WA Budget: State-owned assets sale to reap $2b windfall

Ben Wyatt stands to reap more than $2 billion in windfall gains from the sale of State-owned assets and a dispute over allegedly unpaid royalties by mining giant BHP.

The Treasurer confirmed he had opted not to book revenue from the planned sale of the TAB and partial privatisation of Landgate, leaving room the potential for a Budget boost heading into the 2021 election.

As previously flagged, the Government has also left off the books up to $300 million owed by BHP in iron ore royalties, despite expectations the two parties could soon reach an agreement as soon as next month.

It is understood a deal could be announced by the end of June.

Handing down the Budget, Mr Wyatt said yesterday he would soon introduce legislation to Parliament to offload State betting agency the TAB, which is expected to fetch about $500 million.

While a number of private bidders have previously expressed interest in the business, it is believed east coast gambling giant Tabcorp is looming as the most likely buyer of the asset.

With the Government committed to reserving 35 per cent of the sale proceeds for a racing infrastructure fund, Mr Wyatt revealed the balance would go towards replacing King Edward Memorial Hospital.

He also said the planned “commercialisation” of Government-owned land title registry Landgate was on track to be completed by the end of the year.

The proposal will involve the sale of Landgate’s automated land title arm for a figure that could be up to $1.5 billion.

Under the plan, a private operator would run the service and collect user fees, while it would also get access to their data, which could be even more valuable.

Both asset sales are being handled by South African investment bank Investec, the Government’s preferred consultant which is in line to make millions of dollars worth of fees.

The decision not to account for the privatisations or a potential agreement with BHP represents a major upside to the Budget as the Government eyes re-election at the next state poll in 2021.

Having delivered a $533 million surplus for the current financial year — two years ahead of schedule — Mr Wyatt is projecting the Budget to be $1.5 billion in the black in 2019-20, rising to a $2.6 billion operating surplus the following year.