Western Australia’s monster budget surplus grows again

24th September 2021

The Shadow Treasurer Dr Steve Thomas says that the 2020-21 Annual Report on State Finances released today has highlighted the massive cash income the McGowan Government has received,  which was understated in the state budget delivered only two weeks ago. 

“The incredible $5.6 billion surplus in 2020-21 recorded in the budget papers has been “corrected”  to $5.8 billion in the Annual Report” Dr Thomas said. “This has now become the biggest surplus of  any state in Australia’s history, and represents a high water mark we are unlikely to ever see again.”  

The correction has been attributed to a $213 million lowering of expenses thanks to a variation in  accounting practices for native title settlements. 

“The current once in a lifetime fiscal boom remains the biggest lost opportunity the state has ever  seen.” 

“When you add the 2020-21 surplus to the $4 billion the Government received over and above its  earlier budgets and the very conservative $2.8 billion surplus predicted for the current year, it is a  $12.6 billion mountain of cash that Mark McGowan is already sitting on.” 

The massive increase in state revenue is attributed to: 

1. the high iron ore price resulting in massive iron ore royalties – to a peak of $12 billion in  2020-21 which is more than double the amount expected in a normal price year, 2. higher payroll and land taxes, up $1.1 billion on 2019-20, including payroll tax which is up by  $314 million or 8.4%, transfer duty which is up 58% or $770 million, and 

3. the GST fix put in place by the Federal Government which added $1.5 billion to the state  coffers last financial year and $1.85 billion this year. 

“The Government is expecting to have budget surpluses totalling $15 billion over the five years from  2020-21 to 2024-25, an unprecedented mountain of wealth” Dr Thomas said. 

“Over that period however the total net debt of the state will not decline. Instead, it will rise from  $33.5 billion at the end of last financial year to $36 billion in 2024-25.” 

“At a time of wealth previous Governments could only dream of the McGowan Labor Government  will have $15 billion in surpluses and still go out and have to borrow another $2.5 billion” Dr Thomas  said. 

“On the revenue side the Labor Government has been the beneficiary of the biggest boom in our  history, but you have to ask how well the community has benefitted from this boom which  commenced two and a half years ago and is still going today” Dr Thomas said.

Media contact: Dr Steve Thomas 0427 908 717