WESTERN Australia’s Liberal Government has handed down its first Budget, delivering a $647 million surplus but warning the state will be in deficit by 2012.
Treasurer Troy Buswell today delivered his first Budget since the Liberal Government came to power last year.
He said the 2008/09 surplus of $647 million would shrink to $409 million in 2009/10, and just $23 million the following year.
By 2011/12 the state will be in deficit to the tune of $513 million.
“Over the past months, as the global economy has been in decline, the state has been hit by large downward revisions to projected taxation revenue, GST grants from the Commonwealth and mining royalties,” Mr Buswell told parliament.
“Since the mid-year review, the Budget has lost a massive $4 billion in forecast revenue from these sources.”
Last year, then treasurer Eric Ripper delivered a surplus of more than $2 billion on the back of a booming commodities sector.
Economic growth remained high at 8 per cent for the 2008/09 financial year.
But forecasts predicted growth would fall into negative territory in 2009/10, with unemployment expected to peak, and business investment to fall by 17.5 per cent.
Mr Buswell said the Government would provide a one-year payroll tax rebate to small businesses with payrolls of up to $3.2 million to help protect jobs.
“Some 6,700 small businesses will be eligible for this payroll tax rebate, which will fully offset payroll tax for around 68,000 employees,” he said.
“The cost of this rebate is estimated at $100 million.”
A $47 million jobs training and skills package, and a $8.3 billion spend on infrastructure in the next financial year are key components of the Budget.
Mr Buswell said law and order were also strong focuses, in line with the Government’s election promises to boost funding for police and pump more money into prisons
Mr Buswell said the Government’s election promise to toughen up sentencing laws and introduce mandatory sentencing for people who assault police was underpinned in the Budget by a significant investment in prison capacity.
A total of $655 million will be invested in 2012/13 to create an extra 1657 prison beds across the state.
A record $5.1 billion spend on health services in the next year – rising 5.9 per cent, or $282 million from last year – will include the fast tracking of forward works for a new children’s hospital, the construction stage of the Fiona Stanley Hospital, and new hospitals in two regional centres.
Mr Buswell said the Government would push ahead with public sector reforms in a bid to achieve improved performance and efficiency.
The first stage of the economic audit committee promised by the Government during the last election was complete and a range of hard decisions had delivered $7.6 billion over the forward estimates, Mr Buswell said.
“I am looking forward to the second stage of the economic audit to identify strategies for broader reform over the longer term, so we can ensure the budget stays in surplus,” he said.
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All the latest NEWS from Perth 
Australian share market opens higher
Posted in Political News, tagged $1.15 billion, $16.01, $20.48, $22.00 Westpac up 10 cents, $34.26, $36.40, $65.46, (AEST), 0.23 per cent, 0.31 per cent, 0.60 per cent, 10.15am, 12.1 points, 14 cents, 15 per cent, 20 cents, 3889.3, 4.41 per cent, 4cents, 50.34 points, 8.7 points, ANZ, asess, Average, banks, Ben Bernanke, benchmark, BHP, broader, capital, cash, cash return, comments, Commonwealth Bank, contracts., deficit., down, earnings, efforts, equity, Exchange, Federal Budget, Federal Reserve chairman, firms, five cents, four, gained, gains, generating, higher, Industrial, investors, long rally, lost, lower, lucky, major, March, marginally, Mining giant, mixed finish, mixed lead, morning trade, mulled, NAB, new, open, opened, opening, Ordinaries, over, paused, points higher, Political News, quarter, raise, reassuring, reported, Resources, Rio Tinto, rival, S&P/ASX200, settle, share market, share price index contract, stronger, Sydney Futures, The Dow Jones, to 3872.3., Tuesday, up, US trade, volume, Wall Street, was up, wobbled on May 13, 2009| Leave a Comment »
At 10.15am (AEST), the benchmark S&P/ASX200 was up 12.1 points, or 0.31 per cent, at 3889.3, while the broader All Ordinaries gained 8.7 points, or 0.23 per cent, to 3872.3.
The four major banks were mostly higher at the open.
ANZ gained 4cents to $16.01, NAB was up 14 cents at $22.00 and Westpac was up 10 cents at $20.48.
The Commonwealth Bank, which reported cash earnings for the March quarter of about $1.15 billion, generating a cash return on equity of over 15 per cent, was down 20 cents at $36.40.
Resources weren’t as lucky, opening lower in morning trade.
Mining giant BHP was down five cents at $34.26, while rival Rio Tinto lost 4.41 per cent to $65.46.
Wall Street wobbled to a mixed finish on Tuesday as investors paused to assess gains from a long rally and mulled the new efforts to raise capital by banks and other firms.
The markets also digested better-than-expected data on the US trade deficit and reassuring comments from Federal Reserve chairman, Ben Bernanke, about the health of the banking system.
The Dow Jones Industrial Average was up 50.34 points, or 0.60 per cent, to settle at 8,469.11.
The tech-dominated Nasdaq dropped 15.32 points, or 0.88 per cent, to 1715.92 while the broad-market Standard & Poor’s 500 index lost 0.89 point, or 0.1 per cent, to settle at 908.35.
On the Sydney Futures Exchange, the June share price index contract was trading 17 points higher at 3885 on volume of 4900 contracts.
www.news.com.au
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