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Wednesday, 7 June 2000
Page: 14791


Senator FORSHAW (11:46 AM) —At the outset let me compliment Senator Gibbs on her excellent contribution on the Local Government (Financial Assistance) Amendment Bill 2000. The content was so detailed that it has probably enabled me to shorten my comments in this debate. Senator Gibbs has detailed very well the real impost that is going to impact upon local government when the GST cuts in in July. The minister is not yet in the chamber but I understand he is going to grace us with his presence for once and participate in this debate. This minister and this government have no idea about the problems that local government is facing and is going to face with the introduction of the GST.

In her excellent speech, Senator Gibbs pointed to some of the comments that have been made by Senator Ian Macdonald regarding the GST and his claims that it will be of huge benefit and that he really does not have any concerns, and does not believe that local government has any concerns, about the GST. If you have ever had the torturous experience of having to sit in estimates hearings with Senator Ian Macdonald, you will know that he continually refuses to answer questions but nevertheless wants to give us the benefit of his wisdom on any number of subjects. When asked specific questions, he either refuses to answer them or, if he does not know the answer, invariably refuses to even take them on notice. Senator McGauran and Senator Mackay will recall that at the recent estimates hearings on 25 May it even got to the stage where Senator Macdonald was having an open dispute with officers of his own department about information and answers to questions that they were giving to us in those proceedings. Invariably it was Senator Macdonald sitting there saying to his departmental officers, `Look, I don't know, but I think you're wrong.' That was the tenor of his contribution.

I will quote from the estimates Hansard on 25 May in respect of this issue of the impact of the GST upon local councils and what information this government and this minister have about that issue. It reads:

Senator MACKAY—Have you asked any of the councils how much GST implementation is going to cost?

Senator Ian Macdonald—There have been a number of independent studies done.

He does not answer the question. He says, `There have been a number of independent studies done.' It goes on:

Senator MACKAY—Have you asked any councils?

Senator Ian Macdonald—I don't think so. I do not think too many councils have raised the issue with me. Perhaps late at night over a beer one or two might have. There are a lot of independent studies around.

Senator MACKAY—So, Minister, you have not received or sought any information on the implementation of GST costs in local government? Is that correct?

Senator Ian Macdonald—I have not sought or received. As I say, one or two might have spoken to me, but I have received no formal submissions from anyone on them, no.

Senator Mackay asked a question of Ms Parsons, one of the officers:

Senator MACKAY—Ms Parsons, has the office asked any councils about the cost of implementation of the GST, and whether they are happy with the LGIP?

Ms Parsons—No.

Further down that page, Senator Macdonald makes this classic statement:

We have said any number of times at any number of estimates that we have not done any assessment or analysis from within the department, nor do we intend doing it.

What an arrogant attitude for a minister and for a government to have to the implementation of what they themselves claim is the biggest ever change in the tax system in this country. Local government is an incredibly important aspect of the levels of government in this country. For many people it is essentially the area of government that they have most contact with. Senator Gibbs and Senator Mackay in their contributions pointed to the range of services that local governments around Australia provide. As federal members of parliament, we know—indeed, state members of parliament know—that when people need to approach government in their day-to-day lives, very often the particular issues of concern are local issues: roads, provision of community services and so on.

You would think that the government would regard it as an obligation, as a priority, to go out and ascertain the impact of the GST on local government. Of course they have not done that and they do not intend to do it. Why? It is all based upon this belief that they have, and they continue to believe it because they have to. They know, if they are not correct, that the consequences for them at the next election will be catastrophic. They continue to have blind faith in the view that the GST will be of benefit to everybody. Treasury has told us that and Mr Costello has told us that, so they do not have to even investigate that premise any more. This has occurred right through all the departments. Whenever any senator has attempted to ask questions in estimates hearings about what a particular department have done with respect to the implementation and application of a GST in their area, they say, `It's not our business. We have not done anything.' If you talk to the Department of Agriculture, Fisheries and Forestry, where the GST will have a huge impact right across the portfolio areas, they say, `No, we haven't done any work on it.'


Senator Mackay —Regional?


Senator FORSHAW —Transport and Regional Services particularly say, `No, we haven't done any work. That's all Treasury and the department of finance. Let them worry about it.' This is an incredible attitude but one we are not surprised at, because it demonstrates the arrogance of the government. When he came to office, Mr Howard claimed he was going to set new standards, he was not going to break any promises and he was going to remain true to his word. He is on the record as having broken one of the most solemn promises ever made in an election campaign. Remember `there will be no GST'? He broke that promise and it is going to cost him dearly at the next election.

In respect of local government in particular, which is what this legislation is directed at, I have to compliment the previous speaker, Senator Gibbs. She drew attention to the commitment given by the Federal Director of the Liberal Party that the GST would not apply on non-commercial activities—all those many services that Senator Gibbs read out. But Senator Macdonald, having a flash of insight, said one day at a hearing, `Mr Crosby is wrong. Don't believe what he tells you. Don't believe the solemn commitment that local government will not really be affected by the GST.' We know, and he has admitted, that the GST will be applied to those non-commercial activities.

Is it any wonder that councils would not even bother raising their concerns with this minister and this government? In the Labor Party, we have been out there talking to many councils in New South Wales. We know that each one of them is grappling with the implementation of the GST and the problems it has raised for them. They are very concerned. Senator Macdonald hides behind the defence, `They haven't rung me up.' First of all, why would they bother? Secondly, Senator Macdonald is disingenuous in the argument that because they have not necessarily rung him with their problems, therefore one can conclude there are no problems.

What has been the factual position about this issue? The factual position is that it was not until the end of January this year that the draft determination on exempt taxes, fees and charges was made available. So local government in particular were not even made aware of precisely the range of areas where the GST would apply until the end of January this year—only a couple of months ago. They have been waiting for months for that information. I understand it had been sitting on the Treasurer's table since about August last year. So when Senator Macdonald told us at estimates, `They never raised any of these issues with me in the last 12 months,' they have not had an opportunity to because they have not been given the information by the government upon which to then examine precisely the impact. Further, presumably they were relying upon the guarantees given by various ministers in the government that they would be only slightly affected, if at all. Since January, and particularly since March when that list was finalised, they have known the full extent of the application of the GST on their services. They do not now have time to worry about ringing up Senator Macdonald because they are working overtime, spending thousands and thousands of dollars of ratepayers' money, trying to come to grips with exactly how this system is going to work.

Only a couple of weeks ago, after the budget, I was visiting northern New South Wales, talking to local councils up there. Senator Mackay was there—she will recall it. They were telling us that they have just had to get on with the job of trying to work out how they are going to continue to fund the services that they have to provide, one, with the implementation of the GST and, two, having regard to the fact that the federal government really have no interest in local government and have said, `With all of your issues now, go and talk to the states.' That is their attitude. It is just like their attitude to regional Australia generally. I think it was Minister Anderson who said the national government really do not even have any constitutional role in regional Australia. In rural Australia, it is local government that often provides basic services which, in other parts of Australia, particularly metropolitan areas, may be provided by other agencies.

For instance, many councils in rural and regional Australia are responsible for the water supply service. They are responsible for providing the sewerage service. These are services for which, in the big cities, there is often a state department or a statutory authority or even, in some cases, a privatised body; but when you get out to the local councils in rural and regional Australia, they are the last men standing in terms of providing these sorts of services. They are finding it increasingly difficult because this government has not provided any real increase in funding for local government. That was pointed out earlier by Senator Mackay. They are very much like small business—the basis of the economy of many of these country towns—and they are trying to understand and grapple with the implementation of this system. They have real problems with it. But this minister and this government are not even interested in finding out about that.

What is this minister really interested in? He is interested in interfering in local government when it suits him for political purposes. He is the minister for interfering in local government; he is not the minister for representing local government or the minister for solving the problems of local government. As I pointed out earlier, at estimates Senator Macdonald can never answer a question. He wants to sit there and argue but he will never answer a question. Yet when there is a council election on, he can answer a dorothy dixer from his own side, like he did yesterday. He was asked a question yesterday about the South Sydney Council. He tried to take the opportunity to attack the South Sydney Council. Why would he do that? Why would he pick on the South Sydney Council? He was not going to pick on the Burdekin council, was he? There might be a bit of local embarrassment.

He picked on the South Sydney Council because he knows that there is going to be an election soon. I think he probably knows what the result is going to be. His attacks in this chamber on the South Sydney Council are not going to make any difference to the result, because just as he did when he tried to attack the Brisbane City Council, again through dorothy dix questions in this chamber, he will again end up with egg all over his face. Just as the Labor Party won a resounding, overwhelming, historic victory in the Brisbane City Council, I am certain that Vic Smith and his team, who have been serving the community of South Sydney so well for so long, will again triumph at the council elections.

Let Senator Macdonald come in here and answer his dorothy dix questions, have a bit of fun and try to make a few political attacks upon the Labor councils and upon local government—but it is sad. As you travel around rural and regional Australia, as I do whenever I get the opportunity, when we can get away from these hallowed halls here in this building, you really get to talk to people who are out there, in local government particularly, endeavouring to provide the services that their citizens need and to plug the gaps that have been created by this government federally and, at times, by state government.

When the federal government pulls the funding out, when it says it is not even interested in finding out their concerns, what do local councils do? They cannot just walk away from the problems like Senator Macdonald tries to do; they have to confront those ratepayers, those citizens, every day. They know that they just cannot put up the rates willy-nilly, because in many of these areas the rate income base is very low. They are going to be hit hard in a whole range of service areas, but they are going to continue to struggle to provide those services because people living in those areas are entitled to them. Whilst we are supporting this legislation because of its technical nature, we want to put firmly on the record that this is a minister and a government that have lost interest in local government. If you do not believe that, all you have to do next week when parliament is not sitting is get out there and talk to them. But I think it is going to be too late.