The debut budget for Tasmania's Liberal government has committed to more than $400 million worth of election promises while slashing public sector jobs to help balance the books.
Treasurer Peter Gutwein on Thursday handed down his first budget, including plans to cut 700 full-time public service positions.
Along with a 12-month pay freeze for public servants, the move will save more than $370 million over the next four years.
"Those savings (are) from the back line and what we're doing is we're strengthening the front line," Mr Gutwein told reporters, indicating the cuts will not reduce community services.
He insists there will be no forced redundancies and that individual departments will be responsible for deciding which positions will go, confident that the target will be reached within two years.
But while some jobs will be lost, others will be created, said the treasurer, outlining a $28 million package to generate up to 5000 positions over coming years.
"Our number one priority is jobs," he said.
Tasmania has the country's highest unemployment rate, forecast at 7.25 per cent for 2014/15, and the government wants to reel it in to at least the national average by 2017/18.
The budget received a frosty reception from Labor with shadow treasurer Scott Bacon chastising the government for its job cuts in favour of "extravagant" spending.
"Not only will all Tasmanian public servants be taking a pay cut, they'll all be looking over their shoulder to see when they're going to be tapped on the shoulder to pay for the Liberals' extravagant election promises," Mr Bacon said.
The true pain of the budget is buried deep and is yet to be realised, he added.
Tasmanian Greens leader Kim Booth said the budget does nothing to improve the state's financial bottom line and that spending could have been better directed.
As a part of its savings measures the government will axe, merge or cut funding to 34 advisory and administrative bodies.
As a result there will be a blowout in the number of job losses, Community and Public Service Sector Union secretary Tom Lynch forecasts.
But not all the feedback was negative.
The government got a pat on the back for its good "starter" budget from the Tasmanian Small Business Council, whose members will benefit from a range of expansion and support programs.
"They have learnt from the lessons of the federal government which went too hard too quickly," council spokesman Robert Mallett told reporters.
The government aims to bring the budget back to surplus in six years, which is beyond the four-year estimate outlined when it came to power in March.
Labor fears the delay puts at risk Tasmania's credit rating.
Ratings agency Moody's - which lists Tasmania at AA1-negative - said "some comfort" can be found in the move to lower wage growth as the state tries to keep down expenditure.
The budget also outlines record spending on education and health for 2014/15, equalling $1.4 billion each.
Police and emergency services spending also gets a boost.
THE 2014/15 TASMANIAN BUDGET AT A GLANCE
Revenue: $4.964 billion
Expenditure: $5.249 billion
Forecast deficit: $285 million
2013/14 underlying deficit: $354 million
Return to surplus: 2019/20
Net debt (June 30, 2014): $207.7 million
Unemployment: 7.25 per cent
Growth: 1.5 per cent
Share
