The state's forecasted budget deficit has more than tripled, as the NSW government seeks to embark on major economic reforms while grappling with COVID-19 and disaster spending.
Dominic Perrottet's government has handed down its first budget, as he and Treasurer Matt Kean look to make their mark on both the economy and voters nine months ahead of an election.
The deficit has blown out to $11.3 billion, far exceeding the $3.6 billion deficit forecasted in the 2021-22 half-yearly review.
Treasurer Matt Kean described the budget as a "once in a generation reform budget for the people of NSW".
"It invests in helping them reach their hopes and dreams for tomorrow, " he said.
"We're betting on our kids, because we know investing in our kids and giving them a great education is what sets them up for a great life.
"[These are] investments that will deliver for families today that will also build a brighter, stronger prosperous tomorrow."
While the government seeks to reform home ownership and women's economic participation, it insists the blowout is largely driven by the hangover costs of COVID-19, health spending and the response to the floods.
"Since the half-year review, we've seen once-in-a-generation floods, " Mr Kean said.
"We know that we're moving to a different stage of the pandemic and our health system is under enormous pressure ... we've also seen the impact of inflation on the state's financial position.
"We forecast that inflation will decrease in the future, but we need to support families now."
A modest return to budget surplus of $601 million in the 2024-25 financial year is forecast, driven by large increases in revenue from GST, mineral royalties, and other taxes.
Net debt will balloon to $114.8 billion in the 2025-26 financial year, about 14 per cent of gross state product.
While many of the key budget measures have been announced, the government revealed a $150 voucher for every primary and secondary student attending school in 2023.
The $193 million budget item would help parents pay for shoes, bags, textbooks, stationery and school uniforms.
It's part of $2.2 billion of additional spending to tackle the cost of living pressures, including $520 million in toll relief over the next two years.
A key feature of the budget is spending to improve the participation rate of women in the workforce, with $775 million over the next four years for the creation of a fund to increase the supply of affordable childcare.
In a bid to improve housing affordability, $2.8 billion is being spent on a shared equity trial and a scheme to allow some first home buyers to opt for an annual property tax instead.
Over the next four years, $112.7 billion will be spent on infrastructure, including works to enable Parramatta Light Rail stage two by building the Wentworth Point Bridge and upgrades to the Wyong rail line to enable faster rail between Sydney, Newcastle, and the Central Coast.
About $470 million of funding from the state's $5 billion WestInvest program will be spent to modernise nine schools in Western Sydney.
Health will receive $4.5 billion in additional spending.
For regional NSW, the Regional Growth Fund is being expanded by $1.3 billion.
Programs designed in partnership with First Nations communities will receive money from a $716 million fund.
NSW Opposition Leader Chris Minns today labelled the budget a "spending spree" that future generations will have to pay off.
Mr Minns said the amount of debt would be an ongoing burden.
"Mr Kean spent $1 billion for every minute that he spoke at the lectern today," Mr Minns said.
"A huge amount of money in gross debt has been racked up by the New South Wales government ... that will we have to be paid off by future generations of taxpayers."
