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Wednesday, 20 May 1970

Mr Lionel Bowen (KINGSFORD-SMITH, NEW SOUTH WALES) asked the Prime Minister, upon notice:

(1)   Following the Premiers' Conference in February last, what has the Commonwealth offered like State of New South Wales by way of (a) an increase in the base grant under toe tax reimbursement formula, (b) an annual growth factor and (c) part assumption by the Commonwealth of the State's debts over the period of the next financial agreement.

(2)   What is the estimated value of the annual growth factor in the first 3 years.

Mr Gorton - The answer to the honourable member's question is as follows:

(1)   and (2) At the February Premiers' Conference the Commonwealth offered to increase significantly the financial assistance it provides to the States, lt was proposed that the extra assistance be provided in 4 ways - an increase in the base level of the financial assistance grants, an improvement in the betterment factor in the formula which determines the increase in these grants each year, a take-over by the Commonwealth of responsibility for progressively increasing amounts of existing State debt and the provision of portion of the States' annual loan programmes in the form of grants rather than loans. Discussions on the details of the new arrangements have since been held between Commonwealth and State Treasury officials, but it is not expected that the precise terms of the arrangements will be settled until later in the financial year.

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