Page 1122 - Week 05 - Tuesday, 29 May 2007
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MR STANHOPE (Ginninderra—Chief Minister, Treasurer, Minister for Business and Economic Development, Minister for Indigenous Affairs, Minister for the Environment, Water and Climate Change, Minister for the Arts) (4.21): I thank the member for raising this matter of public importance. There are, indeed, a number of positives coming out of the federal budget. The federal budget has clearly been framed with a looming national election in mind—surprise, surprise! The expansion of commonwealth policy expenditure, which has amounted to around $52 billion since the mid-year statement, comes on top of the $17.5 billion of policy expenditure between the last federal budget and the mid-year statement. Of course, that can only be good for Canberra. Our economy will clearly benefit from this additional expenditure and it will continue to provide a base for economic growth in the ACT.
The commonwealth is the largest employer in the territory and, of course, as the driver of most economic activity in the ACT, it has an enormous influence on the territory’s finances, and this was clearly demonstrated in the myriad announcements contained in the federal budget. I am on the record as supporting the overall budget framework released by the federal Treasurer. There were a number of pleasing aspects, both nationally and locally, which I have spoken of and which I do not need to elaborate on in detail again today.
A comment I made on the day of the budget, in the context of the enormous strength of the Australian economy at the moment, probably does bear repeating. I referred to the extent to which money is simply flowing into commonwealth coffers, driven very significantly by the commodities market and, interestingly, exports to China—and we need to acknowledge that we look to China. It is true that the ACT has benefited from stronger than expected growth in the GST pool over the past few years, entirely due, of course, to the Australian economy recording rates of growth well above the longer term average. But that is not necessarily the whole picture. Of course, the opposition needs to acknowledge and note that net payments to the states and territories from the commonwealth—this is important; it is something that the opposition glosses over all the time—as a proportion of overall economic activity over the whole post-GST period are at levels below the pre-GST average of six per cent of GDP in the 1980s and the 1990s. The states and territories are receiving now less as a proportion of GDP than they were 15 or 20 years ago.
All states and territories have consistently pointed out that the revenue returns from economic growth are not being directed into the core services which are most important to Australians—services such as public hospitals, government schools, policing and public transport. The states and territories have responsibility for the delivery of these services but they do not have the tax powers to fund the levels of services needed, nor to cater for the rapid growth and demand for these services.
For example, over the last five years the commonwealth government—and I will be interested in any further response by the opposition to this particular point—has progressively reduced its share of funding to public hospitals through the Australian health care agreements. In 2001-02 health care grants constituted 31 per cent of acute care costs within Australia. This contribution in 2006 has reduced to 23 per cent. In the last five years the commonwealth has reduced its contribution to acute care cost
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