Rebounding business confidence and investment will help fuel a recovery in WA’s battered fiscal position in the coming years, according to Treasurer Ben Wyatt.

Addressing business and political leaders yesterday, Mr Wyatt said that the mid-year Budget review would reflect an improvement in the State’s bottom line.

He said figures showing two consecutive quarters of growth in State final demand for the first time since 2013 were the strongest sign yet that WA’s economy had turned a corner.

Speaking at a lunch hosted by the Committee for Economic Development of Australia, Mr Wyatt said the results were “extraordinarily positive”.

He said a resurgence in business confidence and capital spending were the main drivers, leading to the creation of more jobs and lower unemployment.

Mr Wyatt said there were also signs that households were increasingly bullish about their discretionary spending as people felt more secure in their jobs.

He said the renewed vitality would flow through to the State’s finances, with the mid-year review due this month to show an improvement in the Budget’s final years.

“You will see across the forward estimates a steady, and not unreliable, reduction in those deficit positions ... by 2021,” Mr Wyatt said.

“We have updated some figures around employment, which is good news for WA.

“We’re starting to see now, certainly out of the national figures, some better data around State final demand.

“Our domestic economy is growing stronger than expected.

“Obviously, there won’t be any dramatic change in the mid-year review because the Budget was only a couple of months ago.”

Despite the optimism, Mr Wyatt confirmed there would be a $400 million blowout in State debt this financial year after the State Government’s planned gold royalty increase was blocked twice in Parliament.

Opposition Leader Mike Nahan said the concern from Mr Wyatt’s comments was the suggestion the deficit would be pushing $3 billion in the mid-year review.

“That’s a 30 per cent increase in the size of deficit in three months,” Dr Nahan said.

“The deficit will go to its highest in history despite his claims of more rapid growth, more rapid revenue growth.

“They have not done what they claimed, they have not got spending under control and the deficit and debt are growing.”