SA budget tracks path to surplus

South Australian Treasurer Rob Lucas has handed down the state's latest financial blueprint.
South Australian Treasurer Rob Lucas has handed down the state's latest financial blueprint.

South Australia's finances will recover from its COVID-19 mugging and return to surplus quicker than expected despite the state government unveiling a big-spending budget for the next 12 months.

Handing down his eighth and final budget before retirement, Treasurer Rob Lucas said South Australia had been able to weather the impacts of the pandemic and get the economy flowing much quicker than many other jurisdictions.

He's denied that the forecast spending in 2021/22, which will push total state debt to more than $33 billion over the next four years, is simply designed to woo voters ahead of the March state election.

Economic stimulus provided over the past two budgets was designed to combat the impacts of COVID-19 after which the government "had to return to spending no more than we earn", the treasurer said.

"This is not a pre-election spending splurge," he said.

"It's a responsible budget in terms of managing the impacts of COVID, setting us up for recovery and making important strategic decisions in priority areas."

The budget forecasts a deficit of $1.39 billion for the next financial year before a return to a modest surplus of $48 million in 2022/23, a year earlier than previously projected.

The surplus is then expected to grow to $498 million the following year.

The SA economy is tipped to grow by 3.5 per cent in 2021/22 and then by 2.25 per cent each year across the forward estimates.

Mr Lucas has confirmed a $17.9 billion infrastructure program across the next four years including more than $800 million for road projects and cash to start planning for a new sports stadium in Adelaide.

The budget focusses heavily on health, with $163.5 million for increases to mental health facilities and services, more money to increase capacity in hospital emergency departments and funds to help ease ambulance ramping.

It also confirms the proposed new Women's and Children's Hospital will cost $1.95 billion with the first patients expected to be admitted in 2027.

Education is similarly a winner with cash for a new high school in Adelaide's eastern suburbs and $50 million for an early learning strategy to increase early intervention and child development health checks.

Increases in fines and charges have been generally limited to 1.9 per cent while total public sector job numbers will remain steady across the forward estimates at about 86,000.

Mr Lucas said when he returned to the treasurer's office after the 2018 election, he could never have contemplated the current state of SA's finances and the need for the big-spending and stimulus measures over the past two years amid the global pandemic.

"But, what I am pleased about is that we have held the line, even through COVID, that the only way of growing our economy and growing jobs in our state was to make the cost of doing business, nationally and internationally, competitive," he said.

"I'm proud to be part of a government, which four years later, has delivered that."

Australian Associated Press