Madeleine King (Brand, Australian Labor Party) Share this | Link to this | Hansard source

The Commonwealth Grants Commission announced last week that WA's return from GST, collected in that state, will be 34c in the dollar and that is up from 30c. There is understandable outrage throughout Western Australia about this. I appreciate the efforts the Minister for Social Services—and former Treasurer and Attorney General of WA—Christian Porter, Senator Dean Smith and others have made in trying to extract some change in the GST distribution. It is awful for them that their leaders do not seem to be listening.

It was outrageous for the Prime Minister to promise to put a GST floor in, of all places, the WA Liberal State Conference, in August last year and then, six months later, abandon all such plans for a number of years. Given this kind of easy disregard for WA concerns, I can understand the frustration of WA Liberals, particularly the five WA Liberal cabinet members, and we can all understand the anger of the Western Australian people.

The lag in calculating the Commonwealth redistribution of GST comes some years after the then WA Liberal government increased the rate of the already extraordinary royalties the state was earning from the mining boom. Because of the timing of the GST redistribution, WA was receiving a high GST return while it also earned high royalties. Knowing the GST return would decrease in a few years, the Liberal WA government increased the royalties yet again. I do not agree with the current distribution of the GST revenue but, for the most part, this problem for Western Australia has been foreseeable for years.

The decrease in revenue to WA was always coming, but they spent at all anyway. The WA Liberal government spent everything on a gamble that iron ore royalties would remain stratospheric and they would be able to force the Commonwealth Grants Commission and the federal Liberal government to change the GST redistribution system. Quite a gamble—quite a gamble from the people and the party claiming to be good economic managers. The least they could do is be competent. The gamble has not paid off and WA is left with a 34c-in-the-dollar return on GST, a budget deficit of $3.9 billion and a federal Liberal government threatening to withhold $1.2 billion of infrastructure funding. It is farcical. It cannot go on and a new way must be found.

I do know that the injustice felt by many in WA is real, particularly real in these difficult economic times. I do know it is not beyond the wit and goodwill of this great federation to sort out the outdated system without devastating the economies of smaller states where our families, friends and colleagues all live and work every day. As Australians we can, we must and we will work this out. It is the ultimate dereliction of duty and responsibility to the Commonwealth, the government and the Treasurer supposedly trying to govern, to say the GST distribution is a matter for the states to sort out.

What kind of leadership is that? It got too hard so they are out. They have left the building. That is simply not good enough. It is not good enough for Western Australians, it is not good enough for Australia and I call upon this Turnbull Liberal government to do its job.