Federal Govt’s hands tied on State’s GST population pain
The Federal Government has revealed it can not intervene to fix a $2 billion hole in the State’s finances, delivering WA Treasurer Ben Wyatt a big fiscal headache ahead of his first Budget next month.
Federal Treasurer Scott Morrison said that, legally, his hands were tied when it came to changing the way the Commonwealth Grants Commission used population figures to distribute GST revenue to the States and Territories.
Population estimates from the Australian Bureau of Statistics had reduced the number of WA residents by 60,000. That will translate into $2 billion less over the next four years because of the way population figures are used by the commission to determine annual GST payments.
Mr Morrison said laws prevented him from directing the commission to alter the way it used the population figures.
However, Mr Morrison said the Federal Government had shown through previous payments that it understood the problems faced by WA when it came to the GST.
“We now need to ... have an enduring solution to that,” he said.
Treasurer Ben Wyatt is facing a fiscal headache.