Page 1317 - Week 05 - Thursday, 31 May 2007
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MS PORTER (Ginninderra) (3.54): Mr Speaker, there is no doubt that responsible financial management is essential for the delivery of sustainable high-class services. Indeed, it is even more important in a small city-state such as the ACT. It is important that governments recognise this reality and take a longer-term view of financial management: financial management that not only funds core services now but also ensures our children and future generations are not burdened by debt.
Sound financial management is the cornerstone of any strong economy and enables a government to meet its people’s needs. The ACT, more than any other Australian jurisdiction, depends on a focused strategic approach to managing its finances. The ACT government balances a complex range of local and state functions. It has a relatively small revenue base which it must use to fund the same services delivered in the large states. With scarce resources, it must target expenditure to areas of greatest need. At the same time, it must maintain basic services for all Canberrans, such as hospitals and schools, to a high standard. That is not an easy task, as we all know.
For two decades, ACT governments have maintained expenditure and a way of living that hark back to the days when our bills were paid for by the commonwealth. Since self-government, all governments had continued down this path. General government spending has been around 20 to 25 per cent above the average of other jurisdictions. This level of spending was funded through high levels of commonwealth transitional assistance in the early years and later through land sales. This was clearly not sustainable.
Mr Speaker, it was this forward-thinking government which decided that we had to put the territory finances on a sustainable footing. To this end, the government began a reform process in the 2006-07 budget. These reforms were designed to maintain our capacity to invest in physical and social infrastructure, preserve the quality of our services, and continue to deliver services in priority areas. The reforms were also to provide a buffer against any future fiscal downturns. The government began a process of reducing the cost of administration while maintaining expenditure and high standards in core government services. There was no crisis, but there would have been one for future generations if the government had not acted.
These reforms involved reprioritising services to areas of greatest need, consolidating and streamlining functions, and increasing some fees and charges. New revenue measures were introduced to expand the revenue base, achieve parity with other jurisdictions where appropriate, and recover more of the real costs of delivering high-quality services. Obviously we would all like to keep fees and charges as low as possible. But, in the context of providing funding for all those services that make Canberra such a great place to live, I think most people would agree that a modest increase in fees and charges is a small price to pay. That is exactly what this government has done in order to sustain the high quality of our services. In fact, numerous people approach me at my regular mobile offices to say that they prefer that this approach by this government be maintained.
Looking into the future the territory, like all jurisdictions, also needed to address the effects of the ageing of the population, growing health care costs, increasing superannuation liabilities and the needs of a growing economy. Our health system is
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