2017 WA State Budget

The WA State Budget was released on Thursday 7 September, and our Chief Economist Alan Langford was there to receive the updates first hand.

What does the budget mean for you as a consumer?

Transportation

$1.34 billion to be invested into METRONET priority projects over the next four years, including:

  • $535.8 million to build the Thornlie-Cockburn Link
  • $520.2 million to build Yanchep Rail Extension on the Joondalup Line
  • $69 million for the Denny Avenue level crossing removal in Kelmscott
  • $28.2 million towards relocating the Midland Train Station & extension to Bellevue


In addition to $508.2 million for building new rail cars, budget has been allocated for the planning phase of the following projects:

  • Morley-Ellenbrook Line
  • Byford Rail Extension
  • Karnup Station


$2.7 billion has been allocated towards the road network. This will be distributed across 20 key road projects, road safety programs & cycling infrastructure.

Key road projects funded include:

  • $237 million to build a bridge over Kwinana Freeway at Armadale Road/North Lake Road
  • $118 million upgrade of Leach Highway (High Street) between Carrington Road & Stirling Highway
  • $145 million to build Armadale Road dual carriageway between Anstey Road & Tapper Drive
  • $112 million for Murdoch Drive connection to Kwinana Freeway and Roe Highway
  • $70 million to build Reid Highway dual carriageway between Altone Road & West Swan Road


$125 million has been allocated to Road Safety Programs, with $29 million for metro programs and $96 million for regional programs.

  • $129 million has been allocated to fund cycle infrastructure over the next four years. This includes funding for:
  • $55 million towards filling gaps on the Principle Shared Path network
  • $45 million for paths alongside major road projects
  • $29 million in grants for local government cycling initiatives

Healthcare

Key budget initiatives:

  • $2 million to establish Urgent Care Clinics to reduce the pressure on emergency departments
  • $2.8 million to expand the Ear Bus program into the Kimberley region
  • $2.1 million to initiate the Let's Prevent pilot program to support & educate people at high risk of developing chronic health conditions
  • $1.6 million to expand the Find Cancer Early program further in Regional WA


Mental Health investment is focused on the following:

  • $7.3 million for a step up/step down mental health facility in Kalgoorlie 
  • $13.2 million towards specialised mental health programs for students in approximately 300 schools 
  • $5 million to develop the Peel Youth Medical Service Health Hub
  • Implementation of Mental Health Observation Areas in selected metro & regional hospitals

Employment

Employment initiatives in budget include:

  • Additional $87 million over four years to support events and marketing in WA Tourism
  • $20 million over five years to establish an Aboriginal Ranger Program
  • $39 million on the Local Projects Local Jobs grants program to deliver over 750 projects across the state
  • $17 million for a New Industries Fund to support new and emerging businesses in the high tech sector
  • Vocational education and training course fees to be frozen from 2018 training year
  • Infrastructure investment in METRONET, road projects, health facilities and schools


The Public sector will be affected by budget repair measures the government is planning to implement. These include:

  • 40% reduction in the number of government departments 
  • Four year wage freeze for portions of the government sector


Introduction of a temporary progressive payroll tax scale for companies with payroll over $100 million per year of 6% (up from 5.5%) for five years. This increases to 6.5% for employers with a payroll over $1.5 billion. This will impact the top 8% of payroll paying employers in WA from July 2018.

Infrastructure

Key infrastructure projects for the metro region outlined in the budget are:

  • $1.34 billion for METRONET Stage 1 projects, including the Thornlie Cockburn Link and Yanchep Rail Extension, and acquisition of an additional 102 rail cars
  • $237 million for construction of the Armadale Road Bridge
  • $50 million for a new traffic interchange at Wanneroo Road and Joondalup Drive
  • $49 million for the widening of Kwinana Freeway northbound between Russell Road and Roe Highway
  • $40 million to begin works on widening the Mitchell Freeway southbound between Cedric Street and Vincent Street
  • $129 million over four years to build at least 95 km of new cycling paths
  • $465 million for building primary schools in high growth areas, redevelop aging high schools and improving learning facilities across the state

Regional WA

Regional WA will be impacted by the following budget updates:

  • $30 million to rebuild WA’s core agricultural and grain research and development capability
  • $20 million to support WA’s regional events program
  • $27.9 million towards tourism funding to showcase regional destinations
  • $463 million towards new and upgraded road, rail and port infrastructure
  • $826 million towards health care for regional patients
  • Patient Assisted Travel Scheme will support patients who need to travel for treatment, and funding to subsidise the higher costs of delivering water, drainage and sewerage services to people in Regional WA so they pay the same price as people living in metropolitan areas
  • $1.25 billion for vital community infrastructure in our regions
  • $356.2 million will be invested through the Regional program to create land to meet the needs of Regional WA, including McLarty Explosives Reserve, Port Hedland Spoilbank Marina, Port Hedland Former Hospital Site Remediation, Pilbara Cities, Broome, Bunbury and Albany Middleton Beach
  • $126 million of investment in environmental protection, including $14.6 million Natural Resource Management Program to work with local communities to protect the environment

Housing Affordability

There have been no changes to the First Home Buyers Grant announced in the WA State Budget, which is currently available up to $10,000 for eligible first home buyers.

Funding of approximately $344 million for significant programs under The Asset Investment Program including:

  • The development of 1,509 housing lots to support affordable public and community housing in metro and Regional WA
  • $21.7 million to secure a range of entry-level properties for low and moderate earners, as part of the Affordable Housing Shared Equity program
  • $44.1 million to allow the commencement of 335 public housing home to be completed in the next year, under the Construction and Spot Purchase program
  • $58.5 million for the acquisition of land for government housing programs and to maintain a stream of affordable land supply for home buyers


Foreign property buyers will pay a 4% surcharge on the purchase of residential property. This is forecasted to add $48 million in net additional revenue.

Technology & Innovation

Science and technology in the classroom

  • $12 million to convert existing classrooms to science labs across 200 primary schools and $5 miilion in grants of $25,000 for schools to equip those labs
  • $2 million for the integration of coding into teaching and the curriculum
  • $900,000 to establish a Science Technology Engineering Mathematics (STEM) Advisory Panel to ensure there is a job ready local workforce to capitalise on new jobs


Digital jobs

  • $16.7 million in grants for new technology start-ups and computer gaming to create new jobs


Healthcare innovation

  • Royal Perth Hospital upgrades include a mental health observation unit, a Medihotel, Innovation Hub and an Urgent Care Clinic

What does the budget mean for businesses?

Small business

$4.2 million will be invested to establish an Industry Participation Advisory Service to support small and medium business to compete for government contracts.

The development of an Asian Business Strategy and tools to encourage growth into Asia and is expected to support small businesses entering regional markets and create jobs.

Resource Industry

Two key revenue drivers implemented by the State Government within this budget will affect the Resource sector:

  • The Gold Royalty rate to increase to 3.75% when the spot price is over AUD$1,200/ounce. The 2,500 ounce exemption will be removed for large producers.
  • Pilbara Port Authority port fees will increase by 17% for the State's biggest companies

Important things you should know

The information contained in this report is of a general nature and is not intended to be nor should it be considered as professional advice. You should not act on the basis of anything contained in this report without first obtaining specific professional advice. To the extent permitted by law, Bankwest, a division of Commonwealth Bank of Australia ABN 48 123 123 124 AFSL/Australian credit licence 234945, its related bodies corporate, employees and contractors accepts no liability or responsibility to any persons for any loss which may be incurred or suffered as a result of acting on or refraining from acting as a result of anything contained in this publication.