Aug 16, 2016

Sod off, Western Australia: no more GST for you

Western Australia's fiscal profligacy should not be rewarded with changes to the GST distribution model -- but Malcolm Turnbull is not in a strong position to resist his colleagues from Perth.

Bernard Keane — Politics editor

Bernard Keane

Politics editor

Malcolm Turnbull's capacity to do no right is showing no signs of abating with Eric Abetz seizing on the Prime Minister's proposal for a GST redistribution floor for Western Australia.

"Last year, the Commonwealth Grants Commission, in providing independent advice on the distribution of GST, recommended against changing the current distribution formula to assist Western Australia," Abetz said yesterday in a joint statement with the smoking ruins of the Tasmanian Liberal post-election parliamentary representation. "It is difficult to comprehend what, if anything, has changed," he added piquantly.

What's changed, as Abetz well knows, is that, having narrowly survived the federal election, Turnbull has a powerful WA bloc within his ranks that is staring at the prospect of defeat at the state level next March when the ageing and fiscally incompetent Barnett government looks to enter a second decade in power. Given Turnbull's fragile position, he's not in much of a position to hang tough in the face of demands from his colleagues -- especially after he so publicly snubbed Julie Bishop over the Kevin Rudd nomination.

Free Trial

You've hit members-only content.

Sign up for a FREE 21-day trial to keep reading and get the best of Crikey straight to your inbox

By starting a free trial, you agree to accept Crikey’s terms and conditions


Leave a comment

17 thoughts on “Sod off, Western Australia: no more GST for you

  1. B.C.

    I don’t think Colin Barnett’s ever seen a dollar he didn’t want to spend.

  2. Lee Tinson

    Absolutely agree with Bernard today. All Barnett does with money is waste it. What WA needs is a government which can properly handle money, and until such time as they find one, give them nothing.

  3. Rais

    No doubt nearly everyone who gains from WA losing most of the GST it raises will continue to say, “Give them nothing, they’ll only waste it.” Some of the mining boom largesse was spent unwisely but certainly not all. WA people can’t do anything about it, we’re one State in the Federation. But in practical terms this vengefulness isn’t good for the country. A big State with big infrastructure needs can’t run on 30% of its GST take and when the system was set up nobody envisaged that happening. In the meantime don’t be surprised if the cash economy grows rapidly in WA because people aren’t interested in sending 70c in every GST dollar out of the State.

  4. mikeb

    I remember when WA was bathing in gold while sneering at the basket-case states. Prior to the resources boom WA was also a basket-case relying on the easterners, and it seems history is being revisited. Suck on that Barnett.

    1. Rais

      Barnett was sneering. He offered to go and run Tasmania after he finished in WA. He’ll probably have his opportunity soon, after the election next March he may be looking for somewhere to retire out of the reach of the baseball bats. But please don’t think Barnett’s sneers at Tas and possibly SA represent all of WA.

  5. klewso

    Come on. How else is he going to help Barnett win the election?

    1. klewso

      … Speaking of ‘basket cases'(Mikeb), how is Erica coming along with that little project of his?
      And Bernard, even a broken cock is right, twice a day.

      1. pinkocommierat

        My eyes are watering 😉

        1. AR

          Well, there are the bifurcated roos’ – twice the fun?

  6. Ian Brown

    Do the assorted pundits, commentators, financial advisors and miscellaneous ticket clippers in Sydney / Canberra / Melbourne ever wonder where the money – ie foreign exchange -comes from to pay for their expensive tastes in imported stuff (you know, like cars and clothes and fancy kitchens, holidays abroad and so on). Not from them, unfortunately.

  7. bushby jane

    Mark Kenny pointed out last night on The Drum that the assessments for GST allocations are made on 3 year old data, which is why WA was deemed not to need so much presumeably as it was swimming in money then. Though they were whinging then as well.
    Please stop Tasmania bashing, we don’t have the advantage of any fed govt offices or agencies here, like Defence Force or Agriculture offices. Or nice contracts like sa and wa even though our private enterprise companies put in tenders for the same projects.

    1. Zarathrusta

      It seems to me the first thing to fix is to speed up the data flow.

  8. Dog's Breakfast

    As per others here, this is just plugging a hole for incompetent economic managers. This formula has been in place for donkeys years, and the same formula delivered for WA a much higher share of receipts while they were also in boom times from mining, and they just sucked up all the money and didn’t squirrel a penny away for leaner times. Any number of public servants could have and would have told them that they would pay for the boom times in GST receipts 3 years hence, so don’t spend it all at once. Contrary to Rais comment, everybody saw this happening as this is the well known formula for GST distributions. I knew about it, how could they not?

    But no, WA wants to go it alone in the good times, and sponge in the bad. What a surprise!

    Just like Costello at the Federal level, they p#%@ed it up against the wall in the good times and have left a mess for somebody else to clean up.

    And for the record, I think you will find that tertiary education income from Melbourne and Sydney alone would account for much more than WA’s mining dollars. Perhaps they could look at greater income from their mining resources rather than giving them away as largely happens now.

    1. klewso

      Oh for those good old daze when Barnett wanted to cede from the union – because WA was going so swimmingly, “subsidising” other states?

  9. Phen

    It would be nice if rather than just bashing Barnett, someone could actually attempt to defend a ludicrous system that penalises WA for its mining royalties, yet doesn’t attempt to adjust for the pokies and gambling revenues that all other states (except WA) are addicted to.

    A system that can result in WA receiving 30c in the dollar back on its GST spend, while no other state has ever dropped below 85c is fundamentally flawed.

    But oh yes, Liberals bad, Barnett bad, etc etc.

  10. Bill

    Barnett should resign and get a plum job with the land developers – his favorite industry.

    If you say “sod off” I hope that doesn’t mean us ordinary folks in WA!!!

Share this article with a friend

Just fill out the fields below and we'll send your friend a link to this article along with a message from you.

Your details

Your friend's details