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Tasmanian Freight Compensation Scheme

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Date 18 April 19 85 r - . T.· 0. 2 4.85


"The Interstate Commission Report on the Tasmanian Freight Equalisation Scheme is to be welcomed", Senator Peter R a e , the Shadow Minister for Finance, said today.

"However, there are some disappointments. "

"There were those amongst us who feared the possibility that Tasmania's fundamental entitlement to compensation for the freight cost disadvantage which we suffer would not be fully recognised. The Interstate Commission has placed that matter beyond doubt.

"The Report goes on to make the point that the acknowledgement of the need to compensate Tasmania and Victoria for the costs imposed on interstate trade by the need to use Bass Strait shipping services, is now formally established, and it exists without any discordant note based on a conflicting political philosophy.

"I am personally delighted to see that the Commission has recognised that the case is one for compensation and not for subsidy. Tasmania is not getting a benefit, but being compensated for a disadvantage imposed on it to the advantage of other parts of the n a t i o n .

"Whilst welcoming the report, I would have to express my disappoint­ ment that the Commission appears to have erred in relation to its understanding of the extent to which the costs of consumer goods are already equalised. Some of the major chains do equalise their

prices, but K-Mart, in particular, is one of the major retailers who adds a freight cost addition of between five and ten percent to most of the goods which it retails in Tasmania.

"Overall, Victorian/Tasmanian trade will receive less under the new scheme, but there were some undoubted anomalies which had to be removed and there is provision for the continuing review as circum­ stances change with the advent of new shipping services on Bass Strait. ■

"I believe Tasmania can feel well satisfied that the case which we first identified through a Senate Committee in 1971 and which we implemented in 1976, is now a permanent feature of the equitable balance within the Federation.

"We must now turn our attention to giving more detailed consider­ ation to the recommendations of the Grants Commission," Senator Rae concluded.

Contact : Henry Bray (062) 726532