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Legislative Assembly for the ACT: 1999 Week 2 Hansard (9 March) . . Page.. 390 ..

MS CARNELL

had been sharply reduced, as I have already spoken about; and the practices of previous governments of flogging off as much land as possible to plug up budget holes had created a massive oversupply in the market. Mr Speaker, this is really interesting when you take into account the comments that those opposite continue to make about asset sales. They claim that they are very negative about asset sales; but, when they were in government last time, they sold, I think, on average about $40m worth of land a year, to end up with a massive oversupply on the market. Mr Speaker, I was also told that population growth and economic growth were stalling and the budget was heading for a $35m blow-out. Of course, budgets were put together in cash terms in those days.

Mr Speaker, it is now a matter of history that, on top of that very fragile budget position that I inherited, we were hit with the double whammy in 1996 of a new Federal government that not only axed thousands of public sector jobs, but demanded that we pay them money to fill the budget black hole left by the Keating Government. It is also a matter of history that, despite these extremely adverse economic and financial circumstances, we were able to reduce the Territory's operating loss from more than $300m three years ago to a forecast $150m this year. We have more than halved it, Mr Speaker. This has been achieved without the benefits of sizeable cash reserves, a strong economy, a booming property sector or the revenue from land sales that previous governments enjoyed. At the same time, we have implemented financial management reforms that have put us in the forefront of public sector accounting practice, with accrual accounting and outputs-based budgeting fast becoming the standard throughout this country. Mr Speaker, we were in there first.

I take some pride in having kept the Territory's finances on track through this difficult period and I acknowledge the outstanding work done by the staff of the Office of Financial Management and public servants right across the ACT Public Service. Mr Speaker, our starting point in considering the 1999-2000 budget is the projected general government sector operating loss of $90m, as published in our forward estimates. In simple terms, the projection is for costs to be $90m more than revenue. We are committed to closing this budget gap.

We have already achieved a reduction in the operating loss from more than $300m three years ago to a forecast $150m this financial year, with further reductions already projected in the forward estimates. However, our goal must be to eliminate the operating loss and, indeed, to generate substantial operating surpluses. If we do not eliminate the operating loss, we will be forced to borrow or to sell assets just to pay our bills and continue the capital works program. As the Auditor-General pointed out in his most recent report on the Territory's operating loss, a reduction in the Territory's net assets is inevitable as long as we continue to run an operating loss.

We need to have a surplus to provide capacity to fund our growing superannuation liability and our capital works budget. In other words, Mr Speaker, the superannuation liability problem that we have, and that I think every member of this Assembly, or almost every member, has admitted to our having, can only be funded - as this Assembly seems to have ruled out a sale of ACTEW - by achieving a substantial operating surplus

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