Mining boom to benefit WA by $4bn a year

Western Australia looks set to receive $4 billion per year in mining royalties.

Premier Colin Barnett committed to a $20 billion cap on state debt last year, but it is likely to be broken within two years, The Australian reports.

Yesterday business groups called on Treasurer Christian Porter to make cutting payroll tax his first priority to increase job creation.

The Chamber of Commerce and Industry’s small enterprise network said the tax was a damaging growth, as it has not changed from 5.5 per cent since 2005 and the $750 000 threshold has not been altered since 2003.

"During this time, other jurisdictions have acted to reduce their rates or increase their thresholds, leaving WA in a worse relative position," the network’s manager Andrew Canion told The Australian.

There is also pressure on the government to reduce the gap between rich and poor in the state, with claims those not in the well-paying resource sector still having to pay for a higher cost of living.

Electricity prices in Western Australia are expected to increase by up to 7 per cent, further adding to their 46 per cent increase over the last 36 months.

Barnett has copped criticism for his hardline economic agenda but last month promised to provide a social dividend "like Western Australia has never seen before"

Groups providing welfare services are expected to benefit from the changes.

Nationals will be the biggest benefiters of the mining boom, after a deal was established following the 2008 election to have 25 per cent of royalties diverted to their Royalties for Regions fund to be spent in regional areas.

The rising royalty revenue will provide them over $1 billion each year until the lead-up to the next election.

The state opposition has slammed the state debt, with yearly debt expected to reach $1.9 billion in 2014.

"When state debt balloons well past the $20bn mark in two years, it will be approaching $10,000 for every man, woman and child in WA, compared to only $6238 in Victoria and $7623 in NSW," Opposition Treasury spokeswoman Michelle Roberts said.

As the country’s leading resource state, Western Australia fared well in the federal budget announced by Wayne Swan last week.

Total skilled migration will increase to 16,000 positions and increase the number of people available to work on WA and Queensland resource projects.

Over the next year, 33 000 skilled workers will be needed for Western Australia’s mining sector.

 

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