- Operating surplus of $553 million in 2018-19 - first surplus in five years achieved after just two years in office
- $1.5 billion operating surplus in 2019-20, and continuing surpluses across entire forward estimates period
- Expense growth limited to just 1.3 per cent per annum, meaning operating surpluses would be achieved even without GST reform
- Net debt is $4.1 billion lower than forecast under the previous Liberal National Government for 2019-20, with WA the only State in the country with debt decreasing
The McGowan Labor Government's third Budget delivers on its pledge to return the Budget to surplus and fix the financial mess left by the previous Liberal National Government.
The 2019-20 Budget delivers a return to surplus (of $553 million) in 2018-19, in just the second year of this Government, and the first operating surplus since 2013-14. This represents a $3 billion turnaround from the $2.5 billion deficit in 2016-17, the final year of the Liberal National Government.
Operating surpluses are also forecast across the entire forward estimates period, including a $1.5 billion surplus in 2019-20 and over $2 billion out to 2022-23. These surpluses are underpinned by the Government's disciplined management of expenditure, combined with an expected pick-up in economic activity from 2019-20.
A return to an operating surplus position is a key requirement of the Government's debt reduction strategy. The State's net debt levels are forecast to peak $4.1 billion lower than projected under the previous Liberal National Government in 2019-20, and subsequently decline in each year of the forward estimates.
Compared to the pre-election estimates under the previous government, the reduction in projected net debt will save Western Australians some $508 million in wasted interest payments by 2019-20.
Strong financial management means that debt can start to be paid down from 2020-21, while still continuously improving the quality of health care, education and community services.
Households will be the beneficiaries of the Government's strong financial management, with the lowest increases to fees and charges in 13 years. This Budget commits $284 million to limit household electricity price increases, with the 2019-20 increase limited to the projected inflation rate of just 1.75 per cent. This is the lowest rise in electricity prices since 2008, when WA Labor was previously in office.
Investments are targeted at job creation, supporting diversification of the economy and encouraging investment and growth in key sectors. The Government is on track to meet our 150,000 jobs target, with 37,000 jobs created since coming to office just over two years ago. The Budget continues to support jobs creation, including investment totalling $4.1 billion over the next four years for METRONET, with construction on key projects set to commence from 2019-20. An additional $1.3 billion has been allocated to 25 priority road projects, which are expected to create some 28,000 new jobs for Western Australians, and lifts total investment in roads over the four years to 2022-23 to $4.2 billion.
Global and national factors have created a challenging economic environment but despite this the WA economy continues to grow, proving the WA economy has become more resilient and diverse.
For more 2019-20 State Budget information, visit http://www.ourstatebudget.wa.gov.au
Comments attributed to Treasurer Ben Wyatt:
"With disciplined management of expenditure, the McGowan Labor Government has delivered on its pledge to return the Budget to surplus - after just two years in office.
"The Budget vindicates the Government's approach to expenditure restraint so much so, that even without the GST floor top-up payments, the McGowan Government would still achieve operating surpluses across the entire forward estimates.
"This result means we have been able to limit increases in household fees and charges to two per cent, the lowest increase in 13 years. We are also making targeted investments in frontline services and job-creating infrastructure like roads and METRONET, for the benefit of all Western Australians.
"The half a billion dollars saved in interest payments since we came to office will be directed towards more productive purposes such as improving services, investment in infrastructure or paying down debt.
"This is why managing the finances is a key priority for the McGowan Government.
"This Budget proves that it is possible to deliver relief to households, prioritise spending to improve key services, and build job-creating infrastructure while maintaining responsible financial management."
Treasurer's office - 6552 5900