Anthony Albanese is set to confront disgruntled east coast leaders who have long agitated over WA’s GST deal after doubling down with his strongest assurance yet to the State during his Perth jaunt this week.
They say what happens in Vegas stays in Vegas — but there was no hiding the Prime Minister’s public display of loyalty to WA by preserving the resource-rich State’s carve-up of the Goods and Services Tax.
Mr Albanese had vowed to keep WA’s existing share of the GST in place for as long as he was Prime Minister amid a stream of questions on Monday from Perth reporters over his stance following a scathing Productivity Commission interim report.
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“There will be no change to WA’s GST arrangements whilst I’m Prime Minister,” he said.
“WA is a major driver of our national economy and they deserve their fair share of the GST.”
The report released earlier this month had called for current GST system to be abandoned — insisting that only WA had benefited from the “perverse” deal and it had been a “costly mistake” to the Federal Budget.
Before taking off for the east to make his annual address to the Business Council on Tuesday night, the Prime Minister was again gushing over WA at meeting with his full ministry.
“You’ve got to come to the West to understand the West,” he said.
But Queensland Treasurer David Janetzki told The Nightly the current GST distribution system unfairly penalises his State for its economic and resource contributions while favouring WA.
He claimed Queensland was not asking for a “special deal” — just a “fair deal” and urged the Albanese Government to adopt the Productivity Commission’s advice.
“Western Australia is being recognised for its resources sector, but Queensland is penalised for its contribution to the national economy,” Mr Janetzki claimed.
“Jim Chalmers and Anthony Albanese must show that they back Queensland. They must listen to the advice. Stop over-penalising other states that develop resources in the national interest.
NSW Treasurer Daniel Mookhey declined to comment to The Nightly in advance of National Cabinet but his office referred to his remarks during a News24 appearance on Monday.
Mr Mookhey had labelled the damning interim report for WA as “historic” and claimed the system had abandoned its core goal of ensuring equal access to services for every Australian.
“When we took on this campaign, we knew full well that we would be facing an uphill battle to persuade the federal parliament to move on this system,” he said.
“But right now, eight out of nine states of territories — Labor and Liberal — all say the current system rewards some Australians more than others. We’re going to have to continue to make our case.”
One of the authors of the report, commissioner Angela Jackson, told the same program on Tuesday that the independent body was “above politics” and would continue a “rigorous” review regardless of Mr Albanese’s commitments to WA.
“From our perspective, it won’t change anything in terms of that process. We have a process which is fairly rigorous at the Productivity Commission,” Dr Jackson said.
Dr Jackson and fellow Productivity Commission senior official Alex Robson are expected to meet with WA’s Treasurer and the State’s chief “GST fairness fighter” Michael Barnes in Melbourne on Wednesday.
The Tasmanian treasurer Eric Abetz echoed Mr Mookhey’s sentiment by insisting that by disproportionately advantaging WA, as the report states, the system had strayed from its foundational principles of service equality.
“Australia was built on a simple concept — a fair go. This sense of fairness is what underpinned GST when it was first introduced,” Mr Abetz said.
“The Prime Minister has told the nation that doesn’t exist anymore. Western Australia has been told it can keep its lucrative and disproportionate deal.”
“Along with most other states and territories, Tasmania will continue to fight for the restoration of full horizontal fiscal equalisation.”
ACT Chief Minister Andrew Barr called for certainty for all other states and territories on the “No Worse Off Guarantee” to allow them to properly budget for long-term essential services.
“The next step is providing certainty for the rest of us about what comes after the GST No Worse Off Guarantee expires in 2029-30,” he told The Nightly.
“The ACT is calling for an early commitment from the Commonwealth to a successor arrangement that gives all states and territories confidence to plan budgets and deliver essential services over the long term.”
Despite his enthusiastic show of support in the West, Mr Albanese had reignited State concerns that WA’s share of federal infrastructure funding was dropping even as its GST revenue grows.
The PM appeared to issue a subtle warning over infrastructure cash in an interview with ABC Radio just hours before jetting off east.
“What we did was make sure there was the no worse off guarantee, and that has meant it’s the Commonwealth that essentially are footing the bill,” he said.
“But we’ll bear that in mind as well when we’re talking about other funding arrangements with the states.”
