Overview

Treasurer David Janetzki has handed down his first Budget since the Crisafulli LNP Government was elected in October 2024, the first LNP State Budget in over a decade.

In line with the messaging of the State Election Campaign, itis pitched as ‘a fresh start for Queensland’, and Treasurer Janetzki has described it as going from ‘fiscal vandalism’ to ‘responsible economic management’.

However, despite some ‘tough talk’ ahead of the Budget being delivered, the Crisafulli Government has not inflicted major cuts to the public sector, which is forecast to grow by 2.24 per cent. It has, however, announced a new initiative to provide in-house advice to departments – Queensland’s Government Consulting – and a hiring freeze for the next four years on non-frontline senior executives.

Like State Premiers across Australia (with the exception of Western Australia), economic uncertainty and households facing cost of living pressures have left the Crisafulli Government with limited policy levers to raise revenue. It has chosen not to raise any taxes.

Treasurer Janetzki said: “Queensland is not immune to the challenges facing other states and countries”, and cited Labor’s announced but unfunded service delivery commitments.

Rather, the Government says it is focused on growing the economy and improving the State’s fiscal position through tourism, mining royalties and income taxes.

Economic Outlook

The 2025-26 Queensland State Budget forecasts a deficit of$8.6 billion. This compares to Labor’s 2024-25 State Budget which forecast a$515 million deficit.

There is no return to surplus forecast over the forward estimates. However, the deficit is estimated to decline substantially – a $5.9 billion deficit in 2026-27 will continue to fall to $1.1 billion by 2028-29.

Total debt of $147.8 billion is forecast for 2025-26. This follows net debt nearly doubling from $22.1 billion in 2024-25 to $41.8 billion in 2025-26. Over the forward estimates, total debt will rise to $205.6 billion in 2028-29

Queensland’s economy is forecast to grow by 2.75 per cent in2025-26 and then will maintain stable Gross State Product (GSP) growth of 2.5per cent per year over the forward estimates. The unemployment rate will increase slightly, from 4.25 per cent in 2025-26 to 4.75 per cent in 2028-29.

Wage growth is forecast to decrease slightly, from 3.5 percent in 2025-26, to 3.25 in 2026-27 and 2027-28, before dropping to 3 per cent in 2028-29. Separately, population growth will marginally decrease, from 1.5per cent in 2025-26 and 2026-27 to 1.25 per cent in 2027-28 and 2028-29.

Ex-Tropical Cyclone Alfred had what the Budget described as a “significant, albeit temporary, impact on economic activity in southeast Queensland”, and the value of lost economic activity as a result of the natural disaster is forecast to be $1 billion or 0.25 per cent of GSP.

This compares to the North Queensland flooding which the Budget estimate that “lost exports across all impacted sectors would reduce the value of production by around $2 billion in 2024-25 or 0.3 per cent of GSP.

The Government notes uncertainty from US tariffs but doesn’t expect significant direct impacts given US exports are just 3 per cent. Instead, it describes the main risk to Queensland being “reduced offshore demand for commodities and the displacement of private spending”. It notes the growth of Queensland’s major trading partners was downgraded by 0.5 percentage points in 2025-26.

Major Announcements

Cost of living

• End of the $1,000 energy bill rebate and the 20 per cent discount on vehicle registration
• $62.5 million to expand the $200 per child sports voucher program
• Restoration of indexation to the energy rebate scheme, which will see around 600,000 households with concession cardholders gain rebates of $386 per year

Tax

• No new or increased taxes
• Abolition of the ‘Patients Tax’ through the permanent exemption of GPs paying payroll tax
• Foreign investors will be able to bypass foreign surcharge taxes if they invest in high density accommodation and agriculture

Health

• A record $33 billion investment in the public health system next financial year, which the LNP states is a 10 per cent increase from this financial year
• Investment of $18 billion into health infrastructure over the next five financial years, with $5 billion for the construction of the new Coomera Hospital and expansions to the Redcliffe and Townsville Hospital
• $638 million over four years to deliver services at Mater Hospital Springfield

Education and Training

• Increased funding of $2.8 billion over five years in partnership with the Federal Government under the Better and Fairer Schools Initiative
• Additional funding of $818.4 million over the next four years for the planning, construction and expansion of schools
• $12.7 million in funding for the Early Childhood Regulatory Authority
• A new $100 “Back to School” payment for every primary school student in Queensland at a cost of $188.6 million

Business and the Economy

• Additional funding of $446 million over four years to support Queensland’s tourism industry
• $79.1 million over three years to increase export opportunities and enable reshoring and onshoring by Queensland manufacturers
• Funding of $44.7 million to boost productivity through a new Business Concierge and $19 million to support small and family businesses with the cost of apprentice wages
• $15 million to increase the Made in Queensland Grant Program

Energy and Manufacturing

• Reduction in funding for the Borumba Pumped Hydro Project from $8 billion to $3 billion
• Confirmation of an election promise to scrap the Pioneer-Burdekin Pumped Hydro project and instead commit to smaller pumped hydro projects

Infrastructure and Transport

• A total of $4.7 billion invested for the Olympic Games venues and athlete villages. This includes $950 million over four years for Athlete’s Villages and $832 million to begin procurement and delivery of Games venues.
• $225.8 million to support grassroots community sporting projects and their infrastructure
• Confirmation of the already-announced funding of $1.8 billion to the Bruce Highway safety upgrades, in partnership with the Federal Government

Housing

• $2 billion over four years for trunk and essential infrastructure to activate new residential developments
• Stamp duty for first home buyers has been waived for new builds or vacant land and the doubling of first homeowner grants to $30,000
• A $165 million Boost to Buy scheme that will see the State Government co-own a stake of up to 30 per cent in the property (noting that only1,000 places are available in the first year)
• Funding of $365 million for crisis accommodation and head leasing, as well as $200 million in specialist housing services

Crime and Safety

• $147.9 million of funding in equipment for frontline police, including tasers and replacing body worn cameras
• $50 million over five years towards four Crime Prevention Schools
• A doubling of the capacity of the 24/7 crisis services at a cost of $31.3 million
• $25 million five-year trial of electronic monitoring for perpetrators