Budget Paper No.01: Budget Statement

The 2025-26 Budget outlines a responsible path back to a moderate surplus, after the largest ever deficit of $15.3 billion in 2021-22.

The budget turnaround is supported by a $9.4 billion reduction in the debt projected relative to the 2023 Pre-election Budget Update, saving around $400 million in interest payments every year. These savings have allowed the NSW Government to make investments to rebuild essential services while outlining a sustainable pathway to surplus.

The 2025-26 Budget also lays the foundation for our future economic growth with measures that facilitate rapid investment, create jobs, and accelerate the delivery of new homes.

Following a global pandemic, bushfires, floods, high inflation and interest rates, families and businesses in New South Wales are under pressure. We are now seeing the first signs that the NSW Government’s fiscal consolidation strategy has avoided additional pressure on inflation without restricting wage growth or increasing joblessness. Inflation declined to 2.3 per cent in the March quarter of 2025. Having made progress to address inflation and fiscal repair, New South Wales enters a new economic challenge. The 2025-26 Budget outlines new investments designed to reduce regulation, fast track investment and generate the jobs and prosperity of the future.

The NSW Government’s commitment to responsible budget management has allowed for the next step towards rebuilding our essential services after a decade of rising demand. Major investments in child protection, TAFE, education and healthcare headline the 2025-26 Budget.