28/11/2014 - 05:08

Yes, he’s the state’s big spender

28/11/2014 - 05:08


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Colin Barnett hopes his capital works program will one day be seen in the same light as those of WA political giants, Charles Court and John Forrest.

Yes, he’s the state’s big spender
ASPIRATION: Colin Barnett has high hopes for his infrastructure spend.

Colin Barnett has drawn on the spirit of two of his most illustrious predecessors to justify his government's big capital works program. He has also poured cold water on the sale of major state utilities to resolve his budget problems.

Mr Barnett shed light on his approach to running the state while also conceding that this year's budget would produce a deficit, something he said would never happen on his watch.

And, just as many have begun predicting a change of government at the 2017 election, Mr Barnett conceded his administration had gone through a rough period. But he claims that it is now back on track.

Mr Barnett has always been associated with big spending. As education minister in Richard Court's administration he earned a rebuke from then under-treasurer John Langoulant for ignoring Treasury advice to tighten the purse strings.

He has done it again since leading the Liberal Party to an unlikely win at the 2008 election. In fact it became apparent early on that Mr Barnett was determined not to go down in the history books as a do-nothing premier.

The capital works program took off with gusto. This has led to a blowout in state debt – from the modest sub-$4 billion legacy of the comparatively frugal Labor treasurer Eric Ripper, to topping $20 billion and heading north after six years.

While the program has included the long-awaited Perth City Link project (in association with the federal government) and football stadium, it is the Perth foreshore development – Elizabeth Quay – that has attracted most criticism as a result of the spending spree.

Mr Barnett gave a spirited defence of his approach, and also shed some light on what drives him on ABC 720.

"In 12 months' time, Elizabeth Quay will be open and there will be thousands of people enjoying it," he told an unimpressed caller.

"People are going to love the new stadium," he said. "This state is not going to stand still and let the world go by. That was my commitment I made myself when I first became premier."

Then he drew on two of the state's most formidable premiers to defend his spending program.

"And you look at the two great premiers of this state, John Forrest (1890-1901) and Charles Court (1974-1982)," the premier continued.

"They took big decisions, and Western Australia has prospered for generations because of that."

Their big decisions included the development of Fremantle as a major port and the Perth-Kalgoorlie water pipeline (Forrest), and the Dampier to Bunbury natural gas pipeline (Court). The costs attracted sustained criticism at the time, but all, of course, have proved their worth.

Obviously Mr Barnett hopes history will repeat and that the projects in the capital works program – including hospitals, schools and roads, as well as Elizabeth Quay and the new stadium – will win wide support, and grateful voters will show their appreciation at the ballot box.

He did concede there was a debt problem, which could be fixed overnight by selling a major utility.

"Some of my colleagues think it would be a good idea to sell off one of the big utilities," Mr Barnett said. "And yes, we might get $10 billion and we might halve our debt. But is that good for the long-term future of this state? No."

The premier said there was another reason for not selling assets to solve debt.

"I want those assets – like the Western Powers, the Synergys, the Water Corporations (sic), the Transport Authority – to actually perform better, not just to flog them off. And that's about building the state."

But the budget presents a more immediate problem. And this is where his reputation and that of Treasurer Mike Nahan, as financial managers, will be carefully scrutinised.

After having been scornful of the possibility of the budget slipping into deficit at the end of the Labor years, Mr Barnett is on the verge of being mugged by reality. And there is precious little that he can do about it, short of indulging in slashing and burning, something he has said he won't do.

The government does not control iron ore or LNG prices, or the exchange rate and its effect on royalty revenue, or the amount of money from the goods and services tax that returns to Western Australia, courtesy of the mysterious formula devised by the Commonwealth Grants Commission.

And all are currently all working against WA's interests.

Mr Barnett is looking at the big picture, and the medium term. It's apparent he wants to be ranked alongside the two great premiers. At this stage, it's a big ask.

His immediate task is to frame the next budget, which is likely, of necessity, to be tough, and then win in 2017.

And by the way, neither Sir John nor Sir Charles lost a state election.


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