Mid-year Review shows WA economy is roaring back to life, says Treasurer Ben Wyatt.
“Western Australia’s economic outlook is nation-leading, if not world-leading. Business and consumer confidence is sky-rocketing in our State.”
“The Mid-year Review showcases WA is in the best position to recover from the pandemic stronger than ever.”
- Western Australia’s COVID-19 economic recovery exceeding expectations with economic and employment growth revised up in 2020-21
- Operating surplus in 2020-21 revised up to $2.2 billion at the Mid-year Review, almost $1 billion higher than expected at Budget
- Employment and housing market driving economic recovery and growing revenue
- McGowan Government’s safe and strong handling of COVID-19 and the Recovery and Jobs Plan getting WA back on track
The McGowan Labor Government has today released the 2020-21 Mid-year Review which highlights that Western Australia’s strong economic recovery continues to exceed expectations, with improved revenue collections flowing through to the State’s finances.
In 2020-21 the forecast net operating surplus has been revised up to $2.2 billion, from $1.2 billion at the Budget delivered in early October, with stronger than expected surpluses anticipated over the forward estimates.
Net debt projections have been revised down by $1.4 billion since Budget to $41.4 billion by June 30, 2024.
The Western Australian economy continues to lead the nation, with forecast growth in Gross State Product revised up from 1.25 per cent in 2020-21 at Budget to 2 per cent at the Mid-year Review – driven by a strikingly strong increase to the domestic economy.
This is the strongest projected growth of any State based on recent projections, and follows growth of 1.4 per cent in 2019-20, in contrast to most other State economies which contracted.
WA’s handling of COVID-19 and the fact the McGowan Government was able to get Western Australians back to work so quickly has seen the domestic economy roar back to life.
Consumer and business confidence recovered faster in WA from COVID-19, with strong growth in retail trade, while the McGowan Government’s Building Bonus and other government incentives have lifted activity in the housing market.
WA’s labour market has also recovered at a faster rate than expected at Budget.
Treasury have revised up employment growth in 2020-21 from a 0.25 per cent contraction to a 1 per cent increase in annual average terms. In year ended terms, the same basis used by the Commonwealth, employment is expected to grow by 6.5 per cent or almost 85,000 jobs.
Improved economic conditions have flowed through to an increase in projected revenue collections.
Projected taxation revenue has been revised up by $1.1 billion over the four years to 2023-24, underpinned by improved activity in the housing and labour markets, and vehicle sales.
The Government has used the State’s stronger financial position to deliver projects that will benefit Western Australians into the future. This includes $1.787 billion which has been set aside to build a new Women and Babies Hospital to replace the ageing King Edward Memorial Hospital.
The McGowan Government’s record pipeline of infrastructure has further increased, with $28.8 billion now committed over the next four years, up $1.8 billion from Budget.
An additional $520 million in recurrent expenditure has been committed over the forward estimates.
Expenditure growth of 9.4 per cent is now expected in 2020-21, up from 8 per cent at Budget. The substantial stimulus and emergency management spending in response to COVID-19 is then expected to unwind from 2021-22.
