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Legislative Assembly for the ACT: 1996 Week 11 Hansard (26 September) . . Page.. 3486 ..

MR OSBORNE (continuing):

because I think it is much more transparent. However, depreciation does not pay the day-to-day bills. In terms of cash only, this budget implies a $10m surplus. Do you want to go, Kate? It does not matter.

Mrs Carnell: No. I will stand here and listen. It is all right. I am fine.

MR OSBORNE: I have started reading. You can go. In accrued terms, this equates to a $232m operating loss. However, in cash management terms, this in reality represents a cash deficit of around $98m to $100m for this financial year once the asset sales have been taken out. Knowing these facts, one must ask: Is there really a $10m surplus? It is because of these facts that I have taken so much exception to Mrs Carnell saying that we are living within our means. The plain truth is that we are not, and I think it is obvious to the rest of us that we are not. We are about $100m short this year, and, if future services, community grants and capital works are to be maintained at the same levels as they are now, then we are going to be at least $100m short in each ensuing year too. I ask: Where is the money going to come from? This year it is from asset sales, but what is the plan for next year and in subsequent years?

Mr Speaker, an even bigger problem that any government of the Territory is yet to address is how to fund our superannuation commitments. I pointed out to the Chief Minister yesterday that this liability currently stands at over $1 billion. I notice that everyone has gone a little bit quiet over this side for some reason.

Mr De Domenico: Do you want some interjections?

MR OSBORNE: You interject as much as you like, Tony. I have a very long memory, so go for your life. Officials from the Office of Financial Management advised me that by the year 2005 this figure will have risen to a point where paying it each year will take approximately 25 per cent of the Territory's annual operational budget. That is only nine years away. I ask: At what stage will this horrendous problem be addressed? I am pleased that for the first time this massive liability is out in the open and plainly shown in these new accrual accounts so that we can see our true financial position. However, showing this $1 billion liability in the accounts is only the first step, as we still need a workable plan for paying it off. Yesterday Mrs Carnell informed us that her plan was, firstly, to get the budget back into having a regular cash surplus and then to use part of that surplus each year to chip away at it. I hope that my children are still alive when that happens. I am pleased that Mrs Carnell has a plan, though; but I am afraid that this problem is going to need something more than a gradual erosion each time the budget returns to a surplus.

When I was first elected to this Assembly, I stated that I was not going to avoid making hard decisions. I think it is clear for all to see that this problem alone requires a really hard decision to be made by a courageous government. Our assets-to-debt ratio is okay at the moment. However, the operational budget is still running at a loss and our accumulated debts are rising correspondingly. In the case of superannuation, it is going through the roof.

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