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Western Australia 2026-27 Budget: $3.5 Billion Surplus with Spending on Health, Housing, and Fuel Rebate

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Western Australia's 2026-27 Budget: A Surplus, But Regional Critics Cry Foul

The Western Australian government has presented its 2026-27 state budget, forecasting a $3.5 billion surplus for the 2025-26 financial year. The budget allocates increased spending to health, housing, and infrastructure, while introducing a one-time $100 fuel payment for driver's license holders.

Fiscal Position

  • The budget projects an operating surplus of $3.5 billion for 2025-26, declining to $2.4 billion in 2026-27. This marks the eighth consecutive surplus.
  • Net debt is reported at $34.5 billion for the current financial year, down from $39 billion the previous year. The debt-to-income ratio rose from 6.7% to 7.1%.
  • Debt is expected to exceed $40 billion by the next financial year, with over $10 billion allocated for interest payments over four years.
  • Global uncertainties cited include creeping inflation and effects of the Middle East war.
  • Western Australia's share of the GST increased from 8.3% to 9.1%.

"The eighth consecutive surplus underscores the state's strong fiscal management, but rising debt and global headwinds pose challenges."

Cost-of-Living Measures

  • A one-time $100 fuel payment for each of the state's 2.1 million driver's license holders, available from July 1. The payment is accessed via the Service WA app. Electric vehicle owners are also eligible.
  • $33.1 million allocated for a three-month fuel excise cut, reducing the cost by 32 cents per litre.
  • Continuation of student assistance payments: $150 per primary school child and $250 per high school student.
  • Free student public transport fares ongoing; free fares for everyone on Sundays.
  • A new gold card for foster parents and grandparents providing $377 in energy bill rebates.
  • Household fees and charges, including power bills, increased by 2.7%, adding approximately $160 per year. Electricity and water charges increased by 2.75%, adding $108.43 to annual bills.
  • The government did not revive the power bill rebate that was ended the previous year.
  • According to the government, households using public transport and eligible for fuel support will be better off by $222 per year.

Housing Measures

  • A total of $4.7 billion allocated for housing and homelessness measures over four years.
  • Stamp duty exemptions for houses worth $600,000 or less; concessional rate for houses up to $800,000.
  • Stamp duty waived for first homebuyers purchasing land up to $450,000, increased from $350,000.
  • First home owner grant of $10,000 for houses up to $800,000, increased from $750,000.
  • $1 billion infrastructure fund (partly federal) for power and water connections to new developments.
  • Target of 34,000 homes built in eight years, including 11,000 for new home buyers.
  • $1.5 billion over four years for 1,591 new social and affordable homes.
  • $50 million to establish prefabrication facilities to boost housing supply.
  • One-off rent relief payments for people at risk of eviction.
  • Rental reforms included ending no-grounds evictions.

Median weekly rent in WA: $747, up 74% in five years.

Health Funding

  • $9.1 billion allocated over four years, described as the largest health funding increase in state history.
  • $6.5 billion for hospital services.
  • $1.5 billion for health infrastructure, including new hospitals and maintenance, with $5.5 billion specifically for health infrastructure.
  • 900 new hospital beds planned.
  • No funding allocated for a hospital at Yanchep.
  • Bunbury Hospital redevelopment reported a cost overrun of $100 million.
  • Sir Charles Gairdner Hospital was not included in the budget allocations.

Public Sector Job Cuts

  • The government plans to cut 1,500 jobs, saving $445 million over four years.
  • A 5% reduction in consultant, advertising, and travel budgets, saving $50 million.
  • Treasurer Rita Saffioti stated cuts will affect "back room staff" and not "nurses, teachers and doctors."

Economic Outlook and Industry

  • The state remains reliant on the resources sector; royalty income estimated at $10.8 billion in 2025-26.
  • Government aims to diversify the economy, including renewable energy and domestic manufacturing.
  • $500 million fund allocated for major projects.
  • $13.2 billion infrastructure investment planned for 2026-27.
  • $91.7 million allocated for strategic industrial areas.
  • $1.4 billion for renewable energy connections. The budget did not include emissions or renewable energy targets.
  • No changes to payroll tax were announced.
  • No state measures were announced to offset expected federal changes to capital gains tax and negative gearing.

Education and Carers

  • $1.9 billion allocated for education and training, including $216 million for TAFE.
  • Foster carer subsidy rates increased by 10%.
  • $14.5 million for the Foster and Grand Carer Gold Card, including $377 energy bill relief.
  • $6.1 million allocated for grandcarers.
  • No capital funding program was provided for private schools; a request for a $25 million fund was denied.

Regional and Community Reaction

Regional communities, particularly in remote areas, have stated that cost-of-living measures are insufficient for their needs.

  • Patricia Riley, chairperson of Pandanus Park Aboriginal Community in the Kimberley, stated that the measures are Perth-centric. She noted her community has no store or public transport and must travel 56 km to Derby for groceries, calling the $100 fuel payment "ridiculous."
  • Todd Jefferis, a business operator in Albany, described the relief as "a joke" and said it does not sufficiently address rising costs in regional areas.
  • Alan Duncan, director of the Bankwest Curtin Economics Centre, commented that the $100 fuel payment provides little assistance outside Perth, as diesel fuel is essential for regional life.
  • A Facebook poll indicated a public perception that West Australians are worse off, with commenters criticizing the $100 payment as insufficient.
  • Conservation groups criticized the lack of emissions or renewable energy targets, despite $1.4 billion allocated for renewable energy connections.
  • Tourism sector representatives noted only $5 million for Traditional Owner-led tourism in the Kimberley, with no broader tourism support.

"The budget delivers record spending in key areas, but for many in regional WA, the relief doesn't reach far enough."