SA: Foley says the SA budget will slide into deficit

AAP General News (Australia)
12-16-2008
SA: Foley says the SA budget will slide into deficit

ADELAIDE, Dec 16 AAP - South Australia's budget will slide into deficit this financial
year due to the global financial crisis, Treasurer Kevin Foley says.

Mr Foley, who'll deliver an economic statement on Friday, said the government was looking
at a modest deficit because of the financial turmoil's impact on the state's finances.

But he said measures would be outlined on Friday to limit the size of the deficit by
the end of the current financial year.

"We are facing a deficit," Mr Foley told ABC radio on Tuesday.

"We have seen a substantial deterioration in the income we receive from both the Commonwealth
through the GST, from our own source revenue and we are seeing a substantial slowdown
in home construction and home sales.

"The sharp deterioration in economic activity has meant that it's very difficult, if
nigh on impossible, to adjust the levers quickly enough to avoid a deficit this budget
year.

"But what I am hoping to do is to forecast a position where we will be returning to
solid surpluses in the not too distant future."

Mr Foley said he would not reveal details of Friday's economic statement and would
not comment on the possibility of tax increases.

"I don't see tax increases as the answer to the problem but I'm not going to give details
of what's in the document ahead of my release of it on Friday," he added.

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KEYWORD: CRISIS SA

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