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Wednesday, 12 April 1972
Page: 1541

Dr SOLOMON (Denison) - One could hardly disagree with the final contention of the honourable member for Scullin (Dr Jenkins) that the most basic purpose of all these State grants, whether they provide revenue or capital assistance, might well be to improve the lot of the recipients in the ultimate degree, by whom I mean the taxpayers and the citizens themselves. I do not think we would have any argument about that. As to what form those grants take in their application at public level, of course, there is hardly ever likely to be total agree ment. It is interesting to me that both the honourable member for Melbourne Ports (Mr Crean) and the honourable member for Scullin, have spent a significant part of their time in talking about urban problems. I think that is entirely appropriate in the sense that a large proportion of our people are, as is well known now, to be found in the capital cities of the States. So I think it is proper that we might talk about some of the problems which remain to be solved in the urban areas, and in particular in the largest 2, Sydney and Melbourne. At the same time, and without wishing to spend an undue amount of my speech dealing with that field, I think it should be said - it has been said already at least twice in debates on matters of public importance in this House - that the problems of Tokyo, New York or London, real as they might be, should be taken as models not to follow - as I am well aware the honourable member for Melbourne Ports is taking them - rather than as indications of the present situation or even the immediately future situation in Sydney or Melbourne in particular.

I want to make my position clear by saying one more thing, and that is that of course there are problems in Sydney or Melbourne and even in lesser cities around the world. But it is not realistic to talk about crises in those areas. It is realistic to talk about certain deficiencies. While one could not disagree with the honourable member for Scullin in wishing to make more pure or less impure the waters of the Yarra or any other local stream, one cannot really regard that as an urban crisis, although I do not think the honourable member claimed it to be that. Nor can one regard as an urban crisis the proliferation of motor traffic at certain hours of the day on certain major highways, because in those terms we can develop any inconvenience of living into a crisis. The term 'urban crisis' is much over used and misused at these times.

Having said all that, I agree that we might well and properly be looking to spend substantial sections of our State grants in the area of urban development. 1 am sure we will have further opportunities to talk about that. I would go only one step further than the honourable members preceding me went, at least as far as I can recall what they said. I think that the problem will be given a great deal more specificity, a great deal more detail and point than has been referred to at this stage, when we really get to grips with urban problems in the economic sense.

As has already been outlined, the 2 Bills being debated cognately tonight are ratifications, in a sense, of the results of the Premiers Conference of 14th February. The result of that meeting was that $86m in revenue and capital grants were made available to the States. I can forgive the 2 previous speakers for not making much of this, although it is true that they did not do the reverse. But I think it is my place at this time to remind the House that this particular allocation, the method of allocation and the reasons for the allocation of money were better received around the country than any similar grants have been received in recent political and economic history in Australia. That should not be forgotten, as in a sense it tended to be in the immediate and subsequent operation which involved a rise in the price of steel, with an immoderate public media hoo-ha. That was acknowledgedly unfortunate perhaps for the Government, but the fact remains that this allocation of $86m was a very well met one indeed. The unusual circumstances occurred in which all the Premiers went home, if not rejoicing certainly not lamenting, and to all intents and purposes the public media were unable to have them in a lamenting condition. That says something for the efficacy of the operation.

We have properly touched on the question also of the underlying philosophy - that is a much overused word in this place - the political philosophy of FederalState relations. I think it is entirely proper that this point should be taken up. I do not think, as the honourable member for Melbourne Ports anticipated, that under any colour of government in this country the problem is likely to be lessened appreciably in the near future. As he said too, it is fairly unlikely that we will see any significant demise of federal government. Therefore this relationship is a central one to our total political and economic operation in the foreseeable future. I do not have any immediate solutions to that. At the present time one could pose some solu tions which would be politically unacceptable and very newsworthy, but I rather think that the problem raised in respect to local government is not immediately one - it could be made to be one - for federal government. After all if you have a 3- tier system as we do it is entirely reasonable and, I believe, logical to consider the passage of the flow-on down the line. There is no basic reason, apart from the fact that they might not think they are getting enough, to propose that it should be the Federal Government per se which makes funds available to local government when in fact, between the 2, there are the State governments.

So if we take the decreasing order of geographical entities, areas, statistical divisions or whatever they might be - for the most part governmental entities of one kind or another - it is entirely reasonable to think that the States may be able to make out of their allocations adequate provision for local government services. The fact that they do not or are said not to on some occasions does not immediately make a case for its being a Federal Government responsibility that they should be better served. Of course, that does not necessarily solve the local government problems. But if you have a structure I believe you should be using the structure as it appears to stand, and not cutting corners and working out alternative, complicated mechanisms for making up for certain deficiencies of operation of one tier, or one part of one tier, of that particular structure.

Time is not infinite in this place. I think I should do some service to the particular situation of Tasmania in relation to these grants and perhaps raise some matters which have been dealt with by some people on some other occasions but could equally be raised again now, and perhaps put in one or two additional pertinent comments. These particular allocations of revenue and of capital assistance from the Premiers Conference were greeted by the Premier of Tasmania in this sort of way. He said:

My own feeling is that the decision arrived at should do much to restore confidence in the private sector and this will provide the real answer to the unemployment problem. The overall outcome satisfied both the Commonwealth and the States. . . .

That is a significant comment, in the sense that one of the major reasons for the allocation as it was at that time was to relieve the unemployment problem. As is well known, or should be, Tasmania tends to have a higher rate of unemployment at any time - seasonally adjusted or otherwise, but in absolute terms a higher rate of unemployment - than any of the other States. It is not difficult to find reasons for that sort of thing. In general terms, if one looks at any entity in its economic sense, one finds that its opportunities tend to be fewer if it is smaller. It tends to play second fiddle to a larger entity, other things being equal. The variety of employment tends to be less. The absolute figures, and thereby the flexibility of the operation of employment, tend to be less in a State such as Tasmania compared with a State such as New South Wales or any other larger entity. So we have this constant endemic condition of relatively high unemployment. At the time of the Premiers Conference the rate was a little under 3 per cent - again the highest in the Commonwealth - but 1 do not think that is a reflection-

Mr Armitage - T will be down there working against the honourable member.

Dr SOLOMON - I do not know whether that will improve the unemployment rate or not. lt may indicate that the honourable member is otherwise unemployed. I am sure it will not make any difference to my opportunities. This condition is, therefore, one which is found, in general terms, throughout the economic sectors of any entity which has certain difficulties which generally larger units do not necessarily suffer. So it is of critical importance to Tasmania that it should be well served by such meetings as the Premiers Conference and, of course, by the Commonwealth's allocation of funds. It is of interest to note that, for a number of years under the Labor administration of Tasmania up to 1969. it was a very common assertion of the then Premier, Mr Reece, that Tasmania was poorly served by the Commonwealth and that it did not get its just desserts in terms of the. Commonwealth's allocation of funds. I was one of those who, year after year, used to assist in publishing advertisements especially at election time showing that Tasmania received something like 1.6 or 1.7 times the national average in return from taxation moneys and that it was something like 2 times the smallest per capita return for the worst off State, which I think was possibly Victoria. Anyway, it was doing very well in comparative terms.

One can argue that it needed to do well and it still needs to do well because of the inherent problems of smallness. Nevertheless the claim made by the then Premier and oft repeated was not valid and I prefer to think that it was shown to be not valid. However, there are other problems even in this and they are not all external problems. Tasmania suffers a persistent and an extremely difficult to solve external problem in relation to shipping. It is a question that has been much canvassed and I do not intend, nor do I have time, to dilate upon it at any length now but I should like to take up one particular point in that regard because a State election is to be held in Tasmania within the next couple of weeks and I think it is entirely relevant.

I hope 1 can raise this matter without any blatant form of electioneering because there exists inside Tasmania a situation which was arranged under the authority of the pre- 1969 Labor Government and continued under the Liberal Government since May of that year. The best reference to this can be found in the report of the Senate Standing Committee on Primary and Secondary Industry and Trade which investigated shipping. In the minutes of that Committee in December 1970 one finds that the Tasmanian railways are in fact operating a subsidy of freight to and from - particularly from - southern Tasmania to the northern ports of that State. I am not greatly in favour of parochialism but there are times when attention needs to be drawn to certain things. I believe that this is one of them. The situation is such that, in charging a rate of something like $3 a ton on internal freight moving from the south to the north, one arrives at a situation whereby the freight movements to, for example, the port of Burnie are running at a rate of about 25 per cent of average revenue per ton mile. To the other mid-northern port of Devonport, the rate was 29 per cent of the revenue per ton mile and to the central Launceston area it was about 42 per cent of the ton mile revenue on that freight.

That has obvious internal implications in relation to an external factor. The Australian National Line, in particular, is moving freight to and from Tasmania and, presumably, not particularly fussy as to which port it comes from as long as it gets the traffic. The situation arises in relation to this condition of northern subsidy where the southern part of Tasmania is having some, and even perhaps a significant part, of its natural traffic flow being creamed off or taken off through other outlets. So, we have here a basic Tasmanian governmental responsibility for moving certain economic advantages in the direction of the northern half of the State where 3 major ports operate to the disadvantage, relatively, of the capital city Hobart which still is the main port of Tasmania. I think that that point should be mentioned just in case by some small chance it gets on record somewhere because both the major political parties which are vying for office again on Saturday week or thereabouts should be in the position of having to face up to that situation, certainly as far as the southern people and the southern economy of Tasmania are concerned. In fact, I hope that they might have to give some answers on that matter, which I would see to be a great deal more central, important and significant than other matters of public consequence, such as the preservation of Lake Pedder and certain matters relating to parks and so on, interesting and even important as they might be. 1 must conclude what I have to say on this matter. I should like to reiterate one or two of the important features of what has taken place and which are covered by the 2 Bills about which we are talking tonight. An amount of $86m was made available in February by the Commonwealth through the Premiers Conference for the use of all States. By all accounts, the allocation was made in a highly professional and equitable way, and the result has been a significant decrease in rural unemployment in all States. That is a trend which we hope and trust will continue. Although I am not able to identify it State by State, this allocation has made significant amounts of funds available for

Whether or not honourable members opposite agree that these expenditures are in precisely the best areas is a matter not so much of conjecture but of personal interest and opinion. Needless to say we will not agree completely on those issues now or at any other time. But I think that honourable members opposite should remember that if the occasion ever arises when they are in government and have to line up all the deficiencies which they would like to solve in one fell swoop, it will be interesting for those of us on the other side of the House to see how they would manage to deal with them in that way - in one fell swoop - because 1 think they will find that the task is equally as much beyond them as it is beyond this or any other government to solve all our problems at once. So, I believe that this Government has done quite well incipiently to solve as many problems as it has in relation to this allocation of funds at the February Premiers Conference.

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