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Perth Now
5 hours ago
- Business
- Perth Now
‘Un-Australian': GST change set to cost $60bn
The 'worst policy change in the 21st' century is set to blow out the national budget by $60bn and keep one state in the black for years to come. The goods and services tax (GST) carve up was back in focus this week as state treasurers came out with their budgets. Queensland, NSW, Western Australia, and the ACT all delivered budgets, with one state standing above them all. Mining-rich WA is in the black, with costs tipped to come in at $2.5bn less than predicted spending. The rest, budget deficits. Western Australia has cashed in on changing GST rules. NewsWire / Nicholas Eagar Credit: NewsWire WA Treasurer Rita Saffioti used her speech to focus on the relative strength of the economy compared with other states while warning of an uncertain global outlook. 'This budget is about fortifying WA amid global shocks,' she said. Independent economist Saul Eslake argues that WA has achieved a surplus for the last seven years on the back of soaring GST revenue. 'Between 2016 and 2025, Western Australia essentially had the country by the shorts and they squeezed as hard as they could,' Mr Eslake told NewsWire. 'I call it the worst public policy decision of the 21st century.' So what changed for the WA government to achieve seven years of surplus. WHY IS WA THE LUCKY STATE? Much of WA's success comes back to two changes. The first was a change to the GST in 2018, with Mr Eslake arguing that the then Liberal federal government wanted to appease WA where it held an overwhelming majority of federal seats. Then treasurer Scott Morrison announced a review of Australia's horizontal fiscal equalisation (HFE) system, which determines the distribution of goods and services tax (GST) revenue among states and territories. Then treasurer Scott Morrison enacted the GST reforms. NewsWire / Martin Ollman Credit: News Corp Australia After a Productivity Commission inquiry, the system changed so that all states and territories received 70c for every dollar of GST raised in 2022-23. That figure increased to 75c a dollar in the new agreement, WA's GST share was 30 cents in the dollar. High iron ore prices at the time could have meant WA got just 15.6 cents of every dollar of GST raised. 'So what Morrison did was commission the Productivity Commission to do an inquiry into horizontal fiscal equalisation,' Mr Eslake said. 'The terms of reference for that were written in Mathias Cormann's office. It was a classic example of (fictional TV character) Sir Humphrey Appleby's advice that you never call an inquiry unless you know what it's going to say.' HFE's aim is to ensure that every state and territory should have an equal opportunity to provide public services. The key word is should, as states and territories are free to raise additional revenues how they please as well as fund their own state-based services. 'That principle is they are equalising the fiscal capacity of the states and territories,' Mr Eslake continued. 'And the point of that, it matters far less where you live when it comes to the quality of schooling your kids get, the quality of healthcare that you and your family get, the quality of policy or environment you get.' The price of iron ore stayed high. Rebecca Le May Credit: NCA NewsWire Mr Eslake used the example of the US, which does not have HFE, meaning different states have varying life outcomes. 'If we didn't have it, then Victorians and NSW people would have much better public services and pay lower taxes, all else being equal, than Tasmanians or South Australians,' Mr Eslake said. 'And I would argue, and traditionally most Australians have accepted, that's something that makes Australia a better and fairer place than America in particular.' The second major change for WA was the rise of China, or as Paul Keating famously said, the state got 'kissed on the a*se by a big Chinese rainbow'. This kissing, Mr Eslake argues, turned WA from being propped up into a donor state. '(In the early 2000s) WA got a bigger share of whatever federal grants were going around than they would have got if it was distributed equal per capita,' he said. 'Because the (Commonwealth) Grants Commission recognised that when gold was fixed at $35 an ounce, and iron ore was only trading at $20 a tonne and they weren't selling much of it, they couldn't raise much money for mineral oil fees, but they had a relatively high cost of providing services.' NSW used its budget to call out WA's share of GST. NewsWire/ Gaye Gerard Credit: News Corp Australia BUDGET BOTTOM LINE To get other states to support these changes, a no one is worse off provision was added, with the federal government topping up any shortfalls in GST revenues. This policy was also extended until 2029-2030 under the Albanese government. This NOWO provision turns a $9bn budget blow into a $60bn black hole. 'This is the biggest blowout in the cost of any single policy decision ever with the possible exception of the NDIS, which as (economist) Chris Richardson says is at least set up for a noble purpose,' Mr Eslake said. 'It's what is allowing Western Australia to run a budget surplus while everyone else, including the feds, are running a deficit. 'In the longer run, what it will mean is residents of Australia's richest state, WA, will have better public services and lower taxes than people who live in the eastern states, which I say is un-Australian.'
Economic Times
8 hours ago
- Business
- Economic Times
Australia to have its first AI minister in shocking plan to save nurses and teachers from boring paperwork
Australia to Appoint First AI Minister Under NSW Plan to Help Teachers and Nurses Focus on What Matters Imagine a classroom or hospital where educators and healthcare workers spend more time caring and less time on paperwork. That's the vision behind NSW Opposition Leader Mark Speakman's bold proposal for Australia's first-ever Minister for Artificial Intelligence, a move designed to liberate frontline public workers from routine chores and boost productivity. Speakman said this new minister would spearhead a statewide AI strategy. 'It can relieve our teachers, our nurses, a whole lot of public‑sector workers of mundane tasks, improve productivity, and drive every tax dollar further,' he told NewsWire . The plan includes not only a dedicated ministry and AI national action plan but also low‑interest 'AI for Biz' loans to help small and medium businesses adopt 'responsible AI'. Speakman aims to follow countries like Canada, France, the UAE, and Taiwan, which already have AI ministers or similar offices. He argues that by pushing innovation, NSW won't lag. 'Every technological change has increased living standards,' he said. 'I want Australia and NSW to be leaders of that, not followers.' Not everyone is ready to sign off. Troy Wright, assistant general secretary of the Public Service Association, warned that AI 'has thus far failed because it lacks empathy' in public‑facing trials. He urges caution, especially with sensitive data. 'Keeping that secure must be our number‑one priority,' he says. Speakman counters that the AI Minister would also oversee re‑skilling workers to ensure technology augments, not replaces, jobs. He draws an analogy with Luddites, arguing that past fears of technology were ultimately proven wrong and that AI will create more and more productive jobs. Delivering a budget reply speech in late June, Speakman branded the timing urgent amid rising living costs and criticisms of the Minns Labor government's spending. He framed AI as a means to stretch every tax dollar meanwhile, is focusing on other pressing issues, housing shortfalls, health care expansion, and small‑business support. Whether AI earns a formal ministry remains to be seen.
Time of India
8 hours ago
- Business
- Time of India
Australia to have its first AI minister in shocking plan to save nurses and teachers from boring paperwork
Live Events (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel Imagine a classroom or hospital where educators and healthcare workers spend more time caring and less time on paperwork. That's the vision behind NSW Opposition Leader Mark Speakman's bold proposal for Australia's first-ever Minister for Artificial Intelligence , a move designed to liberate frontline public workers from routine chores and boost said this new minister would spearhead a statewide AI strategy. 'It can relieve our teachers, our nurses, a whole lot of public‑sector workers of mundane tasks, improve productivity, and drive every tax dollar further,' he told NewsWire. The plan includes not only a dedicated ministry and AI national action plan but also low‑interest 'AI for Biz' loans to help small and medium businesses adopt 'responsible AI'.Speakman aims to follow countries like Canada, France, the UAE, and Taiwan, which already have AI ministers or similar offices. He argues that by pushing innovation, NSW won't lag. 'Every technological change has increased living standards,' he said. 'I want Australia and NSW to be leaders of that, not followers.' Not everyone is ready to sign off. Troy Wright, assistant general secretary of the Public Service Association , warned that AI 'has thus far failed because it lacks empathy' in public‑facing trials. He urges caution, especially with sensitive data. 'Keeping that secure must be our number‑one priority,' he counters that the AI Minister would also oversee re‑skilling workers to ensure technology augments, not replaces, jobs. He draws an analogy with Luddites, arguing that past fears of technology were ultimately proven wrong and that AI will create more and more productive a budget reply speech in late June, Speakman branded the timing urgent amid rising living costs and criticisms of the Minns Labor government's spending. He framed AI as a means to stretch every tax dollar meanwhile, is focusing on other pressing issues, housing shortfalls, health care expansion, and small‑business support. Whether AI earns a formal ministry remains to be seen.
Perth Now
18 hours ago
- Business
- Perth Now
Major super boost for 200,000 Aussies
Major superannuation changes are set to roll out across the country starting from July 1, set to help millions of women bridge the gender pay gap. Starting next Tuesday parents taking government-funded paid parental leave will also receive a superannuation payment. This additional payment is estimated to help the near 200,000 Australian mothers each year and narrow the gender superannuation gap by around 30 per cent. According to the ASFA a woman taking 24 weeks leave the superannuation contributions will lead to $7,200 more at the time of retirement. When the regime is extended to 26 weeks, the boost to the super balance increases to around $7,800. Mothers are tipped to be among the winners when the superannuation changes come into effect on July 1. NewsWire / Nicholas Eagar Credit: NCA NewsWire ASFA chief executive Mary Delahunty said this is a major win for Australian women who take time out of the paid workforce to have and raise children, and helps reduce the superannuation gender gap. 'While compulsory superannuation has been delivering on its purpose of providing a dignified retirement for most Australians, it's long been known that women are often financially disadvantaged in retirement due to time taken out of work to have and raise a family. she said. 'The introduction of superannuation payments on government paid parental leave from 1 July on will go a long way to closing the gender superannuation gap.' Australian treasurer Jim Chalmers said paying super on paid parental leave from this Tuesday is part of our efforts to ensure parents earn more, keep more of what they earn and retire with more as well. 'A sornger paid parental leave system is good for families and good for the economy as well,' he told NewsWire. 'This important change means a more dignified and secure retirement for more Australian parents and especially women.' A second change which will see nearly 14 million workers will see their superannuation guarantee increase from 11.5 to 12 per cent starting from July 1. While the changes seem small, the treasury uses an example of a 27 year old woman who has taken up a graduate position as a professional lawyer. 'During her career, she takes an extended six-year career break for the birth and care of her two children,' treasury estimates. 'Her balance will be $22,000 higher at retirement as a result of the permanent 0.5 percentage point increase in the SG rate from 11.5 to 12 per cent.' Treasurer Chalmers said this will make a meaningful difference for Aussies. NewsWire / Martin Ollman Credit: News Corp Australia Mr Chalmers says these reforms will make a meaningful difference for millions of Australians, helping them work towards a well-deserved and dignified retirement. 'Since we've come to government, we've increased the superannuation guarantee four times, and this means an extra $98,000 at retirement for a 30 year old earning the average full-time income,' Mr Chalmers said. While the Albanese government has implemented an increase of the Superannuation guarantee from 10 to 12 per cent. It was the then Morrison government who started the changes, which saw superannuation lift from 9.5 per cent to 12, at a 0.5 per cent increment a year. The treasury department says the changes to Tuesday's superannuation guarantee will see 14 million employees have their retirement lifted. The ASFA said this increase means a median 30-year old worker making $75,000 a year will add about $20,000 to their superannuation balance by the time they retire. This $20,000 increase will mean the median 30-year old will retire with $610,000 in superannuation, above the $53,383 a year or $595,000 they would need for a comfortable retirement. ASFA says a couple requires $73,875 a year or $690,000 combined in total to live comfortably in retirement using their super plus age pension top-ups. The major caveat to these figures for singles and couples is owning your own home by retirement. The National Minimum Wage and award wages will increase by 3.5 per cent from 1 July 2025, adding $0.85 per hour to $24.95 for full time staff. Treasury estimates this change will add $75,114 over the average working life of an employee. This includes 353,000 retail industry workers, 287,000 social, community, home care and disability workers, and 234,000 hospitality worker
Courier-Mail
18 hours ago
- Business
- Courier-Mail
South Australia puts pause on plastic fruit sticker ban after concerns over cost concerns
Don't miss out on the headlines from Environment. Followed categories will be added to My News. South Australia has delayed the rollout of a nation-leading ban on plastic fruit stickers over fears the cost will be too much for farmers. The state was set to become the first jurisdiction in the country to make the environmentally-friendly move in September, with NSW looking at a similar ban. But the South Australian State Government has paused their rollout and now says both states will work together to save money, following concerns fruit and vegetable producers were doing it tough and the cost of new stickers would make it more difficult for them to continue to provide to SA markets. Any fruit being imported into South Australia will need an eco-friendly sticker when the ban eventually comes into force. 'NSW already had a commitment that they would get rid of these plastic fruit stickers and move to compostable by 2030 — our discussion will be how much sooner than that can we go,' SA Environment Minister Susan Close said. 'We will be able to get rid of these (stickers) which, admittedly, everybody hates … but I didn't want to cause disruption in supermarkets for people wanting to buy products and I didn't want to cause too much harm to our local producers either.' Laser etching is one way to display varietal and barcode information in an environmentally friendly way. Picture: NewsWire The alternative to plastic fruit stickers are either compostable labels, uncoated paper stickers or laser etchings. SA taking the lead to cut out plastic stickers meant farmers would be squeezed; compostable stickers are about twice the price, and any fruit sold in the state would need to adhere, regardless if it was grown interstate. But the eco-friendly September 1 deadline will still bring anti-plastic changes. From September in SA, plastic fish-shaped soy sauce bottles are banned, as are plastic cutlery and straws which come attached to food and drinks, such as straws on juice boxes. South Australia was the first state to ban light weight plastic shopping bags, which came into effect in 2009; Victoria and then NSW were the last to follow suit, more than a decade later. Originally published as South Australia puts pause to plastic fruit sticker ban over fears of extra cost to farmers
