Government fiscal strategy
The Government’s fiscal strategy is based on the following fiscal principles for the responsible and measured management of the state’s finances:
Principle 1: Maintain a General Government sector Net Operating Surplus over the economic cycle.
Principle 2: Pay down General Government sector debt of $5.4 billion over six years, with a target of paying down $12 billion of General Government debt over 10 years.
Principle 3: Borrowing in the General Government sector will be strictly managed for new infrastructure so as to be serviced within a General Government Net Operating Surplus target.
It also seeks to ensure a consistent flow of works support jobs and the economy and mitigates against a backlog of necessary works emerging.
Principle 4: Maintain competitive taxation by ensuring that General Government sector own-source revenue remains at or below 8.5 per cent of nominal gross state product (GSP), on average, over the forward estimates.
Principle 5: Target full funding of long-term liabilities such as superannuation and WorkCover in accordance with actuarial advice.
The Government is undertaking a full review of the State’s finances, including medium-term fiscal projections and strategy, consistent with these fiscal principles, which will be published in the 2015-16 Budget.
The Financial Accountability Act 2009 requires the Treasurer to table in the Legislative Assembly a Charter of Fiscal Responsibility containing the government’s fiscal strategy. The Treasurer must also report regularly on the government’s progress towards the charter’s outcomes.
It is anticipated that the Government will formalise its fiscal strategy by tabling a revised Charter of Fiscal Responsibility alongside, or prior to, the delivery of the 2015-16 Budget.