THE Western Australian Government has agreed to sign a deal with other States and Territories to try and prevent cross-border “poaching” of businesses and events.
Treasurer Eric Ripper said the move was aimed at stamping out the practice of Governments offering financial incentives to lure companies and events from one State to another.
All States and Territories except Queensland have agreed to sign the new deal.
The absence of Queensland leaves a gaping hole, especially as it has been relatively aggressive in the incentives it has offered businesses to relocate.
At least three incentive packages offered by the Gallop and Court governments would appear to run foul of the new agreement.
These include last year’s decision to offer a $4.6 million incentive package to Westpac, payable over 10 years, to take over the former Ansett call centre in Joondalup.
Westpac struck similar deals in Adelaide and Launceston, where it took over state-of-the-art Ansett call centres and received financial support from the respective State governments.
The Finance Sector Union was highly critical of this series of deals, since Westpac was cutting staffing at its Sydney and Melbourne call centres at around the same time.
The call centre industry has been the beneficiary of an inter-state bidding war over recent years.
Stellar Call Centre, half-owned by Telstra, and Ansett are two other national companies to have been given financial incentives to establish call centres in WA.
The Gallop Government’s decision in June to provide a $3 million incentive package to US defence contractor Raytheon, which is relocating its naval systems division headquarters from Sydney to Jervoise Bay, may also have run foul of the new policy.
WA competed with South Australia to lure Raytheon, which plans to employ about 290 people at the new facility.
The Court Government’s 2000 decision to provide a $900,000 incentive package to Mediterranean Shipping Company, to relocate its Australasian shipping office from Sydney to Fremantle, is a third policy initiative in WA that appears to run counter to the new agreement.
Mr Ripper said the States and Territories would still “fight tooth and nail” to attract new investment from overseas.
“But simply poaching a business or an event from over the border does nothing for the national economy and short changes taxpayers,” he said.
“I’m disappointed that Queensland doesn’t yet see the merit in stamping out this economically inefficient practice.”
Mr Ripper did not volunteer any WA examples, but gave two interstate examples of practices targeted by the agreement.
These included an SA Government decision in 2000 to offer financial incentives to whitegoods manufacturer Email to move from Victoria.
“Email simply shifted 650 jobs across the border, with no new jobs or national economic benefit,” he said.
Similarly, the Victorian Government “poached” the Heineken Golf Classic from WA in 2000.
© Business News 2018. You may share content using the tools provided but do not copy and redistribute.