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Thursday, 19 June 1902

Sir GEORGE TURNER - A somewhat erroneous impression seems to prevail with regard to the repayment of Customs revenue to the States. It does not follow that each State gets back 75 per cent, of the amount contributed through the Customs, and many honorable members appear to have been misled on this point when considering the amount we have to distribute out of the revenue. The- prohibition is that the Federal Treasurer must not retain more than one-fourth of the Customs revenue of the Commonwealth, but there is nothing to prohibit him from retaining more than onefourth of the Customs revenue derived from any particular State. It may be that the new expenditure, together with the loss in connexion with transferred services in some of the States, would be so heavy as to amount to more than one-fourth of the Customs revenue derived in such States. As a rule it is not so, but it may possibly be so in Queensland. We do not retain one shilling more than the amount absolute! y required. We have the right under the Constitution to retain one-fourth of the total Customs revenue, but only if we expend it. Whatever amount is collected in a State is credited to that State, and whatever amount is expended for that State is debited to it, and month by month, on the last day of the month, we hand the balance back. We do not retain the full one-fourth from the States, because we have not up to the present required that amount.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - But the Treasurer says that it may be that one State is credited with some of the money belonging to another.

Sir GEORGE TURNER - No. We credit each State with the amount collected, and debit it with the amount expended. We hand over the balance, but it does not follow that that balance must necessarily be more than three-fourths of the customs and excise revenue collected in any State, because the prohibition against the Treasurer is that he must not appropriate a sum in excess of one-fourth of the total customs revenue for the expenditure of the Commonwealth. I do not know any case so far in which we have retained more than onefourth. In Queensland - as in all the other States - we had to meet a very heavy expenditure in May. As honorable members are aware, I have been forced to bring forward Supply Bill after Supply Bill, and in those measures I have kept the expenditure down to the lowest possible limit. As the end of the financial year approached I found that if I did not make certain payments in May T should not have sufficient money to make them in the following month, and should thus have had to carry arrears forward to the next year. Unfortunately, in one or two of the States we had to make pretty heavy payments, especially in Queensland, where they pay the military forces yearly. The result is that the whole expenditure for the twelve months falls at the end of the financial year. I. had to provide for that expenditure in order that I might be able to meet our June payments. Under these circumstances, the amount returned to Queensland last month was comparatively small ; but the large amounts having now been paid, I hope that- the amount returned in June will represent a considerable sum.

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