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Legislative Assembly for the ACT: 1998 Week 7 Hansard (23 September) . . Page.. 2044 ..

MR OSBORNE (continuing):

Since then, Mr Speaker, over the past four years, the Territory's total liabilities have blown out to nearly $2 billion, and the present Government is still running an annual deficit of around $150m. In reality, it is actually closer to $250m, except that the Government has been selling things then leasing them back and milking extra cash out of ACTEW. In spite of this, the Government is still borrowing money to cover the yearly cash shortfalls, and the superannuation situation does not even bear thinking about.

Mr Speaker, I have tried not to make this sound too much like doom and gloom, but the question that needs to be asked again is just how this appalling state of affairs was allowed to happen. Debt has been accumulated at an alarming rate and, as I have already mentioned, a legacy of debt for our children has already been established. How has that happened, Mr Speaker? The answer is quite simple. Right from the very beginning no ACT government has been prepared to live within its means. Indeed, during the first five years of self-government there does not appear to have been any intention to even go close to such a feat. This has been so blatantly obvious that in this traditional Labor city people have preferred the Liberals in the past two ACT elections. Mr Speaker, every family in Canberra knows that you cannot continually spend more than you earn; that you cannot keep putting groceries onto the credit card. Yet it is a lesson that successive ACT governments have failed to put into practice, with what I consider to be disastrous potential results. This Bill, however, will take care of that situation.

As outlined in this Bill, the four principles of responsible financial management for each proposed ACT budget would be, first, reducing the total liabilities of the Territory to prudent levels. This is to be achieved by ensuring that in each financial year the total operating expenses are not greater than the total revenue earned. In other words, gradually getting our debt under control by simply living within our means. Over an acceptable period of time this action would bring our debt down to a manageable level and in due course allow us to build a buffer against any outside factors which can negatively affect our somewhat fragile economy.

Secondly, once our level of debt is manageable we need to keep it under control. This would be achieved by ensuring that over a reasonable period of time we do not spend more each year than is earned. This principle recognises that at times a certain level of debt is both appropriate and necessary for good government but does not allow the amount of debt to get out of control.

Mr Berry: Who has he copied this off? New South Wales?

MR OSBORNE: I hear Mr Berry mumbling over there, Mr Speaker.

MR SPEAKER: Just ignore him.

MR OSBORNE: I understand the embarrassment this Bill is causing him, he having been part of the Labor Government which set up this terrible situation that we are in. Thirdly, we should be achieving and maintaining levels of Territory net worth that provide a buffer against factors that may impact negatively on that net worth in the future. Fourthly, we should be prudently managing the financial risk to the Territory.

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