Australia’s Federal system of Government makes State Governments a critical part of the overall fiscal and economic performance of Australia.

This handbook is intended to provide a comprehensive update and reference tool on both the economies and fiscal finances for each State, and is a joint publication between NAB’s interest rate strategy and economic research teams.

NAB Australian States Handbook 2014 (PDF, 1.09MB)

• Economic profile – The Australian economy has exhibited some positive trends outside of the mining sector over the past 12 months, particularly via strength in residential markets. While strength in residential construction is assisting growth and limiting additional deterioration in the labour market, the long anticipated challenges stemming from the end of the mining investment boom are still playing out. As a result, GDP growth for 2013-14 is forecast to remain below trend, at 2.9%, with weak business investment and softening consumption offsetting strong exports growth and improving building activity. Over the longer term, GDP growth will gradually lift towards trend, reaching 3.1% in 2014-15 and 3.2% in 2015-16. Modest growth in domestic demand will keep the labour market soft. The unemployment rate is expected to remain close to 6½% over the coming months – slightly above previous forecasts.

• Fiscal finances – Improving but focus remains on reducing expenditure as Commonwealth terminates/modifies some payments to states. The Commonwealth has announced a White Paper on Reform of the Federation and White Paper on Tax Reform. Credit ratings are seen to be stable. As budgets move into surplus demand on the market for funds is declining. This is happening at a time when demand from bank balance sheets is moderating.