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Wednesday, 24 August 1994
Page: 218

Senator KERNOT —My question is directed to the Minister representing the Prime Minister. I refer the minister to a report released today by the Deputy Prime Minister which shows that per capita government spending on infrastructure has plummeted by 33 per cent in the last seven years. The report shows that investment in education has fallen even more starkly and is now running at less than half the level of two decades ago. Does the minister agree that falling levels of public investment in education and transport are particularly hurting fast growth, outer suburban areas such as Melbourne's Werribee, Altona, Sunshine and Laverton, in electorates such as Lalor, for example, where high school retention rates are low and falling—ask Barry Jones—and where roads are congested and public transport inadequate? Or does the minister agree with the press club comments today of the Minister for Finance that private sector funding and user-pay charges are the key to funding roads, schools and hospitals in the future? Or does he agree with the Deputy Prime Minister that restoring public investment to reasonable levels will require a review of taxation in the longer term? Which option is the minister's?

Senator GARETH EVANS —If Senator Kernot thinks that I am going to be silly enough to take sides as between the Deputy Prime Minister and the Minister for Finance on a matter of that kind, she is sadly mistaken. The truth of the matter is that there has been, as we all know, a deterioration in funding spent on infrastructure, particularly by the states, in the particular sectors that she mentioned and it is important that that expenditure be renewed. None of us is in any doubt about that.

  There is a question as to whether that is best addressed through the public sector, through expenditure as a result of government revenue being presumably increased or redirected for that purpose, or whether it is better to rely on private sector initiatives with various incentives of the kind that we had in the One Nation statement, for example, last year and in the subsequent policy initiatives in relation to tax concessions for infrastructure projects to enable this to occur.

  As always, the truth is likely to be somewhere between those two extremes. A judicious mixture of both is probably the way to go. But I will not commit myself with any precision as to what kind of policy response we will adopt on this; it is an ongoing debate.