Treasurer Peter Gutwein was understandably surprised to hear Moody’s had downgraded Tasmania’s credit rating on Thursday.
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It came in a week of bad news for the state government, beset by unfortunate economic events, including rising jobless figures.
The credit ratings agency decided Tasmania’s fiscal outlook wasn’t as good as Mr Gutwein said it was in his budget last June.
This, despite a budgeted $60m surplus for 2015-16, earlier than the government previously planned.
Moody’s said that Tasmania would record widening budget deficits due to slow revenue growth and rising spending levels.
“While the budget is back in surplus four years ahead of time there remains significant long-term challenges in the areas of health, education and the state's superannuation liability that need to be managed carefully," it said.
If the downgrade relates to the federal government’s flagged changes to the GST carve-up, as Tasmanian economist Saul Eslake suspects, then Prime Minister Malcolm Turnbull is creating a problem for himself.
His proposal to create a percentage floor beneath which a state’s GST receipts could not fall may help Western Australia deal with its post-mining boom deficits and buoy the Barnett government’s electoral chances.
It could be doing far fewer favours for the Tasmanian Liberal government, which no doubt will make its voice heard privately and publicly on the issue.
By proposing something that could reduce Tasmania’s GST revenue, Mr Turnbull is making no friends in a state that made its thoughts known about his government by voting out three first-term Liberal MPs in July.
Yet the state’s economic fortunes are no less important or vulnerable than before the federal election.
The ratings downgrade is not what the state needs as last week’s employment figures show the weaknesses in the economy.
If the downgrade has been brought about by Mr Turnbull’s proposal, then the consequences of his strange Western vote spinner are proving themselves to be serious.
It would be a strange fight to pick for a government whose agenda and stability is so finely balanced.
A row with the states over GST would be a distraction, even for a government with such an unclear direction.
If Tasmania feels hard done by with GST revenues, it will make itself heard.