News Service from House Harris

Qld: Qld unemployment could hit 10 per cent: Fraser

BRISBANE, April 22 AAP - Queensland Treasurer Andrew Fraser says he cannot rule out unemployment hitting 10 per cent as the state stands on the "cusp of recession".

Mr Fraser, who is preparing the state budget to be delivered on June 16, said the forecast was for seven per cent unemployment in Queensland in the next financial year.

"(But) there is every chance that that figure could be higher and no risk that it will be lower," he told reporters on Wednesday.

Asked whether double-digit unemployment was a possibility he said: "I think there is a risk of that at this point, but clearly the forecasts haven't been settled.

"What we do know is that all the risk remains that the unemployment rate will go higher."

Ten per cent unemployment would equal more than 160,000 out-of-work Queenslanders.

Mr Fraser on Wednesday told parliament the state had recorded growth of just 0.3 per cent in trend terms in the December quarter, placing pressure on the government's forecast growth rate of 2.5 per cent for this financial year.

He said the outlook was also challenged by further deterioration among trading partners, with many economies now expected to contract by 2.5 per cent this year.

Mr Fraser said based on these latest figures, Queensland did not fit with economists' definition of a recession.

"But we should call a spade a spade," he said.

"Clearly what we've got here is rapidly rising unemployment and ... this will look, feel and be like a recession."

Mr Fraser said the government was committed to job protection and he offered a guarantee to public sector workers that their jobs were secure.

However, he again failed to rule out a public sector wage freeze or cuts to entitlements as a cost-saving measure in the June budget.

Opposition Leader John-Paul Langbroek said the possibility of 10 per cent unemployment was "frightening".

Mr Langbroek said the opposition would work to hold the government to its election promise to create 100,000 jobs in the next three years.

"Ten per cent unemployment is just something that really shows how important this is for the premier to give us some more detail about job creation, what they're going to do," he said.

Meanwhile, the government will abolish 103 of its boards and other bodies in sweeping reforms designed to cut back on red tape.

The decision followed a raft of recommendations in an independent report that showed government could save at least $18 million a year by cutting down on the number of boards, committees and statutory authorities.

The changes will not cost jobs.