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Address to the Local Government Association of QLD Annual Conference "The Millennium": Royal Pines Resort, Ashmore, Gold Coast: 31 August 2000.



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5:35 PM : Thurday, November 23, 2000

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Senator the Hon Ian Macdonald Minister for Regional Services, Territories and Local Government

27 July 2000 MS13/2000

Address to Local Government Association of QLD Annual Conference "The Millennium" 31 August 2000 Royal Pines Resort, Ashmore, Gold Coast

AS DELIVERED:

Thank you Peter

You have only been here a very short time in this job, but as I understand you have done a great job in your time as President as I’m sure everyone here will agree. Whoever wins the ballot for presidency later on today, I wish them very well, they will certainly have very big shoes to fill, although they will never quite reach the exulted heights that Peter does every time he stands.

Mayors, Councillors, The Hon Howard Hobbs, the Shadow Minister for Local Government and Planning, Distinguished guests and Ladies and Gentlemen

I just warn you before I start, I think I’m still under the Burdekin Shire Council’s Workcover Programme, so if you do feel inclined to throw things at me during the course of my speech, remember that if you do, the Burdekin Shire’s Workcover rates will go up next year and they wont win that exhaulted award again. Congratulations to the Burdekin on achieving that.

Thank you also ladies and gentlemen for inviting me to speak at your 104th Annual Conference. I’m delighted to be talking to you again, I am delighted in the very short time I have today to catch up with a few of you. I’ve got to know a lot of you over the years and at times, particularly late at night, I’ve become quite good friends with many of you. My last experience in that regard was I think out in McKinlay just a couple of weeks ago, and I regretted the next morning their generosity with the red wine. It is good to be back with you particularly in this venue. I think I am the second prominent person from Ayr who has been in this venue over the last year or so - some other girl that plays golf or something, that comes from Ayr and our Shire Clerk of course always claims that he taught Karrie everything she knew about golf.

But it is great to be here on the Gold Coast. I am pleased to hear that your next Conference is in Townsville, and whilst you’ve had a very good time here on the Gold Coast, you’ll have an even better time in Townsville. I feel that I can say that being a person who pays rates here on the Gold Coast and in Townsville as well as my own home town of Ayr.

Ladies and Gentlemen, it’s interesting to reflect that this is your 104th Conference, and to just consider that the Local Government Association of Queensland has in fact been going longer than the Federal System of Government that we have in Australia.

As Local Government leaders you place great emphasis on the economic development of your shires and cities. And likewise, we at the Federal Government level work to ensure that we get the economic fundamentals right to be able to deliver better outcomes to all Australians.

We are enjoying now the benefits of a long period of economic growth sustained by a responsible budget from the Howard Government. The Australian economy is dynamic, and has now grown at or above 4 per cent on the past 12 consecutive quarters, a growth rate that is unrivalled in the last 30 years.

The national unemployment rate fell to 6.3 per cent in July 2000, it’s lowest level in over a decade. This compares to the unemployment rate of 8.5 per cent that we inherited when we took government in 1996. Sustained growth and low inflation has enabled the unemployment rate to fall by around half of a percentage point per year. And over 730,000 new jobs have been created since March 1996.

Ladies and Gentlemen we all remember, and councillors will particularly remember, the hardship caused by massive interest rates in the late 1980’s. Our policies have been described - our general economic policies at a federal level, have been described as

judicious by the OECD. The International Monetary Funds Board has recently commended Australia’s extended period of strong non-inflationary growth, and remarkable resilience of the economy in the face of the Asian crisis. This very good result to the economy Australia wide has been good for our nation. How does this benefit local Government you might ask?

As I mentioned at last year’s Conference in Toowoomba, the significant reduction in interest rates we have achieved represents a significant saving to your ratepayers. There has been some recent movement in interest rates, but the interest rates that you are paying on borrrowings is still about 9 per cent lower than it was when I was on the Burdekin Shire Council at the end of the 1980s.

On average across Australia council debt of about $9 million that represents an annual saving, on average, on councils across Australia of some almost $800,000 per annum. Now that really means lower rates and charges to your residents, or allows you to spend your money on things that your constituents need, rather than paying interest rates to financiers.

The Commonwealth Government’s commitment to sound economic policy includes the biggest reform yet and that is the reform of Australia’s heretofore antiquated taxation system. Implementing this reform was not without its political costs to us a Federal Government, however, as National leaders we have to do what is right - not what is popular.

The benefits to Local Government from the reform of Australia’s tax system are real, with the majority of your activities being outside the scope of the GST. Local Government will benefit from the removal of embedded wholesale sales tax, you’ll benefit from the increased diesel fuel rebates and the ability to claim back your GST input costs.

A recent report prepared for the Municipal Association of Victoria by Ernst and Young highlights significant savings for Councils - Local Governments - ranging up to 10.6% in the long term. Revenue has as well, started to flow from the Commonwealth’s GST system to the States and I hope the States will pass that, part of those benefits on to you as councils.

I’m pleased each year to be able to provide funds for the Local Government Association of Queensland in the last couple of years to help the Local Government Association of Queensland to help you to implement the GST. I want to thank all councils for the way that some of them, against their better judgement, but all of them put their shoulder to the wheel when they new the implementation of the GST was law and they made it work and I thank

you for your cooperation during the preparation and the implementation stage of the New Tax System. I congratulate the Local Government Association of Queensland on the assistance and advice I know that they gave you.

Ladies and Gentlemen, this year the Federal Government has allocated some $1.3 billion in Local Government financial assistance grants to councils across Australia. Funding has increased this year by almost $50 million.

I have recently allocated some $246 million in total Federal assistance grants to Queensland

councils this year, and that represents 18.61 per cent of the national total.

For Queensland, this is an increase in Commonwealth financial assistance grants over last year of almost $10 million or some 4.19 per cent. That increase compares to the national average increase of some 3.89 per cent an it is on the back of, and reflecting an increased percentage population growth in Queensland.

Ladies and Gentlemen, as most of you will be aware now, I signed off the payments to Queensland with some reluctance, because as will know, I have concerns about how the allocation of Federal assistance grants occurs in Queensland. And I know that in this room I am not alone in that belief.

I think I would be fairly unchallenged to say that there are not many people in this room today, including me, who understand how the distribution of Federal financial assistance grants within Queensland actually works.

I’ve been reading in some of the local newspapers round Queensland in the last couple of weeks and I have seen it suggested that the reason some Councils have lesser grants this year is because I have changed the system.

I haven’t changed anything in the last two years that Terry Mackenroth hasn’t agreed to. In reality this year’s distributions occurred pretty much in line with the way they have occurred for the last five years.

Queensland is the only State where I issue a separate determination providing transitional arrangements for the allocations as a means of phasing in the National Principles. And they are the same National Principles that have been in place since the Federal Act was introduced in 1995 by the previous Government.

You will see on the screen now one of the main objectives of the current Act under which I work is this and that is to improve the capacity of local government bodies to provide their residents with an equitable, and I emphasise equitable, level of services.

This is achieved by the National Principles. And the main purpose of those National Principles is and I quote from the Act "To ensure that each local governing body in a State is able to function, by reasonable effort, at a standard not lower than the average standard of other local governing bodies in the State".

What this really means is that the Federal Government some years ago provided money to ensure fairness and equity across the whole of each state. And I have to say that it irks me considerably when I see Councils with literally dozens of parks and swimming pools, with dozens of playgrounds, social workers, theatres and curb to curb bitumen on every road in the town and beaches worth $27 million and big travel budgets begrudging proportionally higher payments to disadvantaged councils, some of whom don’t even have mains electricity. And I ask what happened to the Aussie tradition of a fair go for your neighbour?

And as some councils are getting deceptively more than apparently other councils are getting, it is because the Federal financial money is given not as a right, but as an attempt to make sure that Australians, no matter where they live, get roughly equally the same access to municipal services.

I have a responsibility to apply the Federal law and a moral responsibility to apply these principles that were established not by my Government, but by the previous Labor Government, although I do hasten to add our Government when we were in opposition, supported those principles. Those principles agreed to at a Federal level have been agreed to by successive Governments across the whole of Australia, including the Queensland Government - both this one, the previous Coalition one and the previous Goss Labor Government. And at the time those principles were agreed, I understand that my good friend Terry Mackenroth was the Minister responsible in those times as well.

Now councillors, as I said last year in Toowoomba, if you don’t accept the National Principles contained in the current Act then you should make sure that I change the Federal Act and come up with some other formula that you might be able to suggest to me. I have to say that I haven’t been inundated with suggestions from Queensland Councils on any

proposed changes to the Act or any suggestions on how I could make the formula or the rules or the national principles better. Perhaps you’ve all been waiting to make a submission to the current review that is under way.

I have to warn you, if I don’t get some decent submissions I am going to appoint a commission of enquiry, including the Pearl Bay and Arcadia Waters Councils and I am going to have Councillor Bob Jelly chair that. Perhaps that way, we might get an outcome that does suit some of the councils that have been very high in their criticism of me in recent time.

As you know ladies and gentlemen, I have been very concerned at the lack of accountability and understanding of the way the Queensland Local Government Grants Commission distributes the Federal Government’s money.

Councils tell me they don’t understand it, they tell me it’s unfair and they tell me that it doesn’t provide certainty.

Now I don’t blame the Urban Local Government Association or its President for supporting a system that gets the best results for their particular councils, and in the case of the President, better per head, than for comparable regional councils elsewhere in Queensland. But it has become abundantly clear to some other councils that they’re getting a raw deal.

I found it fascinating when confronted in the media about this year’s reduced grant to one of the Fraser Coast Councils, that the Queensland Minister quite rightly pointed out that getting a fair system is hard - its not an easy thing to do.

But regrettably, my mate Terry, or as he was referred to earlier here, The Hon Terrible Mackenroth - he didn’t offer to fix it, he offered to flick off his responsibility to the Federal Government altogether. He didn’t or couldn’t or wouldn’t justify the system that is currently applied in Queensland - he just said I guess in the way that politicians do, it’s there because it is the system the LGAQ wanted.

When I wrote to all Mayors two weeks ago I provided an example of what other State grants commissions are doing and this year one of them is undertaking a review of the methodology it uses to allocate general purpose grants to councils. The objective of the review is to ensure that general purpose grants are allocated in a manner that is fair, predictable, stable and easy to understand. As I said in that letter to all of you, I would like to see the same occur in Queensland.

But I do have a suggestion that might overcome the problem that exists in Queensland at the present time. I would like to see the 1/4 of a billion dollars that I provide to Queensland councils distributed in line with the National Principles contained in the Federal Act which Queensland agreed to back in 1995.

But if the Queensland Government, and the Urban Local Government Association insist that some handpicked councils should receive extra funding to protect some hysterical or historical - or political advantage - then the Queensland Government should top up the funds that the Federal Government provides so that other councils with legitimate needs are not disadvantaged.

Can I remind you that the State Government once agreed to provide you a fixed share of their growth revenue from the GST. But then the Queensland Government, under pressure as I understand from Queensland Treasury, took the first opportunity it could to back out of

that deal.

I ask you to remember that very shortly the Queensland Government and all other State Governments will start receiving an increased and increasing pot of money from the GST, because you all know that every single cent of GST collected in Australia goes to the State Governments. I am hoping that with that additional money the Queensland Government is going to receive, that you might as councils be able to share in that bonanza as many of you have called for.

Ladies and Gentlemen, you will also be aware that the Grants Commission is currently undertaking a review of the FAGs Act and as I say, I hope all of you who are unhappy with

the current arrangements have made your submission.

I am conscious that some of you in Local Government would have liked wider terms of reference to allow a review of interstate distribution of funding. I am also aware that some councils around Australia do not want the interstate distribution reviewed at all. Now this has been a contentious issue between States for some time, and it was debated in 1999 in the negotiations over the Intergovernmental Agreement on the Reform of Commonwealth-State Financial Relations which happened as part of the discussions and the arrangements between the States and the Commonwealth with the New Tax System and the GST revenues. The Queensland State Government was a party to those discussions. It was debated but nothing was resolved.

Now Ladies and Gentlemen, it is easy for me to promise you the world, but the political reality is this: that there is no purpose in the Federal Government re-examining interstate distribution until the States and the Territories can agree on a common approach or until the peak body of Local Government in Australia - the Australian Local Government Association, to which you all belong, can put forward a whole of Local Government submission to the Federal Government. And until you can get the States to agree, until you can get Local Government to agree, the political reality is that there is no purpose in the Federal Government re-examining that issue.

Ladies and gentlemen can I move on? I mentioned that the Federal Government’s achievements in shoring up the economic fundamentals have done a lot for our country and hopefully the councils, and I’d now like to now briefly mention just some initiatives that the Government has implemented to assist councils ensure a better share in national prosperity for their constituents.

The recently announced $90 million Regional Solutions Programme is a direct response to a call for greater flexibility to meet the different needs of different communities. The Programme can support small scale projects of $1,000 up to large scale projects of some $500,000 and this Programme will assist communities to implement locally focussed solutions to build their economic and social bases. Guidelines for this Programme will be out in early October.

The Government has as well committed $70 million over five years to establish the Rural Transaction Centres Programme to provide a wide range of services for local communities and to help them meet their own local needs.

Towns in Queensland such as Aramac, Crows Nest, Wallumbilla and Yuleba are some of the 253 communities currently involved in this highly successful programme.

And on Monday, I’ll be announcing funding for the establishment of another 10 RTCs - and these new Centres will again provide basic banking services, medicare, phone and fax facilities and other services to communities that currently lack those services.

Many of our families in rural and regional Australia face isolation, economic hardship and lack of community resources. In April this year the Prime Minister announced a new direction to help support and strengthen Australia’s families. The Stronger Families and Communities Strategy commits over $240 million to prevention and early intervention measures for Australian families and communities. And that strategy will support parenting and relationship education, community leadership training, volunteering and identifying

local solutions to local problems.

Council’s as many of you will know and some of you might regret, I recently took to the roads in far western Queensland for a seven day 5,000 km trip to meet with Councils, and a wide range of other groups to discuss first hand, the day to day problems that you experience, as well as to appreciate the opportunities that exist in that part of the State. Part of what I heard was how the new telecommunications infrastructure and access to new technologies is really making a difference in many of these areas.

The Federal Government’s Networking the Nation (NTN) programme is bridging telecommunications infrastructure gaps in many parts of Australia.

As part of the Networking The Nation Programme, the Government established a $45

million Local Government Fund and I’m pleased to see that your Association - the Local Government Association of Queensland has been funded for a project called "Connecting Communities" that received funding of over $1 million to determine a strategic approach to

providing government services online and I certainly wish you and the LGAQ every success with that project.

The Road Safety Black Spot Program is another Federal Government initiative that provides tangible contributions to reducing the level of road trauma in Australia.

A total of 171 road projects with a total value of some $28 million almost have been approved for Queensland since the programme started in 1996. On the screen you will see the councils that shared in the $7 million for 65 projects announced earlier this month.

Ladies and Gentlemen, I hear what you say about local roads and I hear what your President said in his earlier comments this morning. There is no doubt that the Federal Government is very, very conscious of the need for local roads and the deplorable state which many local roads are in at the moment. We also understand that fixing and maintaining and constructing local roads is getting to a stage were it is beyond the capability of local councils. But I have to say that we struggle to try and find where we can get the funding to help.

Now if we provide money for that purpose, it means that there is some other programme that the Commonwealth Government currently funds that we would have to stop funding. Either that, or we would have to increase taxes on you and none of you would very much like paying increased taxes.

So we are conscious of the problem, we are trying to do something about it, but at this stage of the game I can’t give you a great deal but I can say to you that we will continue to work with you and will continue to try and find ways so that we can address the problems which we well understand.

There is another project that I wish to briefly mention and it’s the Regional Flood Mitigation programme. Through the establishment of this new Federal programme we now have the Queensland Government contributing to flood mitigation works. This is something that Queensland was a little behind in compared to New South Wales but with Federal Government assistance we’re catching up. The Federal Government provided the funds - the State Government recommending priorities to us. I am awaiting this years priority projects from the Queensland Minister and I hope to be able to announce these in September or October.

Ladies and Gentlemen, these are just a few of the practical initiatives that the Federal Government has put in place to help your local communities.

I did so briefly want touch on the Environment Protection and Biodiversity Conservation Act (EPBC) which came into effect on the 16 July this year. Now some people in Local Government have been quite concerned about this - some people in the development industry as well, and they have raised some concerns about aspects of the Act. The EPBC , if I can use an acronym, is a significant reform and has been designed to replace five existing pieces of Commonwealth environment legislation, legislation that I can tell you has been on the books for the last 25 years now. I have been advised that the transition to the EPBC has been relatively smooth.

I was told that there were going to be incidents where 50 block subdivisions at the back of Brisbane would have to be referred to the Commonwealth for approval, but I have been told that these fears have proven unfounded. In the first six weeks of the Acts operation there has only been one project in Queensland which has triggered the Act.

The LGAQ has had a lot of discussions with me and Senator Hill concerning the EPBC Act, and I have certainly discussed the matter with Senator Hill and passed on your concerns. I have, in my discussions with Senator Hill, as recently as last night, had an assurances from Senator Hill that his door is open, and if you do find problems with the Act - we’re hoping you will not - and Senator Hill believes that you wont. If you or the Queensland Development Industry do find that there are issues which develop and cause you problems, please get in touch with Greg Hallam and he will arrange with me for you to talk those things through with Senator Hill and to try and fix this up.

We must remember that the objective of the EPBC is to abandon the ad hoc approach that the Commonwealth has had to environment planning over the past several years to avoid the sort of fiasco we had over the Port Hinchinbrook involvement. It is intended to provide a more logical framework for the Commonwealth’s involvement in many environmental areas.

Today, Ladies and gentlemen, I’m also pleased to be able to advise you about an outline for projects that will be able to be funded under the Local Government Incentive Programme (LGIP) for 2000/2001.

This programme recognises that local councils need support to improve the delivery of services and to lead their communities. Priority areas for funding are; activities that lead to the adoption of best practice and sharing of technical expertise across councils; the promotion of an enhanced role for Local Government in leading their communities and to help increase the capacity of Local Government to contribute to regional development.

Priority will be given to projects from rural and small and medium regional and urban fringe councils. A project that involves a partnership between an eligible council and other councils or carried out by a Regional Organisation of Councils, will be considered for funding under the programme.

Importantly, Local Governments will be eligible for sizeable grants up to a maximum of $100,000 where two or more Local Governments have a co-operative project. Smaller grants may be available to individual councils. All grants will be given on the basis of additional funding for projects from other sources, which may include in-kind council contributions.

The guidelines for this year’s Local Government Incentive Programme this year will be available at the end of September, and they will be sent to all Councils.

Ladies and Gentlemen, can I conclude my address to your Millennium Conference to indicate that from where I stand, the future for Local Government looks very very bright. We have the opportunity to work together to ensure that the future is prosperous for all Australians in the years ahead.

I never miss this opportunity to again say to you that you are fortunate in having an organisation like the Local Government Association of Queensland to look after you. I have to say that we don’t always agree and they attack me as much as any other State organisation does, but I am always impressed by their commitment and their enthusiasm for your interest and the professionalism of their staff. And I also indicate the help they have given me in forming my views that end up in hopefully benefiting Local Government in so many ways that you would not be aware of. But I do appreciate the assistance that they give me and I understand when they have to get angry with me as well.

I would like to spend more time with you today, unfortunately in the big house on the hill down in Canberra we are treated like school boys and we have to be back for Question Time and if we are not there at Question Time the Opposition says that you are being paid to answer questions and you are not there, so I have to get back and because Michael Knight and SOCOG wanted an extra hour for the Olympics it now takes me three hours to get back to Canberra rather than two. I am not sure why they didn’t just start the Olympics an hour earlier instead of bringing daylight saving forward by two months. That may be popular here on the Gold Coast but I understand by that applause by some of us that it may not b popular in other parts of the State.

Ladies and Gentlemen, I do have to leave you in a short time, but Mr Chairman, if it were to your inclination, I would be very happy to answer any questions that you might like to ask. Thank you very much for having me.

Cr Peter Taylor, Acting-President LGAQ:

Thank you very much Mr Minister. While he does catch his breath I will just make a couple of comments on note …………. [inaudible]…………before he takes questions….…….. my comment from the Chair in relation to particularly I think the big issue for Queensland at the moment, is the financial assistance grants. The review is under way within the state of

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Queensland, within the States themselves and I acknowledge what the Minister said in relation to allocations on a needs basis. The contour therefore would have to be the [inaudible]………… with the same formula when they allocate them to the States. Because they say to us "Look Queensland, go to the ALGA get your numbers squared, then we we’ll listen to you or we’ll listen to a change" is really diverting the issue.

Because can say to the Minister there are many, many occasions where the States are not in unanimous agreement with the Commonwealth about to make a decision. To give you examples, we’ve used them before - there’s Medicare and the housing agreement. The

States do not agree they are not unanimous, but ultimately the federal members of Parliament have to make a decision which in their view is in the good of the Nation and they make it.

Again I say to the Minister, there is no escaping this issue. In the end we require that the Commonwealth follows with their own rules. And I say to the Minister and all other Federal Members of Parliament in Queensland - Remember, you come from Queensland we know in the end you could get beaten on the vote, but we expect you as our elected members to represent the interests of Queensland and vote on those lines.

Now I know there’ll be other questions on the Biodiversity Act and the Incentives Programmes, and I thank you Minister. I know I have just given you a bit of a brick bat, but we are good mates and we’ll stay mates - I mean I rang you by telephone and you returned my call before I’d even formally assumed the office of Acting President. But, and we’ve had contact over this issue on many occasions. I’ve written to you - I have written to every council, so it is on the record - all we ask of you is that our Federal members of Parliament stand up for Queensland.

I will now take some questions, on my far left to start with, we will have more than we will have time for, and if you can make your questions brief please rather than a statement.

QUESTIONS:

Councillor Andrew Champion, Caloundra: I just wanted to take this opportunity to update you on something we discussed recently. With this conference at a work shop yesterday on reuse of waste water and there was a lot of interest, Councillor Noel Playford from Noosa, shared some of the initiatives that are happening around the State, and there is stong support from Local Authorities throughout Queensland for a Federally funded initiative to provide some major infrastructure costs to divert effluent from being dumped in oceans and rivers to inland catchments. So I just wanted to make that comment and to have your comments on that.

Senator Ian Macdonald: Andrew thanks very much. You explained that very fully when I met with your Council just recently. I am interested to hear the results of your workshop yesterday.

As I indicated before it is something that I know Senator Hill is keen to look at. Something I think we already know is also appropriate. I am sure that I will get a submission and the LGAQ on the results of the workshop and we will see what we can do from there.

Councillor Joe Ross, Redlands: Thank you for your comments regarding fairness and equity and a fair go, we agree with you there. Could you see some way of improving our road structure by removing the excise on fuel for buses used domestically - in public transport - to allow fairness and equity to happen there? If you can improve or assist us to get more seats on bus and public transport - we won’t come to cap in hand for more money for roads. You’ve got a golden opportunity with the price of fuel going through the roof to assist all of the communities of Australia - you can actually kick a good goal here if you look at it right. If you happen to be …..[inaudible] …we have people who are picked up in Redlands pay the excise required for part of the trip, goes through to Brisbane in rural zone, no passengers are picked up - you know it is an inequity in our own system and people in communities would love to be able to say get more people on buses and that would help us.

Senator Ian Macdonald: Thanks for that. The recognition is there that we do have to try to get people on to - more onto public transport. There is as part of the arrangement with the Democrats, a deal to help buses to convert to friendlier fuels which we’ll be subsiding to a

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degree. I know that you are asking for more than that and I can only take that on board and it’s been raised before. It’s a question of finding the money for it.

Can I just - in part of your question, you referred to the price of petrol going through the roof - this is a golden opportunity. Can I just make it clear while I am here that the federal excise of fuel is fixed. It doesn’t matter what the price of petrol is, we only get 45 cents a

litre or whatever it is. It does go up half yearly with inflation as it has been now for some ten years - again a decision by the former government, but it goes up by 0.6 of a cent. The Federal Government’s excise is a fixed amount. It doesn’t matter what the price of petrol is, but we get 45 cents a litre. The GST may impact, but if the GST - if there is more GST out there, remember that the Federal Government gets not one cent of that GST - not one cent of that GST - that goes to the States.

Councillor John Mann, Beaudesert: Senator, I agree with you absolutely that maintaining our local roads is beyond our capabilities. That leaves us in an appalling situation. I am actually getting very good at attempting to answer phone calls from rate payers who can’t understand that they pay petrol tax, in every car registration they pay they pay rates. Now I can respond to those because our rates on roads are exclusively on roads. Our car registration isn’t too bad either. But I am at a loss on petrol tax. You did say that you were trying. Now I understood from the news that maybe Cabinet was discussing the possibility of helping out raise money - the National Party might have been talking about it in Cabinet. Could you please state how you are trying to give us more Federal money for roads?

Senator Ian Macdonald: Look, it is being discussed, I indicated that. We are trying to find the money but it is not easy. Its like your Council, I mean, you always have rate payers wanting you do things, you’ve got to look through your budget - you’ve got to try and find some money. We do that, and we are trying to do that because we understand the problem. All I am saying to you is that I don’t want to give you unreasonable hope that there is going to be an immediate solution. We’ll keep trying and hopefully, somewhere along the line we might be able to find some money, but you understand the cost.

But you raised a question, and you didn’t actually correctly say this, but I think this is what you were getting to. That you take this money from the motorists, this is what the motoring association are arguing, you take this money from motorists and therefore it should go back to the roads. But I mean we take money from cigarette smokers and from beer drinkers but we don’t give the money back to them. Federal excise on fuel is like any other federal government tax. It’s like income tax, it’s like excise from beer. It is part of our overall revenue that we get in, we then work out, we’ve got to spend so much on defence, so much on welfare, so much on FAGs, so much of health, so much on education - so it just forms part of the general revenue. There is a call, which I believe has some merit at times. In other States they have these three by three programs where you increase the price of fuel by three cents but you actually hypothecate that. I mean that is always something that can be looked at. It’s not good financial management, but it is one of the things that we could keep in mind. It hasn’t found a lot of favour though. But I understand your point.

Councillor Ron McCullough, Mount Isa: OK, I’ll try and keep it very brief Minister, Mr Minister. Thank you for all of the good news you brought us today. We thought the present time the implementation of competition policy throughout Australia, and people in rural Queensland, and I am sure all parts are very much opposed to it. The Howard Government is pushing and promoting this. Where do you stand in this? Do you oppose it or do you support us in opposing it? Secondly, the FAGs grants system at the present time would be very easily sold if we were getting two percent in tax as Whitlam wanted back in the eighties. Do you support an increase in the overall allocation in funding towards FAGs grants?

Senator Ian Macdonald: Well Ron, second question first. If you can tell me what other programme we’ll cut to provide those additional funds, then I’ll look at it. But it is the same as your Council Ron. You have commitments to expenditure, you have a certain revenue you’ve got to make them meet. Now nothing would give me greater pleasure than to promise you the world here - but we have to pay for it. We are like your council. And government is all about managing those priorities and trying to work towards them. So no I don’t support the 2 percent to be correct but that is the reason why.

In relation to the National Competition Policy, yes I do support National Competition Policy. I think competition is great and the figures show that is has been marvellous for

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Australia. In Queensland - well Australia wide, there has been significant financial benefits from Competition Policy and those financial benefits have been distributed to the State Governments and in Queensland - you are one of the better States - your Government has shared those National Competition Policy payments with Local Government and I congratulate the Queensland Government for doing that. So there are benefits. But there are also exceptions to National Competition Policy Ron, which you’d be aware of. There can be applications made to be exemptified. There are in fact, in place already a number of avenues where Local Governments can avoid this [inaudible]. But can work within the rule books to overcome some of the more draconian impacts of the National Competition Policy. So we’ll continue to do that. I support the way that council’s are able to access those exemptions, if I might call them, but I do also support as a general policy, National Competition Policy.

Councillor Tony Mooney, Townsville: Thank you Mr Minister, Thank you for your lecture on FAGs and equity and also thanks for the plug on the Strand in Townsville, it’s a great concept, you should have a look at it at some time.

Mr Minister, like you many councils in this room are concerned about fairness. In our case like many regional councils our general purpose grants have dropped 22% since this Federal Government has come to power. Even your home town council of Burdekin, I understand, is suffering a significant decrease. I would like to put to you that as our President has pointed out before Queensland has been shafted because of the current arrangements in terms of $160 million per year. In the case of regional councils in Queensland, like Townsville which receives about $28 per capita, if you compare that to similar councils in Victoria, for example, Latrobe gets $88 per head, Shoalhaven in New South Wales $70 per head, Bendigo in Victoria is $80 per head. Back in 1996 Minister when in opposition, you gave the commitment along with many other MPs in the State to do something about the review of interstate relativities and shares between the States. I want you to say to us in this room as a Queensland Senator and as the Minister representing Local Government from Queensland, when will you intend to honour that commitment.

Senator Ian Macdonald: Well thanks Tony. You could have just said Question Time number 34, because I get the same speech every day in Parliament from the Labor Party. But it is interesting to know that when the Labor Party were in power they didn’t do anything about this and it is a pity that your enthusiasm for these changes wasn’t so obvious in those days.

But Tony, I have already encouraged everyone to Townsville next year to the conference and I’ll look forward as proudly as you to welcoming everyone there and showing them the beach and the beach is fabulous. The beach is fabulous. Its everything $27 million can buy and I support it entirely. And congratulations to you for doing it. So don’t get me wrong, it is fabulous. In fact I have a couple of properties along The Strand and they are doing quite nicely but that’s irrelevant. So Tony, I want to get - don’t get me wrong.

All I am saying is that we in Townsville, or we in Ayr can always do better but we don’t do badly. But I have seen councils around Australia where they don’t even have mains electricity, running water or reticulated water is something that they just read about. As for the theatres and parks, those sort of things are just beyond their wildest dreams. What they want to do is to be able to find a doctor less than five hours travel away who can just fix a kid’s abscess on a tooth. You know, if your kid or my kid had an abscess on a tooth, we’d just run down to the corner dentist, get it fixed and be back home in an hour. There are some places in Australia Tony you may not remember, you may not know this, where to get that abscess fixed, someone has to travel on a plane for two or three hours, get the tooth lanced, come back home and it costs about $1,000. Now those communities deserve some support, and that’s what the Federal financial assistance grants were for.

Now Townsville does get money from it , I am pleased to see that, it reduces the rates that I pay to you. But we have to be fair, and we have to ensure that those Australians who aren’t, who don’t have access to these sort of things do get reasonable access. Now you asked me when I am going to honour my commitment. My commitment was to fight for Queensland to get a better deal and I have done that. I have fought for Queensland to get a better deal and I will continue to do so.

I am saying to you and to your President, with respect, the political reality is, as you are unable to get the Australian Local Government Association to come up with a formula and if the Labor party is not able to come up with a formula, it is going to be difficult, its going

to be difficult. And why raise expectations when you know the difficulty - the political realities that there are.

Councillor Ann Bennison, Brisbane: I found your speech today enlightening Senator Macdonald, and particularly I would like to hone in on the principle of equity that you espoused, it is certainty commendable what you talked about and I don’t think that there is anyone in this room who would disagree with it. However, the main question that I have for you is why should that equity stop at state borders. Let look at the interstate distribution as well as the intrastate. And in terms of your request for submission, that principle that you had up on your screen earlier, that you were espousing which compared Local Government in each State, if you substituted, and I put this to you as a submission - the words Local Government in Australia instead of Local Government in a State, we will achieve what we want to achieve. Lets have equity across the board, not just intrastate. And I am sure that we will find the Local Government Association of Queensland and everyone in this room united in relation to that end.

Senator Ian Macdonald: Look thank you, you are wanting me to change the Act. That is an Act of the previous government and as I say, you know what it is like trying to change anything in the Federal Parliament - part of the Queensland Government yesterday said how difficult it is to get anything through the Senate at all. I take your point, we can argue about this until the cows come home.

I mean, there are figures bandied around. Someone spoke about Shoalhaven compared to somewhere else. But of course, Shoalhaven is a very, very big Council with 27 separate communities in it. Can you compare that with a community that is small in geographical area? I mean , you can pick statistics from anywhere and you can pick the statistics from South Australia that show that Queensland is doing infinitely better. I acknowledge there are difficulties with it. I am awaiting the solution of how to address the problem.

Councillor Bob Abbott, Noosa: Mr Miniter, I will move right away from FAGs grants and will get right away from individual governments - I’ll attack the Federal government as such and successive government’s for the last 20 years have allowed banks in this country to remove services to rural and regional Australia. For those banks to continually increase their profit rate to what I think is now disgusting in this country. We’ve allowed banks to continue to rape and pillage this country and now we’ve turned around and you suggest to us as a Government that we use $70 million of our money - $70 million of our money - to replace that service in rural and regional Australia. I find that atrocious.

I think we really need to start to understand what is happening in this country with that sort of attitude. We’ve forced the mining companies, the fuel companies, to have a social conscience, to actually start doing things about the environment, to start doing things about social issues, but we continue to allow the banks in this country to have one object in mind and that’s the dollar. And they don’t care about the social issues that are now really prominent in our community. I would suggest to you sir, that we have to start to look at those issues now. And I ask you when will your Government start to ask the banks in this country to accept their social responsibilities Ian and provide some of the services they should be providing - that we should not have to pay for through our taxes.

Senator Ian Macdonald: Well thanks for that Bob. Banking has been deregulated in Australia for what - seven or eight years now? The Federal Government has little impact these days because of the deregulation of banking by a previous Government, but not that we would perhaps re-regulate it if we could because there are a lot of advantages.

I agree with you, I agree with you, the banks have not been fair, have not been community minded in some of their actions across Australia. But they are of course, as entitled as any other business to make a profit and to pay their shareholders and the contributors to their capital and return, and I don’t deny them that opportunity. But as Australian companies, they do, I think, have a moral obligation to help and some of them are, and some of them are.

Can I say that while the Federal Government is helping small communities, and the ones that we are helping really are communities of under 3,000 is the guidelines, but they are really more the communities 100 to 500 people who are getting these services -in many cases - put in for the very first time. They are not places were banks - some of them are - but some places where simply just helping some Australian’s get access to those services.

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But can I also say to you that there is a movement afoot and I quite happily promote the Bendigo Bank and the Bendigo Bank is taking up, and making a lot of money out of it I have to say, where the old banks have left off. And they are moving back into rural and regional Australia. They are doing it in an innovative way - they are doing it in conjunction with local communities. Local communities contribute part of the capital. They therefore have a guaranteed customer base, a local board of advisers and they are expanding like wildfire through out regional and remote Australia. Those sort of innovative approaches to business are happening and are happening with the encouragement of Government and will continue to happen.

But Bob, I agree with your general sentiment, that banks have got to answer to all. I certainly would not be standing here defending some of the banks and some of the actions that they take.

ENDS.

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? Commonwealth of Australia 2000 Last updated: Thursday, 28 September 2000

23/11/2006 http://web.archive.org/web/20010110031900/www.dotrs.gov.au/media/macdon/speeche...