by Labor as a political strength, before targeting the “deeply flawed budget”.

Crisafulli said Dick was only able to improve the debt projections – and promise new dedicated funds in several areas – through a controversial, last-minute revaluation of the Queensland Titles Registry.

“The Treasurer sold an asset he already owned to himself at an inflated price to pay down debt,” Crisafulli said.

An LNP government would establish a Parliamentary Budget Office, as exists in other jurisdictions, to provide more independent scrutiny and transparency, particularly before an election.

“I don’t fear having the microscope put over what I say I’ll do, when I’ll do it, and how much it will cost,” Crisafulli said, having referred to several delayed and underfunded government projects.

Crisafulli said Labor had an opportunity to act on problems with health, crime, congestion, productivity and housing, and instead delivered a “typical Labor budget”. He said reform and cultural change was still needed in government, and his frontbench would outline some of the LNP’s proposals.

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