David Bushby (Tasmania, Liberal Party) Share this | Hansard source

I rise on a subject similar to that which Senator Bilyk talked about—that is, the issue of GST funding its distribution across the country. Senator Bilyk and others are misleading the Australian community by suggesting that there is a threat to the distribution of GST revenue in Tasmania. In misquoting Tony Abbott and trying to put a spin on comments he has made that suggest there will be a $700 million cut to funding in Tasmania, Senator Bilyk is ignoring one fundamental fact, and that is that it was the Gillard Labor government—of which Senator Bilyk is a member—which commissioned the current review examining the distribution of revenue from the goods and services tax to the states and territories.

In pondering that for the purpose of better understanding this issue, on 31 March 2011 the Sydney Morning Herald reported the creation of this review, noting that the Prime Minister, Julia Gillard, had ordered a review of the formula used to distribute the tens of billions of dollars raised by the GST. The article quotes Prime Minister Gillard as saying that she wanted the formula overhauled so that the states that expanded their economies were not penalised and so that those that allowed theirs to stagnate were not rewarded:

'Instead of states facing penalties for economic growth and rewards for economic underperformance, the GST distribution process should encourage economic reform and better delivery of services, and provide states with certainty,' she said.

This seems to me to be code for taking money off those states that are not doing so well—like Tasmania, South Australia and the Northern Territory, which all receive subsidies under the GST distribution process—and giving it back to those states that are doing well, such as WA and Queensland. The article goes on:

Ms Gillard made the announcement in Perth, where Labor is deeply unpopular and where the Premier, Colin Barnett, has complained about losing GST revenue because of the mining boom.

The Australian Financial Review reported a day earlier on this particular review, and that article said:

The review will lead to a simpler, fairer, more predictable and more efficient distribution of the GST to states and territories …

That was a quote from the government. The Prime Minister was quoted as saying that premiers had been calling for reform for some time. Those who raise this issue in this place like to raise the fact that the Liberal premiers are getting together and calling for a review of the GST distribution formula, but, as noted in the Australian Financial Review on 30 March, former Queensland Premier Anna Bligh had been complaining that her state was being penalised for its economic success. So it is not just the Liberal premiers who have been calling for this. Labor premiers in those states that are subsidising the other states through the GST distribution process have also been complaining about this. I quote the Prime Minister, who said:

'Here in WA Premier (Colin) Barnett has posed the question what have we done wrong besides being successful?'

The point I am making is that it is not the Leader of the Opposition who has put at risk the funds received in Tasmania, South Australia and the Northern Territory. It is in fact the Prime Minister and the government that have put all of that at risk with the Prime Minister's knee-jerk reaction to criticism and pressure that she received while in Perth in March this year, which led her to go and put in place a review specifically designed to look at how you can limit the amount of money that comes off those states that are successful and take some away from those that are not doing so well. It is the Prime Minister who has put us in that position—not Tony Abbott, the Leader of the Opposition. The Prime Minister, by commissioning this review, which she announced while she was in Perth, under pressure from the Premier of Western Australia, put GST distribution at risk right across the country. It is not the Leader of the Opposition and it is disingenuous on the part of those Labor senators and members who are going around saying that it is Tony Abbott who has put the smaller states at risk, when in fact it is the Prime Minister.