WA Premier urged to spend more of budget surplus

13 May 2022

Western Australia has delivered a budget surplus of $5.7 billion, which is being praised by analysts, yet critics have questioned why the state still has a “crumbling” health system.

According to Premier Mark McGowan, his national counterparts must be “green with envy” as he announced the current financial year's surplus and the 2022/23 spending plan.

An estimated $1.6 billion surplus next year may be modest, said Moody's Investors Service, due to a cautious assumption of iron ore prices.

"Bumper iron ore export prices and volumes have fuelled the Western Australian economy to be firing on all cylinders, continuing to underscore the stark contrast between the state and its domestic peers," vice president John Manning said in a statement.

S&P Global analysts, having recently held Western Australia’s AA+ credit rating, welcomed the budget surplus announcement.

"Despite the recent spread of COVID-19 in Western Australia, revenue growth is strong and underpinned by elevated commodity prices and GST reforms," analyst Anthony Walker stated.

"We could raise the ratings within the next one to two years if it continues to achieve strong financial outcomes."

However, in contrast, State opposition leader Mia Davies called the surplus figure “eye-watering.”

"How can this be? When we have a crumbling health system, and a housing crisis," Davies said.

"You can't have multi-billion dollar surpluses two years in a row, and not share the wealth of the nation with Australian households struggling to make ends meet."

In addition, Shadow Treasurer Steve Thomas said McGowan had broken his 2017 promise to allocate half of WA’s iron ore revenue for debt repayments.

"Here again we have massive budget surplus but no plan for economic reform, and an inadequate debt repayment program," he said.