Mark McGowan team hits out at Turnbull over GST

The new McGowan Labor government has urged the PM to keep his word on improving WA’s share of GST.

The new McGowan Labor government was in conflict with Malcolm Turnbull even before its first cabinet meeting in Perth yesterday, urging him to keep his word on improving Western Australia’s share of GST and respect what it describes as its mandate to divert commonwealth funds promised for a freight road to its planned city train network.

The Prime Minister was applauded at the WA Liberal Party state conference in August when he used his keynote address to commit to a floor in the amount of GST revenue any state could receive. WA’s share of the distribution has collapsed to 30c in the dollar, and former premier Colin Barnett repeatedly said this was a significant factor in the state’s $3.9 billion deficit and state debt approaching $40bn.

There was no change, however, as the Barnett government headed into a disastrous election campaign that brought the state’s financial woes into sharp focus. Yesterday, Mr Turnbull said when he tried to raise the issue of GST reform at the Council of Australian Governments, he encountered ferocious opposition from Bill Shorten and Labor leaders in South Australia, Victoria and Queensland.

“So the challenge for the new Labor Premier of Western Australia is how is he going to get his own party on side?” Mr Turnbull said. “Labor is absolutely rock solid at the federal level, so far anyway, in defending the existing arrangements on the GST distribution. I believe there is an opportunity to set a floor.”

New WA Treasurer Ben Wyatt said he hoped to have a clearer understanding of how change could occur after meeting with fellow state treasurers this week. “Ultimately, the Prime Minister needs to understand he is the Prime Minister and responsible for delivering on the commitment he made to WA over six months ago,” Mr Wyatt said.

Mr Turnbull yesterday declined to agree to the demands that the freight road funding should instead be used to pay for WA Labor’s promised urban rail network.