Save Search

Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Current HansardDownload Current Hansard    View Or Save XMLView/Save XML

Previous Fragment    Next Fragment
Wednesday, 24 March 1999
Page: 4181


Mr COSTELLO (Treasurer) (11:01 AM) —I move:

That the bill be now read a second time.

With the government's introduction of A New Tax System, the current arrangements for provision of Commonwealth financial assistance to the state, territory and local govern ments will change. This bill repeals the two acts that currently provide this assistance—the States Grants (General Purposes) Act 1994 and the Local Government (Financial Assistance) Act 1995. The second of these acts falls within the responsibility of the Minister for Regional Services, Territories and Local Government and in presenting this bill I therefore also do so on his behalf.

Under the proposed reforms, all goods and services tax revenue will be distributed to the states and territories, and Financial Assistance Grants will be abolished. The States Grants (General Purposes) Act 1994, which appropriates funding for payments of FAGs to the states and territories, will be repealed on commencement of A New Tax System (Commonwealth-State Financial Arrangements) Act 1999.

States and territories have provided their agreement in principle to assuming responsibility for local government funding. This bill therefore amends the Local Government (Financial Assistance) Act 1995 to enable a smooth transition of payments in 1999-2000 and provides for its repeal, also on commencement of A New Tax System (Commonwealth-State Financial Arrangements) Act 1999.

The Local Government (Financial Assistance) Act 1995 was designed for the continual payment of grants, with adjustments in respect of one year's payments being made in the following year. This adjustment process will not be available after 30 June 2000. This bill therefore amends the act to provide for payments in the final quarter of 1999-2000 to be paid by monthly instalments, with the instalment adjusted to reflect the final determination of the local government grant for that year.

In addition, notwithstanding the repeal of the act, state treasurers will be required to report to the Minister for Regional Services, Territories and Local Government that the 1999-2000 payments have been passed on to local government and will need to provide a certificate by the state Auditor-General to that effect. As is currently the case, the minister will be required to report to the parliament on the operation of the act in 1999-2000 as soon as practicable after 30 June next year.

Full details of the measures in the bill are contained in the explanatory memorandum circulated to honourable members.

I commend the bill to the House. I present the explanatory memorandum to this bill.

Debate (on motion by Mr Kelvin Thomson) adjourned.