Expenses are up and revenue is down but the ACT has delivered a net operating cash surplus a year earlier than expected in what the Treasurer says is a sign the government's plan to fix the budget is working.
Chris Steel said achieving a cash operating surplus earlier than budgeted was an "important milestone" for the government's strategy to improve the bottom line without sacrificing high-quality local services.
"With a better budget position and lower-than-estimated net debt, the government is delivering responsive and responsible fiscal management," Mr Steel said.
The ACT is set to post a net operating cash surplus of $74.9 million in 2025-26, which is a $255.5 million improvement on the deficit outcome expected in the 2026-27 budget.
"This improvement is attributed to the receipt of investment gains mainly related to foreign exchange hedging activities for international investments and lower supplies and services payments," the government said.
The 2025-26 ACT budget set out new targets for fiscal discipline, including a return to surplus by 2029-30 and operating cash surpluses from 2028-29. The previous year's budget had shown a net operating cash surplus in 2026-27.
The operating cash surplus target has been reached two years early.
A cash operating surplus means the government's operating expenses, excluding capital expenditure, do not exceed its revenues.
The ACT's June quarter financial report showed the government's headline net operating balance would post a headline net operating balance deficit $55 million larger than had been estimated.
The deficit in 2025-26 would be $556.6 million, larger than the $501.6 million estimated outcome published earlier this year and larger than the 2025-26 budget figure of $426.4 million.
But net debt was set to be $113.4 million lower than the estimated outcome for the past financial year and would scrape in just under $11 billion.
"Net debt increased by $1,825.4 million compared to 2024-25 mainly due to an increase in borrowings to support the territory's infrastructure program and prevailing cash flow requirements, partially offset by higher cash and investment balances," the report said.
Revenue in the 2025-26 financial year was $29.5 million lower than expected with the government collecting $8.8 billion in total.
Taxation revenue was lower than expected, largely because the territory was collecting less payroll tax "from sectors exposed to unfavourable Commonwealth policies".
Lower general rates and commercial conveyance duty revenue also contributed to the smaller overall tax take.
The government spent $9.69 billion in 2025-26, with expenses $39.1 million higher than expected.
The financial report pointed to higher insurance claim expenses, employee expenses and depreciation.
Opposition Leader Mark Parton said only the ACT government would claim success from failure.
"Revenue fell $110 million short of budget. Expenses blew out by $83 million. The net operating balance is $193 million worse than promised. Net debt has surged by more than $1.8 billion in a single year," Mr Parton said.
"If Treasurer [Chris] Steel still says the budget is 'under control', how does he explain this? This is not fiscal management. It is fiscal freefall, and Canberra taxpayers are paying the price."
