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Legislative Assembly for the ACT: 2004 Week 07 Hansard (Tuesday, 29 June 2004) . . Page.. 2933 ..

MR SMYTH (Leader of the Opposition) (8.00): Mr Speaker, it is interesting to recall an issue in the 2003-04 budget about the use of the then departmental banking accounts in addition to the territory banking account. There does not seem to be any comments about the matter in these budget papers. I assume that the new financial arrangements have come into effect and been adopted successfully. Perhaps the Treasurer could confirm that.

I notice from a comment in the 2004-05 budget papers that one of the highlights for the CFU is that for 2004-05 there will be the implementation of new borrowing strategies. According to page 95 of budget paper 4, under a reference to the 2004-05 highlights, the strategic and operational issues to be pursued in 2004-05 include implementing new borrowing strategies consistent with the outcomes of the debt liability management review completed in 2003-04.

The Treasurer might like to fill us in on what that means. I am interested in learning what was the outcome of the review, what the Treasurer has decided to do because of the review and what it says about the borrowings. I had a recollection that the Treasurer said that there would be no new borrowings in the budget. If this is about reborrowing or refinancing, perhaps he could inform us what that means and whether there are any implications arising from this statement for the way in which the Treasurer and the territory would consider funding proposed for new public infrastructure projects—for example, a prison or a dam.

MR QUINLAN (Treasurer, Minister for Economic Development, Business and Tourism, Minister for Sport, Racing and Gaming, and Acting Minister for Planning) (8.03): As far as the review goes, we are constantly reviewing exactly what our debt structure is to make sure that it is appropriately hedged, that we have minimised the risk profile, and we will continue to do so. The exact details of that review I have not yet received, but it does not herald a raft of new borrowings.

In terms of debt structure, in terms of financing major capital works, so far the budget looks to be in pretty good shape. I think that all members—all members who care, anyway—would have read the review of the budget in the Australian Financial Review. It was probably the best objective assessment of it, coming a couple of days after it was brought down, and it included observations by Access Economics to the extent that the ACT budget was considered to be very strong and could run in deficit for a number of years without there being a great bother. Those were the words, I think, of Alan Tregilgas of Access Economics.

I think that it is a little early to be saying exactly what we would do with the prison itself in terms of finance but, unless there is some financial deal that offers us a better financial structure than just investing our own cash, the capacity is there at this stage. That does not preclude us from checking the market and seeing whether there is some form of long-term financing that offers the territory a benefit.

Those structures are less likely to materialise, given that we are not subject to income tax and those deals do swing on income tax. However, some of the lease/buy arrangements that come into play do have tax benefits for the providers of funds. So, a bit closer to when it is necessary, we will be having a look at the market at the time and what is

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