Page 1280 - Week 05 - Tuesday, 16 April 1991
Next page . . . . Previous page . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .
the needs of this community, but restructuring is not cheap. The hospital and TAFE programs, in particular, require major additional expenditure over and above normal operating costs to enable future savings to be achieved. It is almost certain that significant expenditure of a similar nature will now be needed to reduce police operating costs in future years.
The transitional allowances assessed by the Grants Commission do not include any allowance for the high costs of restructuring. Much is being accomplished within the ACT budget, but it is essential that the Commonwealth now release the funds, totalling $50m, that it has frozen in the ACT Transitional Funding Trust Account as a consequence of breaking its real terms funding guarantee to the ACT Government. The Commonwealth must release those funds over the next two years at the outside, in addition to providing the transitional allowances recommended by the Grants Commission and a proper allowance for the expenditures not allowed for in the commission's calculations.
There is no scope for attempts to return to the costly and inefficient practices the Commonwealth imposed on us and which this community simply cannot afford. I know that there are some who would wish to return to those comfortable arrangements, but the clock cannot be turned back and nor, in my view, should it be. The report shows the major efforts that have been made to overcome any earlier ACT revenue shortfall compared to the States. The ACT cannot sustain past levels of expenditure without having to impose unacceptably high tax burdens far exceeding those in the States. Such a high tax strategy would have a seriously adverse impact, not only on individuals but also on the ACT economy and, in turn, on local employment.
It would impose hardships, both directly and indirectly, on ordinary Canberra residents. The Grants Commission has not been persuaded by arguments that the ACT had in the past been overcompensated for the impact of national capital influences. I did not accept the arguments put to the commission by the National Capital Planning Authority. They were not well founded, and the commission was not persuaded by them either.
As I have indicated, there will need to be negotiation with the Commonwealth on the many detailed issues raised by the report. I have written to the Prime Minister to propose that we address these issues soon and that we meet prior to the Premiers Conference if major issues remain unresolved. The commission has completed a complex task. It has provided a reasonable basis for the intergovernmental negotiations now required.
In summary, the report's findings confirm that the ACT is still overfunded by the Commonwealth and that this overfunding is a legacy of earlier Commonwealth decisions. They reinforce the need for continued expenditure restraint
Next page . . . . Previous page . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .