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Legislative Assembly for the ACT: 1996 Week 11 Hansard (26 September) . . Page.. 3458 ..

MRS CARNELL (continuing):

Dr Chessell went on to say that yes, he did believe that there were significant good things about this budget. In fact, he said that if it succeeds he would give it 11 out of 10 and, if it does not, it is a disaster, to use his words exactly. The reality is that to have done nothing would have been a disaster. To have done nothing, to have allowed the economy to continue to slide, to have allowed probably 3,500 Australian public sector redundancies would have caused more problems in this city.

Mr Berry: "Oops! I might have misled you. Did I say $128m?".

MRS CARNELL: It is $232m. I think it is extremely important that we continue with the approach of stimulating the economy in the ACT to get back into growth. It is only with growth that we will be able to start addressing the underlying problems in our economy such as unfunded superannuation. I think it is very important to note that those opposite believe that Dr Chessell is the appropriate guru on this sort of thing. Dr Chessell from Access Economics believes that the Victorian model is the appropriate model for the ACT. Mr Speaker, I expect that I did say $228m instead of $232m. I mean a $232m operating loss for the ACT this year.

MR WHITECROSS: I ask a supplementary question. In Mrs Carnell's answer - it is difficult because you have to pick your way between the five different numbers she gave for the operating - - -

MR SPEAKER: Ask your supplementary question without preamble.

MR WHITECROSS: As I said, it is very difficult under the circumstances, but I think we ended up with a $232m deficit - - -

Mrs Carnell: Operating loss. It is not a deficit.

MR WHITECROSS: An operating loss which Mrs Carnell said was, I think, $48m less than last year. Mrs Carnell, is it not true that the only reason that the operating loss has gone down is a one-off item in last year's budget, and that the real position is that the operating loss has gone up?

MRS CARNELL: It is absolutely ridiculous for those opposite to continue to make these points. I think the point they are trying to make is that we should not have gone down the path of asset sales. They seem to believe that we should have gone down the path of borrowing. They have indicated that they did not want us to cut jobs particularly. There are only two other things. One of them is to increase taxes. Increased taxes force business out of town. That means fewer jobs. The other alternative, of course, is to borrow. If you seriously want to end up in a significantly worse position, what you do is borrow. We could have borrowed $100m this year and not sold any assets. If we had done that, we would be up for about $8m worth of interest this year. Next year we could borrow $100m too. The interest figure would then be $16m. The year after that we could borrow another $100m. We would owe $300m, we would have an interest bill of $24m, and we would not have even started paying off the $300m. That is how you end up in a worse financial position. The fact is that this budget has no new borrowings in it. We pay off $15m worth of debt and we have a $10m cash surplus.

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