❓ Opposition questions the Premier about the impact of falling iron ore prices on the state budget, given independent forecasts differ from the budget's assumptions. The Premier avoids direct answers, predicting a price recovery and highlighting increased export volumes.
AnsweredQoN 455Legislative Assembly
QuestionView source ↗
IRON ORE PRICE — BUDGETARY IMPACTS
455. Mr M. McGOWAN to the Premier:
I refer to the impact of downgrades
in the iron ore price on the state's financial position with
independent bodies now forecasting an average price of $100 per tonne against
the Premier's budget price of $111 per tonne.
(1) Can the
Premier confirm that a stabilised average iron ore price of $100 per tonne will
remove at least half a billion dollars from the state budget in 2014–15?
(2) Can the
Premier confirm that the state budget already takes into account the increased
volumes of iron ore for export that he has used to dismiss any effects on the
budget?
455. Mr M. McGOWAN to the Premier:
I refer to the impact of downgrades
in the iron ore price on the state's financial position with
independent bodies now forecasting an average price of $100 per tonne against
the Premier's budget price of $111 per tonne.
(1) Can the
Premier confirm that a stabilised average iron ore price of $100 per tonne will
remove at least half a billion dollars from the state budget in 2014–15?
(2) Can the
Premier confirm that the state budget already takes into account the increased
volumes of iron ore for export that he has used to dismiss any effects on the
budget?
AnswerView source ↗
(1)–(2) I
am not a fortune teller and neither is anyone else in the industry. As to what
the iron ore prices will do, all sorts of guesses and estimates have been made
and models done. The general consensus around the industry is that the iron ore
price will probably rise during the second half of the year, which is the
normal cyclical happening that we see.
Mrs
M.H. Roberts : It seems that the Premier is a fortune teller after all.
Mr
C.J. BARNETT : Well, opposition members have asked me to be a fortune teller
so I will give it my best shot. I expect that iron ore prices will recover. I
do not think they will go up to the $160 a tonne they were three years ago, but
maybe in the range of around $110 to $115 is where we would normally expect
them to be. It is a fact that while the price is down, and that is a concern,
the volumes are at record levels and that rising volumes will basically
compensate in terms of revenue for Treasury.
am not a fortune teller and neither is anyone else in the industry. As to what
the iron ore prices will do, all sorts of guesses and estimates have been made
and models done. The general consensus around the industry is that the iron ore
price will probably rise during the second half of the year, which is the
normal cyclical happening that we see.
Mrs
M.H. Roberts : It seems that the Premier is a fortune teller after all.
Mr
C.J. BARNETT : Well, opposition members have asked me to be a fortune teller
so I will give it my best shot. I expect that iron ore prices will recover. I
do not think they will go up to the $160 a tonne they were three years ago, but
maybe in the range of around $110 to $115 is where we would normally expect
them to be. It is a fact that while the price is down, and that is a concern,
the volumes are at record levels and that rising volumes will basically
compensate in terms of revenue for Treasury.
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