Western Australia’s footy teams may not have made it to the grand final this year, but it’s safe to say that the release of today’s updated State Finances clarify that WA is up near the top of the table for astute budget management.
The Chamber of Commerce and Industry WA (CCI) congratulates the State Government on today’s 2018-19 Annual Report on State Finances, which confirms that the Government has achieved a $1.3 billion operating surplus – $851 million higher than expected at the 2019-20 Budget – and reduced total public sector net debt by $819 million.
The Government’s continued focus on reducing expenditure growth is good news for WA businesses and households alike, with general government expenditure $316 million less than expected at the 2019-20 Budget.
External factors have contributed to general government revenue growing by 9.1 per cent, relative to 2017-18, namely higher than expected iron ore royalties and additional GST flowing through to WA.
For the first time in the history of the GST, WA is not being punished for exporting more iron ore – and never will be again. This continues to have enormous benefits for WA’s state finances and Australia’s economic outlook for generations to come.
When Moody’s upgraded its outlook for WA earlier this year it indicated an improvement in the trajectory for the State’s financial position, which is extremely positive. Regaining the State’s triple-A credit rating is critical. The higher our credit rating, the lower the Government’s interest payments are on debt – money which could be used to build new roads, hospitals or schools.
It’s crucial that the Government continues its focus on holding back spending growth and keeping taxes low so that the economy can grow and debt can be paid down. As debt is reduced and the interest bill is reined in, the Government’s credit rating and outlook will continue to improve.
With four out of five WA jobs created by business, this means it’s more important than ever that WA businesses are supported with the right policy settings to get on with the job of boosting productivity and creating jobs which benefits us all.
To achieve both job creation and budget repair, CCI has urged the Government to reduce its tax on jobs – payroll tax. WA has the highest payroll tax burden of any state in the nation, making it more expensive to create jobs here than anywhere else in Australia.
Importantly, this will support every industry evenly, from manufacturers, retailers, construction to farmers, as opposed to cherry-picking winners in a fiscally constrained environment.