Budget Highlights The Need For Better Rules For Royalties For Regions

Oct 11, 2020 | State News

The Shadow Minister for Regional Development Dr Steve Thomas says that State budget has revealed the incredible cost shifting the Labor Government has imposed on the Royalties for Regions program, highlighting the need for genuine reform and better operating rules and guidelines. 

“The Royalties for Regions budget is $4.25 billion over the next four years, but far too much of it is directed into two unacceptable areas” Dr Thomas said. “These are – 

  • i. cross subsidisation of the consolidated fund which can then be used to prop up spending in the metropolitan region; and 
  • ii. covering the cost of all regional Labor election promises, including the dud ones.” 

A closer examination of the budget papers shows that: 

  1. The Country Water Pricing Subsidy – a scheme originally funded from consolidated revenue but now a cross subsidising cost will amount to $1 billion over four years, or 25% of all Royalties for Regions expenditure. 
  2. Cross subsidisation of health services will total $658 million over 4 years, or 15.5% of all Royalties for Regions expenditure, including $237 million just for access to care. 
  3. Cross subsidisation of education services will total $560 million over four years, or 13% of all Royalties for Regions expenditure, including $240 million for country school buses. 
  4. Cross subsidisation of transport infrastructure will total $243 million over four years, or 5.7% of all Royalties for Regions expenditure. 

“That’s $2.5 billion or 60% of the entire $4.25 billion gone in cross subsidisation in those four areas alone. When you add in expenditure in community services and housing, the vast majority of Royalties for Regions money is now being stolen back from regional communities by the McGowan Government” Dr Thomas said. “And while some of Labor’s election commitments in the regions should be good investments, many are not, and either way Royalties for Regions is paying for the lot.” 

Dr Thomas said that the misuse of Royalties for Regions by the Labor Party was an indication of the lax rules around the program that allowed Government to effectively spend it however it wanted to, and reiterated his call for a revamp of the entire program.

“That is why I have been asking to meet with the National Party on the issue, to try to work towards an agreed set of principles and operational standards so that a future Liberal-National Government can prevent the kind of misuse of the fund that Labor is currently getting away with.” 

“I am disappointed that the National spokesperson Mia Davies has refused any meeting, however my offer remains in place and my door is always open to a constructive discussion of regional development. I am of the view that we need to work together on this, or the very future of the program is in doubt.” 

“That would be an absolute tragedy for regional families and communities.”