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Legislative Assembly for the ACT: 2003 Week 6 Hansard (17 June) . . Page.. 1873 ..

MS MacDONALD

distributive mechanism and number two the uncertainty for residents, with no allowance for capacity to pay.

The argument made in the committee against the proposed system was that there is no certainty as to what people will be paying. I dispute that. While there is no absolute certainty of what the CPI will be, there is certainly more of an understanding of what it will be, so people will know how much their rates will increase by. I know that this was rejected by some of the people submitting and certainly by the majority of the committee, but the previous system was a lottery. There was no way of knowing what your rates would be under the previous system-I do not mean under the system which was introduced last year.

Another reason for dissenting from the majority report was that no evaluation was done of either the previous interim or of the proposed systems alongside each other. There was no real evaluation done by the committee. A large part of the reason for that is that the committee waited until the presentation of the bill in April 2003 before it referred it off for the inquiry.

It was a wasted opportunity, and I say as much in my dissenting report. While the committee could not review the proposed system by the government, it was well and truly flagged in June by the Treasurer last year when he said that the Department of Treasury were undertaking an inquiry into a proposed system. That should have been a trigger to look at different rates systems. There is nothing to stop the committee from doing that; in fact, the committee looks into all manner of issues without their necessarily being referred by the Assembly. The committee is quite capable of self-referring. As I said, I think this was a wasted opportunity.

The other point I would like to make is that, instead of making a comparison between the two systems, the committee concentrated on the following: the perception of inequity in a differential rating system and the speculation that new rates may dampen economic activity. I believe that the committee devoted more attention to these ideas than was necessary. Rather than looking at creating a new, better system for people, they focused on those two particular issues.

There was a huge focus on differential rates. A few weeks ago the Chief Minister made a comment on radio that what people pay in their rates is not dinner party conversation. But one of the people who made a submission to the hearing said, "I guarantee that this will become dinner party conversation."

People do not decide to buy a place on the basis of what their rates will be; they decide to buy a place if they can afford it. They do not have conversations with their neighbours about what the rates are. I would not have a clue what the rates of my next-door neighbours are, to tell you the truth; I cannot imagine ever having a conversation about this. In the real world I do not believe people have conversations about this unless they work in the real estate industry or in property speculation. That is how they make money: they speculate on property.

The people who are likely to be disadvantaged by the proposed system are those who invest in property, do it up and then sell it. They do not want the proposed rating system to be put into place. Referring to that, I believe that some of the interest groups who

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