2022-23 South Australian Budget

Introduction

On Thursday 2^nd June 2022, South Australian Treasurer Stephen Mullighan delivered the 2022-23 SA State Budget. This is the first budget of the Malinauskas Labor Government after defeating the one term Liberal Government at the March 2022 election.

The 2022-23 SA Budget projects a surplus of $233 million, an increase on the previous government’s prediction of a $102 million surplus in its last update. The deficit for the current financial year is $1.73 billion, up from the forecasted $1.59 billion.

The SA budget, which is projected to remain in surplus through the forward estimates, includes an increase in spending on health and energy infrastructure.

Debt is expected to rise over the forward estimates, from $24.7 billion this financial year to $33.9 billion in 2025-26.

Key Budget Indicators

	2021-22 Estimated Result	2022-23 Budget	2023-24 Estimate	2024-25 Estimate	2025-26 Estimate
General Government net operating balance ($m)	-1,733	233	487	606	643
General Government net lending ($m)	-3,002	-1,650	-2,087	-1,419	-1,466
General Government net debt ($m)	16,930	19,003	21,606	23,441	25,220
Non-financial public sector net debt ($m)	24,710	27,324	30,153	32,012	33,862
Net debt to revenue ratio (NFPS)	100.6%	109.4%	116.2%	119.4%	122.4%

The South Australian economy is projected to grow 3 per cent in 2021-22. Employment growth in 2021-22 is estimated to be 3.25 per cent, however it is expected to return to average rate of 1 per cent in 2022-23.

Key assumptions underlying the budget and forward estimates

	2021-22 Estimate	2022-23 Forecast	2023-24 Projection	2024-25 Projection	2025-26 Projection
Gross State Product – real growth (%)	3	2¼	2¼	2¼	2¼
State Final Demand – real growth (%)	3¼	2½	2¼	2¼	2¼
Employment – growth (%)	3¼	1	1	1	1
CPI (%)	3	4	3¼	2¾	2¾

The SA Government has not introduced any new taxes or tax increases in the 2022-23 budget.

There have been significant revisions on revenue since the Mid-Year Budget Review (MYBR), with an improved economic environment resulting in increases in GST, payroll tax, and conveyance duty collections. GST grant revenue has been revised up by $94 million in 2021-22 and by $793 million over the period 2022-23 to 2024-25. State taxation revenues have been revised up by $340 million in 2021-22, and by $640 million over the period 2022-23 to 2024-25.

Below outlines the major funding commitments. For detailed information about funding commitments that may impact your industry, contact your Hawker Britton consultant.

Health and Mental Health

$2.4 billion in extra spending on health over the next five years, including:

• $124 million over four years for hiring 350 more paramedics and ambulance officers
• $65.4 million to recruit more than 300 nurses and 101 doctors
• $120 million to build a new ambulance headquarters in the Adelaide CBD
• $67.2 million to build four new ambulance stations, rebuild four existing stations, and upgrade 10 stations
• $837 million for hospital infrastructure, including upgrades to regional hospitals and emergency departments
  • Including $30.3 million to the new Women’s and Children’s Hospital, to be completed in 2027
• An additional 326 hospital and mental health beds, and a further 228 beds upon the completion of the Flinders Medical Centre upgrade, and construction of the Mount Barker Hospital. A total of 554 beds
  • Of the extra 326 beds, 72 are mental health beds at the Queen Elizabeth Hospital, Modbury Hospital and Noarlunga Hospital at a cost of $157.8 million over four years
• 20 mental health community beds, and six mental health beds at Mount Gambier Hospital
• $50 million for 100 new mental health support specialists in state primary and secondary schools.

Infrastructure

$18.6 billion in infrastructure spending over next four years

• $3.19 billion to the North-South Corridor upgrade
• $1.44 billion over four years to build a new Women’s and Children’s Hospital by 2027
• $178 million for 400 new public housing units, and the refurbishing of 350 existing public housing units which are currently untenanted
• Adelaide Aquatic Centre upgrade.

Transport

• $55.1 million for construction of the Port Rail Spur
• $29.4 million to improve transport to Mount Barker and the Adelaide Hills
• $10 million for the automated protection system on the Seaford rail line
• $2.2 million to upgrade Noarlunga station
• $1.6 million to upgrade Clarence Park train station
• $1.5 million to install a pedestrian rail crossing in West Croydon
• $1.4 million Overland train subsidy.

Roads

$7.84 billion on roads over four years including:

• $400 million for the Marion Road and Anzac Highway to Cross Road upgrade
• $125 million upgrading Main South Road
• $120 million on-off ramp for the Southern Expressway at Majors Road
• $20 million outback roads flood resilience.

Cost of Living

• $39.3 million in 2022-23 to double the cost of living concession
• $24 million for $100 subsidies to government school parents to help pay for school materials
• $12 million to reintroduce the vehicle registration concession in remote areas
• $6.4 million for a reduction in the compulsory third party insurance premium for eligible taxi operators
• $5.2 million for free public transport for eligible seniors
• $1.8 million to continue the Fuel Price Transparency Scheme
• Government fees and charges will be indexed at 2 per cent in 2022-23, less than half of the annual CPI increase.

Education

The SA Government has committed $630 million to new education initiatives:

• $208.8 million for five new technical colleges, including in Mount Gambier and Port Augusta
• $118.8 million to build additional accommodation for 700 students at Adelaide Botanic High School and 300 students at Roma Mitchell Secondary College
• $72.4 million to introduce mid-year intake for preschool students
• $50 million for 100 new mental health support specialists in state primary and secondary schools
• $28.8 million to appoint an autism lead teacher in every government primary school
• $26.6 million for school upgrades
• $2 million for 400 university scholarships for teaching students
• $2 million Catholic schools regional bus grant
• $2 million to support two special schools.

Early Childhood

• $2 million to a Royal Commission into Early Childhood Education & Care
• $117 million over five years to the preschool reform agreement.

Training

• $12.7 million for TAFE SA courses in the care industries
• $11.9 million additional investment in skills and training system
• $8.8 million skill shortage funding
• $6.7 million to JobTrainer, extending the National Partnership Agreement with the Commonwealth
• $5 million for upgrades to Mount Gambier TAFE SA campus
• $4 million to reverse cuts on adult and community education
• $1.6 million training grants to Tourism Industry Council of South Australia
• $1 million to establish a Commission to advise the government on a university merger
• $1 million to the Master Builder’s Association for school outreach programs.

Housing and Homelessness

• $178 million for 400 new public housing units, and the refurbishing of 350 existing public housing units which are currently untenanted
• $10.4 million for homelessness support, including grants to Catherine House, St Vincent de Paul Society and the Hutt Street Centre
• The SA Government is developing a 3% low deposit home loan for first home buyers program.

Environment and Climate Change

• $593 million hydrogen plan, including an electrolyser and storage facility near Whyalla
• $12.7 million Mt Bold Dam Upgrade
• $6 million for grants to landholders for heritage agreements
• $3.1 million to establish a Biodiversity Coordination Unit within the Department for Environment and Water
• $2.1 million to employ a Commissioner for the River Murray in South Australia
• $2 million to promote nature-based tourism activities in SA.

Police and Emergency Services

Law and Order

• $13.3 million (in 2021-22) additional funding to support COVID-19 related costs in SA Police
• $8.8 million over four years for Operation Ironside
• $6.5 million to purchase multi-purpose load bearing vests
• $4.2 million to build new police posts at Indulkana and Pipalyatjara
• $3.1 million to crack down on child sex offenders.

Emergency services

• $14.1 million for 12 new MFS fire trucks
• $2.3 million to establish a Gawler SES unit
• $2 million to replace fire towers
• $2 million for farm firefighting unit grants.

Community

• $128.9 million to meet the expected growth in children needing protection services and care
• $7.5 million for Child Protection Grants
• $16 million in additional funding for multicultural events and initiatives
• $2.1 million to establish a Cross-Border Commissioner
• $2 million to victim support services
• $1.9 million to extend the Disability community visitor scheme
• $1.5 million for Fairness at Work Measures
• $1 million to establish domestic violence prevention and recovery hubs
• $1 million to provide counselling and support to the families of drug users  
• $1 million in grants for women’s and men’s sheds
• $1 million to the RSPCA, particularly in enforcing animal welfare laws
• $2.1 million to implement the Uluru Statement from the Heart
• $1.4 million for improved detection, monitoring and management of acute rheumatic fever and rheumatic heart disease in Aboriginal and Torres Strait Islander Australians (funded by the Commonwealth).

To view the full 2022-23 Budget Papers, click here.

For more information, please contact your Hawker Britton Consultant Simon Banks on +61 419 648 587 or Stephen Halliday on +61 418 808 799.