West Australia’s newly instated Labor Premier Mark McGowan has already set the ball rolling to restore WA’s sinking economy. Previously a boom state, WA could be looking at a $41 billion debt by the year 2020. With a record debt of $3.3 billion this year and the country’s highest unemployment rate, Mr. McGowan is prepared to deploy all measures to ensure that the state is back on its feet soon.
Mr. McGowan says that budget restoration is his primary concern, and his plan of action reflects that. Already, he has ordered the discontinuation of the construction of the Roe 8 freeway, a piece of infrastructure that has been the subject of much contention in WA. He encourages the contractors involved in the project to cut their losses by withdrawing immediately. Urging the Commonwealth to pay attention to West Australia, he is keen on redirecting the billion-dollar Roe 8 investment into more productive endeavors as per Labor’s policies. First order of business will be the Metronet Rail project.
Mr. McGowan is also encouraging businesspeople and investors to play a part in WA’s revival, promising to be “very friendly” to anyone who brings their business to the state. In addition to restoring the struggling economy to its former glory, Mr. McGowan is also looking to diversify it as a way of consolidating it for the future.
As optimistic as the Labor Premier seems, he has no qualms blaming the previous government for the economic turmoil that WA is currently in. According to him, the Liberal Barnett government is directly responsible for crippling WA’s economy and bringing an end to its good economic times. As such, he is prepared to cause some significant upsets, specifically in the public service where he intends to slash spending significantly, a fact he divulged on an interview with 6PR on Monday.
Ben Wyatt, the most likely candidate to become Mr. McGowan’s next treasurer, earlier disagreed with the Liberal Barnett’s proposal to sell assets in order to right the failing economy of WA. He foresees the process of bringing WA’s economy back to its feet as a long-term project of which he will not be providing a timeline. He is in consensus with Mr. McGowan’s plan to slash spending in the general government sector starting with the public service.
Mr. Wyatt is however under the magnification glass after releasing a controversial debt-reduction plan during the campaign. Part of the controversy stemmed from a plan that involved setting aside WA’s royalty iron ore royalties after WA’s GST share, which currently stands at 30 cents on the dollar, returned 65 cents on the dollar.
The budget plan was also dependent on the significant increase in the price of iron ore, which is currently facing a foreseeable drop to $50 a ton by the end of the year, to $85. Already, Mr. McGowan and Mr. Wyatt have had talks with the treasury and the department of the Premier Cabinet. He will be releasing his first budget as late as September this year.
Mr. McGowan also faces the daunting challenge of chopping down his 21-man frontbenchers to 17 with one seat reserved for Alannah MacTiernan, a former minister looking to take on an economic role after her return to state politics.