Western Australia has announced a mid-year budget forecast surplus of almost $500 million more than projected at the May budget.
Western Australia has announced a mid-year budget forecast surplus of almost $500 million more than projected at the May budget.
The state government's mid-year financial projections statement released today says the forecast surplus for 2006-07 had risen to $1.74 billion, up from the $1.27 billion estimated at budget time.
Last year, WA registered a record $2.26 billion surplus.
Treasurer Eric Ripper said a strong economy and prudent financial management have ensured the state's finances remained strong.
"Every cent of the surplus is being invested in our record building program, replacing funding which would otherwise come from debt, or used directly for debt reduction," Mr Ripper said.
The Treasurer said $19.4 billion would be spent on capital works over four years - up from the $18.1 billion estimated at the budget.
Deputy Opposition Leader Troy Buswell said that despite the massive surplus and a projected total tax take of $5.5 billion over the financial year, Mr Ripper had broken a promise to ease Western Australians' tax burden and improve services.
"Instead of helping people, he is setting himself up to pork barrel before the next election, hoping that a late flood of cash will make people forget just how poorly this government has treated them for the better part of a decade," Mr Buswell said.
The full text of an announcement from the Treasurer's office is pasted below
A buoyant economy and prudent financial management have ensured the State's finances remain strong, according to the Government Mid-Year Financial Projections Statement released today.
Treasurer Eric Ripper said stronger than expected economic growth since the May Budget had seen the Department of Treasury and Finance revise a number of key forecasts for 2006-07.
As a result, the forecast surplus for 2006-07 had risen to $1.74 billion, $526 million less than last year's record $2.26 billion surplus, but higher than the Budget time estimate of $1.27 billion.
Mr Ripper said larger surpluses gave the Government greater capacity to build infrastructure for future generations such as the $1.1billion Fiona Stanley Hospital development at Murdoch, and keep debt low.
"Every cent of the surplus is being invested in our record building program, replacing funding which would otherwise come from debt, or used directly for debt reduction," the Treasurer said.
"After completing $17.7 billion worth of capital works since 2001, net debt at June 30 2007 is forecast to be lower than when the Government was first elected."
Mr Ripper said the economic boom had given the Government an opportunity to invest more in key service delivery areas such as health, education and community safety.
The Government had also taken advantage of the improved financial outlook to address a number of issues post Budget, including:
- $160 million for new rail cars on the Perth Urban Rail Network;
- an additional $133million on expanded project scope and land remediation for the Perth Arena;
- a $51million package to provide additional caseworkers and support staff for vulnerable children and families at risk;
- $39 million to significantly increase places for apprentices and trainees, including indigenous support, expanding the State's response to the nationwide skills shortage; and
- a $38 million expansion of the LPG conversion subsidy scheme;
Key results contained in the mid-year review included:
- a forecast surplus for 2006-07 of $1.74 billion. This is $526 million less than last year's record $2.26 billion surplus, but higher than the Budget time estimate of $1.27 billion. Surpluses over the forward estimates are also forecast to be higher than at Budget.
- continued delivery of record infrastructure spending, with a capital works program of $19.4 billion over four years - up from the $18.1billion program estimated at Budget;
- significantly lower debt levels, reflecting the better than expected outturn for 2005-06 and the stronger surplus outlook over the forward estimates period. By June 30 2010, total public sector net debt is forecast to reach $6 billion, down $1.7 billion on the 2006-07 Budget forecast; and
- estimated expense growth in 2006-07 of 10.6 per cent, up from 7.7 per cent at Budget time. Much of this increase simply reflects the underspend in 2005-06 expenses, with agencies spending $199million less in 2005-06 than the estimated outturn contained in the 2006-07 Budget. With no other changes, this factor alone takes expense growth to 9.3 per cent purely because of the lower base in 2005-06.
The Treasurer said prudent financial management had given the Government a greater capacity to build infrastructure, deliver key services, pay fair wages and consider further tax cuts, building on the $3.3billion worth of tax cuts announced since 2004.
