The New South Wales Treasurer’s attempt to sell his mid-year budget update has been overshadowed by questions about the Government’s $2–billion stadiums plan.
The surplus for this financial year is now predicted to grow more than $600 million to $3.3 billion despite plummeting stamp duty revenue projections.
But Treasurer Dominic Perrottet was peppered with questions from journalists about whether spending $2 billion rebuilding both the Sydney Olympic and Sydney Football stadiums was the right move.
It is understood Mr Perrottet was among a number of senior Cabinet ministers who previously opposed the size of the stadium spend, but this morning he defended the plan.
“We have an Opposition that talks about schools before stadiums. But what I say is schools and stadiums,” he said.
“And what you’ll get under Labor is no schools and no hospitals, no stadiums because they left NSW with a $35 million infrastructure backlog.”
Unveiling the surplus projections at a business breakfast in Sydney, Mr Perrottet said transfer duties were now predicted to bring in $461 million less this financial year than was forecast in the June budget.
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He said the drop was driven by the large number of first home buyers taking advantage of the stamp duty exemptions announced just before the budget.
In the five months since the scheme began, 13,672 people have received stamp duty concessions, the Treasurer said.
“I am very happy to lose money to achieve that policy objective of getting young families into the market for the first time,” he said.
Mr Perrottet also acknowledged the cooling property market was having an impact, noting that the average price of residential properties sold in 2017-18 was forecast to be only about 1.8 per cent higher than the average price for 2016-17.
But he said that had largely been factored into the budget projections in June.
“There is no doubt there are significant challenges and the best thing we can do is keep our fiscal discipline,” Mr Perrottet said.
However, the projected drop in transfer duty revenue has been partly offset by higher-than-forecast payroll and land tax revenue due to an increase in full-time jobs and land values.
GST revenue is now predicted to be $119 million higher than forecast.
But overall, the Government is now expecting to make $149 million less in taxation revenue this financial year than it was predicting in June.
At the same time it has slashed its expenditure forecast for the year by $676.8 million for the financial year, largely by shifting the timing of expenditure across the forward estimates.