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The Government also will pledge up to a further $80 million in future budgets to help construct the $240 million world-class centre, subject to a viable business case being presented.

The project, described by one MP as the Darling Harbour of Cairns, will help re-ignite the local economy, boosting the ailing construction industry by employing up to 1000 people during the construction phase.

It will help establish Cairns as the cultural capital of North Queensland, opening up new markets in festivals, cultural exhibitions and conventions and providing world-class bases for existing and new arts communities.

The State's decision now puts the focus on the Federal Government and Federal Opposition to make similar pledges in this election year.

Yesterday, Anna Bligh said: "We're in. It's an unequivocal commitment."

"Our bona fides are on the table," Ms Bligh said.

When Treasurer Andrew Fraser hands down his Budget today, it will include $2.5 million as a one-third contribution of funding for the detailed planning of the project.

It also includes the transfer of State-owned port land worth $40 million for the construction of the project.

"This project will breathe new life into the Cairns economy, add a major new attraction to the Cairns tourism experience and be a showcase for indigenous art and performance," Ms Bligh said.

"Our Government commits in this year's Budget to be a one-third funding partner in making this facility a reality.

"It will put Far North Queensland on the map as a cultural destination and add a whole new dimension to the experience of visitors to the region.

"This is a firm commitment that the State Government will be an equal partner with the Cairns Regional Council and the Federal Government to develop the Cairns Cultural Precinct.

"I've been convinced that this project is what Cairns needs now and for the future."

Today's Budget announcement will be welcomed by Cairns community and business leaders, members of whom featured in a full-page advertisement in Saturday's The Weekend Post, calling for the State and Federal governments to support the project.

While the announcement will provide a fillip for the economy, it could also help raise the stocks of the Bligh Government, which, like the Rudd Government, is teetering on the edge in opinion polls.

Far Northern Labor MPs will today start selling the virtues of the Budget announcement hoping to shore up the stocks of the Bligh Government.

Cairns MP and Minister for Local Government and Aboriginal and Torres Strait Islander Partnerships, Desley Boyle, said the announcement was "the best news for Cairns that we could have," adding the precinct will be the "Darling Harbour" of Cairns.

"Over the years, major projects such as the Cairns International airport, the Cairns Convention Centre and the Esplanade Lagoon have triggered a new age in the growth and development of Cairns," she said.

Barron River MP Steve Wettenhall said: "We've hit pay dirt on this issue."

Mulgrave MP Curtis Pitt said the project was an important step towards diversifying the region’s economy.

"This will fulfil the vision of a waterfront precinct that the city has held for many years," he said. "Maybe now we will see artists such as Pink not only visit Port Douglas for a holiday but hold a major concert in Cairns as well."

Cook MP Jason O'Brien said: "This is something that will give a new dimension to Cairns as a community and as a tourist destination."

Source: The Cairns Post