Shadow Treasurer Curtis Pitt says the Newman Government has been caught out telling a vastly different story to overseas investors about Queensland’s financial status and Labor’s record than it has been peddling at home.

Just as the Opposition predicted, Treasurer Tim Nicholls is spending his current overseas trip spruiking the strength of the state economy and telling a vastlydifferent tale than the one he spreads in Queensland,” Mr Pitt said.

He said the shallowness of the LNP’s attacks on Labor’s record was highlighted by the latest version of the so-called ‘blue book’ prepared by Queensland Treasury Corporation and distributed to potential investors by state treasurers when travelling overseas.

“The ‘blue book’ Mr Nicholls is using as his calling card underlines the state’s strong position and prospects and confirms Labor’s plans for a return to surplus in 2014-15,” Mr Pitt said.

“Nowhere is there mention of a ‘power dive into the abyss’, or ‘debt crisis’ or any similar claims that he and the Premier have been making at home.

“If it is good enough to tell investors the truth – it is good enough for the Premier and the Treasurer to tell Queenslanders the truth and to stop talking down our state economy.”

Mr Pitt said the QTC’s ‘blue book’ being provided to investors by the Treasurer showed that over the next three years the LNP would reach the same level of debt ($85 billion) as projected by Treasury for the previous government.

“This official LNP government publication cites ratings agency Standard & Poor’s as saying Queensland has a far lower level of general government net debt relative to operating revenue compared with similar international semi-sovereign issuers,” he said.

“S&P is also cited saying the amount of money spent by Queensland on interest payments, when expressed as a share of revenue, is also low relative to its international peers.

“Rather than repeat the claims he makes at home of Queensland being in ‘a debt crisis’, the Treasurer’s own ‘blue book’ spells out that Queensland’s ratio of financial assets to liabilities shows ‘its relative financial strength compared with other Australian states’, especially when considering each state’s investments to meet their future super and long-service leave obligations.

“Nowhere in the ‘blue book’ is there reference to Queensland being ‘a basket case’ as Mr Nicholls has previously claimed at home.

“In fact the ‘blue book’ proves that after spending to build generational infrastructure and to generate or save jobs in the wake of the GFC, Labor left office a debt that was manageable, not unsustainable as the LNP keeps claiming,” he said.

Mr Pitt today also released his updated assessment of the Costello audit and its projections of a “mythical” $100 billion state debt.

“The headline figure of a $100 billion state debt by 2018-19 is a myth generated by the Costello audit by using flawed assumptions,” Mr Pitt said.

“Since the audit’s release LNP MPs have been misleading Queenslanders by quoting the figure as being the current state debt without saying how the Costello audit had to exaggerate assumptions to achieve the figure.

“The truth is that Labor left office with debt of $62 billion as detailed in the January 2012 Treasury Mid-Year Review. That included $30.2 billion held by government-owned corporations much of which is self-sustaining through future profits, for instance port authorities receive revenue from resources companies — not taxpayers — to help pay down their share of GOC debt.

“The LNP has now committed to the same level of debt that was projected prior to the election of $85 billion in 2014-15.

“The Costello audit also confirms that the position of the previous government, outlined in the January 2012 mid-year budget review, was correct including a return of the budget to surplus in 2014-15.

“However, the Costello audit also identifies the LNP’s inability to find the $5.7 billion in savings to fund its election commitments without resorting to ‘downsizing of the workforce’.

“Mr Newman and Mr Nicholls said they had identified these savings before the election, but what they didn’t say is that the savings would come through sacking up to 20,000 of its own employees.”

Mr Pitt said the Costello audit could reach its conclusions only by making flawed assumptions including:

  • that any government elected in March would have done nothing to further address debt and outlays — that it would “take its hands off the wheel”. That was never an option and Labor in Government had already committed to $737 million in net savings in the Budget Mid-Year Review,
  • economic circumstances in the next five years would be a repeat of the past five years — in other words, the next five years would see another global financial crisisand a repeat of record drought and the summer of disastrous floods and cyclones that required heavy spending to repair communities across the state.

“Only by making these assumptionscould the audit come up with a projection for $100 billion in gross debt at a point seven years in the future,” Mr Pitt said.

Download a copy of The Real Story – What the Treasurer is Telling Overseas Investors

Download a copy of the Analysis of ‘Costello’ Audit by Shadow Treasurer Curtis Pitt and its attachments.