Category Archives: Capital Report

Campaign Capital publishes the Capital Report to generate discussion about economic and political issues.

Community divided over foreshore development project

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An exclusive poll of voters in some of the State’s most marginal seats has found the community is divided over the Perth foreshore development project.

Download the full results and and analysis in our June 2012 Capital Report.

A West Australian Opinion Polls (WAOP) telephone poll of 400 voters was undertaken in the electorates of Forestfield, Riverton, Wanneroo and Mount Lawley in the fortnight leading up to the State Budget. The research asked respondents whether they supported or opposed the WA State Government’s foreshore development.

The poll found 48.6 per cent of voters support the development, with 40.3 per cent indicating they opposed the project. However, the poll also found feelings were much stronger among those who opposed the development, with 21.1 per cent strongly opposed, compared to 14.3 per cent strongly in favour.

The State Government will be pleased that a clear majority (61.5 per cent) of young people (18- 29 years) support the project. However, of concern to the State Government, will be the finding that marginally more swinging voters oppose the development (44 per cent) than support it (43 per cent).

This apparent lack of passion for the project could be behind Premier Colin Barnett’s announcement of a name for the development, which is likely to make it project more tangible to voters. However, both the decision making process and the proposed name itself have proven to be contentious, which could divide community opinion further.

Respondents who indicated support or opposition for the project were also asked to nominate reasons for their position. Major reasons given by those who support the development were that it would revitalise the city and make it more vibrant (18.4 per cent of sample), that it would be good for tourism (14.6 per cent) and that families would use it more (9.3 per cent).

People opposed to the project cited the loss of public space (16.5 per cent of sample), the cost of the project (13.5 per cent) and traffic problems with the development (7.7 per cent). Concerns were also raised about the amount of high-rise development planned (4.9 per cent) and the project’s overall design (4.9 per cent).

Canberra’s shrinking presence in WA

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Premier Colin Barnett’s weekend assertion that WA’s relationship with the Commonwealth Government was becoming “negligible” was dramatic, but not without grounding.

While Western Australia’s declining share of GST revenue raised by the Commonwealth has been somewhat offset by increases in other Commonwealth Grants, the proportion of the WA State Budget funded by the Commonwealth is steadily declining.

In 2007/08, GST revenue and other Commonwealth Grants made up 42 per cent of the State Budget.  By 2012/13, this has dropped to 35 per cent and is projected to drop to 28 per cent by 2015/16.

This decline in the Commonwealth’s relative contribution to the WA Government’s budget is predicated on terms agreed between the Howard Government and the Court Government in 1999, as a part of the Intergovernmental Agreement to carve up revenue from the incoming Goods and Services Tax.  Under the principle of horizontal fiscal equalization, the Commonwealth adjusts the GST payable to each State on the basis of the State’s ability to raise its own revenue.  This process is designed to redistribute income from States with greater ability to generate revenue to those with a smaller economic base.

In 1999, WA had a very different economy than we do now.  For many years, WA had been a net beneficiary of the redistribution of Commonwealth revenue.  When signing the Agreement with John Howard and Peter Costello, then Premier Richard Court probably didn’t envisage the huge growth in mining royalty income that would occur over the next two decades and the impact this would have on the State’s share of GST revenue.  Mr Court presumably didn’t notice that poker machine revenue raised by other State’s wouldn’t affect their GST share.  If he had factored in either of these, he may have struck a different deal.

That said, the WA Government is hardly destitute as a result of the Agreement struck.  Mining royalty income has increased significantly more than our share of GST revenue has declined and total State Government revenue has increased by 30 per cent since Mr Barnett was elected.

In arguing for a new model of calculating the distribution of the GST, Mr Barnett is focused on improving his budget bottom line now.  However, with the State Budget increasingly dependent on royalty income, the Premier needs to be careful what he wishes for.  Demand for WA’s natural resources may decline in the future, either through the deterioration in the economic conditions of our trading partners, or through the emergence of more competitive suppliers.  In this event, future WA Governments will be highly exposed if any new method for calculating the distribution of the GST doesn’t build in a mechanism to support WA when we are no longer booming.

Download our May 2012 edition of the Capital Report here.

Barnett can’t hide the boom in his budget

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A clear majority of voters in marginal State Government electorates believe State Government revenue has increased, since Colin Barnett became Premier in 2008.

A Western Australian Opinion Polls (WAOP) poll of 400 voters in the marginal seats of Swan Hills, Riverton, Wanneroo and Mount Lawley in the fortnight leading up to last week’s State Budget, found 50.7 per cent of voters believed revenue had increased.  Only 9.8 per cent of respondents believed revenue had decreased, with 10.6 per cent indicating it had stayed about the same and 28.9 per cent unsure.

The results indicated public opinion is aligned with the reality of the Barnett Government’s revenue performance since it was elected.   In the Carpenter Government’s last year in office (2007/08), the State Government received a total of $19.3billion in revenue.  In 2012/13, the Barnett Government is expected to receive $25.5billion, an increase of 32 per cent.  After adjusting for inflation, Treasurer Christian Porter is currently presiding over a budget 14.7 per cent bigger, in real terms, than Eric Ripper presided over during his last full year as Treasurer.

Download our May 2012 edition of the Capital Report here.

More WA families feeling worse off, despite booming resources sector

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A dramatic increase in the number of Western Australians feeling financially worse off has been recorded, in the wake of large annual increases in the price of electricity, gas and water over the last three years.

A WAOP poll of 400 voters in the marginal State electorates of Wanneroo, Mount Lawley, Riverton and Forrestfield in June 2010 found 40 per cent of voters considered themselves financially worse off than they were 12 months previous.  Only 26 per cent of respondents reported being financially better off.

In a similar poll conducted in July this year, 56 per cent of voters reported being financially worse off than a year ago, representing a sharp increase on last year’s findings.  The number of voters reporting to be financially better off had collapsed to just 12 per cent.

Download our August 2011 edition of the Capital Report here.

Opposition to uranium mining increases post-Fukushima

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The meltdown at Japan’s Fukushima nuclear power plant following the March earthquake and subsequent tsunami appears to have significantly increased opposition to uranium mining in the Barnett Government’s marginal metropolitan seats.

A WAOP poll of 400 voters in the marginal Liberal-held seats of Riverton, Jandakot, Swan Hills and Mount Lawley this April found 46 per cent of voters were opposed to uranium being mined in WA, with only 34 per cent in favour.  A similar poll last October recorded opposition to uranium mining at 40 per cent, with 42 per cent in favour.

Download our July 2011 edition of the Capital Report here.