The ACT is one of only two jurisdictions with a triple-A stable rating from Standard and Poor's (the other is Victoria). Treasurer Andrew Barr’s plan for ambitious borrowing led to expectations of a negative outlook or downgrade, but Standard and Poor's has said that the top rating looks safe for now.

“We’re not seeing any impact from the budget on the triple-A stable outlook,” credit analyst Anna Hughes said. “Certainly with the preliminary analysis we’ve done, it looks like everything is in the current metrics of the triple A.”

The agency had already factored in a more pessimistic budget outcome than the government, anticipating slower land sales, less GST and lower Commonwealth revenues, so when things deteriorated there was “wriggle room”, she said.

Analyst Anthony Walker said initial analysis showed a definite weakening in the economy, led by the federal government funding cuts. The ACT was expecting a slowdown in revenue from payroll tax, land sales and other areas and had been forced to cut its planned program of land release by 1200 sites a year, from 4500 to 3300.

Mr Walker said the ACT’s response, to maintain spending and bring forward and boost capital spending, looked appropriate. “Obviously you don’t want to see the ACT government cut their budget at the same time as the federal government,” he said.

Borrowing looked to be about 90 per cent of revenue in 2015-16, higher than last year, but not high enough to warrant ratings action. The debt ratio was one of only eight factors in a credit rating, with the agency also looking at financial management, liquidity, the economy and other factors.

ANZ senior economist Cherelle Murphy had expected a negative outlook on the triple-A rating, mainly because of the increased borrowing. The budget showed slower growth in revenue, higher capital spending and increased indebtedness, she said.

She noted that net debt was forecast at $3.5 billion in 2017-18, just over 8 per cent of ACT gross state product, a ratio in line with other triple-A rated states. But she expected the rising gross debt to put the credit rating at risk. The ACT was expected to go to the market to raise another $1.4 billion over the next four years, she said.

The money is for planned spending of $2.5 billion on new infrastructure over four years, but the budget papers don’t detail how $1.3 billion of that will be used, simply saying the amount is for “high value projects for which budgets are either yet to be settled or which are commercially sensitive”, including the new public hospital at the University of Canberra, the new courts buildings and the Gungahlin tram.

Last year's budget made much of maintaining the triple-A stable credit rating, listing it as a key aim. This year’s budget barely mentions it, saying only that the government “will strive to maintain a triple-A credit rating in the long term”.

Mr Barr said he had taken advice before the budget from bankers and ratings agencies on how much room there was for borrowing in the budget, and he would talk in more detail with Standard and Poor's when he returned from meetings with investors and lenders in Singapore and Hong Kong this month. But he welcomed the positive early reaction, saying it reinforced the strong underlying financial position of the territory.

“We went into the process with a low level of debt to begin with. We’re running strong operating cash surpluses throughout the period, and we obviously have a series of asset sales as well, which can assist with ensuring that the debt burden is prudent and manageable.”

He also pointed to Standard and Poor's support for the ACT’s tax changes, which have at their heart a shift from stamp duty to rates.

“The ratings agencies have got confidence in the fact that we have continued to pursue tax reform, that we took it to an election, and that we continue to make what are the right economic decisions but are challenging political decisions in relation to that tax reform mix,” he said.

Mr Barr said the triple-A credit rating was “amongst the list of things that we have to manage” but did not rank above everything else. More important were economic growth and confidence.