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Welfare warning on SA budget spending

Tim DorninAAP
SA Treasurer Rob Lucas says the budget follows the Reserve Bank's call to save jobs and businesses.
Camera IconSA Treasurer Rob Lucas says the budget follows the Reserve Bank's call to save jobs and businesses.

The South Australian government has spent up big in the state budget but the welfare sector says those most impacted by the COVID-19 pandemic could have been better targeted.

The government has allocated $4 billion to help protect businesses and jobs in the wake of the coronavirus.

It will also pour money into road and other infrastructure and into health, education and sporting facilities.

But the South Australian Council of Social Service says this may not help those most impacted by COVID-19 job losses - women, the young, migrants, refugees and older workers.

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"Despite these useful infrastructure investments, there is no clear employment strategy that focuses on the groups most impacted by the COVID-19 crisis," council chief executive Ross Womersley said.

"We are worried that the government has overlooked these people, including ways to reconnect them to the workforce during our economic recovery."

The big spending and the loss of GST revenue in the budget will push the deficit for 2020/21 to $2.6 billion.

Total state debt will also balloon in the coming years to peak at $33 billion by 2023/24.

Treasurer Rob Lucas said the high spending budget came amid the Reserve Bank's call to save as many jobs and businesses as possible and not be concerned about debt and deficits.

"That's an unusual message to have heard, but it is what it is. That's the reality," the treasurer said.

"If we are going to respond to a global pandemic and its economic implications, that is what we're going to have to do."

But the state opposition said the government's own forecast was for zero employment growth this financial year, something it blamed on delays on key projects.

"This budget exposes the fact (Premier) Steven Marshall has wasted this term of parliament with delays and indecisiveness on major infrastructure projects and it means South Australia has missed out on jobs," treasury spokesman Stephen Mullighan said.

Surprisingly, the government has charted a path to return the budget to surplus within the forward estimates, with Mr Lucas warning that higher levels of government spending were not sustainable over the longer term.

Although he admitted all its projections, like those at a national level, were based on the rollout of a population-wide COVID-19 vaccine by the end of 2021.

Its forecasts suggest deficits of $1.42 billion in 2021/22 and $435 million in 2022/23 before returning to a $406 million surplus the following year.

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