Colin Barnett fought the GST fight while premier, and continues to do so today. Photo: Attila Csaszar

Barnett back to beat GST drum

Friday, 9 February, 2018 - 08:21

Former premier Colin Barnett has warned that the careers of federal Liberal and Labor MPs will be on the line if there is no change to Western Australia’s appalling deal over the GST.

Mr Barnett also predicted that the state’s traditional commitment to resources development could be scaled back unless a fairer distribution of revenue from the tax was introduced.

He described the excuses coming out of Canberra, and from federal MPs, for retention of the current GST policy as pathetic, ill informed and wrong.

Mr Barnett’s forthright views were made on Peter Newman’s Sunday morning program on 6PR after he officially brought the curtain down on his career in state politics, which began in August 1990. He was either leader or deputy leader of the Liberal Party for almost 23 years.

His comments coincided with reports that, because WA’s population was growing more slowly than had been predicted, a further $348 million would be cut from the expected return on the GST over the next four years. The state’s GST share has already been slashed to offset the revenue through royalties from the resources sector, especially iron ore.

The rest is redistributed to other states according to a formula devised by the Commonwealth Grants Commission and aimed at achieving notionally comparable standards of government services throughout Australia.

Mr Barnett said he had always been a strong supporter of the mining industry.

“For the last 60 years our fortunes in this state have been largely dictated by mining and petroleum, and yet that industry, I think, is now in the cross hairs,” he said.

When asked if the resolve of future governments to develop resources might weaken, Mr Barnett pointed to the Nationals WA’s move to impose a $5 a tonne tax on iron ore (mined by BHP and Rio Tinto) before the last state election, which he said was popular with the public.

“I didn’t agree with it but it showed that there is an element of a shift in emphasis,” he said.

“The fact that the mining companies are now advertising in the media what a great job they do – they did do a great job but I think there is a sensitivity there, and I think that is the sense that, unless Western Australia gets treated with some respect and fairness out of the GST, as it was intended to do, I think you will see a public backlash.

“And I think at the next federal election there is likely to be a backlash against sitting members, whichever party they represent.”

Mr Barnett’s warning coincides with the lodging of an application for registration to the Australian Electoral Commission by the Put Western Australia First Party. The party plans to contest the next federal election on a platform of a fairer distribution of GST revenue. At least one other group with a similar goal has said it would also seek official status.

Should support for a fresh approach gain momentum, as Mr Barnett suggests, the major parties will become extremely nervous about their prospects in WA. The Liberals, with 11 of the state’s 16 seats in the House of Representatives, would have most to lose. Labor holds the other five seats.

The most vulnerable Liberal MPs would be Aged Care Minister Ken Wyatt, who has a margin of 2 per cent in his seat of Hasluck, Steve Irons (Swan, 3.6 per cent), and Attorney-General Christian Porter (Pearce, 3.6 per cent).

Labor’s members most at risk would be Anne Aly (Cowan, 0.7 per cent) and Tim Hammond (Perth, 3.3 per cent).

The Liberals have made lump sum grants totalling $1.2 billion over the past three years for infrastructure to compensate the state for the loss of GST revenue. Federal Labor leader Bill Shorten has countered with the promise of a $1.6 billion infrastructure fund if he becomes prime minister.

Mr Barnett took a parting shot at claims that a change in the GST redistribution requires agreement from all the states.

“That has never been the case,” he said. “The decision on the allocation of the GST is made by the federal treasurer.”