Wed 25 March - 

The announcement of a Commonwealth Government Guarantee for critical state infrastructure will not solve the underlying economic problems facing NSW, Shadow Treasurer Mike Baird said.

“We raised the issue of the impact of the Federal Government’s bank guarantee in October last year, knowing that would make it difficult for the state to raise funding for infrastructure.

“At the time, Treasurer Eric Roozendaal didn’t even understand the implications.

“At Budget Estimates he deferred questions regarding the issue to Treasury.

“I will ask the Treasury Secretary to answer that” – Treasurer Eric Roozendaal in response to question about Federal Government’s rescue package for banks, Budget Estimates 14-10-08

“Mr Roozendaal deferred to the Secretary of NSW Treasury, Mr John Pierce, who confirmed discussions were taking place on the issue.

“It was obvious that the Federal Government’s decision to guarantee all debt issuance of Australia's banks would have an impact on State Government finances.

“The Federal Government has today responded – but no thanks to any action taken by Treasurer Roozendaal or Premier Rees.

“That’s because Premier Rees is economically illiterate.

“That was in evidence during Question Time when Premier Rees challenged my commitment to never deliver a Budget where spending grows at a greater rate than revenue.

“Such a commitment is basic sound financial management and a failure to adhere to these principles is what has got NSW in trouble and has put our credit rating at risk.

“The NSW Government’s expenses have climbed by 6.5 per cent since 2004 while its revenue has increased 5.4 per cent. That means the State’s economy has gone backwards by about $450 million each year.

“It is laughable that Premier Rees claims such a strategy is about cutting jobs and raising taxes when that is exactly what he did in the Mini-Budget.  Our plan is about increasing jobs through services that people want such as transport, health and education, and not wasted on overpriced offices for Ministers and their staff.

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