Queensland’s economy teeters on edge of ratings downgrade despite coal royalty windfall

Earnings from mining the fossil fuel set to increase to $6.9bn over financial year, up from $4.8bn, with budget deficit to reach $6.17bn

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Queensland’s treasurer says he’s “not giving up” on halting a ratings downgrade for the state’s finances after handing down a budget full of red ink, amid predictions state borrowing will top $200bn in three years.

David Janetzki promised a budget surplus in 2029-30, the year after the state’s next election – but only after years of billion-dollar deficits.

Government revenue will increase 5.1% over the forward estimates, driven by increases in government duties, payroll tax and royalties.

Spending will grow, rising from $100.8bn in 2025-26 to $111.6bn in 2029-30.

The government says it is committed to returning the budget to a “fiscally sustainable position through strong expenditure management”, with expense growth dropping from 4.9% in 2026-27 to an average of 2.6% over the four years to 2029-30.

Half a billion dollars will be saved through better coordinating procurement, reducing the cap on senior executive positions and reduced spending on contractors and consultants.

$119.2bn for new roads, bus projects and rail in the next four years, and other infrastructure.

The state’s 50 cent fare scheme will remain and be legislated.

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