Tasmania’s State Businesses Lean on Taxpayer Support

Tasmania’s government business enterprises cost taxpayers more than $584.64 million to keep afloat in 2025-26, while meeting only half their performance targets and missing financial expectations, auditor-general Martin Thompson found. The businesses returned $158.83 million to government coffers but received $743.47 million in subsidies and equity contributions. That’s the balance sheet behind the public promises.

Who Pays for the Shortfall

Thompson tabled his report in state parliament on October 27, 2026, saying several entities remained under pressure to stay financially sustainable. TT-Line, Homes Tasmania and Metro Tasmania reported material uncertainties about continuing as going concerns. They relied on ongoing state support and funding arrangements to meet future obligations.

The May state budget projected government support for the businesses would climb to $909 million in 2029. Increased returns were meant to offset that cost. But Thompson found a different direction in the figures: “declining profitability, increasing borrowings, growing reliance on government support and reduced returns to government are significant trends that warrant ongoing attention and action.”

Borrowing across the government business sector is forecast to rise from $5.39 billion to $8.94 billion in 2030. The general government sector had already borrowed $6.82 billion, with borrowing forecast to reach $9.47 billion by the end of the decade. Those figures accompany the official promise that public enterprises will deliver for Tasmanians.

Treasurer Eric Abetz said the government was “strengthening accountability, increasing transparency and ensuring these businesses deliver for Tasmanians.” Thompson’s assessment, meanwhile, describes entities under financial pressure and increasingly dependent on public support. The announcement and the audit sit side by side.

A Ship Program’s Public Bill

TT-Line, which operates Spirit of Tasmania, received an equity contribution of $74.5 million in the last financial year. The company is receiving another $506 million over the next four years. The bungled ship replacement program cost $717 million more than expected and delayed the ships’ entry into service by years.

Thompson determined in August 2025 that TT-Line was insolvent. The company disagreed, citing financial backing from the state. Metro Tasmania also relies on government support. The public purse carries the cost, while the companies’ ability to meet their obligations remains uncertain.

Labor treasury spokesperson Dean Winter said government businesses were “on the brink.” He accused “Premier Rockliff and his ministers” of having “completely checked out, failing to monitor compliance, ignoring advice, and letting essential public entities fall into financial distress.” His criticism targets oversight at the top. The audit figures show how much support comes from public funds.

Oversight, Then the Privatization Question

The Tasmanian government commissioned economist Saul Eslake in early 2025 to analyse possible sales of government businesses. That work ended after the Liberals ruled out privatisation during the snap state election campaign. Eslake said Thompson’s assessment suggested “careful consideration” should be given to potential sales. He called the ongoing support required by the businesses a “considerable concern,” while also saying some poor performance in 2025-26 might not recur and some businesses had been long-term poor performers.

A second report, released the previous day, examined more than 250 pieces of Treasury Department advice about oversight of government businesses. Thompson found the department “did not always support the treasurer” with the advice needed for informed decisions. Advice often lacked critical analysis, available options, risks and clear recommendations, he wrote. Weak internal processes also produced inconsistent advice without adequate detail and assessment.

The Treasury Department accepted recommendations to improve reporting and monitoring and ensure the Treasurer consistently received comprehensive advice. That’s the promised fix within the same oversight structure. The reports leave a blunt picture: public enterprises miss targets, lean on government funding, and face scrutiny after advice and monitoring failed to consistently equip the Treasurer to make informed decisions.