STATE TO SPEND MORE ON ROADS

Debt to grow after budget

December 2020

After 16 years on the opposition benches, Rob Lucas returned as Treasurer in 2018, with a plan to bring SA’s budget back into black.

But two years on, after catastrophic bushfires and in the midst of a world-disrupting pandemic, everything’s changed.

Mr Lucas has delivered a budget he says is "drowning in red ink".

According to the ABC, it’s not forecast to return to surplus until the end of the 2023-24 financial year, and the Treasurer admits that’s not a done deal.

He said if a COVID-19 vaccine isn’t available by the end of next year the government will be in "a world of pain".

But while the deficit indicates the government is spending more money than it’s collecting in revenue in any given year, another figure is also reaching record levels — the state’s overall debt.

Debt was due to grow to $21.3 billion by 2022-23, but this latest budget forecasts it to reach $33.17 billion by 2023-24.

The Treasurer said the good news is low interest rates are making debt cheap.

One of the most exciting revelations in the budget is the government’s plan to improve the final piece of the North-South Corridor, the section of South Road from the Torrens River to Darlington.

It’ll build two tunnels, one starting one kilometre from Darlington and ending just before the Glenelg tram line, and another stretching from just south of Sir Donald Bradman Drive, and ending before West Thebarton Road.

They’ll be connected by a series of lowered and surface motorways.

The Government estimates that project will cost $8.9 billion, but it won’t act as an immediate stimulus.

Major construction won’t begin until late 2023, and the project is scheduled for completion in 2030.

Another major development that’s a long way off is the new Women’s and Children’s Hospital to be co-located with the Royal Adelaide Hospital.

The Government allocated $685 million towards the project over four years, and believes it will be completed by 2025-26, but hasn’t finished the business case and doesn’t know the final cost.

The Treasurer wants a ‘two-year, in-and-out’ stimulus

With big projects too far away, Mr Lucas says he wants to "spend significantly in the next two years, in and out, on projects which are either completed or significantly completed". Projects include, the South Eastern Freeway, and Main South Road. Also, improvements to sport and recreation infrastructure including Memorial Drive, Hindmarsh Stadium and schools infrastructure improvements and grants for maintenance works.

There’s also grants and other support measures for small businesses, tradies and tourism operators.