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Real federalism forgotten

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Senator Jim Short Deputy Leader of the Opposition in the Senate Shadow Minister for Finance & .

Assisting the Leader on Commonweaith/State Relations

SMF 120/92

Real Federalism Forgotten

The communique from the Council of Australian Government's meeting yesterday- shows that the Prime Minister has again managed to divert debate away from the issues in the "too hard basket", and focus on the peripheral.

There were many reports promised for the next meeting of the Council, but it seems important issues raised in previous reports have been all but forgotten - or swept under the carpet.

What has the Prime Minister done to address the central theme of the report which the Premiers and Chief Ministers put to the Commonwealth a year ago:

"to address these problems [of vertical fiscal imbalance] it is necessary for the States to gain access to revenue from a broad and growing tax base"

The central matter of revenue raising and expenditure responsibilities is going to continue to be hidden beneath a barrage of reports on important, but not the most important, issue.

In contrast to Labor's inaction, the Coalition announced a year ago in Fightback! that it is favourably disposed to providing the States with a permanent share of income tax. We have undertaken to negotiate on this major issue with the States on the basis of the proposals they put to then Prime Minister Hawke last year.

Mr Keating was prepared to sacrifice real reforms in the federalism arena on the alter of his leadership ambitions. Any confidence or trust which existed among State and Territory leaders evaporated with the change of occupants in the Lodge.

Like every other policy matter before the Government, the momentum has gone out of the Federalism debate. Mr Keating and his worn, weary and policy paralysed Cabinet colleagues have lost the will and the energy to provide any answers to the problems they have created.

Canberra 8 December 1992 Contact: Rod Woolley (06) 277 3119 or (06) 288 9355 COMMONWEALTH PARLIAMENTARY LIBRARY