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Tuesday, 5 June 1984
Page: 2572

(Question No. 778)


Senator Kilgariff asked the Minister representing the Treasurer, upon notice, on 30 March 1984:

(1) Will the Federal Government index the fuel levy, which is currently 2 cents per litre and which is channelled into the Australian bicentennial road development program (ABRDP); if so, will the extra revenue earned through the indexation not be directed into the ABRDP; if not, will it be paid into consolidated revenue.

(2) Will the Government guarantee that all revenue raised by the fuel excise be used to fund road programs.

(3) Is the report published in the Adelaide News on 22 February 1984 which states that motorists will be cheated of up to $600m this decade by the decision , correct.

(4) What revenue does the Government expect to raise through the indexation of the levy.

(5) Will the Government reconsider its decision not to direct the extra revenue into the ABRDP.


Senator Walsh —The Treasurer has provided the following answer to the honourable senator's question:

(1) In accordance with the Excise Tariff Amendment Act (No. 2) 1983, the full excise rates on each of the traditional excise items have been subject to indexation adjustments. The total revenue generated from the excises (including the ABRD levy) on motor spirit and distillate is, in the first instance, paid into the Consolidated Revenue Fund. The ABRD Trust Fund Act (1982) then operates to allocate from the Consolidated Revenue Fund an amount equivalent to 2 cents- rather than an indexed amount-for each litre of motor spirit and distillate subject to excise.

(2) No. With the exception of the 2 cents per litre ABRD levy component, all revenue raised through the excises on motor spirit and distillate is directed to expenditure programs according to priorities established in the budgetary context.

In that context, I note that the Government attached a high priority to road development and maintenance in the 1983-84 Budget. The total estimated road funding under the Road Grants Act 1981, the ABRD program and under the new jobs on local roads initiative provided for a Budget time represented an increase of 45 per cent over outlays in 1982-83.

(3) The Government does not consider that anyone is being cheated by this measure.

(4) Any estimate is critically dependent on the assumed growth path of motor spirit and distillate excise clearances as well as assumed future rates of inflation. Both these assumptions would in turn be bound up with assumptions about more general trends in economic activity. In these circumstances, it would be misleading for the Government to venture a view on likely revenue yields from this adjustment.

(5) As with a wide range of expenditure and receipts proposals, the nature and level of funding for the ABRD program will be considered in 1984-85 Budget context.