The state government has revealed a $51 million surplus in its mid-year financial projection statement released today.
The state government has revealed a $51 million surplus in its mid-year financial projection statement released today.
The full statement is below:
Treasurer Troy Buswell today announced an estimated $51 million surplus in the 2009-10 Government Mid-Year Financial Projections Statement.
Mr Buswell said the outlook for the Western Australian economy had improved since the 2009-10 State Budget.
"This reflects a less severe reduction in business investment than previously forecast, underpinned by sustained activity and growth prospects in the State's major trading partners, particularly China," he said.
"We are pleased to be able to announce a surplus today, despite it being smaller than anticipated at the time of the State Budget.
"The outlook for the State's economy has improved since the 2009‑10 State Budget, with growth of 2.25 per cent now forecast for 2009‑10, compared to an expected contraction of 1.25 per cent at Budget time.
"Growth is forecast to accelerate in the medium to longer term, reaching 4.75 per cent by 2012‑13.
"These results are an example of the Government's successful management of the State's finances and suggest that the global recession may soon be over."
The Treasurer said business investment indicated activity in the resources sector had held up better than expected at Budget time.
"Business investment is expected to strongly rebound in 2011-12 and 2012-13 as the $43 billion Gorgon LNG project reaches its construction peak," he said.
The State Government is liaising with the Federal Government, which will collect royalties from Gorgon, to finalise details of the promised $100 million per year Western Australian Infrastructure Fund.
"Despite this good news, the improved economic outlook does not immediately flow through to the State's finances," Mr Buswell said.
Sustained pressure from the global financial crisis has contributed to the general government sector operating surplus for 2009-10 being reduced from the estimated $409 million at the time of the 2009-10 State Budget to a revised surplus of $51 million.
This downward revision largely reflects lower revenue from mining royalties and North West Shelf petroleum grants, mainly due to the significant rise in the value of the Australian dollar since May, and continuing expense pressures.
"To address these pressures, the State Government has approved a new suite of corrective measures worth about $600 million over the forward estimates period," the Treasurer said.
"These include delayed implementation of tax relief measures and the deferral of spending on a number of election commitments, including the State Government Royalties for Regions program."
These new measures add to the corrective measures implemented since the Government came to office in September 2008 which, on current estimates, total $8.5 billion across the forward estimates period.
"If the Government hadn't implemented these measures, the Budget would be in deficit to the tune of $982 million in 2009‑10, and the State's Triple-A credit rating would be in jeopardy," Mr Buswell said.
The Mid‑Year Review also shows that for the four months to October 31, 2009, the general government sector recorded a $970 million operating deficit.
"While the October 2009 outcomes may appear inconsistent with the $51 million surplus projected for the full‑year, they are consistent when a number of significant timing issues are taken into account and illuminate the different characteristics of the volatile monthly reports and the big picture provided by the Mid-Year Review," the Treasurer said.
Significant timing issues impacting the monthly results include the issuing of land tax assessments, the receipt of outstanding Commonwealth stimulus funding and the timing of dividend receipts from the public corporations (which are usually received in May-June each year).
"These issues are all reflected in the full‑year estimates for 2009‑10, with timing differences expected to wash‑through the results by June 30, 2010," Mr Buswell said.