Inflated by GST revenues and mining royalties, the NSW government is able to spend while keeping its fiscal credentials intact.
Like the Commonwealth budget, the NSW 2022-23 budget reveals a big boost in government revenue. And like the Commonwealth budget, part of that is going to election-year spending intended to address cost-of-living issues. But unlike the Commonwealth budget, it also addresses fundamental fiscal challenges and starts some much-needed reform.
NSW Treasurer Matt Kean’s budget benefits from a mammoth $25.7 billion upgrade in forecast revenue over the forward estimates — for which changing GST allocation provides $11 billion and mining royalties $4 billion.
Surging revenue has also brought the 2021-22 budget result in well ahead of expectations, but the northern NSW floods alone pushed spending in the budget year up by more than $3.5 billion, combining with increased cost-of-living measures to blow out next year’s deficit to $11 billion.