Prime Minister Anthony Albanese has confirmed he will maintain the current GST distribution agreement that heavily favours Western Australia, sparking fresh backlash from other states. The deal, struck during the pandemic, guarantees WA a minimum 70 cents per dollar of GST revenue raised, a floor that other premiers argue is no longer justified given the state’s budget surplus.
Speaking in Canberra on Monday, Albanese defended the arrangement as a “fair and necessary” measure to support resource-rich states, but Queensland and New South Wales leaders described it as a “raw deal” for their residents. South Australia, which receives the lowest per capita GST share among mainland states, is particularly aggrieved as it faces a costly recovery from extreme weather.
Meanwhile, Adelaide is bracing for its wettest winter in more than two decades, with a low pressure system expected to bring heavy rainfall over the coming days. The Bureau of Meteorology has warned of possible flash flooding in low-lying areas, with totals of up to 100 millimetres forecast in some suburbs. The city has already recorded above-average rainfall for August, and the coming system could push seasonal totals past 600 millimetres for the first time since 2004.
State emergency services are on standby, and residents have been advised to sandbag properties and avoid unnecessary travel. The weather event is not directly linked to the GST dispute, but it underscores the financial strain on South Australia, which has limited capacity to fund disaster mitigation without a larger share of federal revenue.
The PM’s stance has drawn criticism from both sides of politics. Liberal Premier of South Australia, Peter Malinauskas, called the GST deal “unfair” and urged the federal government to “revisit the formula before the next budget”. Labor premiers from Queensland and Victoria have echoed similar sentiments, though they stopped short of demanding immediate changes.
Albanese has signalled he is open to a broader review of the GST distribution model after the next federal election, but insists the current floor for WA will not be touched. “Western Australia’s economy is unique, and the deal reflects that,” he said. “We will not be ripping up an agreement that provides certainty for millions of Australians.”
Critics argue the arrangement locks in inequality, with states like SA and Tasmania receiving less than 50 cents per dollar of GST revenue. The Productivity Commission is due to release a report on the GST system later this year, which could reignite the debate.