While the dust is settling on the Western Australian State Budget 2025, for the savvy business owner, the true story emerges not from flashy announcements, but from the strategic undercurrents.
This Budget solidifies the Cook Labor Government’s ambitious ‘Made in WA’ agenda, earmarking a substantial $1.4 billion to fortify the state’s economic resilience against global uncertainties.
This big spend is a calculated move, spearheaded by a $500 million expansion of the Strategic Industries Fund – now a $1 billion war chest – complemented by significant top-ups to the Investment Attraction, New Industries, and Collie Industrial Transition Funds.
For businesses, this is a clear signal that the Made in WA agenda will drive this term of government, supported by a concerted effort to boost local manufacturing and workforce capacity.
Investment includes $209 million for everything from buses to batteries, a targeted $38.5 million to bolster key sectors like defence and mining, and a critical $331 million investment in training, including the popular Fee-Free TAFE extension, ensuring the workforce is ready to capitalise on these opportunities.
So, let’s cut through the noise and see why the Treasurer thinks this Budget will take WA from being known as the “wait a while” state to “way ahead”.
Revenue
In her second Budget and first since the state election, Treasurer Rita Saffioti has reported a $2.5 billion surplus for 2024-25, with projections for a $2.4 billion surplus in 2025-26.
Responsible was emphasised in the Treasurer’s speech to Parliament. Sound investment in infrastructure, debt at a sustainable $33.6 billion, while debt as a percentage of Gross State Product (GSP) was 9.1 per cent – the best in the land.
The state’s total tax take grew by 9% to around $14.8 billion in 2024-25, led by payroll tax, which put $5.8 billion into the state’s coffers, transfer duties ($3.4 billion), motor vehicle taxes ($2.24 billion) and insurance duties ($1.09 billion).
While the Budget acknowledged growth in business investment over the past 12 months, a reflection of the continued confidence in the business environment, it also came with a sting in the tail.
Payroll tax growth is expected to slow significantly in coming years, as several major infrastructure projects come off the boil, and with projections acknowledging a sense of caution in the labour market.
Western Australia’s GST grant was $7.4 billion in 2024-25, and assuming growing calls from other states for reform are not entertained, is projected to grow to $7.8 billion in 2025-26. The Budget also included $17.5 billion in Commonwealth grants.
Property
The Budget delivered a substantial boost of housing and construction sector investments, totalling more than $1.4 billion in new commitments alongside expanded financing mechanisms through Keystart reforms.
The largest single Budget component targets affordable housing delivery with $537 million across multiple programs. This includes $246 million to deliver an additional 548 social and affordable homes, representing direct government construction and delivery.
The $210 million Shared Equity Scheme provides up to 1,000 loans where government purchases up to 35 percent equity (maximum $250,000) specifically in new apartment and townhouse developments, targeting medium and high-density housing supply.
Build-to-rent sector support includes $75 million for no-interest and low-interest loans designed to improve project viability and accelerate development timelines for affordable rental housing.
An additional $6 million supports the Community Housing Capability Program, enhancing sector capacity for affordable housing delivery.
Housing demand continues to be high, with housing availability continues to hover below what is deemed to be a healthy market rate of 3%. With population projects continuing to reflect growth, the inclusion of $37.5 million to boost the state’s residential construction workforce is a welcome addition. Noting that without both apprentices and skilled workers – building stops.
Keystart transformation
The Budget formalises Keystart’s transformation into a Government Trading Enterprise, expanding its capacity to deliver specialised housing finance products. Key new offerings include:
- Shared equity scheme: A $210 million program providing up to 1,000 loans where the government purchases up to 35 percent equity (maximum $250,000) in new or under-construction multi-residential dwellings.
- Build-to-rent kickstart fund: $75 million in construction financing comprising no-interest construction loans and low-interest loans for up to 10 years, targeting affordable build-to-rent developments.
- Modular construction loans: Low-deposit products with enhanced progress payments, particularly targeting regional markets where modular construction addresses cost and trade availability challenges.
Additional products for graduates and apprentices will launch later in 2025, featuring low deposits and financial coaching to support younger buyers’ market entry.
Stamp duty reform
Recent legislative changes, effective from March 21, 2025, expand first home buyer concessions and off-the-plan duty relief. For first home buyers, the no-duty threshold increases to $500,000 (from $450,000) with reduced rates applying up to $700,000 in metropolitan areas and $750,000 in regional areas.
Off-the-plan concessions have been extended to June 30, 2026, with expanded thresholds providing full duty exemption up to $750,000 for pre-construction contracts, reducing to 50 percent relief between $750,000-$850,000, and maintaining 50 percent relief above $850,000.
The changes expand concessions to all strata and community title dwellings, including townhouses and villas, broadening the eligible development types beyond multi-tiered schemes.
Regional housing
The Budget acknowledges acute regional housing challenges, with infrastructure funding specifically targeting growth areas outside Perth. Recent political focus on northern regions, including the Pilbara, has highlighted severe housing shortages with Karratha alone facing a potential 3,000 home deficit over five years.
Regional-specific measures include expanded stamp duty thresholds, targeted infrastructure investment, and workforce programs designed to address the unique challenges of regional construction markets.
Construction workforce development
Recognising construction capacity constraints, the Budget allocates $37.5 million to workforce development and attraction programs. This includes $25.2 million for the Group Training Organisation Wage Subsidy Program, creating 225 additional apprentice and trainee positions across the building and construction sector.
The remaining $12.3 million extends two established programs: the Build a Life in WA Incentive targeting skilled Australian and New Zealand workers, and the Construction Visa Subsidy Program supporting skilled migration.
Current program performance shows 1,019 skilled workers have applied for the Build a Life in WA Incentive, with 361 receiving initial payments and commencing work. The Construction Visa Subsidy Program has supported 1,619 skilled migrants, with 849 having arrived and commenced work across 364 businesses statewide.
Infrastructure
The centrepiece infrastructure commitment is a $101 million investment through the Housing Enabling Infrastructure Fund (HEIF), designed to unlock approximately 33,000 residential lots across metropolitan Perth and regional Western Australia.
The funding allocation includes $59.6 million for 18 water and wastewater projects spanning Perth, Peel, and regional locations including Busselton, Dalyellup, Kununurra and Margaret River. An additional $41.4 million will fund three Western Power substation feeders at Muchea, Medina and Pinjarra.
This investment builds on a recent $105 million commitment under the Housing Support Program Priority Works Stream, which supports delivery of up to 28,000 additional housing lots. Combined, these initiatives target over 60,000 new residential lots through strategic infrastructure provision.
The $400 million HEIF represents the government’s primary mechanism for addressing infrastructure bottlenecks that constrain residential land release in key growth corridors.
The State Budget marks a strategic pivot in infrastructure investment for the State Government, shifting from the headline-friendly Metronet era to a more future-focused agenda centred on utilities, energy, and ports.
Transport spending will be significantly reduced, almost halving, while investment in the state’s electricity networks, water infrastructure, and energy transmission systems is set to rise from 20% to nearly 40% of the infrastructure program. This rebalancing reflects a deliberate focus on enabling long-term industrial growth and delivering the backbone of the state’s energy transition.
Key to this shift is the expansion of transmission and generation infrastructure to support the exit from coal by 2030 and unlock new renewable energy zones. These upgrades will power not just the grid but also WA’s broader industrial ambitions, particularly in downstream processing and emerging sectors like green steel.
In the Pilbara, where energy demand and industrial opportunity converge, the investment signals confidence in WA’s ability to lead on decarbonisation while remaining globally competitive.
Complementing this is a multibillion-dollar commitment to port infrastructure south of Perth, critical to strengthening trade routes and enabling the export of future-facing products such as critical minerals and hydrogen.
At the same time, the government is reinforcing its support for gas as a transitional fuel, resisting federal tax reform pressures and calling for policy certainty to get new projects off the ground. It’s a calculated stance that recognises gas as both an economic driver and a stabilising force in the energy mix as the transition accelerates.
Energy
The 2025–26 State Budget reinforces Western Australia’s intent to lead on energy transition by coupling emissions goals with local industrial growth.
While the headline-grabbing battery rebate scheme, a pre-election commitment, will support household energy resilience, the broader significance of this budget lies in the structural investments made in generation, transmission, and supply chain capability.
A standout $584 million commitment to the Clean Energy Link will unlock significant wind generation capacity north of Perth. This infrastructure is central to WA’s goal of phasing out coal-fired power by 2030 and represents a clear step forward in aligning grid investment with decarbonisation timelines.
The Pilbara maritime decarbonisation roadmap is a game-changer for businesses in the maritime, resources, and energy sectors, especially in the state’s north. It’s a clear signal for investment in cleaner energy solutions, sustainable shipping, and the development of green technologies.
Further bolstering WA’s energy credentials is a $30 million boost to the Investment Attraction Fund, supporting new energy industries such as hydrogen, critical minerals, and carbon capture and storage.
Together, these measures reflect a coordinated strategy that accelerates decarbonisation, positions WA to compete globally in clean energy exports, while building local jobs and reducing reliance on offshore infrastructure.
Technology and Defence
AUKUS is under apparent review across the Pacific, but two out of three of the main parties are ensuring that they remain committed with proper investment of $12 million to train hundreds of new apprentices to meet the opportunities of AUKUS. This is important for Australia, naturally, but also for WA.
Given Western Australia is the port of call for Australia’s submarine maintenance, and soon to be the UK’s and US’ port of choice for the Indo-Pacific, this investment shows AUKUS is being taken seriously by the state.
This injection of cash into AUKUS-specific training opportunities ensures Henderson, Garden Island, and the surrounds have a sustainable future workforce, and also means wider technology and defence technology investment should remain in place.
Software, hardware, yet-to-be-invented technologies that will both keep Australia and its people safe are the future of this investment, and this will ensure a high-tech industrial capability for the state.
There is a $40 million commitment to the New Industries and Innovation Fund, supporting the development and acceleration of innovation-based technologies.
As the world continues to use more and more data in its everyday, this boost will be pivotal for the state economy in the long run. WA is already home to the Pawsey Supercomputing Research Centre, and has a growing technology industry, so more funding to increase the number of home-grown tech companies will be most welcome, and attractive to further investment from farther afield.
Healthcare and Aged Care
The Budget, in part, followed through on the WA Government’s election commitments aimed at taking pressure off the healthcare system.
Commitments included $25.5 million in 2025-26 for the Older Adult Care Hubs and WA Virtual ED Expansion, and $8.2 million over two years for an 18-month pilot of ‘GP ASK’ program, allowing GPs to communicate with specialists on behalf of patients.
Among the targeted investments in the health sector, $40 million will go to supporting medical manufacturing at the new Perth Biomedical Precinct. The Budget also delivered 60 new hospital beds at Joondalup Health Campus, aiming to increase capacity and address demand in the northern suburbs.
Concurrently, regional healthcare is strengthened with an additional $20.3 million investment allocated to Bunbury Regional Hospital, specifically designed to bolster the healthcare future for the South West of WA.
In light of recent reforms to the retirement living sector, which by virtue of its model, reduces the reliance of older West Australians on the health system, it was somewhat surprising to see no Budget support to enable to sector to implement reforms announced in December last year.
To find out more about how your business can make the most of the Budget announcement, contact Purple and one of our Government Relations experts.
Full Budget papers are available here: https://www.ourstatebudget.wa.gov.au/budget-papers.html
Contributors: Emily Young, Chris Leitch, Dan Wilkie, Keira McConkey, Ben Cole, Elli Swanson, Madigan Gordon.
