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Wednesday, 24 September 1958

Mr DUTHIE (Wilmot) .- Once again this familiar measure has come before the Federal Parliament for our consideration and deliberation. Every year the three claimant States, Western Australia, South Australia and Tasmania, have their finances augmented by special grants. This procedure dates back to the early 1930's, and has been a feature of the financial activities of those three States during the intervening years, irrespective of the type of government that has been in office in Canberra. During the last twelve months these States have presented to the Commonwealth Grants Commission their requests for help in this financial year. The report of the commission, which is always an excellent document, presents this year, on page 13, a fund of information in respect of the whole of the Commonwealth. South Australia asked for £5,250,000, Western Australia for £11,100,000, and Tasmania for £4,400,000. On page 83 of the report appears a summary of the commission's recommendations. The commission gave its verdict at its final meeting in July of this year.

As we know, the commission goes from capital to capital of those three States, and meets the State Premiers, Treasurers, and Treasury officers. All the facts in relation to the financial problems of the States, in every phase of their activities, including education, hydroelectric undertakings, other electrical undertakings, railways, and so on, are presented to the commission. The commission examines State expenditure on social services, hospitals, health services, and the like. A very detailed inspection is made, and I have always commended the commission for its sincerity in handling this difficult situation as between those three States, its tremendous activity in finding the facts about State finances, and the excellent report which comes each year to the Federal Parliament for consideration.

In assessing the needs of the claimant States, the commission has to look at the actual expenditure by the States in various fields. The whole economy of the States is examined with great thoroughness. The commission finally makes its decision, against which there is no appeal. The States have to accept the determination, as it comes before us in the Federal Parliament. On this occasion a total of £20,750,000 has been recommended to the three States as a special grant for 1958-59. I am more concerned, of course, with the Tasmanian aspect than with that of the other two States.

I might mention that Tasmania has been penalized because of its heavy expenditure on health services and social services. The present Premier, the Honorable Eric Reece, who has succeeded the Honorable Robert Cosgrove, who was Premier for eighteen years, in his recent Budget has taken notice of certain recommendations by the Commonwealth Grants Commission with respect to expenditure on health services and social services. As a result Tasmania has to make a substantial cut this financial year in the expansion of its health services.

Like other States, Tasmania has had a very big increase in population through migration, and the demand on its health and education services has been particularly heavy. Tasmania has the biggest hydroelectric works in Australia, except for the Snowy Mountains scheme. At the present time, 96 per cent, of the Tasmanian people are linked with hydro-electric power. Migrants have been brought in to help develop the resources of the rivers. In the northern part of my electorate, near Cressy, a beginning was made last February on a £27,000,000 hydro-electric project. As I said a while ago, it seems a pity that we have to cut down on our expenditure on hospitals and schools. These two facilities, which give broad assistance to any State, have been strained to the utmost in Tasmania by the increase in population. We are very proud of the Tasmanian schools and justifiably so. So far, 44 area schools have been established. They are fine modern buildings. The Education Department has never stinted its expenditure on education. When Tasmanian scholars come to the mainland schools they go up one grade, but when scholars from Victoria or any other mainland State come to Tasmania they generally go down one grade.

Sir Wilfrid Kent Hughes - Nonsense!

Mr DUTHIE - The honorable member for Chisholm says, " Nonsense! " But it is not nonsense. All the statements I have made are factual. I have spoken to many parents of children who have come to Tasmania from the mainland whose children have had to be put down a grade. The Tasmanian education system is definitely second to none in the Commonwealth. The standard of the school buildings is high, the facilities for the use of the teachers and the children are up to date and the area schools system so successful that education experts from other countries have visited

Tasmania specially to inspect them. They have returned to their respective countries to report on what they have seen.

Sir Wilfrid Kent Hughes - I agree with you as to the buildings, but not as to the grades.

Mr DUTHIE - The honorable member must have visited a section of the State which was lacking in these modern facilities when he went to Tasmania. Hospital development, in Tasmania has forged ahead as rapidly as in any other State. The relevant figures show what the Tasmanian Government has spent per capita on education and health services; and for years Tasmania has been ahead of the other States in both these fields.

In the next twelve months, however, expenditure on some new hospitals and on other aspects of our health services will have to be cut. I have had the privilege of being the chairman of a hospital board for six years, and I served as a member of the board for eight years. Therefore, I know how much the Tasmanian Health Department has done to help hospitals in Tasmania. There are now 26 major hospitals in that State. But it is a sad day for any State when its Government has to cut down expenditure in the two important fields of health and education. Because Tasmania has spent more than what the Commonwealth Grants Commission regarded as a fair average for the mainland claimant States, it has been asked to cut its expenses. As a result, in the next twelve months expenditure will have to be curtailed in the fields of health and education.

Tasmania spends a tremendous amount each year in the development of hydroelectric power. I have already mentioned the new scheme at Poatina, near Cressy, in my electorate. It will be the biggest in Australia apart from the Snowy Mountains Scheme, lt was commenced last February and within the next ten or twelve years £27,000,000 will be spent on its development.

Sir Wilfrid Kent Hughes - The State Electricity Commission of Victoria controls a bigger organization than the Snowy Mountains Authority.

Mr DUTHIE - That is the first time I have heard that strange claim. I am speaking of hydro-electric power.

Sir Wilfrid Kent Hughes - I am talking about electric power.

Mr DUTHIE - I am dealing with hydroelectric power. The Snowy Mountains scheme is devoted entirely to the production of hydro-electric power as are all the schemes in Tasmania. This undertaking at Poatina will eventually have 2,500 people living in the new township to be established there. The plan is to build an underground power station similar to the Snowy Mountains Authority's power station. That will be the main characteristic of the project. It will be 400 feet long, 300 feet wide and 100 feet deep, going in under the western tiers. Water will be brought from the Great Lakes down the western tiers by canal and pipeline to the underground station. At the present time shafts 500 feet deep are being sunk to levels at which tunnels will be driven into the mountain for the purpose of building this underground power station.

The Hydro-electric Commission of Tasmania has been noted, in all its activities, for the way it looks after its employees and the new village of Poatina will be no exception. Most modern facilities of every kind are being provided for the workers for cooking, recreation and other amenities. Wherever that commission has undertaken a project, it has established a temporary town, modern in every respect, even to the street numbers of the houses. Public buildings have included a modern school, hospital, recreation rooms and workshops. These places are an education for any one to inspect. The new village of Poatina will be the fifth or sixth which the Hydroelectric Commission of Tasmania has built within the last fifteen years.

As soon as the project is completed most of the village is moved to the site of the next undertaking. Only a few men are left to look after the installations. At the present time, the buildings at Bronte Park are being taken to Poatina, that is from the highlands to the lowlands. To shift a whole township and re-settle the workers in a new area is an important part of a tremendous project such as the establishment of a new hydro-electric power station.

Tasmania has not been criticized by the Commonwealth Grants Commission for its expenditure on hydro-electric power. The only comment from the commission has been in regard to the expenditure on health and education. It is a good job that the State has not been restricted in regard to hydro-electric power, because a large number of men are employed in the hydroelectric development programme. It would be a tragedy if expenditure in this direction had to be curtailed. Already 2,200 workers in the building industry are unemployed in Tasmania.

We know that employment depends on finance and credit, and that when a country's financial resources are restricted in any way the employment forces are affected immediately. The development of any country or State centres around finance and the availability of markets in which to sell its produce, because markets consist of the mouths of people to be fed and the bodies of people to be clothed. The assistance given by the Commonwealth Grants Commission to the three claimant States, Tasmania, Western Australia and South Australia, is the very lifeblood of their development. We are grateful for the additional grants provided, but it is a pity that the provision of services like health and education should be adversely affected by the commission's report. To my knowledge, this is the first time in my twelve years as a member of this Parliament that Tasmania has had to restrict expenditure in these fields because it has, in the opinion of the commission, spent too much per capita on health and education.

The Poatina scheme will take ten years or twelve years to complete, and it is easy to imagine the wonderful assistance that the expenditure of £27,000,000 in a period of ten or twelve years will be to Tasmania. New roads have had to be put into the area. The State Department of Public Works has co-operated with the Tasmanian Hydro-electric Commission, which is putting new, broad, modern, bitumen highways into the area, which will become a great tourist attraction.

In arriving at its recommendations the Commonwealth Grants Commission considers every phase of State taxation - estate duty, stamp duty, land taxation, liquor taxation, racing taxation, entertainment taxation, poker-machine licence-fees, motor taxation - and equates the State's revenue from these sources with income from similar sources in the non-claimant States. All the way through, the commission compares a State's income and expenditure with those of the non-claimant States.

At present the membership of the commission consists of Sir Alexander Fitzgerald - the chairman - Mr. A. J. Reid and Professor Wilfred Prest. On page 93 of the commission's report appear the following acknowledgments: -

The Commission gratefully acknowledges the valuable assistance which it has received from the representatives and officers of the Commonwealth and of the claimant States. The Premiers and Ministers of the claimant States have helped the Commission in every possible way by making the hearings and tours of inspection informative and comprehensive.

I pause there to say that one of the features of the visits of the commission to the claimant States is that the commission's members make personal inspections of State projects. They do not just sit in an office in Hobart, Adelaide or Perth and hear the evidence put before them by the Treasurer, the Premier and other officers. They go out and make an on-the-spot inspection to inform themselves about what money is being expended and how. That is only right, of course, because the claimant States are spending Commonwealth money, and the commission is entrusted with the responsibility of ensuring that the expenditure of the money is proper expenditure. The commission's report continues -

The Commission is also indebted to the Stale Treasury and other Government Departments in each of the non-claimant States and to Commonwealth Departments for the provision of information and statistical data which were required for the Commission's work during the year.

This year information has been sought more extensively than in previous years on several aspects of State finance; and the Commission has been greatly assisted in its work by the additional data which was so readily provided.

The work load of the Commission's small staff was heavier this year in several respects, and the Commission expresses its appreciation of the capable and energetic services given by the Secretary (Mr. K. J. McKenzie) and all members of the staff.

Those acknowledgments are dated 15th September, 1958, and the report has only just been completed for presentation to the Parliament. I should like to pay a personal tribute again to the commission for its exhaustive inquiries and its sensible attitude to the States, as well as for the ex cellent manner in which it is carrying out the assignment given to it over the years by the Commonwealth Government.

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