Friends –
Here I am again: at McKell. Ready for the start of budget season. The time of the year we can all gorge ourselves in the finer points of state finance.
The McKell Institute is my agora praeferenda for marking the looming arrival of a state budget.
Because, like your namesake, this Institute is optimistic. It’s also realistic. Two traits that combine to make its counsel pragmatic. Which lights the way forward for progress. Resulting in leadership.
Your institute has superb leaders.
You know him as Chairman Dan Walton, I know him as Comrade Walton. Dan, and CEO Ed Cavanagh: thank you both for your active citizenship and your welcome here today.
Hello to McKell Institute leaders from further afield: Queensland Executive Director, Sarah Mawhinney, and Queensland Chair, Rachel Nolan. Thank you all for building this very fine organisation north of the border.
Ashley Tsacalos and the team here at Clayton Utz: thank you for playing host to us all today.
Of course – I acknowledge the Gadigal people upon whose land we gather today. I pay my respects to elders past, present and emerging.
And by the way –
I look forward to never having to bear witness to a federal election where gestures of respect like ‘acknowledging country’ are used to divide us – not unite us – ever again.
One more upside of the federal election result is the stability it has engendered.
The Albanese Government has been re-elected with a clear majority. Armed with a powerful mandate to carry forth with the task of national modernisation.
NSW Labor is eager to partner with Federal Labor. To jointly solve the nation’s challenges. Especially the challenge of boosting economic growth.
So one month out from the Minns Government’s third budget,
at a time when inflation is receding, but the threat of low-growth is increasing; amidst a punishing housing crisis; tremendous uncertainty in global trade; but with real wages growing, interest rates falling, and public finances beginning to stabilise: I have come here to tell you about the next steps we intend to take to boost economic growth.
To explain why we need to build, build, build.
How the task of lifting productivity means building more homes, more power, and more water.
Friends –
In preparing for the next budget, I have been meeting with those who are building NSW, and are building in NSW, every day.
The workers, manufacturers, investors, tech leaders, and innovators whose decisions help determine the pace of NSW’s economic growth.
I’ve asked them directly:
What is stopping you from scaling your business? What is stopping you from creating more jobs? Or paying higher wages?
Or spending more on R&D?
Above all –
What stops you from investing more in NSW?
Especially given that every serious economist agrees: more private sector investment will unlock the next great era of Australian economic growth.
Here is what they say:
Everything about NSW is awesome! Except the time it takes to get major projects done.
Getting major projects – the projects that drive productivity – getting them done in NSW is taking too long.
Why?
Construction costs are rising, planning delays are slowing delivery, and the construction workers we need to literally build our brighter future are increasingly scarce.
Which means…The time to build is now the biggest deterrent to capital investment.
So to boost investment, we need to get projects built faster.
Put like that – the task is simple. But, plainly, the task is not easy.
The task begs us all to look at how we can increase competition to improve economic dynamism.
To support investment in infrastructure and technology so our workers have the very best tools of trade.
To encourage regulatory experimentation to boost efficiency and innovation. So we have a smart state – instead of a slow state.
But if reform is to endure, if the economy is to fire on all circuits – we need it coordinated like an electric powertrain: fine-tuned from battery to inverter, through motor to drivetrain.
Getting the set-up right can put maximum thrust behind our prosperity and the lives people in NSW enjoy.
What we need to sequence for maximum effect are reforms to: Housing, Water, Energy, Transport, Technology and Investment.
Upon these things rest our ability to set up our people and our businesses for the next decade.
Our program of reform, whether it be improving service delivery or infrastructure alignment, is reform with an eye to how all these systems connect down the line.
Better connected workplaces are more productive and more creative.
More profitable businesses can use that capital to invest in the potential of their people. Getting that virtuous circle to turn is key.
Let me explain, beginning with Housing:
Housing is shelter, it is security. It is where people make a home and a life. It is where people find connection. It also makes a big difference to economic mobility. The home you live in determines the job you can reach, the school your child attends, and the support network around you.
But right now, housing insecurity is acting as a drag on productivity and a barrier to belonging.
The Department of Communities and Justice tells us that rent price concern is above 80 out of 100 across all of Sydney. That level of stress is not sustainable — for individuals, for families, or for the economy.
That’s why Paul Scully is delivering zoning reform so more homes are built near existing infrastructure and services.
We’re continuing that push through our low- and mid-rise housing policy — and we are standing firm against efforts by councils and others to delay or dilute supply where demand is strong.
We are tackling this from every angle:
The largest investment in social housing since World War II.
Stronger protections for renters.
Record increases to homelessness services.
And, with the Commonwealth, the Help to Buy scheme — opening new paths to ownership for working families.
We will use the next budget to take the next steps forward in building the homes we need to make sure we can house the people we cannot do without to keep our economy humming.
Just like we will use the budget to direct more investment into our water and power systems.
Water infrastructure underpins every one of our housing plans — and every job, factory, and community that will grow around them.
IPART’s review makes it clear: big investment in water infrastructure is needed to support the homes and industries our population will require.
That means replacing 50-year-old pipes to support urban density. It means expanding water treatment. It means finally matching land use to infrastructure delivery — something the last government failed to do.
As for energy, it is both a constraint and a catalyst.
Just two weeks ago, we approved 10 major projects in the Central-West Orana Renewable Energy Zone — delivering 7.15 gigawatts of capacity, enough to power 2.7 million homes and cut 10 million tonnes of emissions each year.
But as we heard from manufacturers, energy certainty is still a concern. Long wait times for grid connection, project risk, and rising operating costs are slowing down investment and local industry growth.
This Government will act to build not just new power generation — but new confidence in our energy future.
NSW has a strong manufacturing base — but we’re being clear-eyed about the challenges.
Construction costs are higher than our global competitors. Tier 1 builders are struggling to deliver. High-value precincts face fragmentation and zoning hurdles. And too many businesses still find it difficult to work with government.
We will look to address that by helping businesses navigate the system — with concierge-style support, investment in skills and training, and better alignment of planning, infrastructure, and industrial land use.
We are also supporting a next-generation manufacturing sector — focused on advanced capabilities, domestic supply chains, and export readiness. That includes making sure the right trade agreements, logistics and infrastructure are in place to help firms grow and reach new markets.
And finally — we are backing our tech sector to lead.
The Innovation Blueprint we will start funding in this Budget sets out a clear path: invest in precincts like Tech Central, support early-stage startups, improve talent attraction, and grow the pipeline from research to revenue.
NSW is a great place to start a tech company — but not always to scale one. That’s what we’re changing. Because the race for innovation is global. With proper support, our best ideas — and our best people — will stay right here, and boost success for us all.
Security and amenity, training and development, connectivity and convenience. These are the measures of success that mean something to people, and which the Minns Labor government is focused on.
Strong management of the state’s finances certainly adds capacity to drive these things, but there is so much more to productivity.
So while I am proud as a Labor treasurer:
to have reduced our debt,
to so far have retained our credit ratings,
to have lowered expense growth from 9.7% during the last five years of the Liberal Government, down to 1.8% over the forward years.
And to have already returned the budget cash surplus
I’m more excited about financial management as a platform for our next big leap, not as the end goal.
In Budget number three, the bigger picture should be coming into view. Let me recap our journey so far.
Budget 1 was about resetting the priorities of government in NSW.
Our focus was on rebuilding essential services, helping people with the cost of living, and resetting the fiscal settings of the state. $7 billion of programs without funding. Debt projected to reach $188.2 Billion. Covid-Level spending that was driving post-Covid inflation. And ending the wages cap that was driving down recruitment and retention across the public service.
Budget 2 saw NSW lose $12b in the GST carve-up as we were writing it. I’m still sore about that.
But through all this I’ve realised that one key to lasting reform is to choose what to renew and where to free up capacity for the next challenge.
I’m proud that –
Because we fixed the Department of Education’s budget, we were able to make NSW teachers the best paid in the nation; keeping more teachers in classrooms; slashing the number of merged and cancelled classes, making sure our kids actually have a teacher to help them learn.
I’m just as proud that we partnered with the Police Association to overhaul a police death and disability insurance scheme no longer fit for purpose: we have been able to make the biggest investment in police wages in a generation.
Leading to record enrollments in the Goulburn police academy – helping us make sure we recruit and retain enough cops for every community.
I’m glad we abolished TAHE. That obscure transport agency no one understood. The one that was robbing the budget of billions of dollars.
Because we abolished it, we had the money needed to rescue the Metro South West.
A real public transport project. Not a weird accounting trick masquerading as one.
And I’m proud we abolished the wage cap.
Meaning we can recruit the essential workers we need to deliver the services the public expect. Resulting in every public service worker getting their biggest wage boost in more than decade. Resulting in the public getting better services in their communities.
The third Budget of the Minns Labor Government is an important one. Like Budgets One and Two, it reflects studious choices—decisions grounded in discipline, shaped by purpose.
It comes at a time when the world is moving fast. Trade is shifting. Technology is accelerating. The energy transition is reshaping everything. But NSW is ready.
We have the skills, the scale, and the diversity to not just respond to change—but to shape it.
And as we enter the final four weeks to June 24, that’s exactly what this Budget will do.
It brings the pieces together—so we can keep building a better NSW.
A NSW that’s more secure, more productive, and more fair. A NSW that works—for the people who live here, and for the nation we help to power.
Thank you
