Chief Minister Andrew Barr at a light rail announcement earlier in the year with Federal Infrastructure Minister Catherine King and local members Alicia Payne and David Smith, who is facing a challenge from community independent Jessie Price. Photo: Ian Bushnell.
A Coalition victory at the federal election due in May would take the wind out of the ACT’s economic sails and delay important infrastructure projects, Chief Minister Andrew Barr has warned.
Although the ACT is considered safe Labor territory, Mr Barr’s comments in a State of the Territory speech delivered to economic think tank CEDA at the Rex Hotel today (13 March) could be directed at Canberrans flirting with independents in a tight election where every seat may count.
The Chief Minister painted a picture of a healthy economy with strong growth and record levels of employment, low unemployment, high participation rates and solid growth in real wages.
Mr Barr said gross state product grew at 4.0 per cent for 2023-24, above its long-run average of 3.75 per cent, and state final demand at 3.6 per cent through the year to December quarter 2024, which was the highest among states and territories.
“This growth was driven by increases in public consumption and investment, household consumption, and improvements in net interstate trade,” he said.
“As a point of comparison, our gross state product grew the second fastest and significantly faster than an economy with a similar size to ours such as Tasmania’s, which saw growth of 1.4 per cent for 2023-24.”
Cost of living pressures had also eased a little more quickly than expected, with underlying inflation in the December quarter down to 3.2 per cent.
But Mr Barr said this rosy picture would become clouded with the election of a Dutton government.
He said the ACT economy’s strength was due in part to “helpful Commonwealth policy settings”.
“There is a risk that our economic development goals and timeframes will be set back by a change of government at the Federal Election,” Mr Barr said.
“Having a constructive partner in the Commonwealth means more can be delivered, more quickly.”
Mr Barr said that the rising costs of construction and labour shortages would impact the pace of delivery of the government’s $8 billion Infrastructure Plan, but a Dutton government would exacerbate the situation.
Only recently, the government announced that completion dates for the key Molonglo River Bridge and the new public school in Whitlam have had to be pushed back.
Mr Barr said the government aimed to maintain a “realistic” program of capital works over the coming decade.
However, a significant factor in when projects could be delivered was having a willing partner at the Commonwealth level.
“It’s certainly been a huge welcome to have a Prime Minister who is interested in the nation’s capital and who has committed funding to infrastructure projects in the Territory,” he said.
The government also has a goal of delivering 30,000 new homes by 2030, including more ‘missing middle’ properties and public and social housing.
Mr Barr said an example of the important role the Commonwealth was playing in building more housing was the recent announcement that 750 affordable homes would be supported through the first round of the Housing Australia Future Fund (HAFF).
He said that under current arrangements more social housing, including affordable rentals, would be built over the next four years through partnerships with the Commonwealth and the community housing sector.
Mr Barr also flagged new housing in the Tuggeranong Town Centre where he had been having talks with the owners of the South.Point shopping centre, and said the planned sporting, health and education precinct at Bruce had the potential for 1000 homes.
In the CBD, where light rail is being extended and new residential and office precincts are planned, 15,000 people are expected to make the city their home by 2031, and 45,000 will work there daily.
“Canberra’s CBD is undergoing the biggest transformation we have ever seen,” he said. “CBD GVA [gross value added] to the ACT economy has increased from $6.2 billion in 2019 to $7.4 billion in 2024,” he said.
But Mr Barr made it clear that much of the ACT’s progress would lose steam under a Dutton government, which is also threatening to take a knife to the public service, a traditional harbinger of leaner times for the Territory.
“The state of the Territory economy is strong, but the forthcoming Federal election result will determine whether that continues,” he said.
Mr Barr also announced the launch of a new venture capital fund to help diversify the ACT economy.
He said the fund would support start-ups, the innovation ecosystem, and the commercialisation of ideas generated by ACT-based tertiary education, research and business sectors.
