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Thursday, 8 September 1983
Page: 587

Mr UREN (Minister for Territories and Local Government)(4.03) —I want to thank the honourable member for Dawson (Mr Braithwaite) for raising a matter of public importance about the Commonwealth's approach to local government. At the outset I want to nail the false and misleading arguments put by the honourable member. I can do that in simple terms. If the honourable member looks at all the Australian Government programs involving local government he will see that $994m is to be made available this year and that only $687m was made available last year. That is an increase of over $300m or 45 per cent. So let us get this matter in its proper perspective. In contrast to the neglect shown by the Fraser -Anthony Government, this Government has a commitment to a fuller recognition of local government as a genuine partner in the nation's three-sphere system of government. This Government has created for the first time in the nation's history a Commonwealth ministry for local government. The Government is not hiding behind anything. It is being responsible for this matter. It wants to work in co-operation with both State and local governments.

I should remind the House that the previous Federal Labor Government in 1972-75 , of which I was a member, made the historic breakthrough of being the first Government to give direct Commonwealth payments to local government. Labor was committed to expanding the capacity of local councils to fulfil their functions, especially in areas of need. In retrospect I think that some errors were made in the years 1972-75 in the way funds were distributed. Since that time, of course, local government has become more sophisticated and now it is better placed to have a major role, in co-operation with the State and Commonwealth governments, in advancing the well-being of their communities in the interests of the Australian people. The provision of tax sharing payments for local government was altered by the previous Federal Government through the Local Government ( Personal Income Tax Sharing) Act of 1976. It should be remembered that the Act was introduced as a part of the previous Government's new federalism ' initiatives' within an overall policy of public sector expenditure restraint. We know that in all cases its new role was small government, and there was a cutback of funds, particularly public sector funds. The provisions of the Act were seen as a means of absorbing the specific purpose payments to local government into a system of general purpose grants to the States for local government, thereby transferring responsibility for certain services in which the Commonwealth had previously played a policy and planning role as well as a financing role. Yet the honourable member for Dawson talked about a dribble. Nobody withdrew more from those services, particularly specific purpose payments , than did the Fraser-Anthony Government.

The effect of this shift to general purpose funds for local government and the winding down of specific purpose payments was a net reduction-I stress the words 'net reduction' so that they will get through the honourable member's head-in the total amount of funds provided for local government by the Commonwealth at that time. I believe there is evidence to suggest that there was some damage to equity and efficiency as a result of the 'ad hoc' arrangements of the previous Government and the constraining actions of some States. Labor in opposition recognised the value of general revenue assistance for local government and made a commitment to retain the funding at 2 per cent of Federal personal income tax. That commitment was honoured in the 1983-84 Budget allocation for tax sharing funds for local government. In 1983-84 local government will receive a total of $459m in tax sharing funds. That is an increase of $35m over the allocation of $ 424m provided by the then Fraser-Anthony Government in 1982-83.

In assessing the basis for this increase Cabinet compared the real value of the grant with the level of inflation during the year in which it is to be spent. In the Budget year 1983-84 this is estimated to by 7.5 per cent on a year to year basis. General revenue assistance for local government has been increased by 8.2 per cent, which more than accounts for the projected increase in costs in the coming year. But my role as Minister for Territories and Local Government is not only to administer the Local Government (Personal Income Tax Sharing) Act but also to provide a focus for local government in its approaches to the Commonwealth and to co-ordinate Commonwealth assistance for local government. My Department, in consultation with other Commonwealth departments which make the payments in respect of local government, made an assessment of total estimated Commonwealth payments to local government in 1983-84. I seek leave to incorporate in Hansard a table showing these payments for the years 1979-80 to 1983-84.

Leave granted.

The table read as follows-


($ thousands)

1979-80 1980-81 1981-82 1982-83 1983-84


Local government tax sharing grant(a) 221,739 300,786 350,865 424,486 459,336 Direct payments-

Nursing homes 1,076 1,488 2,401 2,995 3,842 Home nursing 394 411 518 678 767 Aged/disabled persons' homes 1,979 3,210 3,956 7,799 9,627 Aged/disabled persons' hostels 282 1,412 469 220 150 Delivered meals subsidy 885 1,349 1, 668 1,848 1,976 Handicapped persons assistance 47 . . . . 236 133 Children's services 6,894 9,721 11,503 15,482 26,279 Community Youth Support Scheme 847 . . . . . . . . Homeless persons' assistance 8 15 . . 25 228 Subsidy for migrant aid . . . . 8 31 34 Arts 81 126 303 308 367 Aerodrome local ownership plan 3,439 3,952 6,364 29,564 44,700

Total direct payments 15,931 21,684 27,190 59,185 88,103

Other payments through States-

Assistance for Exmouth Shire 352 . . . . . . . . Community health facilities 543 558 . . . . . . Home care services 4,226 4,331 4,098 5,892 5,939 Senior citizens' centres 4,097 4,881 4,720 7,742 7,895 Children's services 4,744 5, 658 5,029 4,898 n.a. Urban flood mitigation 762 126 . . . . 4,120 Urban water supply 250 250 . . . . . . National estate 402 393 298 413 (b)420 Roads 131, 420 141,866 167,307 177,983 (c)291,100 Urban public transport 63 . . . . . . . . Wage pause-special employment program . . . . . . 2,923 (d)51,485

Total other payments 146,967 158,063 181,452 199,851 360,959

Northern Territory-

Local government tax sharing grant(a) 1,062 1,440 1,680 2,033 2,200 Direct payments-

Delivered meals subsidy . . . . 2 3 3 Children's services 298 246 295 443 491 Arts . . . . . . 14 n.a. Aerodrome local ownership plan . . . . . . . . 600

Total direct payments 298 246 297 460 1,094

Other payments through the Northern Territory Government-

Children's services 2 10 3 11 n.a. National estate . . . . . . 3 n.a. Roads 519 750 818 876 12,100 Wage pause-special employment program . . . . . . 476 768

Total other payments 521 760 821 1,366 12,868 Community employment program- general (e)53,000 Country town water supply 16,100 Jobs on local roads (see above)

Grand total 386,519 482,979 562,305 687,381 993,660

(a) The Local Government Tax Sharing Grants are paid, in the first instance, to the States/Northern Territory, but are shown in this table separately, because of their importance.

(b) Estimate very approximate as calculated by applying the same ratio (21%) of the total State grant that was passed on by the States to local government in 1982-83.

(c) Total moneys allocated to local roads from Road Grants Act, Australian Bicentennial Road Development Program and Jobs on Local Roads (excludes 0.7 m JOLOR allocation to the A.C.T. but includes S.A.).

(d) Includes some funds for community organisations which cannot be delineated from payments to local government.

(e) Estimated at up to 2/3 of the $80m allocated nationally to local government and community groups.

Sources: Derived from Budget Paper No. 7 1983-84 and Departmental estimates.

Mr UREN —The table shows the figure I stressed to the House earlier. It shows that in 1982-83 local government was allocated $687m and that in 1983-84 the allocation is $993.7m. As I stated earlier, the figure is $994m in round figures . This is an increase of over $300m and represents an increase of 45 per cent over the figure for last year. The increase is made up mainly of programs specifically directed to areas of need, about which the honourable member would not have any real understanding, and it is a nationally important initiative for recovery. The major increases comprise funds for the community employment program; $62m is estimated to assist local councils through the jobs on local roads program; $16m for country town water supply improvements; and a further $ 53m for use by local councils from the $160m available to the States, local government and community groups. Assistance for road programs, excluding jobs on local road programs, increased by $63m under the Roads Grants Act fund and the Australian Bicentennial Road Development program. Total local road allocation in 1983-84 is $122.3m, or 67 per cent higher than the allocation for 1982-83. In addition, assistance for the aerodrome local ownership plan has been increased by $15m, and assistance for local government children's services has increased by $11m.

There is no doubt that local government has been afforded a significantly higher level of funding by the Hawke Labor Government than it received under the previous Government. But effective inter-governmental relationships involve much more than a mere flow of funds-something that the previous Government utterly failed to comprehend. The Local Government (Personal Income Tax Sharing) Act has operated for seven years without review or any assessment of its impact or effectiveness. I shall soon be announcing the membership and terms of reference of an expert committee of review of local government financing, including financing from Commonwealth, State and local government sources. Such a review will place us in a better position to make allocations for local government which strengthen the capacities of councils and promote equity and efficiency.

This Government has also accorded local government a higher level of recognition as a partner in the nation's system of government. For instance, local government was represented at the National Economic Summit Conference and is represented on the Economic Planning Advisory Council, known as EPAC. A sub- committee was formed out of the Australian Constitutional Convention to propose a form of constitutional recognition of local government, and we shall soon be receiving the report of the Advisory Council on Inter-Government Relations on the responsibilities and resources of local government. That report should generate constructive debate on the potential and capacity of local government.

My own Department will be working in consultation with other Commonwealth departments and the States and local government to establish a co-ordinated system of information at a local area level-something that the former Government again failed to comprehend. An initial allocation of $250,000 has been made for the purpose of making available information on public finance and social and economic conditions at a local level. We are also upgrading the facilities for the training of local government elected members and staff. This year the local government scholarship scheme will recieve a 40 per cent increase on last year's funds, providing--

Opposition members interjecting-

Mr DEPUTY SPEAKER (Mr Millar) —Order! The honourable member for Dawson has had his say. He was heard in silence. I ask him to accord the Minister a similar opportunity.

Mr UREN —Thank you, Mr Deputy Speaker. I am glad that you have come to my rescue , because very little decency has been accorded to me. There have been many interjections. We know that our policies are hurting the Opposition tremendously . The Opposition knows about the whole shallowness of its role in local government. In a few seconds time, I shall give some details about the real role of Federal government responsibility concerning local government. I was stressing that this year the local government scholarship scheme will receive a 40 per cent increase on last year's funds, providing $35,000 for programs conducted at the Australian Centre for Local Government Studies here in Canberra . It is well known that funds for those local government studies have been frozen for a number of years. It is important that officers of local government departments, and aldermen themselves, should have the opportunity of greater training in the future.

When my Department was formed, I inherited the office of Minister responsible for local government, and the present Federal Government, which has such a commitment to local government, had four Federal officers in the office of local government. That was the basis of the new Department of Territories and Local Government. What is really needed is a spirit of co-operation by the three levels of government. If we are to overcome the problems, there must be an interrelationship between Australian Government officers concerned with local government, State government officers and officers of local government at the local level. It is only when we break down the differences between the bureaucracies and get a better understanding between the officers and the politicians who are trying to work in the interests of the people that any real progress is made.

There is another interesting program in the fine print of the Budget. We have also made available $1.5m for studies in the western regions of Sydney and the western regions of Melbourne. These are areas of great social concern. Unless there is this interrelationship of the Australian, State and local governments working together to overcome many of the social problems in such areas, we shall have appalling conditions in the future. We are witnessing an initial stage of a historic progress in the development of local government. Wherever I have been in honourable members' areas, the response of local government towards me as the responsible Minister has been to applaud the policies of this Government. There is a wonderful spirit and relationship between us. There is a feeling that at last there is some hope of a breakthrough. I stress that our approach will be gradual, but it will be a co-operative approach. This Government is committed to working co-operatively with the States and local government to strengthen democracy in our nation. It is only when the three levels of government work together in the interests of the people, and particularly with Federal Government that is closer to the people, that that aim will be achieved. We on this side of the House believe in giving responsibility to people and we are against the concept of sectarianism and withdrawalism which, when in government, the Opposition certainly followed in relation to local government.

Mr DEPUTY SPEAKER —Order! The discussion is concluded.