Page 2329 - Week 08 - Friday, 21 June 1991
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I would like to take issue with Mr Stevenson's proposition that this is a rates increase. In fact, it is not. By allowing for only the expected CPI increase for next year, of 4 per cent, this is, in fact, not an increase at all. It is merely maintaining revenue from this source in real dollar terms. So, I would argue that it is not a rates increase.
Indeed, the Government is taking somewhat of a risk, in my view, by projecting its revenue from this source for the next fiscal year on the basis of only a 4 per cent change in the CPI, given the hole that the budget is in. I know the hole that the budget is in and I know that the Chief Minister is now aware of that; hence her visit to Mr Kerin. The difficulty is going to be to generate sufficient revenue from all available sources next year to actually cover the cost of running the Government. That is going to be the case, even if the Government puts no new initiatives into place next year.
The Government is going to have great difficulty finding revenue from all sources just to keep pace with the current costs of government, increased to cope with the expected 4 per cent CPI increase next year, or rate of inflation. So, I think that the Government is being very conservative in projecting only a 4 per cent CPI increase and adjusting its rating only to that level, because it does close off an option to adjust it, perhaps, if in a month or two, or three months' time, they discover that 4 per cent is much too low an estimate. In that event their collections from rates next year could be an underachievement and make their budget-balancing on their recurrent budget even more difficult than it is going to be now. I do have to take issue with Mr Stevenson on the proposition that it is a rates increase; it is not.
The Government, of course, is putting into effect, by means of these amendments, the same kinds of things that we would have done had we remained in government. The move to annual revaluation of land for rating purposes is something that we had proposed to do. It is sensible. What we will find now is that there will not be major fluctuations in the valuation of land every three years. By doing an annual valuation, changes will be much smaller and people will not be surprised at the nature of the change in their unimproved land value. Of course, the percentage in the dollar that we will be collecting for rates will not change dramatically from one year to the next as long as successive governments stick with the proposition that rates should increase only in accordance with CPI movements. So, that is a sensible thing and it is something that we would have done in government.
The other adjustments, as have already been noted, are really tidying up the Act and removing some anomalies. The Chief Minister has run through them and I do not think I need to do it again. They are all things that we would have done had we remained in government. They remove some
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