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Canberra braces for tough times

The ACT government is braced for a ''tough couple of years'' but believes it can ease some of the pain caused by the new Abbott government.

The territory's Treasurer, Andrew Barr, said ACT taxes and land-release programs would be reviewed and possibly adjusted in the wake of the election, depending on how many jobs the city lost.

''As I said on budget day, we can't save Canberra from an Abbott government, but we certainly can make a difference and we intend to,'' he said on Sunday.

The Coalition pledged to shed 12,000 federal public service jobs across the country, and to impose a tougher austerity regime on the bureaucracy than Labor had promised, which will lead to even greater staff reductions.

The extent to which the ACT will cop the brunt of these cuts remains unknown.

Mr Barr said Canberrans would need to wait and see whether federal Liberal leader Tony Abbott was able to stick to his stated agenda.


''It's going to be a tough couple of years for us. But the incoming government will realise pretty quickly that it needs staff if it wants to actually implement its agenda.

''The question will be, will they go through this cycle of laying people off only to re-employ them shortly afterwards? Time will tell.

''The other issue for [the Coalition] will be the Senate, which looks an interesting beast.''

He said the ACT government would closely examine the outcomes of the promised commission of audit, which will advise Mr Abbott on how to reduce spending.

The territory government expects the oncoming job losses to reduce the size of the ACT economy by about $350 million to $650 million.

Mr Barr said he might be forced to adjust ACT taxes and the speed of its land releases in response to an economic downturn.

Will they go through this cycle of laying people off only to re-employ them shortly afterwards? Time will tell.

ACT Treasurer Andrew Barr

He would also try to take part in the federal government's promised white paper on tax reform, saying both the ACT and national economies needed to move away from inefficient, unpredictable taxes – such as stamp duties and other fees – to broader, sustainable revenue sources.

The ACT government would also examine how to cut red tape to attract new businesses and investment, including from overseas.

Mr Barr said the territory's large building projects – such as the City to the Lake development, the Capital Metro light-rail network and the new public hospital at the University of Canberra – would now become ''all the more important over the coming three years''.


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