S&P gave a bullish response to the NSW government's 2009-10 budget, returning the outlook on the 'AAA/A-1+' ratings on the state to stable from negative. This was the result of a re-assessment of the state's fiscal flexibility and particularly the government's ability to make structural improvements to its financial position despite a likely cyclical deterioration.However, S&P warned against the government materially stepping back from the process of privatising electricity retail assets, failing to substantially deliver on proposed savings measures or introducing significant new policies in the lead-up to the March 2011 election.