NSW budget hides private profit push

By Jonathan Strauss

SYDNEY -- “Every inch a Labor budget”, NSW treasurer Michael Egan declared on May 7, when he delivered the state government's budget in parliament.

Egan was trying to imply that this meant looking after “the battlers” through measures such as a $50 per year handout to parents of school students and some taxes directed at the wealthy. The budget was more true to the real Labor tradition of supporting private profit-making through government subsidies and public sector cutbacks.

A record $2.2 billion goes to roads, including $144 million for the M5 East, which will link two private tollways. Public transport funding has been cut by 3% in real terms.

John Connor of the Nature Conservation Council, a member of the transport action alliance LinkUp, told Green Left Weekly, “Half the capital expenditure goes in subsidies to the private Southern Railway project, and more for the Olympic site railway spur, while train carriage upgrades needed before the Olympics have been put on the back burner.

“Thus nothing is being done to answer the crying need for a major expansion of public transport in Sydney.”

The $50 for students' parents -- clearly designed to be “visible” -- comes with a 16% cut in funds for new schools and school maintenance, the third consecutive year of capital works cuts.

The handout can be seen as a support for the development of “user pays” in public schools, which are already charging “elective” fees. NSW Teachers Federation president Denis Fitzgerald contrasted cuts to education capital works with the increased government funds for the Olympics construction budget, which has risen to over $2 billion.

Egan achieved a small budget surplus by raising taxes, including land taxes on expensive owner-occupied houses, a luxury car tax and increased electricity charges on the largest users, but also through increased land tax on investment properties (often rental homes) and a doubling of stamp tax duties on general insurance, including third-party and comprehensive car insurance and house insurance, raising living costs for many working people.

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