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Thursday, 11 May 2000
Page: 16310


Mr CREAN (2:41 PM) —My question is to the Treasurer. I refer to his $1.6 billion Commonwealth loan to the states for GST compensation, which does not show in his budget as an outlay. I ask the Treasurer if he is aware that state governments are showing it on their books as revenue, based on formal audit advice such as advice from the New South Wales Auditor-General:

... the full amount received in the first GST year (including any "loan" component) should be recognised as revenue.

This is because I see the substance of the "loan" as being akin to a non-reciprocal contribution in accordance with Australian Accounting Standard AAS 15 "Revenue"


Mr Tuckey —Come on, Mr Speaker, he is infringing standing orders.

Honourable members interjecting


Mr SPEAKER —The Deputy Leader of the Opposition will come to his question.


Mr CREAN —Treasurer, if the states have to show the $1.6 billion coming in as revenue, why don't you have to show it going out as an expense? Isn't it just another budget fiddle?


Mr COSTELLO (Treasurer) —Part of the reform of the taxation system, a reform which has been opposed every step of the way by Labor, was to reform Commonwealth-state relations. That was put forward in the New Tax System document. We said in the New Tax System document that we would make up to the states the guaranteed minimum payment, which was subsequently agreed to and was signed into an agreement. The guaranteed minimum payment is to be made up by those loans and also by the revenue from the GST so the Commonwealth can ensure that the states are no worse off over the five-year period. The Prime Minister and I well remember being at the meeting to sign this agreement with every Labor state.


Mr Howard —Unforgettable.


Mr COSTELLO —I think the first person to rush up with his pen to sign it was Premier Bob Carr. I felt this rustle behind me, and it was actually the Treasurer of Tasmania pushing his way down past me to get his signature on the documents.


Mr Beazley —I raise a point of order on relevance, Mr Speaker. The answer could have no more remote relationship to the question that was asked.



Mr Beazley —I think it is going just fine, thanks. One more piece of smirking from you is just about the limit.


Mr SPEAKER —The Leader of the Opposition?


Mr Beazley —He has been asked a very specific question on budget matters that goes to the very heart of the integrity of his budget and the way in which this is recorded in his books and the states' books, and it is totally different in both cases—


Mr SPEAKER —The Leader of the Opposition has made his point of order and will resume his seat. It is in fact valid to say that it was difficult to draw the line between the Premier of Tasmania pushing into the queue and the question asked about—


Mr COSTELLO —It was the Treasurer.


Mr SPEAKER —The Treasurer of Tasmania—and I invite the Treasurer to come back to the question.


Mr COSTELLO —As each one of them signed, they signed an agreement asking the Commonwealth to provide them with loans. This is an agreement between the Commonwealth and the states.


Mr McMullan —Mr Speaker, I rise on a point of order. He is treating your ruling with contempt. You specifically said that it was a very long bow, and it is getting longer.


Mr SPEAKER —If the Treasurer had treated my ruling with contempt, I would have dealt with him in precisely the same way I dealt with the Deputy Leader of the Opposition. In fact, had the Treasurer continued in the vein in which he was speaking, he would have been dealing with the matter with contempt. He went on to point out that the matter concerned loans, and that was entirely relevant to the question asked.


Mr COSTELLO —I was asked a question about the loans to the states, and the point that I make is that not only was it our policy but also it is now a unanimous agreement between the Commonwealth and the six states which we are obliged to pay—an agreement which was signed by representatives of all of the Labor states with that treatment, including the Labor Treasurer of Tasmania. That is why it is done.


Mr Crean —Mr Speaker, I rise on a point of order. It goes to relevance. We are not questioning—


Mr SPEAKER —The Deputy Leader of the Opposition is aware, though, that the Treasurer has concluded his answer—


Mr Crean —It goes to relevance.


Mr SPEAKER —The Deputy Leader of the Opposition must be aware that the Treasurer has concluded his answer, therefore any point of order on relevance is no longer valid.


Mr Crean —Mr Speaker, under indulgence, can I suggest that we do not question the agreement; we question its presentation.


Mr SPEAKER —The Deputy Leader of the Opposition will resume his seat.