Public investment supports economic growth

Seasonally adjusted State Final Demand (SFD) figures released today show the ACT performed better than most other jurisdictions during the September quarter 2009, with the local economy growing
1.3 per cent, ACT Treasurer Katy Gallagher said.

The Australian Bureau of Statistics figures show SFD increased by 1.3 per cent in seasonally adjusted terms during the quarter, and over the past 6 months the Territory’s economy has grown by 3.8 per cent which is well above the long-term average.

“These are encouraging results for the ACT after a period of negative growth,” Ms Gallagher said.

“The figures suggest that expenditure across most components of demand contributed positively to growth, with the largest contribution coming from public investment,” she said.

“This confirms that the Government’s approach of supporting capital investment through the worst of the economic slowdown was the right one.

“We took the decision that this year was not the time to dramatically wind back spending, cut services or reduce our capital works program and those decisions appear to be paying dividends.”

The ABS figures show that, in seasonally adjusted terms, the ACT recorded the equal second strongest growth for the quarter.

“While these figures are pleasing and encouraging, there are ongoing risks to the ACT’s economic outlook in the medium term, particularly as we expect the Commonwealth to moderate its spending in the future. This will be a challenge for the ACT given the role of the public sector in our economy,” Ms Gallagher said.

16 December 2009