Page 2413 - Week 08 - Thursday, 6 June 2013
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We have the expertise in our community, and particularly in our universities, but we have not yet made significant attempts to build and retain that expertise in our own business sector. We all recognise the key areas that we can be leaders in. However, we must equally acknowledge that it is simply not possible to change 50 per cent of our economy in the time frame that any one of us will be in this place and for the foreseeable future we will continue to be dependent on the whims of the federal government.
Managing an economy is a difficult task at the best of times; managing it in the ACT presents a range of unique challenges that at times make it even more so. Managing the ACT economy in a federal election year when polls indicate a change of government is significantly more difficult again.
The fine line that this budget walks is between balancing territory government expenditure and maintaining our AAA credit rating and giving us enough fiscal space to ensure that if the worst comes to pass and there is a significant reduction in the size of the federal public service, we can respond to try and offset some of that contraction. However, it is true that the action that can be taken by the ACT to offset the impacts of large federal public service cuts is indeed limited.
The Greens have long said that we are committed to a balanced budget over the economic cycle, and we support the planned return to surplus in 2015-16. There are significant spending cuts in the budget and the Greens agree that we need to protect our AAA credit rating and save where that is possible.
The ACT must ensure a sustainable revenue base and we have seen an important shift towards this with the tax reforms that were passed last year. The budget continues the implementation of the tax reform program—reforms endorsed not only by every credible economist to have examined the issue but also by the people of the ACT at the last election. It could be said that one thing the deceptive campaign run by the Liberals did draw out was that the majority of the Canberra community support the reforms even in the face of outrageous claims by the Liberal Party that were simply untrue.
We know that stamp duty is an unfair and unstable tax that is counter-productive in terms of using our housing stock sustainably. Phasing out stamp duty is a good initiative and one that the Greens continue to support. One does have to make the observation that it was Mr Hockey who, ironically, told us to expect a significant decline in stamp duty if the Liberals form government federally, and yet stamp duty is a revenue that the Canberra Liberals would have us continue to rely on.
As a result of the tax reform policy, this budget sees about an additional six per cent increase in rates, on top of WPI, as was outlined prior to the ACT election. These increases will be offset by reductions in other taxes such as the insurance levy and, of course, the reduction in stamp duty. There can be no doubt that a tax system that does not fluctuate and that allows us to accurately forecast our revenue and fairly distribute the burden across the community on an annual basis rather than in great chunks when anyone buys a house is a much better system.
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