Jacinta Allan blasts Queensland Treasurer David Janetzki as GST feud deepens

Victoria’s Premier labelled Queensland’s David Janetzki’s shot at her state over its share of GST revenue as ‘bullshit’.

Queensland Treasurer David Janetzki. Picture: Liam Kidston

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Victorian Premier Jacinta Allan has labelled Queensland Treasurer David Janetzki’s shot at her state over its share of GST revenue as “bullshit”.

Mr Janetzki used a speech on Monday to blast Victoria’s bid to put GST ­reform at the centre of Jim Chalmers’s economic reform roundtable, saying states working to improve their productivity face losing revenue to help keep Victoria’s “hospital lights on”.

It prompted a blunt response from Ms Allan.

“Perhaps let me put it in language in a way the Queensland Treasurer can understand: it’s just bullshit,” Ms Allan said on Monday.

“Because when you look at the history of the GST, Victoria has been a net contributor to the tune of $31bn and the Queensland budget’s… $8bn-plus black hole has got nothing to do with the circumstances here in Victoria.

“I don’t want to quibble with another state, I don’t want to quibble with the Queensland Treasurer. What I’m focused on is not on nonsense like this, but on making sure Victorians get their fair share, whether it’s their fair share of infrastructure funding, their fair share of revenue... that’s raised out of here in Victoria, that should be returned to Victorians.”

Ms Allan said Mr Janetzki would “be better off focusing on the facts” and working with the federal government to secure infrastructure funding and GST allocation.

“These nonsensical pot shots across state borders are just that, complete nonsense,” she said.

States of animosity when GST’s at stake

Mr Janetzki said in his speech that the “states are at the frontline of productivity reform”, putting himself or Premier David Crisafulli forward to advocate for the states and territories at the August roundtable.

With the federal Treasurer open to discussing reforms to the consumption tax during the roundtable, Mr Janetzki said the “GST’s intended benefits to states needs to be reimagined” if productivity is to be improved.

Mr Janetzki’s comments come as an Albanese government minister said real wage growth could only be sustained if it is “grounded in productivity”.

The Australian understands the Queensland government ­opposes the states being represented by Ms Allan, with Mr Janetzki using his speech to take aim at her government’s economic record.

“Just as the approach to a fairer GST system needs to be driven by the states and developed in the national interest, the pursuit of economic reform to boost productivity, strengthen our resilience and improve budget sustainability must be advanced by state governments,” Mr Janetzki told a CEDA event in Brisbane on Monday.

“Queensland, with its own newly re-established Productivity Commission, is doing the heavy lifting on productivity; our gas is solving the southern states’ energy crisis and our GST revenue is going to Victoria to keep their hospital lights on.”

Victorian Premier Jacinta Allan at a Suburban Rail Loop build site in Burwood on Sunday. Picture: David Crosling/NewsWire

Dr Chalmers on Friday said there would be a process to involve state and territories on economic reform proposals, but he has not said whether any of the premiers would be invited to ­attend the roundtable of about 25 representatives from business, unions, government and civic ­society.

The push from Queensland comes as Assistant Minister for Productivity Andrew Leigh said wages growth would lead to better living standards only if it was accompanied by improvements in productivity.

“That’s ultimately just how the economy works,” Dr Leigh told The Australian.

Asked whether it was worthwhile linking wage rises in the care economy sector to efficiency dividends, he said: “You can formalise it if you like, but ultimately long-term wage gains have to be grounded in productivity.”

During the federal election campaign, Anthony Albanese backed cabinet minister Murray Watt for declaring real wages growth could be achieved without stronger productivity growth – a position that put Labor at odds with Reserve Bank governor Mich­ele Bullock.

The Prime Minister said during the campaign “there has been wages growth and productivity growth has been lower”, as he backed an above-inflation wage rises for low-paid workers.

The Fair Work Commission’s decision to award a 3.5 per cent wage increase to 2.9 million ­people on award and minimum wages will go active on Tuesday, benefiting many workers in the care economy.

After the election, Mr Albanese and Dr Chalmers have put productivity growth, which averaged 0.2 per cent a year in the six years to 2024, at the centre of the government’s economic agenda.

Assistant Minister for Productivity Andrew Leigh and Treasurer Jim Chalmers. Picture: Martin Ollman/NewsWire

Dr Leigh said artificial intelligence was a huge opportunity for productivity gains in the growing care economy sector, which has lagged the private sector on the measure in the past 20 years.

He said it was important the Productivity Commission was examining “how to better measure output in the care sector”.

“And to get a measure of quality of care, not just the number of hours of care,” Dr Leigh said. “That then drives an agenda towards better skilled operations and better use of technology.

“There’s a range of AI-enabled technologies that are being used in care homes in order to supplement the work of humans, things like fall detectors, which could be important in ensuring that somebody is able to get to a person in an aged-care home quickly.”

With the government eyeing cuts to red tape to boost productivity, Dr Leigh downplayed the prospect of some of Labor’s first-term regulations being torn up. “I don’t think that is the approach we are taking,” he said.

Dr Leigh, an admirer of the book Abundance that calls for progressives to back deregulation, said a mix of federal, state and local government rules would be looked at to bolster productivity. “In the area of housing … it’s looking at state and local regulations principally,” he said.

“The (aim for federal) EPBC reforms fit within this phil­osophy of trying to get a quicker answer.”

In his speech on Monday, Mr Janetzki will put a future target on the state’s PC to investigate microeconomic reform “to rip up the red tape and regulation restraining business”. “Reshaping our economic architecture in service of the nation and, ultimately the Queensland people, will take time and persistence but it is fundamental for a better future,” he will say.

Opposition defence spokesman Angus Taylor – who led the Coalition economic agenda at the election that included higher income taxes and debt than Labor – said he would be unlikely to support GST reforms.

“My instincts are against raising a tax like the GST,” he told Sky News. “We all need to be fighting for lower, simple, fairer taxes but I would say the starting point for tax reform is always spending reform.”