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Budget 'golden era' for Tasmania

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June 14, 2018

Tasmanian Treasurer Peter Gutwein has handed down the first state budget since re-election.

Infrastructure spending is at the heart of Tasmania's $6 billion budget, trumpeted by the Liberal government as the dawn of a "golden age" in the state.

Treasurer Peter Gutwein on Thursday handed down the first budget of the re-elected Hodgman government that funds a host of campaign promises, alongside a surplus of $161.9 million and a positive balance sheet over the forward estimates.

Infrastructure projects across the state, including in health, education and housing, get $2.6 billion over the next four years.

"(The budget) is framed not just for the next four years, it is framed to lay the foundations for our long-term future," Mr Gutwein said, heralding the "record" spend he expects to create 9300 jobs.

"I believe that Tasmania is on the cusp of a golden age.

"We can now leverage the strong financial position that as a government we have worked so hard to achieve."

More than $1.1 billion will go toward roads and bridges, including a state contribution of $115 million toward a joint-federal-funded new Bridgewater crossing north of Hobart.

Australia's most aging population will get more than 450 frontline hospital staff over the next four years, backing up an election pledge to make health a priority.

More than $475 million will be spent on health infrastructure, including hospital upgrades and new ambulances.

A new private hospital in Launceston is in the planning stages, but money won't come from state coffers, instead from a private health care provider.

Education takes up more than a quarter of overall 2018/19 budget spending, with $192 million allocated for new schools or improvements to existing ones.

The government is confident its amount of GST revenue will continue as per normal, despite the risk of it changing when a Productivity Commission report is revealed in the coming weeks.

"We have made it clear that we will fight tooth and nail for our revenue base," Mr Gutwein said.

GST revenue grows by $63 million based on estimated outcomes.

As Hobart grapples with a housing shortage, $125 million will be spent on building 1500 new affordable homes.

But the news isn't all rosy, with the state's public sector superannuation liability continuing to hurt the bottom line at a cost of $284.5 million next financial year.

The now-defunct pension scheme for workers is expected to hit an unprecedented $7 billion in value in the 2022 forward estimates and remains unfunded.

Under a strong jobs-growth mantra, the government will cut payroll tax for small businesses.

"By reducing the rate of payroll tax on payrolls up to $2 million from 6.1 per cent to four per cent, we will provide a tax saving of up to $15,750 for businesses," Mr Gutwein said.

The government hopes to get a windfall of more than $20 million from the sale of the treasury building.

There are no flagged jobs cuts, but the government has confirmed it won't budge on a two per cent wage increase policy.

TASMANIAN BUDGET 2018/19 SNAPSHOT

Surplus: $161.9 million

Revenue: $6.22 billion

Expenditure: $6.06 billion

Net Debt (June, 30 2018): $329.6 million

GST Revenue: $2.49 billion

Unemployment: 6 per cent

Growth: 3.25 per cent

Source: 2018/19 Tasmanian budget papers

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