WA State Budget 2021: Your five minute guide to Mark McGowan’s Budget

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Josh ZimmermanThe West Australian
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Mark McGowan arrives at the Parliament House to discuss the State Budget
Camera IconMark McGowan arrives at the Parliament House to discuss the State Budget Credit: Ian Munro/The West Australian

Mark McGowan has handed down his first Budget as Treasurer. Here’s everything you need to know.

SURPLUS

WA is expected to bank a $5.6 billion operating surplus from 2020-21, more than doubling the previous record from 2007. The Budget is forecast to remain in surplus across the forward estimates to the tune of an additional $9.2 billion

IRON ORE

Iron ore royalties totalled $11.3 billion last year and are expected to contribute another $9.2 billion this year. But a predicted fall in the iron ore price back to the long-run average – $US66 – from mid-2022 will see the steel-making commodity’s revenue contribution fall to around $5 billion annually.

DEBT

Net debt has fallen for a third consecutive year to $32 billion – but resumes its upward trajectory from next year as the McGowan Government pumps cash into major infrastructure projects across the State. Debt is forecast to hit $36 billion by 2025.

CLIMATE CHANGE

Perth is getting a third desalination plant with $1.4 billion set aside as a down payment on a new facility – either to the north of the city or near Kwinana. The McGowan Government has also created a $750 million climate action fund, $350 million of which will be spent on softwood plantations in the wake of a native logging ban from 2024.

HEALTH

As previously announced, the WA Health system is receiving a $1.9 billion cash injection to fund the recruitment of new nurses and doctors and the expansion of emergency departments. $1.8 billion will be set aside for a new women’s and babies hospital, with $1.3 billion used to redevelop hospitals across the State.

WAGES POLICY

The end of the $1000 per year public sector wages cap is in sight with an announcement the policy – which was meant to remain in place for another two years – to be reviewed by the end of 2021.

INFRASTRUCTURE DELAYS

The $30.7 billion pipeline of major capital works has been “smoothed” to avoid competing for scarce tradies. That has resulted in a swag of projects being pushed back at least a year, headlined by Thornlie-Cockburn Link and Yanchep Rail Extension.

Operating surplus

2020-21: $5.6 billion

2021-22: $2.8 billion

2022-23: $2 billion

2023-24: $2.9 billion

2024-25: $1.6 billion

Net debt

2020-21: $33.5 billion

2021-22: $32.1 billion

2022-23: $34.4 billion

2023-24: $35.3 billion

2024-25: $36 billion

Unemployment rate

2021-22: 4.75%

2022-23: 4.5%

2023-24: 4.5%

2024-25: 4.5%

Wages growth

2021-22: 2.25%

2022-23: 2.25%

2023-24: 2.5%

2024-25: 2.5%

Iron ore price ($US/tonne)

2021-22: $121.30

2022-23: $66

2023-24: $66

2024-25: $66

Government expenses 2021-22

Health and Mental Health: $10,632m (30%)

Education: $5,629m (16%)

Electricity and water subsidies: $888m (3%)

Roads, rail and transport: $3,004m (8%)

All other: $7,803m (22%)

Community safety: $3,924m (11%)

Communities: $2,751m (8%)

Training and TAFEs: $877m (2%)

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