CREDIT RATING

The Hon. I.F. EVANS (Davenport) (14:46): My question is to the Treasurer. As the loss of the AAA credit rating cost the Queensland government $200 million a year, and is estimated to cost the New South Wales government $375 million a year, why should the public believe the loss of the South Australian AAA credit rating will cost South Australia only $2 million to $4 million a year, as the Treasurer has previously stated? Is that the estimated extra cost of the loss of the AAA credit rating on the budgeted debt of $13 billion?

The Hon. J.J. SNELLING (Playford—Treasurer, Minister for Workers Rehabilitation, Minister for Defence Industries, Minister for Veterans' Affairs) (14:46): The yield on our bonds, when they are traded on the market, is about the same as Tasmania, which is a AA+ rated state and has been for quite an amount of time, so there is every reason to believe that there would be a negligible impact on the interest we need to pay on our debt, given that we are also rated AA+. The fact is that the markets had already in fact factored in—

Members interjecting:

The SPEAKER: Order!

The Hon. J.J. SNELLING: —a likely downgrade—

Members interjecting:

The SPEAKER: Order!

Mr Marshall interjecting:

The SPEAKER: Order! Member for Norwood, leave the chamber for the rest of question time.

The honourable member for Norwood having withdrawn from the chamber:

The Hon. J.J. SNELLING: The markets had already factored in a likely downgrade to AA+ in our credit rating and had priced our bonds accordingly.

Mr Gardner interjecting:

The SPEAKER: The member for Morialta will also leave the chamber for the rest of question time.

The honourable member for Morialta having withdrawn from the chamber:

The Hon. J.J. SNELLING: We have recently gone to market and reissued debt; we were oversubscribed for that issue. Earlier in the year, I did a road trip with SAFA to meet with the various institutions which buy our paper throughout Asia and spoke to them about our budget situation; if necessary, I will do so again. I am confident that any impact from the downgrade by Standard & Poor's to AA+ will be negligible.

We have to remember that the United States of America, the largest economy in the world, is rated by Standard & Poor's at AA+ and it has, I think, among the lowest bond yields in the world as well. The credit ratings are not the be-all and end-all to how much you pay in interest.