Page 1266 - Week 04 - Wednesday, 25 March 2009
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to perform strongly while the world was collapsing around us is of most concern. In the lead-up to the 2008 ACT election, the Chief Minister and former Treasurer assured the Canberra community that the ACT economy was performing very strongly. In the Assembly on 28 August 2008 the Chief Minister and Treasurer said:
The ACT economy is experiencing a period of sustained economic growth and prosperity.
Let me repeat that, just so we are quite clear what our former Treasurer was telling us:
The ACT economy is experiencing a period of sustained economic growth and prosperity.
And, in case you have missed the important words, let me emphasise them again: sustained economic growth.
While the global financial crisis was reaching full force and governments all around the world were starting to develop responses to this crisis, our Treasurer was in a world of his own. Perhaps something started to gel with our Treasurer soon after he made this statement, because on 9 September, two weeks later, he said on ABC radio that the ACT had a “slowing economy”. The question we asked then, just before the ACT election, was: what was the Chief Minister and Treasurer telling the Canberra community? Did the Chief Minister know that the prospects for the ACT economy, and implicitly for the ACT budget, in financial year 2008-09 were already looking less favourable? If he did, he was not going to say so only a few weeks out from the ACT election. In fact, not only did he not make any suggestions about deteriorating prospects; he said quite the opposite. On 19 September 2008 the Chief Minister and Treasurer said:
ACT Labor has given its word that the election promises it makes will be fully funded and will allow the ACT to maintain surpluses in each of the years of the next term of government.
This was not a Treasurer who could see declining prospects for the ACT economy. This was not a Treasurer who appeared concerned about the changing prospects for the ACT budget for 2008-09, let alone the outyears. On the contrary, it appears that this was a Chief Minister and Treasurer who was living in the aftermath of the very strong ACT economy that he had inherited from the former Liberal government in 2001. As is well known, when the Stanhope-Gallagher government was elected in 2001 it inherited a very strong budgetary position. We also know that the ACT economy continued to perform very strongly over the succeeding years. We experienced a revenue boom of substantial proportions. The ACT received additional revenue of $1.6 billion over and above that which had been budgeted for in successive ACT budgets.
The tragedy for the ACT is that the Stanhope-Gallagher government squandered that bonus. This bonus, which could have helped prepare the ACT to withstand economic shocks, was frittered away. The state of the ACT budget remained—
Mr Stanhope: What, on health and on education?
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