Political editor Joe Spagnolo takes you through the WA State budget including the hit families will cop in the wake of increased household costs.
WA Premier Colin Barnett. Source: News Corp Australia
HOUSEHOLD annual fees and charges will go up more than $300 as part of a tough WA Budget that will also see the Barnett Government raid the Royalties for Regions scheme and sell major assets.
Releasing his first State Budget, Treasurer Mike Nahan made no excuses for a tough Budget – revealing state debt now topped the $20 billion mark.
Part of the Budget will see first home buyers no longer be exempt from the stamp duty tax for homes under $500,000. The new threshold will be $430,000.
FULL COVERAGE
● AT A GLANCE: Your five-minute guide
● BREAKDOWN: Winners and losers
● STANDARD AND POOR'S: Budget leaves WA 'open to shocks'
● HOUSING: Stamp duty hit for first homebuyers
As foreshadowed in The Sunday Times on the weekend, household fees and charges will go up by about $324 from July 1. Electricity charges alone are set to go up by about $62 a year.The average family will now spend $5224 a year in household fees and charges (not including gas) as compared to $4900 this year.
Breaking an election promise not to raise power bills by more than the inflation rate, Premier Colin Barnett has authorised electricity hikes of 4.5 per cent per cent.
Water charges will go up 6 per cent, or $84 a year.
As well, there will be 20 per cent hikes in student fares and 5 per cent increases in the Emergency Services Levy.
And, parking in the Perth CBD will also be more expensive in 2014-15, with a $365 increase in the Perth Parking Levy over two years.
Treasurer Mike Nahan delivering his first State Budget to Parliament. Picture: Stewart Allen Source: News Corp Australia
Land tax will increase 10 per cent.
Dr Nahan tried to play down the increases by saying WA families were still well off compared to those in other states across Australia.
"If you compare the NSW basket of goods it is 40 per cent higher (than WA), " he said.
"It is (increase WA fees and charges) is what you have to do."
Dr Nahan, the fourth Treasurer for the Barnett Government since it came into power in 2008, said tough measures were needed to get the state's finances back on track.
"It's the right budget for its time," he said.
● HEALTH: Another $40m for Fiona Stanley Hospital
● STATE DEBT: TAB, port facilities in sell-off firing line
● COMMENT: WA Budget targets wrong people
Dr Nahan said the Utah Point bulk export facility at Port Hedland, Kwinana bulk terminal, the TAB, Perth Market Authority and "surplus" hospitals sites like Princess Margaret were all were likely to be sold off to pay back debt.
He would not say when the assets would be sold or how much the Government expected to reap from the fire sale.
However, informed Liberal sources have told PerthNow that the Government is hoping to get about $1.5 billion every year up until the 2017 election.
"The government will keep a close eye on the state's debt levels, and in conjunction with sound budget management, will pursue an orderly program of asset sales. This will be overseen by the Premier," Dr Nahan said.
Former treasurer Troy Buswell looks on as his successor Mike Nahan delivers the Budget he had much involvement in. Picture: Stewart Allen Source: News Corp Australia
Dr Nahan said the Water Corporation's assets, like wastewater treatment plants, were also on the radar.
In a controversial move, Mr Barnett will raid $3 billion from the Nationals' Royalties for Regions fund over the next four years – instead of their normal 25 per cent entitlement.
According to Treasury forecasts, the Nationals were entitled to $6.9 billion over the next four years in Royalties for Regions funding, but will only get $4 billion to spend.
WA's precarious financial position was highlighted by revelations WA would record a $183 million surplus for 2013-14 - well short of the $386 million forecast by Treasury last August.
The surplus is expected to drop to just $5 million in 2015-16.
● LAW AND ORDER: Police wage cap row
● TRANSPORT: Student fares up 20 per cent
● EDUCATION: Education spared further cuts
● SOCIAL WELFARE: $90m boost for child protection
State debt will tip the $22 billion mark this financial year, increasing to just under $30 billion in four years time.
Business investment is expected to drop to $60 billion over the next four years, but exports are expected to increase from $140 billion in 2013-14 to $170 billion in 2017-18.
Despite the pressure of delivering his first Budget just two months after being made Treasurer, Mr Nahan was quite relaxed.
He even referenced a few less-fortunate Liberal colleagues when recounting his reaction to being told to wipe $420 million out of the Budget two weeks ago, because a drop in iron ore prices affected projected revenue from royalties.
"So I sat down and had a bottle of wine. I wasn't driving. And no, it wasn't Grange," he said.
'HORROR' BUDGET FULL OF PAIN: LABOR Labor leader Mark McGowan said this was a "horror Budget " which heavily slugged West Australians for Mr Barnett's "extravagances".
"This is a Budget of pain, hardship and dishonesty that will impact every West Australian man, woman and child," he said. "It's a horror Budget on the hip pocket. It's a Budget that hurts people who can least afford it.
"They've had seven treasurers in the last five years. This is a government not fit to be in government."
The Budget confirms the Royalties for Regions program is "dead and buried", the opposition claims.
Regional Development Minister Terry Redman insists it does not represent a raid, saying the integrity of the legislation has been maintained and also "supports the broader state government budget".
But Labor leader Mark McGowan said the Liberals and the Nationals had "let down the bush".
"The promise was clearly 25 per cent of royalties and that is clearly not going to happen," Mr McGowan said. "It is a clear broken promise."
WACOSS boss Irina Cattalini blasted the Budget, saying the government has once again failed to address cost of living pressures.
"The number one issue is housing and yet there is nothing in this budget to address this massive problem " she said.
"The Budget fails to take seriously enough the cost of living pressures in this community for people living on low incomes.
"We keep hearing talk of reforming tariffs and of reforming concessions, we cannot keep pushing the prices up until the government delivers that outcome."
Community and Public Sector Union branch secretary Toni Walkington said the Budget was "yet another lie in a long line of lies from the Barnett Government".
"They would have us believe that public service expenditure is out of control and more services need to be cut. This is clearly and blatantly not the case," she said.
"(Over) the last five years the expense of public services on general expenses has reduced and not increased. However other operating costs in the same period of time have increased by 190 per cent.
"Those other operating costs are the result of vanity projects such as Elizabeth Quay and of privatisation and outsourcing. That's a waste of taxpayers' money. That needs to be cut, not public services".
Master Builders director of housing, Geoff Cooper, said the Budget would make the housing affordability crisis in WA worse.
"This is the tax man putting his hands in the pockets of WA home buyers."
TWITTER: @SpagnoloJoe
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