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2015 WA State Budget: investing in infrastructure

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For the first time in 15 years, Western Australia's State budget is in deficit. WA's financial position has been hit hard by the combined effect of falling GST and dramatic dives in iron ore royalties. Treasurer Mike Nahan announced the state would fall into a deficit of $1.287 billion this financial year, $2.7 billion in 2015-16, before hopefully returning to a surplus of $874 million in 2017.

All key financial measures have been blown apart in the state budget, with net debt (above $30 billion), cash deficits (above $5 billion) and debt to revenue ratios (above 80 per cent) hitting unprecedented levels. Jonathan Barrett of the Financial Review

The government plans to sell assets worth collectively up to $5 billion (including Fremantle Port, TAB, Utah Point Bullk Handling facility at Port Hedlland, Kwinana Bulk Terminal and Market City in Canning Vale), pick up millions in commonwealth incentive payments and invest in infrastructure to pay down the record debt.

The WA Government just released their plans for the infrastructure sector:

The Liberal National Government will spend $15.1 billion investing in roads and public transport infrastructure in Western Australia between 2008-09 and 2018-19.

  • $6.3b Asset Investment Program in 2015-16 and $24.1b over four years
  • 93,000 jobs created through recent and current major projects
  • $15.1b on roads and public transport between 2008-09 and 2018-19
  • Funding for 4 new primary schools - $60.2m approved in 2015-16 State Budget
  • Funding for 2 new high schools - $112m approved in the 2015-16 State Budget

Premier Colin Barnett said in 2015-16 alone, the Government would spend $1.6 billion on roads and public transport, including $5 million to plan for 300 new C-series railcars to double the State’s rail fleet over the decade from 2019 at a cost of $1.2 billion.

Transport is a key focus of this Government. We are investing in infrastructure to grow the State for the future while providing thousands of jobs now. Just one example of this is the $1 billion Gateway WA project due for completion in 2016 which, over the course of its life, will create 7,000 jobs. Premier Barnett

Work on major road projects include the Perth Freight Link; Gateway WA project; NorthLink WA Swan Valley; Great Northern Highway; Mitchell Freeway Extension from Burns Beach Road to Hester Avenue; and North West Coastal Highway will account for $609 million in 2015-16.

After spending $101.6 million on cycling networks across the State over the past six years, resulting in 221 kilometres of off-road shared paths and 71km of on-road bike lanes, the Government has included further cycle path spending of $72.1 million over the next four years in this State Budget.

The Treasurer said a school building and improvement program valued at $1.18 billion to 2018 was another key element of the Liberal National Government’s drive to invest in infrastructure to grow the State.

The Government will spend $295 million in 2015-16 on education infrastructure, including four new primary schools and two new high schools as part of a $6.3 billion Asset Investment Program across multiple portfolios in 2015-16

Dr Nahan said recent and current major projects would result in the creation of more than 93,000 jobs - with thousands more indirect jobs created for offsite suppliers and services.

The Government’s Asset Investment Program has rebuilt the regions; rebuilt the health and education sectors and is transforming the city for the 21st century, as well as providing jobs both directly and indirectly for workers now. Treasurer Mike Nahan

From 2009-10 to 2014-15, the Government has invested about $2.3 billion to construct new and replacement schools as well as to refurbish and upgrade schools.

In this period, the Government has opened 28 new primary schools, nine new secondary schools and 13 replacement schools, providing 1,199 new classrooms.

The Treasurer said that the successful consortium for Western Australia’s first Public Private Partnership for schools was expected to be announced in August 2015 by the Government.

The project involves a consortium financing, designing and building eight public schools and then maintaining them over a 25-year period at an estimated capital cost of $370 million.

The Government had spent more than $7 billion on hospital infrastructure since 2008 and will continue to invest in a range of hospital projects across the State.

After opening the $2 billion Fiona Stanley Hospital in October 2014, the $1.2 billion Perth Children’s Hospital was on schedule to open in the first half of 2016 while the $360 million Midland Public Hospital would be completed in the second half of 2015.

In the city of Perth, projects such as the $918 million new Perth Stadium and $441 million Elizabeth Quay project - the latter due for completion in November 2015 - were world-class developments that would transform the city.

Fact File - Strategic projects

Health

  • Midland Public Hospital - $360m and 7,601 jobs - due for completion 2015
  • Perth Children’s Hospital - $1.2b and 5,169 jobs - due for completion 2015
  • Karratha Health Campus - $206.9m and 1,700 jobs - due for completion in 2018
  • Harvey Health Campus upgrades - $13m

Transport

  • Forrestfield Airport Link - $2b and 2,000 jobs - due for completion in 2020
  • Gateway WA - $1b and 7,000 jobs - due for completion in 2016
  • Perth Freight Link - $1.6b and 11,000 jobs - due for completion in 2019
  • NorthLink WA - $1.1b and 7,700 jobs - due for completion in 2019
  • Perth City Link rail and bus works - $569.3m and 3,000 jobs - due for completion 2016
  • $5m to plan for 300 C-series railcars
  • $72.1m for cycle paths over four years

Transforming the City

  • $918 million new Perth Stadium
  • Elizabeth Quay - $441m and 1,600 jobs - due for completion 2015
  • Perth City Link development works - $195m and 2,500 ongoing jobs
  • New WA Museum - $428.5m and 4,250 jobs - due for completion 2020

Corrective Services

  • Eastern Goldfields Regional Prison - $232m and 1,500 jobs - due for completion 2015

Education

  • Primary schools under construction to open in 2016
  • Annie’s Landing Primary School, Ellenbrook - $14m
  • Rivergums Primary School, Baldivis - $18.2m
  • Trinity Primary School, Alkimos - $14m
  • Harrisdale Primary School, Harrisdale - $14m
  • Secondary College under construction to open in 2017
  • Harrisdale Senior High School Stage 1 - $57m
  • New primary schools to be constructed under Private Public Partnership to open in 2017
  • Alkimos South West Primary School, Alkimos - $14m
  • Landsdale East Primary School, Landsdale - $14m
  • Baldivis North Primary School, Baldivis - $14m
  • Byford South West Primary School, Byford - $14m

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