Iemma government sees red


Rachel Evans, Sydney

The NSW Labor government is set to run an operating deficit of $696 million over the coming year following the federal government's June 2 decision to pull the plug on the Snowy Hydro sale.

Premier Morris Iemma will be going into next March's state election without the $1.74 billion slush fund he'd hoped for and the June 7 Australian editorial claimed that the government is turning to banks and bond markets to raise $17.4 billion for infrastructure spending over the next four years.

The NSW Council of Social Service (NCOSS) noted that Treasurer Michael Costa's 2006-07 budget, announced on June 6, gives a $32 million expenditure boost to the state prison system, with post-prison rehabilitation being granted a "pathetic increase of $10,000".

Overall education spending was increased by only 4.4% to $9.989 billion, to cover a 4% increase in teachers' salaries. Private schools received a 5.1% increase while public schools received only a 4.3% increase. Adult Community Education spending was cut by 12.5% and TAFE "did not fare well", NCOSS noted. Funding is up by 4.8% overall, but enrolments are predicted to remain static while staff are reduced by around 100.

Commenting on the cut in TAFE funding, Phil Bradley, the NSW Teachers Federation assistant general secretary (post-school education), told Green Left Weekly, "There has been no attempt to even partially address the union's claim for the additional $250 million per year needed to restore funding to the 1998 level in real terms ... Although the [TAFE] budget was topped up by $45.5 million, necessary to cover salary increases including the pro-rata case outcome, there was no extra for servicing the actual growth in student hours of 3.3%."

Only 300 extra social housing units were promised, which will do nothing to alleviate NSW's housing crisis. Expenditure on health care in 2006-07 will be $10.25 billion, a real increase of 4.9%. However, despite Aboriginal communities crying out for assistance, Aboriginal primary health care received only a 2.6% funding increase — below the inflation rate.

Before the budget, the government announced an expansion in funding for dental services of $40 million over four years, with $4 million allocated in 2006-07. Dr Hans Zoellner, chairperson of the Association for the Promotion of Dental Health, told the media: "The promised $4 million for each year over the next four years is at least five times less than what is required to make substantial changes to long waiting lists and inadequate staffing and skills levels."

NCOSS estimates that the NSW government will be giving $4.4 billion in tax giveaways to business and property developers by 2010.

From Green Left Weekly, June 14, 2006.
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