Thursday, 20 December 2012 09:24
Queensland's bottom line will continue to take a "substantial" hit from falling coal prices and exports, Treasurer Tim Nicholls has warned.
Mr Nicholls, who will deliver his mid-year economic update on Thursday, says ongoing economic woes in Europe and the US are flowing through to Queensland.
He said coal prices and exports will remain down, but points to a recovery in demand out of Asia from 2014/15.
"We anticipate that the state will have to take a fairly substantial hit in terms of its coal revenue," Mr Nicholls told ABC radio.
He said the government's tough cost-cutting program meant Queensland was still on track for a surplus by 2014/15, and would save the state almost half-a-billion dollars in interest payments over the next three years.
But he said it would take another term in office to reclaim Queensland's AAA credit rating.
The treasurer said the government had stopped the state from hurtling towards a potential debt of $100 billion, and that figure would be stabilised at just under $82 billion.
The Mid-Year Fiscal and Economic Review is also expected to outline how the federal government's funding cuts to health and education in the state have affected the bottom line.
"(Federal Treasurer Wayne Swan's) home state will bear 32 per cent of the overall reduction in commonwealth payments to state governments, which is well above a per capita calculation," Mr Nicholls said.
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