Nick Sherry (Tasmania, Australian Labor Party, Minister for Superannuation and Corporate Law) Share this | Hansard source

I have a number of responses in respect of some earlier questions Senator Joyce posed. Thank you, Senator Macdonald; I think drawing attention to the impact of the floods is important. I cannot give a specific commitment in respect of the individual communities you have highlighted. I can indicate that the package contains two elements on page 22, in Repairing Regional Roads and the Regional and Local Community Infrastructure Program—Strategic Projects. I understand that they are to be delivered through local governments. It would be possible for the type of infrastructure issue you have highlighted to be accessed through those two areas. I will also pass on to the minister, Mr Albanese, the specific matters you have raised.

Senator Joyce raised this issue. He asked why, when the Commonwealth buys land, we are refunding stamp duty to the states. The Commonwealth is providing funding to the states to invest further in social housing. The states will purchase houses and units under normal commercial conditions or, where the private sector or the not-for-profit community sector is contracted by state governments, the states and the developers will negotiate these arrangements. Stamp duty may be payable on purchases and construction of these homes. The Commonwealth will not own any housing and is not refunding stamp duty. The Commonwealth and the states have agreed that the states are responsible for identifying social housing projects that are already in their development pipelines and can be brought forward and completed through stage 1 before 30 June 2010. The states will also be responsible for undertaking the process to determine suitable social housing projects through stage 2 for the 2009-10 financial year and onwards.

Senator Joyce also raised a question about the schedule for returning the budget to surplus. In the UEFO it is estimated that the underlying cash balance will be in deficit in 2008-09 and in 2009-10. It is projected to remain in deficit across the forward years from 2010-11 and 2011-12. In saying that I point out that, if you look at the fiscal balance set out from MYEFO to UEFO from 2008-09 through to 2011-12, the fiscal balance is projected at 1.9 per cent of GDP in 2008-09, at 2.8 in 2009-10—which is in fact the maximum—and then it commences a decline in 2010-11 to 2.5 and in 2011-12 to 1.8. As I have indicated, as the economy recovers and grows above trend, the government will take action to return the budget to surplus. When the budget returns to surplus, the government has said it will draw upon surpluses to pay down debt as rapidly as economic conditions permit. The speed at which the budget can be returned to surplus will depend on the severity of the current downturn and the speed of recovery. It is important to note that the fiscal stimulus package has been developed to ensure that it does not lock in increases in baseline government spending. This recognises that the stimulus needs to fall away over time so that it no longer operates when it is not needed.

Senator Joyce, you asked for some components of interest receipts and payments. Again, I do not want to take up too much time with reams of statistics but I will give you some figures. Future Fund breakdown of interest receipts: Future Fund interest 2008-09 is calculated to be $2.3 billion and then $1.9 billion over two remaining fiscal years dropping to $1.8 billion in 2011-12. Interest on cash and deposits: $2 billion in 2008-09, rising slightly to $2.2 billion in 2009-10 and around $2 billion in 2010-11 and 2011-12. There are details of other interest receipts and then a breakdown of interest payments on government borrowings that are projected out to 2011-12. As I have indicated, there is no change in budget of Future Fund earnings. The underlying cash balance is reported, excluding Future Fund earnings, but the Future Fund is included in the Australian government sector general balance sheet.