A report from the Auditor-General summarising the results of his Office’s financial audits for all Government entities has found that the impact of the coronavirus pandemic resonated through the State’s finances.
In his report, Auditor-General Brendan Worrall said the State recorded its first deficit in seven years and had to borrow $4.5 billion more than originally budgeted.
“While the Government’s ongoing response to the pandemic will continue to place pressure on Queensland’s financial performance and position in the coming years, it is also aimed at supporting economic recovery over the longer term,” Mr Worrall said.
“The Government will rely more on borrowings over the next four years with these forecast to reach $121 billion by 2023–2024,” he said.
“This will require the Government to manage its expenditure and ensure debt levels are sustainable.”
Mr Worrall said the substantial downturn in economic activity caused by the pandemic significantly reduced total goods and services tax (GST) collections by the Federal Government, which reduced the amount of GST it paid to the States and Territories as GST grants.
“The Queensland Government received $1.6 billion (11 per cent) less GST funding this year,” the Auditor-General said.
“This decline is expected to continue in 2020–2021,” he said.
Mr Worrall said debt levels were expected to significantly increase over the next four years as the State continued with its COVID-19 economic recovery plan.
“Some of the additional borrowings will be required to fund the Government’s operating expenses in 2020–2021, for the first time in eight years,” he said.
Mr Worrall made two recommendations, including the introduction of a statutory time frame for the consolidated whole-of-Government financial statements, with statements to be certified prior to 31 October to allow for tabling before the State election, and a statutory requirement for annual financial statements to be prepared for funds established under the Queensland Future Fund Act 2020.
The Auditor-General’s 27-page report can be accessed at this PS News link.
