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Tuesday, 5 November 1985
Page: 1519

Senator REYNOLDS —Can the Minister representing the Minister for Local Government and Administrative Services comment on the report of the National Inquiry into Local Government Finance which was presented to the Government by the Chairman, Peter Self, last week? Is the Minister satisfied with the extent of local government consultation during the inquiry? Will the Minister inform the Senate about the way in which local government views will continue to be considered by the Government in responding to the report's recommendations?

Senator GIETZELT —It is true, as Senator Reynolds suggested, that an inquiry into the financing of local government has been underway for the past two years. I think that the inquiry was established in September 1983. It is to the credit of those involved in such an inquiry that they have travelled not only to the States but also to very many local government areas throughout Australia seeking views and examining the way in which local government finances are organised on a very local basis. I stress that many of the 900-odd local government bodies are small and are in isolated areas. As a consequence of that, the report of the inquiry takes into account the difficulties of local government bodies in remote areas, matters which have been discussed often in this place. I refer particularly to the areas in north Queensland in which Senator Reynolds has an interest such as Cloncurry and Emerald. Therefore, the persons involved in the preparation of the report have had extensive consultation with not only State government and State government Ministers for local government but also local government itself.

I think it would be true to say that there is a general acceptance that there is a degree of imbalance in local government finance and that it is not possible for local government to carry out its proper function with the narrow rate base on which most local government bodies have to rely. With an increasing number of local government bodies exercising their option of going into the area of human services, it is all the more important that the Commonwealth, as the principal collector of funds throughout Australia, should establish a policy-I think the report seeks to do that-of providing funds on an equitable basis to every local government body in Australia. Rather than having direct or untied grants, which was examined by the inquiry, the objective has been to try to establish a system in which there would be a greater equality in services and, therefore, a greater degree of Commonwealth involvement in providing funds.

The report is in the hands of the Government. The Government has established an interdepartmental committee comprising the departments of Prime Minister and Cabinet, Finance, Treasury, Transport and the new office of the Minister for Community Services. The Prime Minister has undertaken to write to all State Premiers and the Chief Minister of the Northern Territory. We hope that, as a result of the further consultative processes that have been the subject of this report, we will be in a position to make a submission to government.