08/08/2013 - 15:54

Industry disappointed with budget

08/08/2013 - 15:54

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AMEC chief executive Simon Bennison.

The Barnett government's cost-cutting measures in the state budget have prompted an industry backlash, with the government accused of adding to the cost of doing business in Western Australia.

Association of Mining and Exploration Companies chief executive Simon Bennison said increases in utility charges and mining tenament fees and charges were "troubling" and changes to the payroll tax threshold did not go far enough.

"At a time when every dollar is critical to all companies, the budget will have an adverse impact on the bottom line and make Western Australia a less favourable place to operate," Mr Bennison said.

"We are already seeing an increasing proportion of business and investment heading offshore to places such as Canada and Africa.

"This budget will not change that trend or improve international competitiveness."

Chamber of Minerals and Energy chief executive Reg Howard-Smith said spiralling net debt levels were putting additional pressure on the state's AAA credit rating.

"Maintaining our triple AAA credit rating is important to ensure Western Australia continues to attract foreign investment," Mr Howard-Smith said.

"In an increasingly internationally competitive environment, governments need to have policies in place to attract investment and promote economic development and loss of this rating would add another unnecessary burden to the resources sector."

The government needs to do more to tackle its spending growth, Chamber of Commerce and Industry chief executive James Pearson said.

"At a time when businesses are focused on spending restraint to remain financially sustainable, the government could have done more to demonstrate the same discipline," Mr Pearson said.

Tourism Council WA chief executive Evan Hall said the government had turned its back on the tourism industry by breaking a pre-election promise to increase tourism funding from $2 million to $6 million, in a move he said would cost more than 1,000 jobs.

"The government has demoted the tourism minister, denied their election promise and dumped 1,300 jobs" Mr Hall said.

"This broken promise is a devastating blow to tourism towns across regional WA."

Urban Development Institute of Australia WA chief executive Debra Goostrey expressed concern that the Department of Planning's cash assets had quadrupled at a time when the government was slashing costs.

"With a government slashing costs it is interesting that the bank balances of a key agency is getting fat," Ms Goostrey said.

"We also note that the Department of Planning's cost per application for each subdivision and development application processed has actually decreased in 2012-13 and is expected to decline further in 2013-14, but the WAPC has increased their fees."

Master Builders WA praised the government's decision to increase the first home owners grant for buyers of new homes from $7,000 to $10,000, predicting the change could combine with historically low interest rates to provide 900 new dwellings this year.

However, Real Estate Insitute of WA president David Airey said doing so at the expense of buyers of established homes, who will now receive a grant of just $3,000, would not have the desired effect. 

"Maintaining the stamp duty exemption for first home buyers is a huge saving to many people, but slanting the FHOG towards new construction and away from established dwellings will not produce the outcome the
government is expecting," Mr Airey said.

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