❓ Opposition questions the Premier's justification for tax increases and broken promises, citing discrepancies between the midyear review's iron ore price forecast and current prices. The Premier defends the actions, attributing them to GST revenue losses and declining commodity prices.
AnsweredQoN 123Legislative Assembly
QuestionView source ↗
MIDYEAR REVIEW — IRON ORE PRICE
123. Mr M. McGOWAN to the Premier:
I refer to the Premier's
increase in taxes announced today and to yesterday's excuse for
breaking another election promise, which was, as he claims, a structural issue
with the budget, in particular declining commodity prices.
(1) Can the
Premier confirm that the midyear review just prior to the election was
predicated on an iron ore price of $118 per tonne and that the iron ore price
for April was over $135 per tonne, and today it is still at around $US130 per
tonne; in other words, well above Treasury forecasts?
(2) Considering
iron ore is WA's overwhelming royalty income source, does this not
contradict what the Premier has said?
(3) What new,
unforeseen structural change has occurred in the past two months to justify
those broken promises?
123. Mr M. McGOWAN to the Premier:
I refer to the Premier's
increase in taxes announced today and to yesterday's excuse for
breaking another election promise, which was, as he claims, a structural issue
with the budget, in particular declining commodity prices.
(1) Can the
Premier confirm that the midyear review just prior to the election was
predicated on an iron ore price of $118 per tonne and that the iron ore price
for April was over $135 per tonne, and today it is still at around $US130 per
tonne; in other words, well above Treasury forecasts?
(2) Considering
iron ore is WA's overwhelming royalty income source, does this not
contradict what the Premier has said?
(3) What new,
unforeseen structural change has occurred in the past two months to justify
those broken promises?
AnswerView source ↗
(1)–(3)
We have not broken promises. Maybe it is semantics—we have not
increased taxes; we have decided not to reduce taxes. It is true. When members
opposite talk about increasing taxes, that is actually not correct.
Several members interjected.
Mr
C.J. BARNETT : We made no commitments in the area of stamp duty during the
election campaign. We did not make any commitments at all. We made no
commitments on stamp duty. We have taken a decision to defer the abolition of
stamp duty on non-real property. Indeed, most other states have done exactly
the same. We regret that, but it is not a broken promise. We made no
commitments in that area.
As I said last night, this state
lost $400 million. Every other state and territory in Australia had an increase
in GST dollars from the Gillard government except for Western Australia, with a
further $400 million loss. That is a reality we have to deal with. That is a
structural change. The other structural change, if members opposite have not
noticed, over the last few months, effectively, the government was more or less
in caretaker mode from Christmas, given the summer holidays and all the rest of
it —
Mr W.J. Johnston :
Oh, my God!
Mr C.J. BARNETT :
If the opposition has not noticed, commodity prices —
Several members interjected.
Mr C.J. BARNETT :
There is no point; you are not serious opposition.
The SPEAKER :
Member for Cannington, I call you to order for the first time. I cannot hear
the Premier's answer.
Mr C.J. BARNETT :
Another change is that we have seen commodity prices come off the boil. It is
the general view within industry, including the iron ore industry, that
commodity prices will fall further. That is another structural change. We have
also seen a number of significant projects, not ones that have been committed—with
perhaps one exception—but projects that were to follow the current
round of investment in the resources sector, be deferred, and some may never
reappear. That is a structural change. They are factors that have happened over
the past two or three months. That is why the government is taking actions, and
we will take further actions. We will not enjoy doing it, but we are going to
take further actions. We will act strongly and we will go early. In a scenario of
GST revenue going from $3 billion today to $1 billion in four years, we have to
make not only corrective measures but also substantial changes to the structure
of the public sector in Western Australia in its operation and funding. We will
do that. If we fail to do that, this state will be in the situation Queensland
found itself in. That state had to dismiss 14 000 public servants and, only the
other day, closed nearly 60 schools. That will not happen in Western Australia
because this state is taking action early.
We have not broken promises. Maybe it is semantics—we have not
increased taxes; we have decided not to reduce taxes. It is true. When members
opposite talk about increasing taxes, that is actually not correct.
Several members interjected.
Mr
C.J. BARNETT : We made no commitments in the area of stamp duty during the
election campaign. We did not make any commitments at all. We made no
commitments on stamp duty. We have taken a decision to defer the abolition of
stamp duty on non-real property. Indeed, most other states have done exactly
the same. We regret that, but it is not a broken promise. We made no
commitments in that area.
As I said last night, this state
lost $400 million. Every other state and territory in Australia had an increase
in GST dollars from the Gillard government except for Western Australia, with a
further $400 million loss. That is a reality we have to deal with. That is a
structural change. The other structural change, if members opposite have not
noticed, over the last few months, effectively, the government was more or less
in caretaker mode from Christmas, given the summer holidays and all the rest of
it —
Mr W.J. Johnston :
Oh, my God!
Mr C.J. BARNETT :
If the opposition has not noticed, commodity prices —
Several members interjected.
Mr C.J. BARNETT :
There is no point; you are not serious opposition.
The SPEAKER :
Member for Cannington, I call you to order for the first time. I cannot hear
the Premier's answer.
Mr C.J. BARNETT :
Another change is that we have seen commodity prices come off the boil. It is
the general view within industry, including the iron ore industry, that
commodity prices will fall further. That is another structural change. We have
also seen a number of significant projects, not ones that have been committed—with
perhaps one exception—but projects that were to follow the current
round of investment in the resources sector, be deferred, and some may never
reappear. That is a structural change. They are factors that have happened over
the past two or three months. That is why the government is taking actions, and
we will take further actions. We will not enjoy doing it, but we are going to
take further actions. We will act strongly and we will go early. In a scenario of
GST revenue going from $3 billion today to $1 billion in four years, we have to
make not only corrective measures but also substantial changes to the structure
of the public sector in Western Australia in its operation and funding. We will
do that. If we fail to do that, this state will be in the situation Queensland
found itself in. That state had to dismiss 14 000 public servants and, only the
other day, closed nearly 60 schools. That will not happen in Western Australia
because this state is taking action early.
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