By Amy Kelly
Queensland Treasurer Andrew Fraser has foreshadowed a tough budget for the state after revealing the damage repair bill from months of bad weather was likely top the estimated $5.8-billion.
Speaking at the Committee for Economic Development of Australia forum today the Treasurer said he expected the bill from the natural disasters to exceed the $6-billion figure and warned that tough choices would be necessary in the forthcoming state budget.
Mr Fraser said the Government needed to balance the dual challenges of the reconstruction bill with the state’s multi-speed economy and said the budget would be constrained by the escalating costs of the damage bill.
He said rebuilding would remain the unchallenged priority.
“There can be no question that presently we face enormous and immediate challenges in kicking over the flooded engine of the state’s economy,” he said.
“Rebuilding and reconstruction is a social priority as much as it is an economic priority.
“That has to be first and foremost.”
But he said the state also faced other challenges.
“We will soon face a task in throttling back that same engine that has been turbo-charged by a resources led investment boom that is going to threaten over-heating,” he said.
Mr Fraser said while the resources sector continued to be strong industries like housing were struggling and the resulting differences were contributing to a multi-speed economy.
“Anyone withing three ripples of the resources sector is already talking about the need for skills formation to be a priority,” he said.
“For many others, conditions continue to be soft.”
Trade and tourism in Queensland have both suffered as a result of natural disasters in the region.
Trade has slowed following the earthquake and tsunami that rocked Japan, Queensland’s major trading partner, earlier this year.
The number of visitors to the state has also slowed, with New Zealand, which is the largest category of visitors to the state, rocked by its own natural disasters.
Mr Fraser said the budget, which will be delivered in June, was not the one he planned to deliver but would make the tough choices needed to continue to guide Queensland’s recovery from the GFC and the natural disasters and return the budget to surplus in 2015-2016.