Future focus as inflation blare dims but change needed
The man who writes the cheques for Australia's largest state budget can finally focus on the future.
Inflation was "blaring" in NSW Treasurer Daniel Mookhey's ears when he was compiling his first two budgets after Labor returned to government in 2023 for the first time in 12 years.
"But the challenge in front of the state and the nation is making sure that we are growing our economy fast enough to support a rise in living standards," he tells AAP as he prepares to hand down his third.
Mr Mookhey says Tuesday's state budget is about the future of the state's essential services and economic growth.
"There's a lot of opportunity and a lot of ambition in NSW and the changes we're making are designed to hold on to what we love ... but also ensure that our kids and our grandkids have the same level of opportunity that we had," he says.
While receding inflation and distance from the COVID-19 pandemic's associated spending have allowed the treasurer to cast an eye to the future, issues from the past remain.
Framed in Mr Mookhey's parliament office is a newspaper headline relating to the underpayments scandal in the state's workers' compensation scheme he played a role in exposing in opposition.
The page is yellowing with age as Mr Mookhey pushes to reform a scheme he is now in charge of, and which he argues is becoming unsustainable due to the rising cost and prevalence of psychological injuries.
"It's been a hard case to argue," he says.
"This system is failing everybody. It's a system that is fundamentally broken."
Changes are simmering on the back burner after a parliamentary inquiry prevented action before the budget.
Mr Mookhey hopes reform can create a "prevention culture" that limits psychological injuries from occurring.
Outside of the workplace, he has promised some reassurance to people dealing with mental health issues and their loved ones.
"They will see more investment in mental health resources in our health system and they will see more investment when it comes to our social interventions," he says.
However, public psychiatrists at the pointy end of mental health crises should not expect the budget to deliver a pay rise at the level they have been calling for amid resignations in protest and arbitration in the state's Industrial Relations Commission.
The federal distribution of GST to the states also continues to frustrate Mr Mookhey after dashing his hopes of a surplus in 2024.
NSW now receives its lowest share of GST since it was introduced - about 85 cents for every dollar raised.
"What frustrates me is not so much that we support the other states, it's just the missed opportunities," he says.
The distribution needs to change but the tax's bigger proportional hit on the spending power of lower-income Australians means Mr Mookhey does not support raising the rate.
"We can do better," he says.
"What we need to focus on is just making sure the system is simple, the distribution is fair, the distribution is predictable, but also the distribution is understandable."
Another federal issue with implications for state budgets is the rise of the black market for illicit tobacco fuelled by rising excise on dinky-di durries.
The market shift is robbing the Commonwealth of expected revenue and creating criminal complications for states.
It has already led to increased funding for enforcement within the health budget, but Premier Chris Minns indicated earlier in June a decision would have to be made about the resources devoted to combating illicit tobacco sales.
While smoke clouds what the budget might do to address the issue, Mr Mookhey notes it is a source of public anxiety.
"It's right and fair that we respond to community concerns about it ... we're going to have to work through what is the right solution."
The tax issues are part of what economic researchers at the e61 Institute call a "vertical fiscal imbalance" that characterises the nation.
"The states carry many of the spending responsibilities but lack equivalent revenue-raising capacity," chief executive Michael Brennan says, warning state finances are drifting onto an unsustainable path.
But NSW will at least bank a cash surplus in Tuesday's budget for the first time since 2021.
"Which means we're no longer borrowing money to pay our day-to-day bills as a government," Mr Mookhey says.
"That gives us a platform for further progress."
Australian Public Policy Institute chief executive Libby Hackett expects the budget will be a step forward, building on previous years.
"This will be a structural reform budget: supporting better service delivery, infrastructure alignment and long-term productivity, even in a tight fiscal environment," Professor Hackett tells AAP.
"Moreover, this budget presents a real opportunity to advance whole-of-government objectives in cross-cutting areas."
Opposition Leader Mark Speakman sees it differently, warning the state is heading for "yet another low-vision, low-value, low-energy budget".
"We have had not one visionary pre-budget announcement."
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The Advertiser
an hour ago
- The Advertiser
Australia's enduring love affair with the US is at a critical point
Few stories start in a more compelling way than Ian McEwan's brilliant novel Enduring Love (1997). Several men, strangers to each other, rush across an English field converging on a stricken helium balloon as they try frantically to hold it grounded long enough to free a child cowering in its basket. As the ungainly apparatus is gusted violently aloft during a wind squall, the men suddenly find themselves "treading air", each facing a terrible choice - whether to hang on in the hope their collective weight will bring it down again or let go before rising too high to survive the fall. It might seem rich to describe Australia's umbilical attachment to the United States as an enduring love, but that unanswerable question in the untethered balloon scene feels disturbingly apt. As does the book's title. The bilateral relationship has survived long enough to natural, even definitional. With that "enduring", though, has come less admirable attributes like unbalanced, fawning, and captive. Hence the reckless conservative boast that Australians have fought alongside Americans in every war they've undertaken since 1900. This includes moral, legal, and strategic outrages like Vietnam, Iraq and Afghanistan. Like McEwan's disparate characters twisting precariously on guy ropes and slaves to untameable forces of physics, the existential question of whether to cling on or let go, is fast becoming existential. Not that the cheerleaders of the AUKUS caucus are awake to it. While the US talks openly of rehabilitating Russia, invading Greenland and seizing the Panama Canal, they mouth terms like strategic alignment, shared values, cooperation and interoperability. In so many ways, McEwan's exquisitely described dilemma seems like a fitting metaphor for this instant. A temporally reflexive metaphor that works, albeit in different ways, for Australia, for Iran, for Israel, and even for those democracies keeping schtum as another American president contemplates a Middle Eastern war. And as Israel reveals its bottomless reserves of military power and lawless vengeance. In short order, Iran must decide if it is to surrender its nuclear enrichment capacities - even for exclusively peaceful domestic purposes like medical isotopes - or face a US aerial bombardment of unimaginable ferocity. Israel must decide, in the same compressed timeframe, if it is to accommodate such assurances - should Donald Trump insist(?) - or fight on condemning Israelis to further carnage and the state itself to perennial insecurity in its region. It is a choice between an unlikely peace and the guarantee of endless war and an ever-enduring hate. The oafish Trump has no plan. He has bought himself a mere fortnight to decide between backing off or pursuing a path he expressly campaigned against. McEwan's well-meaning strangers who've sprinted towards the flailing balloon exhibit some characteristics of the international community. In the nine days since Israel's far-right Netanyahu government began bombing Iran's nuclear sites without warning, a kind of uncoordinated helplessness has taken hold. Those gathered in Canada for the G7 caved instantly to US and Israeli pressure, citing the Jewish state's limitless "right to defend itself". The group called Iran the "principal source of regional instability". While the criticism of Iran is justified, one might have expected the top liberal states to weigh more heavily the authoritative opinions of international legal scholars such as Professor Ben Saul, Challis chair of international law at the University of Sydney and UN Special Rapporteur on Human Rights and Counter Terrorism. Saul says Israel's claimed legal impunity simply does not apply here. "Israel claims that its attack is necessary to prevent Iran acquiring nuclear weapons and using them in the future. The problem is that under international law, a country may only defend itself from an actual or imminent armed attack by another country," wrote Saul in the Guardian. As the rules break down, such facts have become ethereal, prone to dissipating, like so much helium. READ MORE KENNY: It is worth remembering that the trend to American unreliability now so blatant, started more than two decades ago, when fragmentary intelligence was deliberately "sexed up" to look like solid intel ahead of the Iraq invasion. America's "forever wars" in Iraq and Afghanistan, with the attendant abuses of Abu Ghraib and the eventual surrender to the very Taliban it had expelled - signalled a loss of prestige internationally. But they also sparked a crisis at the moral and institutional core of America. The nativist, protectionist, anti-establishment Trump is its indignant progeny. A vulgar up-yours to the compromises of democracy and the checks on executive power by laws, courts, multilateral bodies and international norms. As Hugh White notes in his latest insightful Quarterly Essay, "Hard New World: Our Post-American Future", the nation which had saved democracy, then created and policed a post-war rules-based international order, has gone and is not coming back. Now, an avowed America First isolationist scoffs at such an order (globally and domestically) and ridicules the haughty ethics that had underpinned it. Even last week, Trump arrived at the G7 only to complain that Vladimir Putin should be there too. To bend McEwan's balloon dilemma further, Australia might ask itself a further question: are we the poor sods clinging white-knuckled to guy ropes? Or are we perhaps the panicked child cowering in the basket, too frightened to determine our own survival as a sovereign nation? Few stories start in a more compelling way than Ian McEwan's brilliant novel Enduring Love (1997). Several men, strangers to each other, rush across an English field converging on a stricken helium balloon as they try frantically to hold it grounded long enough to free a child cowering in its basket. As the ungainly apparatus is gusted violently aloft during a wind squall, the men suddenly find themselves "treading air", each facing a terrible choice - whether to hang on in the hope their collective weight will bring it down again or let go before rising too high to survive the fall. It might seem rich to describe Australia's umbilical attachment to the United States as an enduring love, but that unanswerable question in the untethered balloon scene feels disturbingly apt. As does the book's title. The bilateral relationship has survived long enough to natural, even definitional. With that "enduring", though, has come less admirable attributes like unbalanced, fawning, and captive. Hence the reckless conservative boast that Australians have fought alongside Americans in every war they've undertaken since 1900. This includes moral, legal, and strategic outrages like Vietnam, Iraq and Afghanistan. Like McEwan's disparate characters twisting precariously on guy ropes and slaves to untameable forces of physics, the existential question of whether to cling on or let go, is fast becoming existential. Not that the cheerleaders of the AUKUS caucus are awake to it. While the US talks openly of rehabilitating Russia, invading Greenland and seizing the Panama Canal, they mouth terms like strategic alignment, shared values, cooperation and interoperability. In so many ways, McEwan's exquisitely described dilemma seems like a fitting metaphor for this instant. A temporally reflexive metaphor that works, albeit in different ways, for Australia, for Iran, for Israel, and even for those democracies keeping schtum as another American president contemplates a Middle Eastern war. And as Israel reveals its bottomless reserves of military power and lawless vengeance. In short order, Iran must decide if it is to surrender its nuclear enrichment capacities - even for exclusively peaceful domestic purposes like medical isotopes - or face a US aerial bombardment of unimaginable ferocity. Israel must decide, in the same compressed timeframe, if it is to accommodate such assurances - should Donald Trump insist(?) - or fight on condemning Israelis to further carnage and the state itself to perennial insecurity in its region. It is a choice between an unlikely peace and the guarantee of endless war and an ever-enduring hate. The oafish Trump has no plan. He has bought himself a mere fortnight to decide between backing off or pursuing a path he expressly campaigned against. McEwan's well-meaning strangers who've sprinted towards the flailing balloon exhibit some characteristics of the international community. In the nine days since Israel's far-right Netanyahu government began bombing Iran's nuclear sites without warning, a kind of uncoordinated helplessness has taken hold. Those gathered in Canada for the G7 caved instantly to US and Israeli pressure, citing the Jewish state's limitless "right to defend itself". The group called Iran the "principal source of regional instability". While the criticism of Iran is justified, one might have expected the top liberal states to weigh more heavily the authoritative opinions of international legal scholars such as Professor Ben Saul, Challis chair of international law at the University of Sydney and UN Special Rapporteur on Human Rights and Counter Terrorism. Saul says Israel's claimed legal impunity simply does not apply here. "Israel claims that its attack is necessary to prevent Iran acquiring nuclear weapons and using them in the future. The problem is that under international law, a country may only defend itself from an actual or imminent armed attack by another country," wrote Saul in the Guardian. As the rules break down, such facts have become ethereal, prone to dissipating, like so much helium. READ MORE KENNY: It is worth remembering that the trend to American unreliability now so blatant, started more than two decades ago, when fragmentary intelligence was deliberately "sexed up" to look like solid intel ahead of the Iraq invasion. America's "forever wars" in Iraq and Afghanistan, with the attendant abuses of Abu Ghraib and the eventual surrender to the very Taliban it had expelled - signalled a loss of prestige internationally. But they also sparked a crisis at the moral and institutional core of America. The nativist, protectionist, anti-establishment Trump is its indignant progeny. A vulgar up-yours to the compromises of democracy and the checks on executive power by laws, courts, multilateral bodies and international norms. As Hugh White notes in his latest insightful Quarterly Essay, "Hard New World: Our Post-American Future", the nation which had saved democracy, then created and policed a post-war rules-based international order, has gone and is not coming back. Now, an avowed America First isolationist scoffs at such an order (globally and domestically) and ridicules the haughty ethics that had underpinned it. Even last week, Trump arrived at the G7 only to complain that Vladimir Putin should be there too. To bend McEwan's balloon dilemma further, Australia might ask itself a further question: are we the poor sods clinging white-knuckled to guy ropes? Or are we perhaps the panicked child cowering in the basket, too frightened to determine our own survival as a sovereign nation? Few stories start in a more compelling way than Ian McEwan's brilliant novel Enduring Love (1997). Several men, strangers to each other, rush across an English field converging on a stricken helium balloon as they try frantically to hold it grounded long enough to free a child cowering in its basket. As the ungainly apparatus is gusted violently aloft during a wind squall, the men suddenly find themselves "treading air", each facing a terrible choice - whether to hang on in the hope their collective weight will bring it down again or let go before rising too high to survive the fall. It might seem rich to describe Australia's umbilical attachment to the United States as an enduring love, but that unanswerable question in the untethered balloon scene feels disturbingly apt. As does the book's title. The bilateral relationship has survived long enough to natural, even definitional. With that "enduring", though, has come less admirable attributes like unbalanced, fawning, and captive. Hence the reckless conservative boast that Australians have fought alongside Americans in every war they've undertaken since 1900. This includes moral, legal, and strategic outrages like Vietnam, Iraq and Afghanistan. Like McEwan's disparate characters twisting precariously on guy ropes and slaves to untameable forces of physics, the existential question of whether to cling on or let go, is fast becoming existential. Not that the cheerleaders of the AUKUS caucus are awake to it. While the US talks openly of rehabilitating Russia, invading Greenland and seizing the Panama Canal, they mouth terms like strategic alignment, shared values, cooperation and interoperability. In so many ways, McEwan's exquisitely described dilemma seems like a fitting metaphor for this instant. A temporally reflexive metaphor that works, albeit in different ways, for Australia, for Iran, for Israel, and even for those democracies keeping schtum as another American president contemplates a Middle Eastern war. And as Israel reveals its bottomless reserves of military power and lawless vengeance. In short order, Iran must decide if it is to surrender its nuclear enrichment capacities - even for exclusively peaceful domestic purposes like medical isotopes - or face a US aerial bombardment of unimaginable ferocity. Israel must decide, in the same compressed timeframe, if it is to accommodate such assurances - should Donald Trump insist(?) - or fight on condemning Israelis to further carnage and the state itself to perennial insecurity in its region. It is a choice between an unlikely peace and the guarantee of endless war and an ever-enduring hate. The oafish Trump has no plan. He has bought himself a mere fortnight to decide between backing off or pursuing a path he expressly campaigned against. McEwan's well-meaning strangers who've sprinted towards the flailing balloon exhibit some characteristics of the international community. In the nine days since Israel's far-right Netanyahu government began bombing Iran's nuclear sites without warning, a kind of uncoordinated helplessness has taken hold. Those gathered in Canada for the G7 caved instantly to US and Israeli pressure, citing the Jewish state's limitless "right to defend itself". The group called Iran the "principal source of regional instability". While the criticism of Iran is justified, one might have expected the top liberal states to weigh more heavily the authoritative opinions of international legal scholars such as Professor Ben Saul, Challis chair of international law at the University of Sydney and UN Special Rapporteur on Human Rights and Counter Terrorism. Saul says Israel's claimed legal impunity simply does not apply here. "Israel claims that its attack is necessary to prevent Iran acquiring nuclear weapons and using them in the future. The problem is that under international law, a country may only defend itself from an actual or imminent armed attack by another country," wrote Saul in the Guardian. As the rules break down, such facts have become ethereal, prone to dissipating, like so much helium. READ MORE KENNY: It is worth remembering that the trend to American unreliability now so blatant, started more than two decades ago, when fragmentary intelligence was deliberately "sexed up" to look like solid intel ahead of the Iraq invasion. America's "forever wars" in Iraq and Afghanistan, with the attendant abuses of Abu Ghraib and the eventual surrender to the very Taliban it had expelled - signalled a loss of prestige internationally. But they also sparked a crisis at the moral and institutional core of America. The nativist, protectionist, anti-establishment Trump is its indignant progeny. A vulgar up-yours to the compromises of democracy and the checks on executive power by laws, courts, multilateral bodies and international norms. As Hugh White notes in his latest insightful Quarterly Essay, "Hard New World: Our Post-American Future", the nation which had saved democracy, then created and policed a post-war rules-based international order, has gone and is not coming back. Now, an avowed America First isolationist scoffs at such an order (globally and domestically) and ridicules the haughty ethics that had underpinned it. Even last week, Trump arrived at the G7 only to complain that Vladimir Putin should be there too. To bend McEwan's balloon dilemma further, Australia might ask itself a further question: are we the poor sods clinging white-knuckled to guy ropes? Or are we perhaps the panicked child cowering in the basket, too frightened to determine our own survival as a sovereign nation? Few stories start in a more compelling way than Ian McEwan's brilliant novel Enduring Love (1997). Several men, strangers to each other, rush across an English field converging on a stricken helium balloon as they try frantically to hold it grounded long enough to free a child cowering in its basket. As the ungainly apparatus is gusted violently aloft during a wind squall, the men suddenly find themselves "treading air", each facing a terrible choice - whether to hang on in the hope their collective weight will bring it down again or let go before rising too high to survive the fall. It might seem rich to describe Australia's umbilical attachment to the United States as an enduring love, but that unanswerable question in the untethered balloon scene feels disturbingly apt. As does the book's title. The bilateral relationship has survived long enough to natural, even definitional. With that "enduring", though, has come less admirable attributes like unbalanced, fawning, and captive. Hence the reckless conservative boast that Australians have fought alongside Americans in every war they've undertaken since 1900. This includes moral, legal, and strategic outrages like Vietnam, Iraq and Afghanistan. Like McEwan's disparate characters twisting precariously on guy ropes and slaves to untameable forces of physics, the existential question of whether to cling on or let go, is fast becoming existential. Not that the cheerleaders of the AUKUS caucus are awake to it. While the US talks openly of rehabilitating Russia, invading Greenland and seizing the Panama Canal, they mouth terms like strategic alignment, shared values, cooperation and interoperability. In so many ways, McEwan's exquisitely described dilemma seems like a fitting metaphor for this instant. A temporally reflexive metaphor that works, albeit in different ways, for Australia, for Iran, for Israel, and even for those democracies keeping schtum as another American president contemplates a Middle Eastern war. And as Israel reveals its bottomless reserves of military power and lawless vengeance. In short order, Iran must decide if it is to surrender its nuclear enrichment capacities - even for exclusively peaceful domestic purposes like medical isotopes - or face a US aerial bombardment of unimaginable ferocity. Israel must decide, in the same compressed timeframe, if it is to accommodate such assurances - should Donald Trump insist(?) - or fight on condemning Israelis to further carnage and the state itself to perennial insecurity in its region. It is a choice between an unlikely peace and the guarantee of endless war and an ever-enduring hate. The oafish Trump has no plan. He has bought himself a mere fortnight to decide between backing off or pursuing a path he expressly campaigned against. McEwan's well-meaning strangers who've sprinted towards the flailing balloon exhibit some characteristics of the international community. In the nine days since Israel's far-right Netanyahu government began bombing Iran's nuclear sites without warning, a kind of uncoordinated helplessness has taken hold. Those gathered in Canada for the G7 caved instantly to US and Israeli pressure, citing the Jewish state's limitless "right to defend itself". The group called Iran the "principal source of regional instability". While the criticism of Iran is justified, one might have expected the top liberal states to weigh more heavily the authoritative opinions of international legal scholars such as Professor Ben Saul, Challis chair of international law at the University of Sydney and UN Special Rapporteur on Human Rights and Counter Terrorism. Saul says Israel's claimed legal impunity simply does not apply here. "Israel claims that its attack is necessary to prevent Iran acquiring nuclear weapons and using them in the future. The problem is that under international law, a country may only defend itself from an actual or imminent armed attack by another country," wrote Saul in the Guardian. As the rules break down, such facts have become ethereal, prone to dissipating, like so much helium. READ MORE KENNY: It is worth remembering that the trend to American unreliability now so blatant, started more than two decades ago, when fragmentary intelligence was deliberately "sexed up" to look like solid intel ahead of the Iraq invasion. America's "forever wars" in Iraq and Afghanistan, with the attendant abuses of Abu Ghraib and the eventual surrender to the very Taliban it had expelled - signalled a loss of prestige internationally. But they also sparked a crisis at the moral and institutional core of America. The nativist, protectionist, anti-establishment Trump is its indignant progeny. A vulgar up-yours to the compromises of democracy and the checks on executive power by laws, courts, multilateral bodies and international norms. As Hugh White notes in his latest insightful Quarterly Essay, "Hard New World: Our Post-American Future", the nation which had saved democracy, then created and policed a post-war rules-based international order, has gone and is not coming back. Now, an avowed America First isolationist scoffs at such an order (globally and domestically) and ridicules the haughty ethics that had underpinned it. Even last week, Trump arrived at the G7 only to complain that Vladimir Putin should be there too. To bend McEwan's balloon dilemma further, Australia might ask itself a further question: are we the poor sods clinging white-knuckled to guy ropes? Or are we perhaps the panicked child cowering in the basket, too frightened to determine our own survival as a sovereign nation?
The Advertiser
an hour ago
- The Advertiser
Future focus as inflation blare dims but change needed
The man who writes the cheques for Australia's largest state budget can finally focus on the future. Inflation was "blaring" in NSW Treasurer Daniel Mookhey's ears when he was compiling his first two budgets after Labor returned to government in 2023 for the first time in 12 years. "But the challenge in front of the state and the nation is making sure that we are growing our economy fast enough to support a rise in living standards," he tells AAP as he prepares to hand down his third. Mr Mookhey says Tuesday's state budget is about the future of the state's essential services and economic growth. "There's a lot of opportunity and a lot of ambition in NSW and the changes we're making are designed to hold on to what we love ... but also ensure that our kids and our grandkids have the same level of opportunity that we had," he says. While receding inflation and distance from the COVID-19 pandemic's associated spending have allowed the treasurer to cast an eye to the future, issues from the past remain. Framed in Mr Mookhey's parliament office is a newspaper headline relating to the underpayments scandal in the state's workers' compensation scheme he played a role in exposing in opposition. The page is yellowing with age as Mr Mookhey pushes to reform a scheme he is now in charge of, and which he argues is becoming unsustainable due to the rising cost and prevalence of psychological injuries. "It's been a hard case to argue," he says. "This system is failing everybody. It's a system that is fundamentally broken." Changes are simmering on the back burner after a parliamentary inquiry prevented action before the budget. Mr Mookhey hopes reform can create a "prevention culture" that limits psychological injuries from occurring. Outside of the workplace, he has promised some reassurance to people dealing with mental health issues and their loved ones. "They will see more investment in mental health resources in our health system and they will see more investment when it comes to our social interventions," he says. However, public psychiatrists at the pointy end of mental health crises should not expect the budget to deliver a pay rise at the level they have been calling for amid resignations in protest and arbitration in the state's Industrial Relations Commission. The federal distribution of GST to the states also continues to frustrate Mr Mookhey after dashing his hopes of a surplus in 2024. NSW now receives its lowest share of GST since it was introduced - about 85 cents for every dollar raised. "What frustrates me is not so much that we support the other states, it's just the missed opportunities," he says. The distribution needs to change but the tax's bigger proportional hit on the spending power of lower-income Australians means Mr Mookhey does not support raising the rate. "We can do better," he says. "What we need to focus on is just making sure the system is simple, the distribution is fair, the distribution is predictable, but also the distribution is understandable." Another federal issue with implications for state budgets is the rise of the black market for illicit tobacco fuelled by rising excise on dinky-di durries. The market shift is robbing the Commonwealth of expected revenue and creating criminal complications for states. It has already led to increased funding for enforcement within the health budget, but Premier Chris Minns indicated earlier in June a decision would have to be made about the resources devoted to combating illicit tobacco sales. While smoke clouds what the budget might do to address the issue, Mr Mookhey notes it is a source of public anxiety. "It's right and fair that we respond to community concerns about it ... we're going to have to work through what is the right solution." The tax issues are part of what economic researchers at the e61 Institute call a "vertical fiscal imbalance" that characterises the nation. "The states carry many of the spending responsibilities but lack equivalent revenue-raising capacity," chief executive Michael Brennan says, warning state finances are drifting onto an unsustainable path. But NSW will at least bank a cash surplus in Tuesday's budget for the first time since 2021. "Which means we're no longer borrowing money to pay our day-to-day bills as a government," Mr Mookhey says. "That gives us a platform for further progress." Australian Public Policy Institute chief executive Libby Hackett expects the budget will be a step forward, building on previous years. "This will be a structural reform budget: supporting better service delivery, infrastructure alignment and long-term productivity, even in a tight fiscal environment," Professor Hackett tells AAP. "Moreover, this budget presents a real opportunity to advance whole-of-government objectives in cross-cutting areas." Opposition Leader Mark Speakman sees it differently, warning the state is heading for "yet another low-vision, low-value, low-energy budget". "We have had not one visionary pre-budget announcement." The man who writes the cheques for Australia's largest state budget can finally focus on the future. Inflation was "blaring" in NSW Treasurer Daniel Mookhey's ears when he was compiling his first two budgets after Labor returned to government in 2023 for the first time in 12 years. "But the challenge in front of the state and the nation is making sure that we are growing our economy fast enough to support a rise in living standards," he tells AAP as he prepares to hand down his third. Mr Mookhey says Tuesday's state budget is about the future of the state's essential services and economic growth. "There's a lot of opportunity and a lot of ambition in NSW and the changes we're making are designed to hold on to what we love ... but also ensure that our kids and our grandkids have the same level of opportunity that we had," he says. While receding inflation and distance from the COVID-19 pandemic's associated spending have allowed the treasurer to cast an eye to the future, issues from the past remain. Framed in Mr Mookhey's parliament office is a newspaper headline relating to the underpayments scandal in the state's workers' compensation scheme he played a role in exposing in opposition. The page is yellowing with age as Mr Mookhey pushes to reform a scheme he is now in charge of, and which he argues is becoming unsustainable due to the rising cost and prevalence of psychological injuries. "It's been a hard case to argue," he says. "This system is failing everybody. It's a system that is fundamentally broken." Changes are simmering on the back burner after a parliamentary inquiry prevented action before the budget. Mr Mookhey hopes reform can create a "prevention culture" that limits psychological injuries from occurring. Outside of the workplace, he has promised some reassurance to people dealing with mental health issues and their loved ones. "They will see more investment in mental health resources in our health system and they will see more investment when it comes to our social interventions," he says. However, public psychiatrists at the pointy end of mental health crises should not expect the budget to deliver a pay rise at the level they have been calling for amid resignations in protest and arbitration in the state's Industrial Relations Commission. The federal distribution of GST to the states also continues to frustrate Mr Mookhey after dashing his hopes of a surplus in 2024. NSW now receives its lowest share of GST since it was introduced - about 85 cents for every dollar raised. "What frustrates me is not so much that we support the other states, it's just the missed opportunities," he says. The distribution needs to change but the tax's bigger proportional hit on the spending power of lower-income Australians means Mr Mookhey does not support raising the rate. "We can do better," he says. "What we need to focus on is just making sure the system is simple, the distribution is fair, the distribution is predictable, but also the distribution is understandable." Another federal issue with implications for state budgets is the rise of the black market for illicit tobacco fuelled by rising excise on dinky-di durries. The market shift is robbing the Commonwealth of expected revenue and creating criminal complications for states. It has already led to increased funding for enforcement within the health budget, but Premier Chris Minns indicated earlier in June a decision would have to be made about the resources devoted to combating illicit tobacco sales. While smoke clouds what the budget might do to address the issue, Mr Mookhey notes it is a source of public anxiety. "It's right and fair that we respond to community concerns about it ... we're going to have to work through what is the right solution." The tax issues are part of what economic researchers at the e61 Institute call a "vertical fiscal imbalance" that characterises the nation. "The states carry many of the spending responsibilities but lack equivalent revenue-raising capacity," chief executive Michael Brennan says, warning state finances are drifting onto an unsustainable path. But NSW will at least bank a cash surplus in Tuesday's budget for the first time since 2021. "Which means we're no longer borrowing money to pay our day-to-day bills as a government," Mr Mookhey says. "That gives us a platform for further progress." Australian Public Policy Institute chief executive Libby Hackett expects the budget will be a step forward, building on previous years. "This will be a structural reform budget: supporting better service delivery, infrastructure alignment and long-term productivity, even in a tight fiscal environment," Professor Hackett tells AAP. "Moreover, this budget presents a real opportunity to advance whole-of-government objectives in cross-cutting areas." Opposition Leader Mark Speakman sees it differently, warning the state is heading for "yet another low-vision, low-value, low-energy budget". "We have had not one visionary pre-budget announcement." The man who writes the cheques for Australia's largest state budget can finally focus on the future. Inflation was "blaring" in NSW Treasurer Daniel Mookhey's ears when he was compiling his first two budgets after Labor returned to government in 2023 for the first time in 12 years. "But the challenge in front of the state and the nation is making sure that we are growing our economy fast enough to support a rise in living standards," he tells AAP as he prepares to hand down his third. Mr Mookhey says Tuesday's state budget is about the future of the state's essential services and economic growth. "There's a lot of opportunity and a lot of ambition in NSW and the changes we're making are designed to hold on to what we love ... but also ensure that our kids and our grandkids have the same level of opportunity that we had," he says. While receding inflation and distance from the COVID-19 pandemic's associated spending have allowed the treasurer to cast an eye to the future, issues from the past remain. Framed in Mr Mookhey's parliament office is a newspaper headline relating to the underpayments scandal in the state's workers' compensation scheme he played a role in exposing in opposition. The page is yellowing with age as Mr Mookhey pushes to reform a scheme he is now in charge of, and which he argues is becoming unsustainable due to the rising cost and prevalence of psychological injuries. "It's been a hard case to argue," he says. "This system is failing everybody. It's a system that is fundamentally broken." Changes are simmering on the back burner after a parliamentary inquiry prevented action before the budget. Mr Mookhey hopes reform can create a "prevention culture" that limits psychological injuries from occurring. Outside of the workplace, he has promised some reassurance to people dealing with mental health issues and their loved ones. "They will see more investment in mental health resources in our health system and they will see more investment when it comes to our social interventions," he says. However, public psychiatrists at the pointy end of mental health crises should not expect the budget to deliver a pay rise at the level they have been calling for amid resignations in protest and arbitration in the state's Industrial Relations Commission. The federal distribution of GST to the states also continues to frustrate Mr Mookhey after dashing his hopes of a surplus in 2024. NSW now receives its lowest share of GST since it was introduced - about 85 cents for every dollar raised. "What frustrates me is not so much that we support the other states, it's just the missed opportunities," he says. The distribution needs to change but the tax's bigger proportional hit on the spending power of lower-income Australians means Mr Mookhey does not support raising the rate. "We can do better," he says. "What we need to focus on is just making sure the system is simple, the distribution is fair, the distribution is predictable, but also the distribution is understandable." Another federal issue with implications for state budgets is the rise of the black market for illicit tobacco fuelled by rising excise on dinky-di durries. The market shift is robbing the Commonwealth of expected revenue and creating criminal complications for states. It has already led to increased funding for enforcement within the health budget, but Premier Chris Minns indicated earlier in June a decision would have to be made about the resources devoted to combating illicit tobacco sales. While smoke clouds what the budget might do to address the issue, Mr Mookhey notes it is a source of public anxiety. "It's right and fair that we respond to community concerns about it ... we're going to have to work through what is the right solution." The tax issues are part of what economic researchers at the e61 Institute call a "vertical fiscal imbalance" that characterises the nation. "The states carry many of the spending responsibilities but lack equivalent revenue-raising capacity," chief executive Michael Brennan says, warning state finances are drifting onto an unsustainable path. But NSW will at least bank a cash surplus in Tuesday's budget for the first time since 2021. "Which means we're no longer borrowing money to pay our day-to-day bills as a government," Mr Mookhey says. "That gives us a platform for further progress." Australian Public Policy Institute chief executive Libby Hackett expects the budget will be a step forward, building on previous years. "This will be a structural reform budget: supporting better service delivery, infrastructure alignment and long-term productivity, even in a tight fiscal environment," Professor Hackett tells AAP. "Moreover, this budget presents a real opportunity to advance whole-of-government objectives in cross-cutting areas." Opposition Leader Mark Speakman sees it differently, warning the state is heading for "yet another low-vision, low-value, low-energy budget". "We have had not one visionary pre-budget announcement." The man who writes the cheques for Australia's largest state budget can finally focus on the future. Inflation was "blaring" in NSW Treasurer Daniel Mookhey's ears when he was compiling his first two budgets after Labor returned to government in 2023 for the first time in 12 years. "But the challenge in front of the state and the nation is making sure that we are growing our economy fast enough to support a rise in living standards," he tells AAP as he prepares to hand down his third. Mr Mookhey says Tuesday's state budget is about the future of the state's essential services and economic growth. "There's a lot of opportunity and a lot of ambition in NSW and the changes we're making are designed to hold on to what we love ... but also ensure that our kids and our grandkids have the same level of opportunity that we had," he says. While receding inflation and distance from the COVID-19 pandemic's associated spending have allowed the treasurer to cast an eye to the future, issues from the past remain. Framed in Mr Mookhey's parliament office is a newspaper headline relating to the underpayments scandal in the state's workers' compensation scheme he played a role in exposing in opposition. The page is yellowing with age as Mr Mookhey pushes to reform a scheme he is now in charge of, and which he argues is becoming unsustainable due to the rising cost and prevalence of psychological injuries. "It's been a hard case to argue," he says. "This system is failing everybody. It's a system that is fundamentally broken." Changes are simmering on the back burner after a parliamentary inquiry prevented action before the budget. Mr Mookhey hopes reform can create a "prevention culture" that limits psychological injuries from occurring. Outside of the workplace, he has promised some reassurance to people dealing with mental health issues and their loved ones. "They will see more investment in mental health resources in our health system and they will see more investment when it comes to our social interventions," he says. However, public psychiatrists at the pointy end of mental health crises should not expect the budget to deliver a pay rise at the level they have been calling for amid resignations in protest and arbitration in the state's Industrial Relations Commission. The federal distribution of GST to the states also continues to frustrate Mr Mookhey after dashing his hopes of a surplus in 2024. NSW now receives its lowest share of GST since it was introduced - about 85 cents for every dollar raised. "What frustrates me is not so much that we support the other states, it's just the missed opportunities," he says. The distribution needs to change but the tax's bigger proportional hit on the spending power of lower-income Australians means Mr Mookhey does not support raising the rate. "We can do better," he says. "What we need to focus on is just making sure the system is simple, the distribution is fair, the distribution is predictable, but also the distribution is understandable." Another federal issue with implications for state budgets is the rise of the black market for illicit tobacco fuelled by rising excise on dinky-di durries. The market shift is robbing the Commonwealth of expected revenue and creating criminal complications for states. It has already led to increased funding for enforcement within the health budget, but Premier Chris Minns indicated earlier in June a decision would have to be made about the resources devoted to combating illicit tobacco sales. While smoke clouds what the budget might do to address the issue, Mr Mookhey notes it is a source of public anxiety. "It's right and fair that we respond to community concerns about it ... we're going to have to work through what is the right solution." The tax issues are part of what economic researchers at the e61 Institute call a "vertical fiscal imbalance" that characterises the nation. "The states carry many of the spending responsibilities but lack equivalent revenue-raising capacity," chief executive Michael Brennan says, warning state finances are drifting onto an unsustainable path. But NSW will at least bank a cash surplus in Tuesday's budget for the first time since 2021. "Which means we're no longer borrowing money to pay our day-to-day bills as a government," Mr Mookhey says. "That gives us a platform for further progress." Australian Public Policy Institute chief executive Libby Hackett expects the budget will be a step forward, building on previous years. "This will be a structural reform budget: supporting better service delivery, infrastructure alignment and long-term productivity, even in a tight fiscal environment," Professor Hackett tells AAP. "Moreover, this budget presents a real opportunity to advance whole-of-government objectives in cross-cutting areas." Opposition Leader Mark Speakman sees it differently, warning the state is heading for "yet another low-vision, low-value, low-energy budget". "We have had not one visionary pre-budget announcement."
AU Financial Review
an hour ago
- AU Financial Review
Labor must seal the cracks in Australia's carbon credits market
After Labor's resounding election victory, it is now likely that Australia and Pacific countries will co-host next year's global climate summit, bringing renewed focus on the Albanese government's performance in this area. With Australia's emissions continuing to rise and growing concerns in the business community about ESG risks relating to the offsets market, Labor should bring forward the review of its signature emissions pricing policy to this year.
