ReGen Strategic
Much of the discussion about the formation of the second McGowan Cabinet has understandably focused on the Premier and his taking of the Treasury portfolio. But there is a lot more to read into the Premier’s announcement yesterday.
Here are my key takeaways, including pointers to the future:
- Those predicting the Premier will give up Treasury in the short to medium term, might want to reserve their judgment. The Premier is known to have been highly involved in the budget process during Labor’s first term, and at least as passionate as then-treasurer Ben Wyatt about financial discipline. Having shifted a large portion of his previous workload to Deputy Premier Roger Cook, in the form of State Development, Jobs and Trade, as well as enlisting the support of Tony Buti as Finance Minister, the Premier has created a structure that might work for the long term. Given the value he has placed on stability to date, relinquishing Treasury mid-term and claiming some other portfolios would seem out of character.
- While the Premier has talked about the looming threat from other States to his GST deal with the Commonwealth as a key driver for his taking of the Treasury portfolio, it is possible the biggest challenge he will face in his first year as Treasurer is the effort by public sector unions to end the $1,000 per year wage rise cap. With a number of enterprise bargaining agreements up for negotiation over the next 12 months, unions will argue that public sector workers have done the heavy lifting in getting the state budget back on track and, with the state economy heating up, more competitive wages will be essential if the public sector is to retain and attract quality staff. Unions may find unlikely allies in industry, given the challenges many businesses had getting approvals and decisions out of government during the last boom, when public sector workers flocked to the private sector in pursuit of better wages. New Industrial Relations Minister Stephen Dawson will lead the government’s negotiations.
- Irrespective of what happens with the Treasury portfolio, if Australia continues to win the fight against COVID, Mr Cook is likely to hand Health to someone else in 12 months or so, after 13 years in the portfolio. Education Minister Sue Ellery has been talked about for some time as a suitable replacement, however Mr Dawson may have come into the frame now that he has picked up Mental Health with his new responsibilities. Either way, the Premier will be looking for a safe and experienced set of hands, given the size and importance of Health, leaving Mr Cook to focus on the new and important portfolios he received yesterday.
- As Minister for State Development, Jobs, Trade and Science, Mr Cook has become Mr Manufacturing and will help fulfill the Premier’s vision to diversify the State economy. During the election campaign, Labor announced initiatives to progress new advanced manufacturing hubs in Kwinana and the South West, and now has hundreds of millions in incentives and initiatives on the table to attract investment in local manufacturing. The announcement of an agreement to manufacture components for the maintenance of WA’s 30,000 iron ore rail cars in WA, when considered alongside Rita Saffioti’s achievement in manufacturing the new fleet of Metronet rail cars locally, points to the potential establishment of a major new strategic industry for WA.
- Ms Saffioti and Mr Cook will jointly have responsibility for delivering Labor’s Westport outer harbour vision, with Ms Saffioti leading the effort after adding Ports to her existing Transport and Planning portfolios, and Mr Cook having responsibility for promoting the landside benefits for industry in his electorate of Kwinana. With Labor now having the numbers in both houses, Westport will happen, the Beeliar Wetlands will become an A-Class Nature Reserve, and it will be almost impossible for any future government to build the previously proposed Roe 8 and Roe 9 extensions.
- John Quigley’s appointment as Minister for Electoral Affairs suggests change is coming. With Labor already proposing sweeping changes to political donation disclosures and having a long-term commitment to the principle of one-vote-one-value, the rules under which future elections are fought may be significantly different. Attention will focus on the Legislative Council, where a malapportionment currently exists strongly favouring regional voters. Striking a balance that ensures regional voices are not lost, given WA’s size and the concentration of our population in the Perth metro area, will be a significant challenge. I expect it’s a challenge Mr Quigley will lean into. Whatever the outcome, let’s hope this year’s election was the last election that micro-parties can game the system.
- Thinking forward, the possibility of a major reshuffle and injection of fresh blood into the Cabinet prior to the next election is real. Neither political party has won a third four-year term in Western Australia, and despite the obvious electoral advantage it enjoys following this year’s state election, Labor will not want to appear tired heading into 2025. The left’s Alanna Clohesy was considered unlucky to miss out on a Cabinet spot this time, and David Michael appears to have been anointed as the next cab off the rank from the right, with his elevation to Cabinet Secretary. However, there are now 10 additional names to keep an eye on, following the Premier’s appointment of Parliamentary Secretaries. These are Samantha Rowe, Darren West, Terry Healy, Simon Millman, Jessica Shaw, Jessica Stojkovski, Kyle McGinn, Sabine Winton, Yaz Mubarakai and Matthew Swinbourne. With only four of the existing 17 Cabinet positions currently filled by women, expect the Premier to use future promotions to work towards a gender balance that reflects the 50 per cent female Parliamentary representation achieved by Labor at this year’s election.
There is much more I could write about the personalities and policies that will confront the challenges and opportunities of the next four years, but these are the key takeouts as I see them, today.
As always, CGM is here to assist our clients understand key government drivers and identify opportunities for collaboration in the public interest.