As was the case in Tuesday’s Federal Budget, providing cost of living relief was a key plank of the State Budget given the strong increases in inflation that have been experienced in recent times.

However, the Budget also announced a range of new funding commitments aimed at addressing current pressure points for the community in housing and health, as well the challenges facing the state over the longer term to transition to net zero and diversify the state’s economy. It also includes a record $39 billion investment in infrastructure over the next four years.

$17.4 million is provided in cost-of-living relief for households over the next four years. A range of measures are included in this package, such as a $400 electricity bill rebate for all households, with additional support for those most in need; increased payments under the Hardship Utilities Grant Scheme; additional funding for the Regional Airfare Zone Cap Scheme; and keeping increases to State Government fees below inflation in 2023-24.

The Budget also includes a significant investment in healthcare, with a record $2.7 billion to be spent on a range of initiatives over the next four years. The majority of this will be directed towards hospital services, however funding is also provided for COVID-19 response, addressing emergency department pressures, workforce attraction and retention and ICT projects.

$750 million has also been provided for additional investment to boost housing supply and housing choice.

Climate change is also a focus area for the Budget to support the State’s transition to net zero. The estimates include a $3 billion investment to support the Government’s plan to decarbonise electricity production and move towards cleaner energy.  The most significant Climate Action initiative is $2.3 billion for Synergy to deliver a 500 MW Battery Energy Storage System in Collie. $38.9 million has been allocated for a range of climate adaptation measures.

The state’s strong budget position has underpinned its ability to invest in these priorities. A $3.3 billion surplus is predicted in 2023-24, as a result of strong increase in royalty income, Commonwealth Grants, and property tax revenues.  Surpluses in excess of $2 billion are expected to be maintained across the forward estimates.

For Local Governments, the Budget provided funding for a number of important areas identified in WALGA’s State Budget Submission.
  • $3.75 million has been allocated to deliver a grant program over 2023-24 and 2024-25 to increase tree canopy cover and improve biodiversity within Western Australia’s urban centres.

  • An additional $15 million has been added to the Community Sport and Recreation Facilities Fund, which will be spent over 2023-24 and 2024-25, bringing the Fund to $20 million for these two years respectively.

  • The Budget papers confirm the State Government’s ongoing funding commitment to the State Road Funds to Local Government to assist Councils with the management of the local road network.

  • Additional expenditure of $77 million has been approved over the forward estimates for the ongoing operational costs associated with the Aboriginal Cultural Heritage Act 2021 and to fund Local Aboriginal Cultural Heritage Services.

  • Spending on regional health and mental health initiatives will increase by $342 million, including the continuation of the Mental Health Emergency Telehealth Service and additional investment in WA Health’s regional workforce.

  • An additional $12 million is allocated for the Regional Development Assistance Program over 2023-24 to 2026-27 for residential, industrial, commercial and tourism-related land and infrastructure projects.

  • $3.6 million has been allocated in 2023-24 to assist with mid-tier transport planning.

  • $5.5m to DPLH to integrate climate adaption into policy and planning frameworks.

  • $300,000 is provided to develop a business case to support a Stage 2 Infrastructure Australia proposal for a Western Australian coastal hazard adaptation program.

  • An additional $1.1 million will be spent in 2023-24 for the Department of Fire and Emergency Services to continue the consolidation of existing emergency services legislation into a new Emergency Services Act

Outside of the requests in WALGA’s State Budget Submission, the Budget also contains funding for a number of other initiatives important to Local Governments.
  • An additional $61.6 million is provided over the forward estimates period to address demand for Government Regional Officer Housing (GROH). This includes $40.9 million to acquire new dwellings and purchase land for future construction and $19.7 million to refurbish 133 existing GROH properties. $1.1 million will also be spent on a comprehensive review and reform of the GROH program.

  • $11.3 million is provided over 2022-23 to 2024-25 (jointly funded by the State and Commonwealth Governments) for infrastructure projects that will increase the State’s organic waste processing capacity.

  • $81.7 million is allocated to upgrade and maintain the State’s emergency radio network and equipment used by frontline officers including police officers and firefighters.

  • $24.4 million has been provided to permanently appoint 29 dedicated disaster recovery officers to form WA’s largest ever recovery team

  • An additional $175 million will be spent in 2024-25 (jointly funded by the Commonwealth and State Governments) to continue safety treatments on regional roads to reduce run off crashes.

  • Over 2022-23 and 2023-24, an additional $20.7 million will be spent on the regional airfares cap

  • An additional $52.5 million has been invested in the provision of Family and Domestic Violence services in metropolitan and regional Western Australia

  • $24.4 million is provided over 2022-23 to 2026-27 to implement initiatives approved as part of Planning Reform Phase Two. This includes the centralised assessment of Development Contributions Plans, implementing Development Assessment Panel Reforms and the establishment of a permanent determination pathway for State and regionally significant developments.

The Budget also contains estimates for regulated fees and charges. Of note to Local Governments, street lighting tariffs are projected to increase by 4.8% across the forward estimates. However, this figure remains an estimate and will be finalised in coming weeks. The Economic Regulation Authority is currently considering the proposed 44% increase put forward by Western Power for network costs and will make its decision in coming days.

If you have any further questions on the State Budget, email WALGA’s Economics team.
Manager, Economics, Dana Mason
Economist, Daniel Thomson