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Legislative Assembly for the ACT: 1996 Week 8 Hansard (25 June) . . Page.. 2042 ..

MR MOORE (continuing):

Indeed, there were problems with the rating system. Mind you, a lot of those problems, I believe, were to do with redevelopment in inner Canberra. A number of properties, because of their redevelopment potential, were sold for more than their genuine value. Therefore properties rated at an enhanced valuation, even if the owner of the lease had absolutely no intention of selling or developing. That certainly caused a problem in the rating system. I think that accounts for the vast majority of the significant increases that we talked about.

Mrs Carnell: Macarthur, 62 per cent.

MR MOORE: The Chief Minister interjects about Macarthur. In newer suburbs it has always been the case that in the first few years the values remain fairly constant, then they increase fairly significantly and then they plateau off. When you are dealing with new suburbs, there will always be that particular process. It may well be that your review ought to have actually looked at that issue and worked out exactly how to handle that plateau. Perhaps you could have used a formula that extended the overall rate payment over six or seven years, or four or five years, rather than one year.

Those sorts of issues we can understand and they can be dealt with, but the Government's response has been: "Oh, no. Instead of doing that we will just stick with our 1994 valuations. We will keep giving a 3 per cent rise". It is not possible for this Assembly to continue to allow you to do that. It is simply an act of cowardice on the part of the Government. It does not want to deal with rates, and putting off the problem will exacerbate the problem. If it was just putting off the problem until somebody else more competent could deal with it, until the Government changes, that would probably be acceptable. When it is actually exacerbating the problem, then the Assembly must be reluctant to allow it to proceed down this path.

In some ways the Leader of the Opposition, in moving this amendment, is generous in saying, "Yes, we will give you another year to look at the rates review and come up with the management solutions that you said you were going to be able to come up with and then we can make sure that the whole rates issue is dealt with appropriately". Although I support the amendment, I think it is a generous move on the part of the Opposition, supported by most of the crossbenchers, if not all the crossbenchers. Mr Osborne may speak in a minute. The message to the Government is very clear. You are highly unlikely to get away with this next year.

MRS CARNELL (Chief Minister and Treasurer) (11.15): Mr Speaker, I have already made it clear that the reason we put two years in this Bill was to give confidence to members of the community in Canberra. We have always made it very clear that we are looking for a new rates system for Canberra. The Greens made it clear that they wanted a system under which there were not sudden leaps, to use the actual words that were used by Ms Horodny. We agree totally. That was the whole problem with the system under the previous Government. There were enormous leaps in particular suburbs. Macarthur went up by 62 per cent in one year, not at a time when the suburb was new. Under the previous Government's approach only a couple of sales were used in particular suburbs - they may have been in line or out of line with the way the suburb was generally trending - and you ended up with huge skewings of valuations in those suburbs.

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