Economic policy advice

(Budget Output 1.5)

Procurement and contract management

During 2007–08, we continued to play a major part in progressing the Launceston Flood Risk Management Project, building on the cost-benefit assessments and engineering studies completed in 2006–07. We prepared a Deed setting out the details of the project, including funding and governance arrangements, that was signed by the State Government and the Launceston City Council in April 2008. The project involves the Launceston City Council establishing a separate authority. This authority will be responsible for implementing the following measures to address the flood risks at Launceston:

• rebuilding and realigning the levees at Invermay;
• amending the Launceston Planning Scheme to constrain the potential future damage in cases of major floods;
• revising emergency management procedures; and
• enhanced community education to increase awareness of the flood risks.

Demographic change

We provided secretariat and research support to the Demographic Change Advisory Council, including preparing several research reports. A major project was the development of population projections for Tasmania and its 29 local government areas.

We also coordinated the development of two major reports that examine the economic, social, workforce and fiscal issues that Tasmania faces and the strategies that could be adopted in response to the challenges and opportunities arising from demographic change. All Council reports can be accessed from the Council's website, www.dcac.tas.gov.au.

Economic monitoring

We contributed to the Budget Papers, principally by preparing a chapter on the State's economy that included Treasury's outlook for the following financial year and for the forward estimates period. The chapter also highlighted some major economic issues affecting the Tasmanian economy.

We also provided detailed information on the Tasmanian economy and its outlook to the two ratings agencies, Standard and Poor's and Moody's. This included further information on the structural changes that are driving Tasmania's economy and how our economy is now more closely integrated with the mainland economy than in previous years.

Competition Index

The Government released The Competition Index 2006–07, in October 2007. The Index measures Tasmania's competitiveness against other Australian states and New Zealand using a range of indicators. The report helps to identify the areas where Tasmania has a relative advantage and those where further measures are needed to make Tasmania a more favourable business location.

Competition in the Tasmanian energy market

In January 2008, we took over from Shareholder Policy and Markets Branch responsibility for advising on energy market issues. As part of these responsibilities, we have assisted in the development of measures needed for the rollout of retail contestability in the Tasmanian electricity supply industry. The work has been done in consultation with other agencies, the Office of the Tasmanian Energy Regulator and external stakeholders.

Climate change

Over the past 12 months, we provided input into the national studies that have been examining the economic impacts of climate change. In particular, we have reviewed and provided comments on the economic modelling undertaken for the Garnaut Review and the National Emissions Trading Taskforce. We have also worked closely with the Tasmanian Climate Change Office on a number of climate change-related issues.

Next year…

In 2008–09, we will continue to support the Demographic Change Advisory Council, including undertaking research on demographic change issues and completing the first set of population projections for Tasmania prepared by the State Government.

We will provide advice to the Treasurer and the Government on emerging economic and fiscal issues for Tasmania as the Australian Government develops its Emissions Trading Scheme.

We will provide secretariat and research support to the Business Tax and Regulation Reference Group.

Following consultation with key stakeholders, including the Tasmanian Chamber of Commerce and Industry and the Department of Economic Development and Tourism, we will publish the 2007–08 Competition Index.