Key facts
- Queensland's treasurer aims to avoid a credit rating downgrade despite a projected $1.9 billion deficit in 2028-29.
- State borrowings are forecast to surpass $202 billion by 2028-29.
- Coal royalties are expected to significantly increase, reaching $6.9 billion in 2026-27.
- S&P previously warned of a negative outlook for Queensland's debt due to large deficits.
- The government has committed to no new or increased taxes and plans infrastructure spending of $119.2 billion over four years.
Queensland's economy is facing the possibility of a credit rating downgrade, despite an anticipated surge in coal royalties. Treasurer David Janetzki presented a budget forecasting significant deficits in the coming years, with state borrowings expected to exceed $200 billion within three years. While the budget projects positive economic growth and a strong labor market, and anticipates billions more from coal royalties driven by increased exports, rating agency S&P has maintained a negative outlook on the state's debt, citing "large deficits" and "weak" budgetary performance.
Janetzki expressed determination to halt a downgrade, promising budget improvements while delivering on government commitments. The budget forecasts a $1.9 billion net operating balance in 2028-29, followed by a $619 million surplus the subsequent year. Key measures include a $6.2 billion operating deficit for the current year, revenue increases from government duties, payroll tax, and royalties, and projected spending growth from $100.8 billion in 2025-26 to $111.6 billion in 2029-30. The government plans to achieve savings through better procurement, reduced senior executive positions, and fewer contractors, while allocating $119.2 billion to infrastructure over four years. Premier David Crisafulli emphasized the government's commitment to not introducing new taxes, contrasting it with "global crises."
The Brisbane 2032 Olympics present another fiscal challenge, though the state will reportedly spend more than twice as much on health infrastructure. The government has yet to break down the specific costs for the 17 Olympic venues, with Crisafulli confident in the overall $7.1 billion figure for the Games venues, citing ongoing efforts to drive down contract prices. The government also noted a decrease in jail capacity utilization to 135.5% following the opening of a new correctional center.