Colin Barnett has been named as the new Premier of Western Australia, following the resignation of Alan Carpenter.

According to the ABC, the Premier-elect Colin Barnett has met with the National leader Brendon Grylls to negotiate a power-sharing deal in WA’s parliament.

The new alliance, which will see the end of Labor reign in the state politics, came to an agreement after Mr Barnett promised to offer the Nationals 25 per cent of mining royalties spent in regional areas, equivalent of $675 million a year.

“We had a situation of wall-to-wall Labor governments. I don’t believe that was good for Australian democracy.

“This is a significant result for politics across the country,” Mr Barnett said.

He told the ABC that he was happy with the negotiation, and the royalty payout would not affect the state’s AAA credit rating.

“I believe that the real factor behind the National Party coming with the Liberals was that we philosophically agree on virtually every issue. Our policies are consistent,” he said. “There are major differences, I would think, between the National Party and the Labor Party on a range of issues including a whole lot of social issues.”

Rejecting the view that the $675 million commitment was unfunded, he said the state’s economic activities remained strong with a large amount of surplus.

“The state does have a significant surplus, around $2 billion at present, because of the fall in the value of the Australian dollar, the Australian dollar value of mining royalties is very much greater.

“We will allow uranium mining in Western Australia. That will generate more income and we will make savings across a whole range of government projects,” Mr Barnett said.

Meanwhile, the Labor Party will elect a new Opposition leader to replace Mr Carpenter at a caucus meeting tomorrow.

It is understood among the contenders are Planning Minister Alannah MacTiernan, Eric Ripper and Mark McGowan.