Pay rise as revenue surge fills WA coffers
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West Australian teachers and other public servants will receive long-sought pay increases as the state’s turbocharged economy continues to defy the global pandemic.
Thursday’s mid-year financial review is headlined by a $2.4 billion operating surplus this financial year, a slight decline from the $2.8 billion forecast in the September budget due to a sharper than expected fall in the iron ore price.
That fall is offset by a forecast $1.7 billion surge in transfer duty and payroll tax revenue which will keep the state finances in the black across the next four years.
With the state’s borders having largely remained closed throughout the COVID-19 pandemic, WA’s economy is tipped to grow by 3.5 per cent this financial year – the strongest growth in eight years.
Unemployment is expected to remain below four per cent over the next four years as the state grapples with significant labour shortages.
“Our finances remain the strongest in the country, with operating surpluses in each year of the forward estimates and the lowest debt trajectory of all jurisdictions,” Premier and Treasurer Mark McGowan said.
The government will spend $1.2 billion on a new public sector wages policy, having faced threats of industrial action from frustrated unions.
Teachers and other public servants have had annual salary increases capped at $1000 for the past four years, with the government coming under pressure to axe the cap after banking a whopping $5.6 billion surplus last financial year.
Under the new policy, eligible unions will be offered a 2.5 per cent annual wage increase with the option of a $1000 sign-on bonus or an additional 0.25 per cent annual increase for negotiated workforce reform measures.
WA’s state teachers union had been seeking a four per cent annual wage increase.
It comes amid warnings of potential staff shortages early next year, when teachers will be required to be fully vaccinated against COVID-19.
“Stagnant wages is one of the factors that has contributed to a teacher shortage in our public schools, and a 2.5 per cent increase is not going to be enough to turn that around,” the State School Teachers Union of WA said on Thursday.
Mr McGowan said the pay increases were responsible and reasonable, and would ensure lower-paid workers received increases above inflation.
A further $1.2 billion will be spent on readying WA’s health system for the arrival of cases when state borders reopen on February 5.
The funding will go towards additional hospital beds and staff, vaccination and testing, and health infrastructure.
Casual workers will meanwhile become eligible for isolation payments while awaiting test results under a new $80 million scheme.
The payments are capped at $320 across two days.
“The mid‑year review uses our financial capacity to make further investments as we prepare to transition border restrictions when we reach our 90 per cent vaccination rate in early 2022,” Mr McGowan said.
Opposition treasury spokesman Steve Thomas said the government was eyeing an unprecedented $16 billion worth of forecast surpluses on the back of an iron ore boom and a favourable GST deal struck by the federal government.
“To suggest that their financial management has been responsible for this outcome is a ridiculous sleight of hand that should not be allowed to go unchallenged,” Dr Thomas said.
