APART from the previously announced national broadband roll-out, Tasmania has missed out on major infrastructure spending announced in the Federal Budget

Tasmania’s peak employer body, the Tasmanian Chamber of Commerce and Industry (TCCI), says it is a major disappointment that the State had not received any new infrastructure funding in this year’s Budget.

TCCI chief economist Richard Dowling said that a lack of infrastructure spending combined with a $1 billion drop in the State’s GST receipts represented a double whammy for Tasmania.

“The thing that Tasmania needed most was infrastructure investment and this Budget did not deliver,” Mr Dowling said.

“Out of the so-called third stimulus of $22 billion, Tasmania received about $50 million, which is a pathetic outcome.

“We must take this a warning and sharpen up our submissions to Infrastructure Australia.  At the moment it would appear Tasmanian infrastructure is viewed as insignificant.

“This is a major blow and one that Tasmania must act quickly to restore.

“It is unbelievable that of all the States, Tasmania’s ailing rail system had not received any substantial funding.”

Mr Dowling said that the almost $1 billion write down in GST receipts over the next four years would create further problems for the State Budget.

“The State Government must do it all can to quickly return our Budget to surplus and avoid going into debt.

“Tasmania has a relatively competitive budget position amongst the States. We need to maintain strong fiscal discipline to avoid the risk of a downgrade of our credit rating.

“The State Government needs a credible plan to return to budget sustainability before the economic recovery can begin.”

Mr Dowling said the Federal Budget was aimed at the current tougher times, but the mix of big spending and moderate saving was a risky high-wire act, albeit a calculated one.

“If the recovery comes soon the budget strategy might just work. But it’s a big drop and hard landing from a $57.6 billion deficit if the recession is long and deep”.

“More should have been done to take pressure off the cost of doing business at a time when the private sector is doing it very tough. That will delay the recovery.

“On tax, the failure to set out a plan for restructuring Commonwealth-State financial arrangements so that taxes on jobs like payroll tax is a lost opportunity.”

Mr Dowling said the Budget was not all bad news and small business in Tasmania with a turnover of less than $2 million, would welcome the extension of the investment allowance to 50 percent until December 2009.

“Extending and boosting the investment allowance for small business will help encourage spending on capital equipment.

“It a welcome initiative and one that the TCCI specifically lobbied for in the lead up to the Federal Budget,” Mr Dowling said.

But he warned that the Federal Budget would get nastier in years to come if the surplus budget target was to be achieved by 2015-16.