NSW slashes $3 billion - deficit $917M

The NSW government has slashed more than $3 billion from its planned spending for the next four years, as today's mini-budget confirms the state will record a deficit of $917 million this financial year.

Treasurer Eric Roozendaal has handed down the mini-budget, insisting the state can withstand a dip into the red for one year, which he said had been caused by a slowing property market and a fall in GST revenue.

He said NSW was forecast to return to the black the following year with a surplus of $138 million, that is expected to grow to $573 million in 2010-11 and reaching $900 million in 2011-12.

The mini-budget process has seen the state razor gang make $3.3 billion worth of savings over the next four years, while it will rake in $3.6 billion in revenues.

The ambitious four year capital works program outlined in this year's budget has been re-prioritised but the outlay remains largely unchanged, with $56.8 billion worth of infrastructure projects to be built.

That is down $890 million from what was announced in the budget in June.
"NSW will maintain the biggest public infrastructure investment program in Australia - and we are able to do so because the government has tightened its belt," Mr Roozendaal said.

The mini-budget will also bring an end to the 10-year long electricity debate, with the three electricity retailers to be sold off, along with the sale of development sites for power generators and the transfer of electricity trading functions to the private sector.

Mr Roozendaal said the government is also considering the possible sale or lease of other assets including NSW Lotteries, its waste services, the Pillar Superannuation Administration Corporation, and the Roads and Traffic Authority's (RTA) personalised number plate business.

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$58b spree plunges NSW further into debt

New South Wales Treasurer Michael Costa is defending his decision to plunge the state further into debt by $21 billion to pay for a huge rise in infrastructure spending.

Mr Costa has revealed tomorrow's state Budget will include $58 billion in spending on infrastructure across sectors including roads, health, transport, housing and education over the next four years.

Infrastructure spending for the next financial year will be 11 per cent higher at $14 billion.

The Treasurer says some of the rise will be funded by borrowings but the state can afford to take on the debt.

"Our total capital expenditure will be somewhere in the order of $58 billion over the next four years, so that's a massive amount spent on capital," he said.

"That's an appropriate amount given community expectations and it's also prudent in the sense that it's also within our triple-A credit rating...

"The state's balance sheet's in a very strong position and we can afford to take on debt to fund infrastructure that's for the long term."

State Opposition Leader Barry O'Farrell says taxpayers should be horrified.

"These are the usual Labor tactics - try and spend their way out of unpopularity and don't worry about the economic consequences," he said.

Teachers dismayed
School maintenance will receive an $11 million boost, taking the total spend to $276 million.

There will also be an increase of $116 million for new and upgraded schools and TAFE facilities.

But NSW Teachers Federation president Maree O'Halloran says that is nowhere near enough.

"That's a paltry increase," she said. "The Government's increases are barely enough to cover inflation and certainly not enough to fix up the backlog.

"They sound like big figures but unfortunately, there has been such a backlog that it needs a significant boost just for maintenance alone, for example - we need a boost of about $90 million extra per year."

Rail, bio-security
There will be no extra funding for rail infrastructure, with the capital works budget remaining steady at $1.6 billion.

But the Government maintains there will be record public transport spending this year, with $12 billion set aside for the north-west metro rail line project.

The Budget also includes more than $43 million for a bio-security facility at Camden, in south-west Sydney.

Primary Industries Minister Ian Macdonald says a new high-security wing will be built to combat outbreaks of exotic disease from plants and animals.

Unfair tax on gays: activist

There are concerns same sex couples could be financially worse off under the Federal Budget.

The gay and lesbian rights group, Coming Out Proud, says this year's budget treats all same sex couples as de facto relationships.

The group's Julian Punch says this will mean some couples could lose welfare benefits and be taxed on double incomes because their relationship is not recognised as having the same value as a marriage.

He wants the Federal Government to recognise same sex civil unions nationally to avoid tax discrimination.

"At the moment, currently and with the previous government, as facist as it was, our relationships were just in a no person zone, they weren't accepted they weren't recognised," he said.

"Now the government's going to recognise them for the purposes of tax accruements."

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Govt to crack down on welfare fraud

The Federal Government is expanding its ability to crack down on welfare fraud.

The Government is providing $138 million for a new computer system to widen a program allowing the four major banks - Commonwealth, NAB, Westpac and ANZ - to provide Centrelink with information about suspected welfare cheats.

It follows a trial period with Commonwealth Bank and the money for the data-matching program was included in this week's Federal Budget.

Federal Human Services Minister Joe Ludwig says the changes should save taxpayers an estimated $600 million over four years.

He says privacy concerns have been addressed.

"Civil liberties are not eroded by this. There is a balance struck between ensuring that welfare fraud is addressed appropriately and ensuring that privacy is protected and that balance is there," he said.

"Centrelink does follow the strict Privacy Commissioner guidelines."

But the Federal Opposition says the Government has gone too far in its plans to scrutinise the bank accounts of some welfare recipients.

Opposition Leader Brendan Nelson says the Government is seeking 'big brother' type powers.

"Every person in the country is entitled to at least a minimum level of privacy," he said.

"It doesn't matter whether you're struggling and on Centrelink payments, or whether you're an everyday person out there doing a job."

Opposition human services spokeswoman Helen Coonan says she wants more detail on the plan.

Ms Coonan says the Coalition's access card, which the Government has scrapped, would have done the same thing.

"I think there's a very serious concern about how it is done, but the Labor Government is really playing catchup with the Coalition, which was well down the track of introducing an access card where all of these concerns had been very much addressed," she said.

'Rubbery fingers'

Meanwhile, civil libertarians have attacked the crack down as an attack on privacy.

Australian Council for Civil Liberties president Terry O'Gorman says the Government is using rubbery figures to justify an attack on people's rights.

"We hear year after year, more and more dollars are being brought in as a result of welfare fraud in court cases," he said.

"The Government doesn't need these powers. The money that's being thrown around, that supposedly will be saved, are the same sort of wild, plucked out of the air figures that we heard in relation to the access card that was ditched 12 months ago."