Page 2286 - Week 08 - Tuesday, 28 August 2007
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and/or territory governments and their budgets. We cannot mask them with reliance on these gains in superannuation assets.
Indeed, even the Chief Minister himself conceded in committee hearings that reliance on superannuation gains is unsustainable. In response to a question from Ms Porter about balancing the budget without the use of land sales and receipts Mr Stanhope discussed some savings measures and then said:
Through all these measures we believe that, in time, we will achieve a position where we produce operating budget surpluses without the traditional reliance on that serendipitous end of superannuation receipts and land sale receipts.
Just a few minutes ago I was being howled down and told, “What, are you going to go it alone? Nobody will support you.” And these were the words of the Chief Minister only a few weeks ago in estimates. He then went on:
For the sustainable future we need to do that. We cannot go on, year after year, as we have, on a prayer and a hope that our superannuation investments will return above long-term averages or that every year will be a booming year in relation to land sales …
We need now to do what we have done, to begin to wean governments off an expectation that budgets can be balanced year after year after year on the basis of that perhaps above average return on superannuation and exceptional land sale receipts. That is the underlying philosophy. All the measures we have taken have been to ensure, essentially, that our revenue raising meets our expenditures. It is a simple equation.
That is from pages 95 and 96 of the 18 June Hansard. All the things that I have been saying, which are apparently so out of whack with the rest of Australia, seem to be on the horizon for the same Chief Minister who is launching the criticism.
Mr Stanhope: No; you misunderstand. I thought you were the world’s second-best shadow Treasurer.
MR MULCAHY: Maybe I do. As I understand it, the Chief Minister knows where he has got to get to, but he is in no hurry to get there. Indeed, it is a simple equation. Superannuation assets cannot be spent on general government expenditure and so should not be included in the operating performance. We certainly would welcome the above statement by the Chief Minister of his alleged intention to wean governments off an expectation that budgets can be balanced year after year on the basis of those receipts.
However, in our view, the only way to wean governments off an expectation of balancing budgets in this manner is to be clear and honest about the operating performance of the government. Even the surplus achieved by the government is not the result of any increase in efficiency or restraint in spending. In fact, it is due to massive increases in taxation revenue, the effects of which have been obscured for the last year by the Treasury’s underestimation of taxation revenues.
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