Western Australia says economy rebounds, partly due to iron ore

The state government of Western Australia says a rebound in household spending, an improving employment and housing market and higher tax revenue have put the economy in a stronger position than expected in the October Budget, which sought to buffer the state from the worst of the global coronavirus pandemic, ABC News Australia reports.

Treasurer Ben Wyatt delivered his last mid-year financial review before he retires from politics at the March State election, declaring the WA economy was "roaring back to life."

While iron ore royalties were up, the WA government says it was only part of the financial picture.

"The WA budget as at May this year was expected to be dramatically worse than where we've ended up," Wyatt said.

"We were expecting very high unemployment levels and an economy contracting. [But] Western Australia has avoided recession.

"We are in a strong position. You can see now really the WA economy is roaring back to life. It's not an iron ore story. Iron ore is a part of it, but it is a story across the Western Australian economy."

As previously announced, the predicted surplus for 2020-21 has been revised up to A$2.2 billion, almost double what was anticipated when the Budget was handed down three months ago.

The government has already announced almost A$1.8 billion of that will be spent on a new hospital for women and babies in Perth.