The Northern Territory is projected to see its debt rise to $12.55 billion in the upcoming financial year, as the government reveals significant spending plans focused on crime prevention, healthcare, and infrastructure in its latest budget announcement.
During the presentation of his second budget, Treasurer Bill Yan expressed optimism, stating that the government’s initiatives would “enhance lives,” even though no new measures to alleviate the cost of living for families were included.
Economist Rakesh Gupta from Charles Darwin University characterized the budget as “disciplined,” while questioning the government’s expectation of an economic stabilization by the year 2027-28.
The Northern Territory’s debt is set to increase to $12.55 billion next year, following the release of a budget that emphasizes unprecedented investment in health and law enforcement, albeit without introducing any new cost-of-living relief initiatives.
The Country Liberal Party (CLP) government’s budget reveals a slight improvement in the debt situation, forecasting a slower rise in debt than previously anticipated, despite substantial expenditures related to recent natural disaster responses.
This more favorable outlook is attributed to heightened mining royalties, growth in GST revenue, and increased income from stamp duty due to the thriving housing market in the territory.
However, the budget also disclosed an additional $30 million overrun for the troubled ship lift project, which has now escalated to a total cost of $850 million and is not expected to yield any revenue for the government.
The budget data indicates that the Northern Territory’s net debt per capita remains among the highest in the nation, climbing to $61,800 per resident, up from $57,500 in the previous financial year.
In his remarks, Treasurer Yan emphasized that the budget aims to “improve lives” for residents of the Northern Territory, despite the absence of new measures addressing cost-of-living challenges.
A significant portion of the budget is allocated to law enforcement, with a record $1.7 billion dedicated to advancing the government’s stringent crime policies. This allocation includes $654 million for the NT Police, $524 million for correctional facilities, and $250 million for judicial services, such as courts and legal assistance.
Funding has also been designated to manage the growing prison population, with $15 million allocated for planning new men’s and women’s correctional facilities in Darwin, $250 million for work camps in Katherine and Darwin, and $48 million over the next four years to hire 212 new public safety officers for the police.
Additionally, the budget outlines a historic infrastructure investment of $2.7 billion, which includes funds for repairing the territory’s roadways. Health services will receive $2.62 billion in the forthcoming financial year.
Dr. Gupta described the budget as “disciplined” but lacking in transformative measures. He pointed out that while overall revenue is on the rise, the government’s claim that debt will stabilize by 2027-28 may be overly optimistic, given the slowdown in employment growth and a mere 1.1 percent increase in population.
“Population growth is projected to be exceedingly low,” he noted.
Dr. Gupta expressed concerns that the territory’s fiscal outlook is overly dependent on mining royalties and the property market in Darwin, both of which have experienced unusually high growth that may not be sustainable.
He criticized the lack of a clear plan for long-term job creation or sustainable economic development within the budget and questioned the potential impact of the infrastructure spending on future growth.
“It lacks ambition,” he remarked.
“While there is investment in essential infrastructure to support business growth, it does not directly foster job creation. I do not see an ongoing strategy for employment development,” he added.
Dr. Gupta suggested that the government could justify the debt if it successfully builds future capacity. However, he emphasized that high levels of debt must be matched by significant, tangible outcomes, which are currently lacking.
On a broader scale, he noted that the budget does little to foster long-term growth for local businesses, skilled migration, population growth, Indigenous enterprises, or regional economies. Instead, it largely focuses on temporary infrastructure projects and short-range measures.
“These initiatives are important,” he acknowledged, “but they are not transformative and do not significantly alter the economic landscape of the Northern Territory.”
Other notable budget allocations include: $1.4 million annually for 2026-27 and 2027-28 to develop the Beetaloo Sub-Basin; $18.3 million per year for the operation of a new 32-bed modular ward at Royal Darwin Hospital; $10 million annually to enhance road ambulance services; $5 million per year for park and reserve maintenance; $3.3 million annually for two years to protect fisheries; $3 million annually for three years to secure Australian Football League matches in the NT; $1 million annually for two years for international cricket matches; $3.8 million annually for two new local court judges; and $2.5 million to facilitate increased use of electronic monitoring for individuals on bail.
Funding for mental health services is set to decrease from $135,049 last year to $130,912 in the upcoming financial year, while funding for domestic, family, and sexual violence services will see a reduction from $71,503 million last year to $63,511 million.
