State Budget 2026: What we know so far
The Malinauskas government has revealed some key investments and projected surpluses, ahead of its fifth State Budget on Thursday. Here’s a snapshot of what we know so far.
Today’s State Budget will focus on “relief for families and stability for business”, according to Treasurer Tom Koutsantonis, who this morning announced operating surpluses would continue until FY2029.
The current financial year would see a surplus of $189 million from its net operating balance of $223 million, which Koutsantonis said was more than forecast in December’s mid-year budget review.
Also revised since December’s estimates was GST revenue, which saw $225 million flow to government coffers in 2025–26, and was expected to bring in $794 million from FY26 until FY2029.
Surpluses were projected through forward estimates until 2029-30, with $285 million in FY27, $348 million in FY28 and $327 million in FY29.
Koutsantonis said the surplus projections would “fortify” the state “against economic shocks and unforeseen spending, and allowed us to sustainably manage debt and retain strong economic credentials”.
He said the surpluses came despite unplanned spending on the Whyalla Steelworks collapse, the Port Pirie smelter bailout, the Bedford Group disability services bailout, the regional drought and the algal bloom.
Early announcements this week focused on cost-of-living for older South Australians, education, a First Nations treaty, and a slimmed-down public service.
Since last year’s budget, the government has committed to a $45 million taxpayer-funded redevelopment of the North Adelaide Golf Course, $674 million to implement the recommendations of the state’s Royal Commission into Domestic, Family and Sexual Violence and a suite of election commitments – which would all be factored into today’s pile of papers.
The Treasurer said the budget “won’t be the place” to support the struggling wine sector. There also has been no word yet on whether a Tarrkarri First Nations arts and culture centre would finally get the go-ahead, after years of valuable North Terrace land set aside for the project sitting vacant.
A pot of money for “development of a new innovation and cultural precinct in the city centre” – including the Tarrkarri project – was in the federal government’s budget last month, although the quarantined cash was not expected to be enough to prompt the state government into making the long-awaited Indigenous Cultural Centre a reality.
SA’s economy has been boosted by mining revenue – particularly from copper giant BHP, which delivered record royalties of $25.6 million to SA in April.
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But the South Australian Opposition said the budget was “cooked” and claimed Labor had no plan to manage the state’s debt, predicted to balloon to close to $50 billion by 2039.
The key culprits for growing debt include the $15.4 billion Torrens to Darlington tunnel project, to complete the city’s north-south corridor link, and the new Women’s and Children’s Hospital, estimated to cost $3.2 billion.
SA Liberal shadow treasurer Ben Hood said the government must have a debt recovery plan alongside today’s budget, claiming the state was paying “close to $5.3 million a day on interest alone, a figure that’s set to reach almost $8 million a day by 2029”.
Hood also said the government had been “ignoring the reality facing many businesses” and reiterated the Liberal party’s calls for the payroll tax threshold to be lifted in SA from $1.5 million to $2.1 million to support small business.
Seniors Card expanded
An $8.4 million package over four years would expand Seniors Card eligibility to offer cost-of-living relief for thousands more South Australians, delivering on an election commitment.
The Seniors Card was previously only available to people over 60 working less than 20 hours a week. The changes remove working restrictions and would be available to all SA permanent residents aged 60 and over, and Aboriginal and Torres Strait Islander people aged 50 or over, from July 1.
Card-holders can access free public transport, discounted health services such as dental, optical and pharmacy, savings on home maintenance and fuel and grocery discounts at participating stores.
Announcing the measure on Wednesday, Premier Peter Malinauskas said “we know cost-of-living pressures are real and we want to do everything we can to help South Australians”.
First Nations Treaty
From 2026-27, $8.5 million over four years has been allocated to establish a Truth-Telling Commission and progress a Treaty with First Nations South Australians.
The Commission will be headed by Aboriginal leaders who will progress work to acknowledge and recognise the history and experience of Aboriginal South Australians. Work on establishing the Commission will start after June 30 this year.
The government money would support further work towards a Treaty – a formal agreement between the state government and Aboriginal South Australians.
It comes after the state’s First Nations Voice called for Treaty in its 2025 annual address and delivers on the SA Government’s response to the Uluru Statement from the Heart, which called for Voice, Treaty and Truth.
“Truth-telling is an essential step forward in the reconciliation process. It will enable Aboriginal people to tell the stories of their community’s experiences with past government policies and social norms, to help build common understanding across the state,” Aboriginal Affairs Minister Kyam Maher said.
Three-year-old preschool
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The rollout of three-year-old preschool has been brought forward with $624.5 million over five years, which includes opening eight new preschools, 20 integrated hubs and infrastructure upgrades at dozens more school sites.
In 2027, more than 7500 three-year-olds would be able to start preschool under a $1.9 billion Flying Start package, the government saying all SA children can access 15 hours a week of three-year-old preschool by 2032.
Housing and stamp duty
A $50 million infrastructure fund would be established to fast-track building 400 new homes by the end of 2027.
The new homes slated for Playford Alive would create the first neighbourhood exclusively for first homebuyers in the country.
Also to get South Australians into their own homes, the government has expanded the stamp duty waiver to support victim-survivors of Domestic, Family and Sexual Violence.
Treasurer Tom Koutsantonis said the measure would”take away some of the barriers currently in place for women escaping domestic, family and sexual violence”.
The new scheme is designed to help vulnerable women leaving dangerous situations, and applies to victims even if they had purchased a home previously.
Public service slashed
For the next 12 months, a partial freeze would apply to the recruitment of non-frontline positions across all state government agencies, which the Treasurer said would save about $120 million annually.
The measure would result in 1000 fewer full-time equivalent staff, but would not involve forced redundancies, the government said.
Greens leader Robert Simms said the cuts would “shift the burden” onto other areas of the public sector.
“Frontline services simply don’t work unless there are other staff able to support them,” Simms said.
Koutsantonis said frontline services would not be impacted.
“With AUKUS, Olympic Dam and a new era for Whyalla on the horizon, reducing the public sector intake will help the private sector to fill crucial jobs at a time when the labour market is tight and demand for labour is high,” Koutsantonis said.
Health spend hits record billions
Last year’s health spend made up about 30 per cent of the total budget, and this year the Malinauskas government’s total health spend would reach $10 billion since it came to government in 2022.
Health Minister Blair Boyer said the funding was “a once-in-a-generation investment in our health system”. Liberal shadow treasurer Ben Hood called the record “disingenuous” and a “health budget blowout”.
This week’s budget is expected to deliver on election commitments, which included $3 million for planning a Concordia hospital in the Barossa region, $33 million for five new women’s health clinics, a $13 million medical training centre in Mount Gambier and $400,000 to expand specialist nursing services.
InDaily will be at today’s Budget lockup and will publish a special edition on Thursday afternoon.
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