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Wednesday, 24 November 2010
Page: 3585


Ms MARINO (11:47 AM) —I rise to support the shadow Treasurer’s amendments. As we know the Federal Financial Relations Amendment (National Health and Hospitals Network) Bill 2010 strips unspecified amounts of GST funding from the states to be retained by the Commonwealth simply so that the Labor government can make the false claim that it will be the dominant funder of health spending. And I suspect that the other reason is to make a grab for future state wealth through their individual increased GST revenues—their growth source.

This measure simply re-badges $56.1 billion of GST revenue—perhaps, because there are several different figures out about that now—over the current forward estimates, although this figure, as I said, may not necessarily be accurate at all. In the MYEFO released a week after the Treasurer’s second reading speech on this bill, it was said to be $44.5 billion. And recently we have heard sums of perhaps $50 billion. This demonstrates the problems with this particular bill as there are no definites.

Perhaps the Treasurer of Australia could clarify this for the parliament. We should actually not be voting on legislation that does not specify the exact amount of GST that the Labor government will retain by this measure nor should we vote on legislation which is in breach of the GST agreement between the states and territories. It is an abuse of parliamentary process that we in this House are expected to vote on this before all state and territory governments have signed agreements with the Commonwealth about what amount to hand over. This is an agreement to hand over a significant but, as yet, unknown share of their GST to the Labor government.

It is an attack on our Federation and an undermining of the financial independence of the states. It is an embarrassment to the parliament that passes it and an abrogation of duty by state governments that have agreed to it. I only hope that people in these states hold their individual governments to account for their decision to sign the health agreement. This is not a bill about health reform. It is, as I said, all about federal-state financial relations and federal financial control.

Being a proud Western Australian, I acknowledge the strength and foresight of Premier Colin Barnett in not agreeing to this latest Labor mess. He is the only state Premier in Australia not to abrogate the rights of his state or, indeed, his people. Colin Barnett and our health minister Kim Haines both know that, if this was genuine health reform, the Prime Minister and Treasurer would have agreed to WA’s offer to commit an equivalent amount of WA revenue into health reform. The Western Australian state government funds over 60 per cent of the operating costs of our public hospital system right now. It is the dominant funding source.

The Labor government’s proposal to become the major funder by simply increasing the Commonwealth funding from 35 to 60 per cent is, by sleight of hand, using the state’s own GST revenue to do so. They are taking at least one-third—at least, we do not know yet—of these funds, re-badging it as federal funding and then making the claim that the 60 per cent is all Commonwealth funding. Clearly the Labor government is proposing that any additional funding needed for the health system will come directly from the states through those increased GST revenues. And once again WA, if it agreed, would be the loser and would continue to prop up other states. Our GST share is already down to 68c while New South Wales is receiving 95c under the Grants Commission formula.

So how would Western Australia keep funding our remaining 40 per cent share of public hospital costs when the growing source and base revenue, at least 30 per cent of the GST, would be in the control of the federal government? We would still have to fund our other 40 per cent share. This bill provides no clarity or certainty on exactly how much GST revenue the states will actually have stripped away by the Commonwealth. This is an open-ended deal in which the Treasurer has loosely said that the states and territories will dedicate around one-third of GST revenue. ‘Around one-third of GST’—that is bound to give the states a great sense of confidence, as it obviously did for Colin Barnett. After all, to a federal Labor government addicted to spending, what is a few billion dollars here or there, as we have seen? Let’s face it, of all the billions of dollars splashed around, wasted or rorted in stimulus packages, not one cent went to health.

I cannot believe that any state premier or government would have signed even an in-principle agreement without knowing exactly what amount of GST is to be taken from their state. A government that has been unable to give away free pink batts and unable to run a green loans scheme, Fuelwatch, GroceryWatch or the BER program is saying: ‘Trust us. Sign up now and we’ll let you know later what it is going to cost you.’ Added to the open-ended nature of this is the fact that, under proposed section 6A, the minister will determine the amount of GST revenue to be paid, and here lies the danger and the very real problem for the states and territories. That is why they should not sign even an in-principle agreement. This decision of the minister cannot be disallowed by the parliament. Simply put: this will be the only opportunity for the parliament to pass judgment on these arrangements. As with the Home Insulation Program and the NBN, there will be no scrutiny—just trust Labor to get it right. I will say again for the states and territories that have already signed the in-principle agreements: the decision of the minister cannot be disallowed by the parliament. I just wonder whether those premiers are actually aware of that. Are the people in the states aware of it? I ask: have you discharged your responsibility to your states by signing an open-ended agreement? The federal minister will determine the amount of GST revenue that your states are going to lose. It is an open-ended deal.

Given the constant repeated waste and mismanagement of taxpayers’ funds and the government’s addiction to spending, having an open-ended deal is like a red flag to a bull to a debt and deficit government, particularly one that proposed to fix hospitals by 2009. Figures taken from MYEFO show percentages from 14 to 50 per cent—and perhaps 60 per cent, we have heard—of GST revenues. That is what will be removed by the Commonwealth. The states that have signed have clearly signed up blindly or were oblivious, or perhaps not caring, of the amount of GST that will be stripped from their revenue streams and future growth or, worse, unwilling to stand up for their state’s rights. I wonder how the signatory states are feeling right now when they look at this bill and I wonder whether they are having second thoughts. We know that ACT Treasurer Katy Gallagher’s office has confirmed that the territory would have to hand back 48 to 50 per cent of GST, and Queensland’s Minister for Health and the shadow health minister believe that their hand-back will be between 39 and 42 per cent of GST in 2012-13.

It is absolutely extraordinary and sets a dangerous precedent that states would sign up to this when the explanatory memorandum states that the funding commitments are yet to be finalised. No wonder Colin Barnett said no. This is an open-ended deal and Premier Barnett, in strongly representing Western Australia’s interests, has said that he believes that the handover of any part of the GST will eventually lead to the Commonwealth having 100 per cent control of the growth revenue stream of the GST, which affects the ongoing sustainability of states. Given the growth and development in Western Australia, this would be literally like letting the fox in with the chickens. I can imagine Treasurer Wayne Swan in charge of Western Australia’s revenue. It does not bear thinking about. We only have to look at the Labor government’s proposed mining tax, which is basically a tax on Western Australia, and the carbon tax on top. Add the GST grab and Western Australia will simply be a mendicant state, begging at federal Labor’s feet—something I know this government would very much like to achieve and is, by way of this agreement, trying to achieve.

I will be very interested to see how the government progresses with this health bill, given those changes to GST arrangements require unanimous agreement by the Commonwealth and every state and territory noted in the Treasury incoming government brief. This is the same advice that told the Treasurer to resolve this issue before the reintroduction of this legislation, but the Treasurer clearly has not listened. He has not resolved this issue and has not achieved unanimous agreement, but he has reintroduced the legislation. I also understand that not one single state or territory has actually signed over its share of GST revenue to the Commonwealth. Again it is clear that the Treasurer should not have progressed with this legislation until he had unanimous, signed agreements from all states and territories. As well as the people of New South Wales and Victoria having had an opportunity to pass judgement through their elections on Labor state governments who have agreed in-principle to abrogate their state rights with this deal, we have moved a second reading amendment to this effect.

In Western Australia we owe much to our historic strong leaders. In 1897, over 107 years ago, WA Premier Sir John Forrest, after whom my seat is named, was one of the greatest leaders of our state. He was a driving force in amending the legislation that eventually became the Australian Constitution. He did so to protect our state’s rights. He was concerned that the state of Western Australia would effectively become mendicant to the Commonwealth of Australia. He would have been equally as concerned today with this bill. The problem then was the same as this: one of finance. There is no doubt that whoever holds the purse strings dictates what can or will be done. John Forrest fought hard to negotiate fair funding arrangements for his state and I will continue to do so, as will members on this side of the House.

The Labor Party has clearly agreed to strip GST revenue from the states and territories. On 31 October 2010, the Western Australian Labor leader Eric Ripper—not everybody agrees with this—was reported as calling on the federal government to urgently address the state’s share of the GST and rejected the Gillard grab for our state’s GST. Mr Ripper said:

There’s an issue here that needs to be fixed and the Gillard government has got to look at addressing this GST share issue for WA.

The report stated:

WA’s share of the GST is one of the reasons Mr Ripper is opposed to the state signing up to a national health reform agreement, which would see it hand over 30 per cent of its remaining GST revenue.

Mr Ripper further said:

We can’t accept the GST claw back, which in WA could even be as much as 60 per cent of our remaining GST which is already far too small and unfair.

So in Western Australia even the local Labor Party opposes this deal. I hope the remaining Labor members in this chamber from WA take note of this and support their state leader by joining with us in our move. In the state of Western Australia, the people and our political parties demand it. But in spite of the Labor government taking over the states’ GST to fund health and hospitals, they claim to be the majority funder by only using the states’ own GST for the purpose.

Even though this bill does not provide details of the new health arrangements, we do know that it will be a massive new, expensive, ever expanding, gross and likely incompetent bureaucratic beast under this Labor government and there has been a failure to deal with practical issues. We are yet to see the details and this bill fails to provide any of the details. What we do know, however, is that the government is committed to centralising planning and control, and that is a concern. There are very many valid reasons against it. In March the health minister admitted that this health plan may end up increasing taxes and costing jobs in the health sector. We do know that there will be four new health bureaucracies created at a federal level and one in every state on top of an undecided number of local hospital networks and primary healthcare organisations. So, unfortunately, I can see where the states’ GST will be going. As I said, there are many valid reasons not to support the legislation in this form. If this is put to a vote now, this is of real concern. I support the amendments put by the shadow Treasurer.