NSW to sell Newcastle port - Weekly Times Now

THE world's largest port in Newcastle will be sold off by the NSW government as part of Treasurer Mike Baird's mostly prudent budget.

There are fears more public servants will lose their jobs as the beleaguered sector struggles to find another $750 million in savings over the next two years.

The government is also stepping up efforts to chase people over unpaid fines while doctors say a 5.2 per cent increase in health funding isn't enough to meet growing demand.

But the big announcement is that the government will sell off the state's last major port with the privatisation of the facility in Newcastle.

The 99-year lease is expected to net the government up to $700 million, half of which will be returned to the growth city north of Sydney to give it a light rail network.

The treasurer said his third budget yesterday "consolidates two years of tough decisions, two years of reform, two years of stringent expense control".

The government is estimating a smaller than expected deficit of $329 million for 2013/14, bouncing back into the black the following year by $829 million.

The figures, however, change when estimated under new accounting methods that bring NSW into line with global standards.

The new accounting standards have a return to surplus not happening until 2015/16 and a deficit of $1.89 billion for 2013/14.

The government said marketing and rating agencies will "look through that" as there is no actual change in the state's cash or debt position.

It follows years of savage cutbacks to rein in government expenditure, including an unpopular public sector wages cap and the reform of the police death and disability scheme.

And even though Mr Baird says his "tough decisions are beginning to bear fruit", the pain isn't over.

Public servants appear to have been spared the big job cuts of previous years but the treasurer has conceded more could come over the next 12 months.

"There's no number ... I am open at every opportunity to make the public sector more efficient."

The efficiency dividend and wages cap imposed on the sector is expected to net the government almost $19 billion in the six years to 2016/17.

On the plus side, 1300 businesses will be spared from paying from payroll tax next year while $302 million will speed up new home building.

A massive $60 billion will be ploughed into new roads, rail, hospitals and schools over the next four years as the government rolls out the largest urban road project and largest rail project in the country.

Unions are urging the government not to ship the promised infrastructure in from overseas in flat packs while the opposition claims families will bear the brunt of the budget's cuts to hospital resources and frontline services, despite rising revenues.

Mr Baird hailed his budget for slowing expense growth, accelerating spending on infrastructure and reducing net debt - "an extraordinary trifecta in the light of the challenges we face".

NSW Premier Barry O'Farrell told parliament the government was "living within its means".