The WA Government has established a Debt Repayment Account to support the repayment of central borrowings in a further effort to get the State’s finances back on track.
Growth in State debt reached record levels and was put on an unsustainable trajectory by the previous Liberal National government.
The account will be utilised when the State receives unexpected revenue windfalls, such as any significant un-budgeted or unforeseen revenue gains.
The Budget includes $338 million in debt repayments to flow through the new account over the four years to 2020-21, commencing with a $230 million repayment in 2017-18, with repayments scheduled to be made each year thereafter.
The initial funds to flow through the account will be sourced from a one-off duty assessment worth $169.4 million issued in May 2017 (associated with a high value commercial property transaction).
Debt repayment funded from this unexpected revenue will be supplemented by surplus funds to be paid into the Consolidated Account by RiskCover (totalling $168.6 million over the forward estimates period), including $60.3 million in 2017-18.
The repayment of central borrowings is a significant achievement and together with the Budget repair initiatives outlined in the Budget, is the first tangible step to address Western Australia’s long-term debt challenge.
For more 2017-18 State Budget information, visit http://www.ourstatebudget.wa.gov.au