Fiscal pivot, investing for resilience, wages, structural deficit, infrastructure realism, population, community safety, cost of living, frontline workers, payroll, net debt, Industry Outlook.
Dr RAHMAN (Fong Lim): Madam Speaker, fearmongering and flinging mud will not fix our economy, but grown-up governance will. It will rebuild our economy and is what the Treasurer has provided in the 2026–27 budget, laying the foundations for opportunity for everyday Territorians into the future.
I have given wide-ranging commentary on the budget and our budgetary failures in the past. It is time to move past that and speak specifically to a strategic defence of our budget, contrasting our current fiscal pivot with the structural economic failures of the past once and for all. Let us do so from the perspective of a neutral economic observer who is focused on long-term fiscal sustainability.
I will speak on four points of contrast in this, my final of four addresses on the economy. The headline item is that we are moving from borrowing for consumption—which happened for years as we tried to spend our way out of the problem—towards investing for resilience. These budget papers provide an investment for long-term fiscal resilience.
Under the first head, it is important we understand that we are restoring fiscal integrity. We are ending the cycle of recurrent debt cycles. The primary improvement of the 2026–27 budget is the definitive break from unsustainable positions of borrowing to fund recurrent activities. Instead, we are specifically paying public sector wages and interest costs without having to do it on a credit card. The discipline we are showing is in trying to deliver a $95m operating surplus for 2025–26, which will be the first since 2022–23. This ensures that the Territory is finally living within its means for daily operations rather than paying wages on credit.
Contrast that with what was a core failure identified in the Langoulant report in 2018, which warned that the NT was in structural deficit cycles where debt was being used to fund consumption rather than productive assets. Between 2016 and 2024 we know that net debt spiralled from $1.8bn to more than $10bn due to a lack of expenditure restraint.
We are providing sustainability by trying to achieve a surplus. The government has reduced projected debt growth by 18% and improved the net-debt-to-revenue ratio by 15 percentage points compared with previous forecasts. That stabilisation is validated by what looks to be a stable credit rating from Moody’s as well, providing a foundation for lower future interest bills.
The second head we should consider as a point of contrast is infrastructure realism. We are replacing phantom projects with funded delivery, meaning that the hallmark of previous economic management, which was the announcement of major projects and the lack of business cases that led to massive blowouts and revoted funding, will not happen going forward for us.
The discipline we are showing is in removing those phantom projects and initiatives that existed only in rhetoric and not in reality and did not have realistic pathways. The current $4.25bn infrastructure program is backed by $460m in additional capital works cash to ensure projects move to construction, rather than remaining undelivered in perpetuity.
We have spoken about the ship lift, and we have committed to strict Treasury-level oversight to maximise the asset’s return on investment for a maritime precinct over the long haul.
We are also focused on resilience, which we had little chance to speak about. The flood recovery fund of $100m and the $30.5m in the roads repair package are a shift towards building back better for the long term to reduce the long-term maintenance burden caused by the NT’s exposure to extreme weather.
The third head is population and community safety, which we are now utilising as an economic lever. For a decade, the Territory has attempted to solve its population stagnation through expensive campaigns without doing the real work to arrest the loss of residents to other states. The realism we are bringing is to move away from shiny marketing campaigns and instead address the primary reasons people leave, which include antisocial behaviour, crime, social dysfunction and the cost of living. They are the things we are consistently tackling.
We acknowledge that population growth will be modest but realistic over the forward estimates, hovering at about 1.1%. If we improve on that position, it will be great for everyone in the Territory.
The first most important thing to do is treat safety as economy now. We are investing $1.7bn in law and order, introducing 100 more police on the streets and establishing a 212-strong police public safety officer workforce because we are framing it as an economic necessity at this point. We are trying to reduce crime further, stabilise the population base and restore business confidence.
For the cost of living we are providing $290m in practical concessions, including a $19.7m contribution to reducing fuel excise. That is a targeted attempt to mitigate the inflation gap that previously made the NT less competitive than the east coast.
The last head is frontline priority versus bureaucratic restraint. Previous budgets saw significant growth in the non-frontline public service, even as we had ongoing code yellows and shortages of police. The discipline that we are trying to instil now is in providing a 6% growth in frontline workers—that is in the budget papers— such as nurses, police, teachers whilst explicitly directing agencies to restrain back office administrative staffing. We are trying to ensure that taxpayer funds are directed towards service delivery rather than head office bloat. I will be specific about this because I feel that it may have been missed by some.
It is not in Budget Paper No 1, 2, 3 or 4; it is in the Budget and Regional Overview. If you look at page 4,
Fiscal outlook, you will see the giant box titled ‘Restraining non-frontline staffing growth’. It spells out all the extra areas that we are adding frontline staff to—assistant teachers, police, classroom teachers, medical officers, correctional officers, nurses, police auxiliaries and senior teachers. It is there in black and white; read the papers. We are trying to slowly deal with the state of our wages bill by ensuring that we prioritise the front line, create efficiencies and improve productivity over time.
The end strategic verdict of this all is that in this budget we are trying to transition to grown-up governance. We are prioritising operating surpluses, stabilising debt and funding essential services with cash rather than credit. This budget addresses the structural failures of the preceding decade. For the taxpayer I believe this budget offers the first credible pathway towards long-term fiscal resilience.
The budget Bill is being debated in cognate with a Bill regarding the first home owner grants and some adjustments to payroll tax. I make it clear that I am supportive of those manoeuvres. Continuing HomeGrown Territory, which sees more action in the Fong Lim electorate than anywhere else, is a great step forward; likewise, introducing a payroll tax rate of 6.5%—an increase of 1%—for large national businesses to ensure that we continue to grow our additional payroll tax revenue and, hopefully, raise an extra $25m per annum.
We are in charge of ensuring community safety. This budget will continue to invest in law and order, police, courts and Corrections. It is not about new promises; it is about sticking to our plans and continuing to deliver them.
Net debt will remain a challenge for everyone in this House, and we will have to work collectively on that by not flinging mud and fearmongering but working out where we want to try to create efficiencies and improve productivity. This government has a clear plan and a responsibility it takes seriously to manage debt responsibly whilst continuing to invest in priority areas. We are not shirking our responsibilities by simply kicking the can down the road and leaving it to future generations or future governments to pick up the pieces. Instead, we are staying focused on our priorities. Those priorities mean that in this budget we are not focused on spending; we are focused on creating restraint. Sometimes the best investment a government can make is restraint. We did not create the debt problem, but we will be the ones to fix it over time.
How will we do that? With my final minute, I simply say to everyone in the House: look at the Industry Outlook. It is not distributed with the other budget papers we get; it is available online from Treasury. It explains how important the minerals and onshore gas industries are to our long-term future potentially. We are supportive of trying to generate wealth and create opportunity for the Northern Territory because the multiplier effect of those industries, once seeded, will create an architecture of opportunity for the everyday Territorian in public health, housing, education and infrastructure.
It is my great privilege and joy this year to speak on the Appropriation Bill, support my learned colleague the Treasurer and endorse wholeheartedly this Bill.
I commend the Bill to the Assembly.