Warren Snowdon (Lingiari, Australian Labor Party, Shadow Assistant Minister for External Territories) Share this | Hansard source

You do have a right to be heard, and I'm pleased you were heard. I want to actually explain why what you said was, in a sense, an insult. What you've basically got up here and said this evening is that the governments of Queensland, Victoria, New South Wales and elsewhere in Australia are not accountable for what they do. They, like your government, are accountable at every election. If they make the wrong decisions, they will be held accountable. Let me give you an example of a decision taken by Campbell Newman when he was the Premier of Queensland. Campbell Newman, this great, bright Premier, decided he would change the funding available to public health. As a result, he cut public health expenditure in North Queensland. It's true to say this: the fact that they cut positions in public health, at the department of health in Queensland, led to the start of a syphilis outbreak which spread across northern Australia. That was a direct result of a decision taken by Campbell Newman. He was held accountable. What happened to him? He lost government.

Let's be very, very clear. State governments, which are, like governments in this place, elected by the people, are held accountable at every election. If they make the wrong decisions for their electors, for their states, they are held accountable. Member for Petrie, what you need to understand, my friend, is that that accountability goes both ways. You can spray who you like—the government of Queensland, the government of Victoria or the government of Tasmania, or the government of the Northern Territory, for that matter—but ultimately they should take responsibility, and they do. We may not agree with it, we may not even like it, but you shouldn't try to say, as you've tried to say, that they should be accountable to you for what they do. They are accountable; they are accountable every time they go to the polls.

This legislation, as we've heard, will change the nature of the way in which the principle of horizontal fiscal equalisation is applied. That's important, and it's important because it will have a significant deleterious impact on some communities across Australia, such as, in this case, the Northern Territory, and I want to explain why. GST is currently distributed to the states and territories according to this principle of horizontal fiscal equalisation, and, up until now, it has been based on payments to the fiscally strongest state. Western Australia became the fiscally strongest state in 2008-09, thanks to the mining boom, and will remain the fiscally strongest state for the time being. As a result, the government has now chosen to change equalisation to the second strongest state, either New South Wales or Victoria, and this, it has said, will remove the effect of extreme circumstances—like mining booms—from the GST distribution system, due to those states having broad based and stable economies.

But, in a place like the Northern Territory, it means that the Northern Territory's revenues will decline. That's an issue of huge importance to the people and the economy of the Northern Territory. It is of far greater importance to the Northern Territory than to anywhere else in the country. We say that because, on the Northern Territory government's own figures, GST revenue alone accounts for 47 per cent of the Northern Territory government's total revenue—47 per cent—compared to 24 per cent of total state revenues. If there is a change in the way in which the formula is applied and if money is lost as a result of that change in the formula, then it stands to reason that there would be a long-term impact on the Northern Territory budget and on the Northern Territory economy.

Since 2016, the Northern Territory's GST revenue forecasts have seen a cumulative decline of $3.4 billion over the forward estimates. This is in an annual budget of around $6.3 billion. That's a huge decline, and it reflects the significant declines in the Northern Territory's GST relativity between 2016-17 and 2018-19—from a 10-year average of $5.28 to $4.66, and now to $4.26, the lowest GST relativity in the Northern Territory's history. That's a loss in revenue of some $500 million.

I live in the electorate of Lingiari. For those listeners who may not know, the electorate of Lingiari is all of the Northern Territory except Darwin and three-quarters of Palmerston. So, if you exclude the major metropolitan centre of the Northern Territory and you look at the rest of the Northern Territory, that's Lingiari. What do we know about the electorate of Lingiari? Well, 42 per cent or thereabouts of its population are Aboriginal people, with a high proportion of those living in dispersed populations across that remote region of 1.34 million square kilometres. There is a challenge for any government, whether it's Labor, which is currently in government in the Northern Territory, or the CLP, which was previously in government—not that it did it very well, I have to say; in fact, it squandered its money. I was talking about accountability. They were held accountable. They were held so accountable they've basically got only two members left in the Legislative Assembly—they're hardly an opposition. They were held accountable for the way in which they ran the Northern Territory.

What I need to say here is that, whether it's the CLP or the ALP in power in the Northern Territory, they are going to be long-term dependent upon revenues from the Commonwealth. Almost 70 per cent of the Northern Territory government's budget has its source in Canberra, whether it's the 47 per cent through GST revenue or other direct payments. There's no getting away from it. Yet the principle of horizontal fiscal equalisation is that you have the fiscal capacity to provide a similar level of services that are available to everyone else in Australia.

Now, contemplate this. In a place like the Northern Territory, the population is dispersed, as I said, and 42 per cent live in the most disadvantaged communities in the country. I know of one community of 3,000 people where the average housing occupancy is 15. This morning in this place we had a discussion about rheumatic heart disease. Rheumatic heart disease is a disease of poverty, something which is preventable. But you won't prevent it unless you get rid of overcrowding and change environmental health and the way in which you apply health services, and that requires resources. They are extra costs which governments have got to meet. So, for the Northern Territory government to do its job, it requires the assistance of the Commonwealth. I heard the puerile statements from the member for Petrie, which just show how ignorant he is of the way in which this process operates across Australia.

I want to say this: I respect the fact that the states have got to get together and work with the Commonwealth around the distribution of these resources. But it is extremely important that there is an understanding of why we've got to have this process of fiscal equalisation and why, in the way in which this formula changes, it's likely the Northern Territory government will lose further revenue unless additional resources are provided to it. I have to say that, while this bill changes the formula, it does not provide for additional top-up funding, although I note that the Treasury and the Treasurer—I'm not sure if it is this Treasurer or the former Treasurer—had agreed with the Northern Territory government to provide them with some top-up resources. But, in the long term, they're going to require this into the future. If they are going to be able to provide the resources their citizens need for health, housing, education, roads and other infrastructure, then they need ongoing recognition of this principle of horizontal fiscal equalisation and they need to address the disadvantage that people have. If we don't continue to fight for that, then we're condemning the Northern Territory into a parlous future where the infrastructure that's required to provide a healthy population with the conditions it needs to remain healthy and to provide people a safe living environment, a proper educational opportunity, job opportunities and the like will only come when we can ensure that these investments are ongoing.

We know that the private revenue base in the Northern Territory is limited, but I note that the member for Solomon pointed out that they had their first sale of LNG floating out of Darwin Harbour this morning. That's a very good sign of revenues that will come into the Northern Territory and, indeed, the Australian economy as a result of gas exploitation off the Northern Territory and Western Australia and through production facilities in Darwin. We know that there are other major mining enterprises which operate in the Northern Territory and prospective mining enterprises which will operate. We know that the pastoral industry is important, that the agriculture industry is important and that horticulture is important, but together the revenues that come out of the private sector into the Northern Territory economy account for about 30 per cent. That is, taxation and other sources account for only about 30 per cent of Northern Territory government revenue. So we're going to have a consistent and continuing requirement for the Commonwealth government to accept its responsibilities, whether it's the Treasurer who's currently sitting before us as the Treasurer or a future Treasurer, to ensure that the citizens of the Northern Territory are not further disadvantaged by changes to the GST formula.

I know that the Northern Territory government will continue to fight. I referred to the opposition in the Northern Territory as the CLP, and that includes Senator Scullion, but we don't see them standing up for the rights and interests of the Northern Territory community or the Northern Territory population generally. We have a responsibility in this place, as they have, to speak up for the people of the Northern Territory and to support the quest by the government of the Northern Territory to get fair and decent treatment around the issue of horizontal fiscal equalisation and the distribution of GST resources across the country.

I understand what was going on in Western Australia. I have to say, I wasn't that sympathetic when I first heard it, but, nevertheless, I accept the requirement to address the losses that they incurred. We've seen that the opposition will support this piece of legislation, but we should not discount the impacts of changing GST formula for the smaller states and territories and, in my own case, particularly the Northern Territory, where, as I say—

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