WA Budget 2025 five-minute guide: What the State Budget means for you

Rita Saffioti has handed down the Government’s first Budget since Labor’s thumping re-election in March. The financial statement, Labor’s ninth, showed Western Australia remained the economic powerhouse of the nation, with a big spend on economic infrastructure.

Here’s what you need to know:

FINANCES

WA is set to book a $2.5 billion surplus this financial year, a drop from $3.2 billion predicted in the pre-election update. Over the next four years, the Government banks more than $10 billion in surpluses, of between $2.4 billion and $2.8 billion — including $2.4 billion in the 2025-26 financial year.

“In a world of global instability and uncertainty, our government has a strong economic plan for this State,” Ms Saffioti said.

“Western Australia has become the envy of the nation for our financial management and economic success.

“Western Australia was once likened to a fortress – Fortress WA. While not a worldwide pandemic, the global instability and volatility we now face, means we must once again stand together to repel any economic threat.

“This Budget reinforces the walls of fortress WA.”

Net debt is on track to climb from $33.5 billion by June 30, to more than $42 billion by 2028-29, which Ms Saffioti said was still the cheapest to manage in Australia.

HOUSEHOLD FEES AND CHARGES

The Government claims households will be better off after July to the tune of $50, but largely off the back of savings under Labor’s proposed one zone public transport cap.

Under the model, a regular commuter will save up to $625 a year, while students will remain free after the Government extended the discounted travel.

“Inflation has turned the corner, wages have strengthened, and Western Australians with mortgages have welcomed two interest rate cuts in the past four months,” Ms Saffioti told Parliament.

But families will need to brace for an increase in power and water prices of 2.5 per cent, with electricity this year not softened by $700 in power bill credits. Instead, just $150 will be shaved off bills in the next six months courtesy of a federally funded credit.

The cost of owning a car will also jump by 3.3 per cent – to more than $1000 for the first time.

Also hidden in the figures is another a 5 per cent increase in the emergency services levy, which will be applied to homeowners.

IRON ORE

The State’s biggest revenue driver, iron ore, is set to deliver $8.5 billion in royalties to Treasury’s books this financial year, with lower price forecasts meaning it is expected to bring in $6.6 billion in 2025-26.

But the commodity is set to stabilise, with royalty returns forecast to drop by $3 billion as the price lowers to $US72 per tonne by 2029.

The Budget sparked warnings of a softened demand outlook for iron ore, with Chinese consumption subdued, due to a weaker property sector.

“While there are signs that the property downturn may be stabilising, particularly floor sold, high inventories of unsold homes are expected to limit any near-term recovery in construction,” the Budget stated.

“While this combination of slowing demand and rising supply means prices could fall below levels seen in recent years, the State’s competitive position is underpinned by the relatively low cost of most of its iron ore production.”

WAGES

Currently sitting at 3.75 per cent, the strongest in Australia, wage growth is set to slow to 3 per cent out to 2028-29, despite a tightness in the labour market, with demand sufficiently met with the pool of workers available.

“Nonetheless, nominal wage growth is expected to exceed inflation over the forward estimates, resulting in a sustained period of real wage increases,” the Budget stated.

Inflation, meanwhile, is predicted to remain at 2.75 until next June, before dropping to 2.5 per cent for the next three years, within the Reserve Bank of Australia’s target band for the economy.

THE NEW SPENDS

A $1.4b for the State’s health and mental health system, including $830 million to address increased hospital activity, implementing nurse-to-patient ratios, and an expansion of the Hospital in the Home Program

Another $1.4b to improve housing supply, including a $210 million to expand Keystart’s Shared Equity Scheme and $119m in stamp duty relief.

More than $1.8b for education and training, including nearly $700m to address a surge in public school enrolments

$162m to implement a flat fare for public transport across Perth.

Measures to diversify the economy with $500 million to top-up the Strategic Industries Fund, and $217.5 million to develop the Perth Entertainment and Sporting Precinct at Burswood.

OPERATING SURPLUS

2024-25: $2.5 billion

2025-26: $2.4 billion

2026-27: $2.4 billion

2027-28: $2.6 billion

2028-29: $2.8 billion

NET DEBT

2024-25: $33.5 billion

2025-26: $38.9 billion

2026-27: $41.3 billion

2027-28: $42.2 billion

2028-29: $42.5 billion

UNEMPLOYMENT RATE

2024-25: 3.75%

2025-26: 3.75%

2026-27: 4%

2027-28: 4.25%

2028-29: 4.25%

WAGES GROWTH

2024-25: 3.75%

2025-26: 3.5%

2026-27: 3%

2027-28: 3%

2028-29: 3%

IRON ORE PRICE ($US/TONNE)

2024-25: $101.40

2025-26: $77.60

2026-27: $72

2027-28: $72

2028-29: $72

GOVERNMENT EXPENSES 2025-26

Health and Mental Health: $14.6 billion (31%)

Education: $8.21 billion (17%)

Electricity and water subsidies: $1.62 billion (3%)

Roads, rail and transport: $4.94 billion (10%)

Community safety: $5.19 billion (11%)

Communities: $3.4 billion (7%)

Training and TAFEs: $1.21 billion (3%)

All other: $8.86 billion (18%)

NET CONTRIBUTION OF EACH STATE TO THE FEDERATION PER CAPITA

WA: $13,324

NSW: $712

VIC: -$77

SA: -$7594

QLD: -$3035

TAS: -$12,130

NT: -$25,885