Andrew Bartlett (Queensland, Australian Democrats) Share this | Hansard source

The Commonwealth Grants Commission revenue-sharing formula is often a matter of continuing stoushes between various states about the way that different Commonwealth revenue is divided up between the states and territories. Not surprisingly, each state and territory tends to think they should be getting more and some of the others should be getting less. Certainly, in recent times there has been a fairly continual propaganda campaign from governments, in New South Wales in particular and to a lesser extent in Victoria, targeting in particular Queensland and to a lesser extent Western Australia saying that Queensland basically is getting too much, we are getting more than our fair share, and that is at the expense of states like New South Wales.

I do not want to turn the Commonwealth Grants Commission revenue-sharing relativities issue into a state of origin contest but I do think it should at least be based on something more solid than jingoistic parochialism. To that extent I think this report is valuable. It is often talked about as though there is some simple formula, X divided by Y times Z, which gives so much money per state. That is not particularly accurate because the principle that the commission bases its calculations on is horizontal fiscal equalisation, and there are actually a range of mathematical formulae that the commission uses, simply as the means by which the commission seeks to implement that principle. To define or clarify what that principle of horizontal fiscal equalisation is: it is that state governments should receive funding from the pool of goods and services tax revenue and healthcare grants such that, if each made the same effort to raise revenue from its own sources and operated at the same level of efficiency, each would have the capacity to provide services at the same standard. That is the principle and there are a range of formulae that go to ensuring as much as possible that that principle is implemented.

States have different capacities to raise revenue and different spending needs and obviously people also have different ideas about what is a need and what is a bit of vote-buying profligacy. For example, of course, Western Australia has a relatively large capacity to raise revenue from the mining industry compared with Tasmania. A state with a young population needs to spend more on primary education; states with older populations may need to spend more on health services. So, to provide states with equal capacity to provide services, states with below average revenue-raising capacity or above average spending needs receive a larger share. The commission needs to take account of factors that a state cannot control. When you start to look at the complexities of it and the attempts of the commission to make its assessment of revenue-raising capacity and spending needs so-called policy neutral, it is a fairly difficult task. The commission also has to take into account revenue-raising efforts which compare each state’s actual revenue with its assessed capacity. The issue here is really to try to make sure that, when we are talking about the Commonwealth Grants Commission formulae and the various relativities, it is not some nice simple measurement of total number of population equals X number of dollars per head and we all should get that mix.

The Northern Territory of course gets a significant amount extra per head because of a variety of factors, not least distance. Frankly, I think each state including my own state of Queensland could make a very strong case for all those different issues and criteria that come to implementing the formula that could be just as credible. If you look at, frankly, the pretty lamentable record of the New South Wales government when it comes to basic infrastructure and even getting that to work properly then I do not think really they can suggest that somehow or other they are making full value of the dollars they get. In saying that, I do not suggest the Queensland state government have a perfect record by any means but I do think that, when we have these debates, we need to recognise the need for them to be based on facts, substance and information rather than just blithe jingoistic parochialism. Wasting money, as state governments have done, buying big newspaper advertisements trying to promote their case is hardly the way to go. It is not going to influence the commission and it is not going to influence an informed debate. Certainly, from my point of view, I think Queensland very much has a case for saying that it is not getting any less than it should be. (Time expired)