❓ Mr. Nalder questions the Treasurer about the unfair GST distribution to WA and the state's contribution to the Federation. The Treasurer highlights the significant financial contribution of WA to other states and territories.
AnsweredQoN 192Legislative Assembly
QuestionView source ↗
GOODS AND
SERVICES TAX DISTRIBUTION
192. Mr D.C. NALDER to the Treasurer:
We know how unfair the GST distribution process is to Western
Australia. With this in mind, can the Treasurer please outline to the house the
real value of Western Australia's contribution to the rest of the
Federation?
Mr
B.S. Wyatt : You did this the other day in the MPI!
SERVICES TAX DISTRIBUTION
192. Mr D.C. NALDER to the Treasurer:
We know how unfair the GST distribution process is to Western
Australia. With this in mind, can the Treasurer please outline to the house the
real value of Western Australia's contribution to the rest of the
Federation?
Mr
B.S. Wyatt : You did this the other day in the MPI!
AnswerView source ↗
I have discovered more information, member for Victoria Park,
which I felt compelled to share with the house.
I thank the member for Alfred Cove
for the question. I am sure this is a question of importance to every member of
the house. It is certainly of importance to everyone in Western Australia. We
all know of the shocking outcome that Western Australia is receiving in
relation to GST payments. Last year we got $3.4 billion. Based on Treasury's
estimates, in a few years' time we will get $1.1 billion in GST
payments from the commonwealth. That is a massive decline on any measure. That
is $2.3 billion per annum that we could use to invest in infrastructure, that
we could use to support the delivery of services or that we could use to pay
down debt. It is a lot of money. Interestingly, though, member for Alfred Cove,
it is only part of the story. GST distributions are only part of the story of
horizontal fiscal equalisation in this nation. There are other tools that the
commonwealth uses. States like ours, where people earn higher incomes, where
companies are relatively prosperous and where people are young—not
necessarily young, but certainly healthy—tend to draw a lot less on the
commonwealth.
Treasury conducts an analysis to add that up. It comes up
with an estimation of the total value of Western Australia's net
contribution to the Federation; that is, the total amount that we effectively
distribute out of Western Australia by a variety of mechanisms and ends up,
directly or indirectly, in the coffers and pockets of residents of other
Australian states. The last year that Treasury conducted the estimate—which
was accurately reported this morning in the local newspaper—was in 2010–11.
That amount added up to $14.9 billion. That is a large amount of money, but the
significance is when we consider it relative to other states. New South Wales'
total net contribution was $2.1 billion; Victoria's was $1.3 billion;
Queensland was $6 billion; South Australia was $5.1 billion; Tasmania was $3.4 billion;
and the Northern Territory was $3.9 billion. In other words, if we add the
total amount paid by Western Australia, we are propping up Queensland, South
Australia and the Northern Territory. New South Wales and Victoria, very
generously, take care of Tasmania; and long may they have it!
Mr
B.S. Wyatt : The tiger economy!
Mr
T.R. BUSWELL : You have thrown me off now!
In anyone's estimation, this
is ridiculous. On a per capita basis, for every man, woman and child in this
state, Western Australians contribute nearly $6 500 into that mix. Every person
in the Northern Territory receives $17 000, and then there are quantums in
between. It is a terrible outcome for Western Australia.
Mr
B.S. Wyatt : Does that Treasury analysis—because it does not say—also
take into consideration defence and foreign affairs spending?
Mr
T.R. BUSWELL : I am not sure that it does, but who would want to attack
Western Australia? We already have our own foreign affairs department; it is
called the Premier! It is a very good question. This document was produced by
Treasury. I discovered it yesterday.
Mr
B.S. Wyatt : That's an old copy.
Mr
T.R. BUSWELL : Yes—2006. It is a very good document. I will get
Treasury to upgrade it.
Mr
W.J. Johnston : It was done by the former member for Belmont.
Mr
T.R. BUSWELL : It was done by the member for Belmont. It is very good work.
We will have it upgraded this year. The interesting point out of this, member
for Cannington —
Mr
W.J. Johnston interjected.
The SPEAKER :
Member for Cannington!
Mr T.R. BUSWELL : —
is that in 2004–05, when a similar analysis was conducted, Western
Australia's net contribution to the commonwealth was $4.1 billion. Five
years later that contribution had grown to more than $14 billion, so the extent
to which we are being ripped off under the current system grows at the moment
by a rate of around $2 billion a year.
I will conclude with this observation. Later this year, in September,
a whole lot of people will want to be elected to represent Western Australia in
the federal Parliament. My personal view is that I do not care what party they
represent, but when they knock on my door or on the doors of members opposite
or the doors of anyone in this state, we should ask them, ''What is your
view on this disparity and what are you going to do about it?''
which I felt compelled to share with the house.
I thank the member for Alfred Cove
for the question. I am sure this is a question of importance to every member of
the house. It is certainly of importance to everyone in Western Australia. We
all know of the shocking outcome that Western Australia is receiving in
relation to GST payments. Last year we got $3.4 billion. Based on Treasury's
estimates, in a few years' time we will get $1.1 billion in GST
payments from the commonwealth. That is a massive decline on any measure. That
is $2.3 billion per annum that we could use to invest in infrastructure, that
we could use to support the delivery of services or that we could use to pay
down debt. It is a lot of money. Interestingly, though, member for Alfred Cove,
it is only part of the story. GST distributions are only part of the story of
horizontal fiscal equalisation in this nation. There are other tools that the
commonwealth uses. States like ours, where people earn higher incomes, where
companies are relatively prosperous and where people are young—not
necessarily young, but certainly healthy—tend to draw a lot less on the
commonwealth.
Treasury conducts an analysis to add that up. It comes up
with an estimation of the total value of Western Australia's net
contribution to the Federation; that is, the total amount that we effectively
distribute out of Western Australia by a variety of mechanisms and ends up,
directly or indirectly, in the coffers and pockets of residents of other
Australian states. The last year that Treasury conducted the estimate—which
was accurately reported this morning in the local newspaper—was in 2010–11.
That amount added up to $14.9 billion. That is a large amount of money, but the
significance is when we consider it relative to other states. New South Wales'
total net contribution was $2.1 billion; Victoria's was $1.3 billion;
Queensland was $6 billion; South Australia was $5.1 billion; Tasmania was $3.4 billion;
and the Northern Territory was $3.9 billion. In other words, if we add the
total amount paid by Western Australia, we are propping up Queensland, South
Australia and the Northern Territory. New South Wales and Victoria, very
generously, take care of Tasmania; and long may they have it!
Mr
B.S. Wyatt : The tiger economy!
Mr
T.R. BUSWELL : You have thrown me off now!
In anyone's estimation, this
is ridiculous. On a per capita basis, for every man, woman and child in this
state, Western Australians contribute nearly $6 500 into that mix. Every person
in the Northern Territory receives $17 000, and then there are quantums in
between. It is a terrible outcome for Western Australia.
Mr
B.S. Wyatt : Does that Treasury analysis—because it does not say—also
take into consideration defence and foreign affairs spending?
Mr
T.R. BUSWELL : I am not sure that it does, but who would want to attack
Western Australia? We already have our own foreign affairs department; it is
called the Premier! It is a very good question. This document was produced by
Treasury. I discovered it yesterday.
Mr
B.S. Wyatt : That's an old copy.
Mr
T.R. BUSWELL : Yes—2006. It is a very good document. I will get
Treasury to upgrade it.
Mr
W.J. Johnston : It was done by the former member for Belmont.
Mr
T.R. BUSWELL : It was done by the member for Belmont. It is very good work.
We will have it upgraded this year. The interesting point out of this, member
for Cannington —
Mr
W.J. Johnston interjected.
The SPEAKER :
Member for Cannington!
Mr T.R. BUSWELL : —
is that in 2004–05, when a similar analysis was conducted, Western
Australia's net contribution to the commonwealth was $4.1 billion. Five
years later that contribution had grown to more than $14 billion, so the extent
to which we are being ripped off under the current system grows at the moment
by a rate of around $2 billion a year.
I will conclude with this observation. Later this year, in September,
a whole lot of people will want to be elected to represent Western Australia in
the federal Parliament. My personal view is that I do not care what party they
represent, but when they knock on my door or on the doors of members opposite
or the doors of anyone in this state, we should ask them, ''What is your
view on this disparity and what are you going to do about it?''
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