Grievance Debate

Auditor-General's Report

Mr TELFER (Flinders) (15:08): Yesterday a very interesting document was tabled in parliament looking at the Auditor-General's Report, No. 9 of 2025, State Finances—Insights on the 2025-26 Budget. It is not as big a document as some of the ones that get tabled here in this place but it is one that is full of content that South Australians would rightly be really concerned about.

I want to highlight a few of these aspects just to shine a light on the fact that the Auditor-General has laid bare some of those financial concerns that Labor are blindly taking our state into. To start, looking at net debt in particular, the Auditor-General talks about net debt and makes the comment that it continues to rise and is forecast to reach $48.5 billion by 2029—$48.5 billion. That number is eye-watering. That number is one which South Australians struggle to comprehend. That number is exponentially worse than any level of debt that South Australia has ever been in, even when taking into consideration the equivalent dollars that we are facing.

Some of the commentary that the Auditor-General has put in the report should make South Australians stand up and take notice. Net debt is projected to rise to 26 per cent of gross state product by 2029. The Auditor-General talks about net debt as a proportion of GSP being a common measure used by state governments to assess financial sustainability. It gives the advice that the commonwealth Parliamentary Budget Office considers a sustainable fiscal position to be one where net debt as a proportion of GSP is expected to be stable or to trend down over the long term. If you look at the graph that is within this report, South Australia sadly is in a higher trajectory when it comes to net debt to GSP. Things are only getting worse under this Labor government, and some of the commentary that has been provided by the Auditor-General is truly concerning.

Net debt in itself is not a bad thing, but when it is growing at a faster rate than revenue it should be ringing alarm bells for the Treasurer and for the Premier, because this is the situation that Labor is putting us in. If net debt is rising quicker than the revenue, we are only getting ourselves further and further into debt.

As I said, debt in itself is not a bad thing if it is used wisely, but some of the commentary that the Auditor-General makes is also about the restriction that it puts on the opportunities for future growth for our state. Not just the debt burden but the interest burden that is being faced by South Australia because of this debt is truly astronomical. The rising interest expense may constrain the state's fiscal capacity. Basically, the amount that we are paying in interest is going to significantly limit the amount of money that governments in the future are going to be able to put as investments into the community to pay for the things that are really important.

Interest expense as a total proportion of total revenue is expected to reach 8.3 per cent in 2028-29. Once again, it is a number that some people struggle to get their head around. It is up from 5.4 per cent in 2024-25, and it is going to be payments, repayments and interest payments of nearly $7 million a day—$7 million a day, each and every day, 365 days a year, and that number is only growing. Imagine what could be paid for with an extra $7 million. This is debt burden that state Labor is putting us under without any sort of management plan in place.

When the Premier was opposition leader he crowed about the importance of debt management. He called on the previous government to have a debt management plan in place. He said that that is exactly what they would do in government. Well, we are still waiting. We are nearly four years in and there is no plan to manage the debt that Labor is taking us down. Do not forget that that debt number is exponentially higher than under the previous government—record levels of debt, nearly $48.5 billion. What does Labor do about it? Just hope that it all goes away.

Some of the commentary from the Auditor-General about this is particularly worrying. It is not just about debt, it is also about budget management. The Auditor-General, in making commentary around the importance of budget management, states that robust performance monitoring is required for existing budget programs to inform decision-making. What does that mean? It means that ministers and departments should be conscientious in the way that they spend taxpayers' money. They should be managing their budget in a responsible way.