The government’s fiscal strategy is guided by its medium-term fiscal principles. In the 2022–23 Budget, net debt is lower than in the 2021–22 Budget Update, expenses growth continues to be lower than revenue growth, and an increasing share of investment in non-financial assets (i.e. public infrastructure) will be funded by operational cash surpluses across the forward estimates from 2022–23.
Improving economic conditions since mid-2020 are translating into stronger revenue performance. Despite volatility in some revenue lines, revenue is expected to remain elevated over the forward estimates compared to the 2021–22 Budget Update.
The additional revenue in the 2022–23 Budget is being directed towards measures that address the increasing demand for key services. Over the 5 years to 2025–26, revenue is expected to grow at 4.5 per cent on average per annum, compared to 4.1 per cent for expenses.
A substantial net operating balance of $1.9 billion is expected for 2021–22, driven by the revenue impacts from the temporary surge in coal and oil prices and increase in housing activity. As these factors unwind, the net operating position reverts to a modest deficit across 2022–23 and 2023–24 and is then expected to return to surplus from 2024–25 consistent with previous forecasts.
Government spending in the 2022–23 Budget is targeted to meet increasing demand for services in key sectors, including health, and child safety, as well as assisting with cost-of-living pressures and substantial disaster recovery and reconstruction efforts in the wake of the 2022 disaster season.
The government’s public infrastructure investment continues to enlarge the Queensland economy’s productive capacity, supporting service delivery and sustaining jobs. The capital program continues to meet the government’s $50 billion infrastructure guarantee and ensures a continual pipeline of key priority projects. The 4-year program from 2022–23 to 2025–26 amounts to $59 billion. Over the 11 years to 2025–26, the government will have supported over $138 billion in infrastructure works.
Forecast borrowings have been progressively revised downwards since the 2020–21 Budget due to prudent fiscal management. General government borrowings are expected to be $3.6 billion lower by 2024–25 than forecast in the 2021–22 Budget Update, and $4.5 billion lower than forecast in the 2021–22 Budget.