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Thursday, 21 November 1974
Page: 2686

Senator CARRICK (New South Wales) - The Senate is now debating the Local Government Grants Bill 1974. This Bill seeks to allocate a total sum of approximately $56.3m through the States to local government bodies, the municipal and shire councils, throughout Australia. The grants themselves apply to approximately 800 of the more than 900 local government bodies. It is a considerable pity that the Government which had absolute charge of the ordering of business both in the other place and in the Senate should have waited since the announcement of these grants in August until now to have the second reading debate in the Senate. On 17 October I asked a question in the Senate urging the Government to bring in this Bill because of the clamant need of the councils for money even to stay viable. The Government assured me that it would do so. Nevertheless the Bill came into the other place on 23 October, was not passed there until 14 November, was brought in here some 3 days ago and, by the deliberate placing of it by the Government in an inferior place each day on the business paper, has been delayed until now. It is also a reflection on the Government that it should in terms of its priorities consider that one hour and a half is the full time that the Government in the Senate is willing to devote to a very important piece of legislation. It is important that the Government is willing to spend day after day on the Family Law Bill but will graciously allow about 90 minutes on this Bill.

Having recorded that very strong protest, the comments that have been made by the Government, both on this Bill and on its policies on local government, strongly remind me of a statement which was made by Francis Bacon about 400 years ago. He said: 'The fly sat on the axle tree of the chariot wheel and said: "What a dust do I make".' I wish to look at that phrase in terms of the Labor Government when, sitting on the axle trees of the chariot wheel, it says: 'What a dust do I make', because it is important to put in perspective this $56m in terms of the overall commitments of approximately $ 1,300m of the municipal and shire councils of Australia. I wish to raise 4 main points of perspective so that we can see the dust that they do make.

Firstly, in the current year the inflationary policies of the Government have forced up the administrative costs of all municipal and shire councils by approximately 30 per cent to 35 per cent. That means that the ratepayers of Australia, as the direct result of Labor Party policies, have been milked of an extra $350m. In that perspective we look at $56m. The $350m of extra ratings is because of inflation. Every council in Australia is faced with putting up its rates by 30 per cent to 35 percent. The ratepayers, therefore, are paying this Government. Of course 2 semigovernmental authorities, water and sewerage authorities, will have had to put up their rates by the equivalent of $100m. So that the real taxation upon the public in terms of semigovernment and local government rates is very high indeed- approximately $400m.

The second point that I wish to make is that construction costs at the local level of government are up by approximately 40 per cent due directly to the inflationary policies of this Government. The third point is that because of the credit squeeze and because of the alteration in the borrowing and lending ratios of savings banks in this country, it will be quite impossible for local government bodies in the coming year to raise their normal borrowing programs. The trading banks simply face illiquidity and cannot come to the party in any real way. The trading banks now are not compelled to put 60 per cent into general lending but must of course put 50 per cent into housing. Savings bank deposits are down because of this Government's policies and the amount available for lending to local government bodies is severely down. Everywhere throughout Australia municipal and shire councils are facing a cut back of their works programs in a major way- some of them by as much as $ 1 m- because of the credit policies and the lending policies of this Government. So works programs will be cut back by $ 100m. This is the picture against which we measure this so-called topping up.

My fourth point is that almost every municipal and shire council in Australia has been forced already to reduce staff. Almost every one of them reports that in the coming weeks, because of the foreshadowed failure of their borrowing programs, they will reduce staff very substantially. They have approached the Federal Government and pointed this out. They have asked for extra funds. They have asked for an underwriting of their programs. They have been told to go away. They have asked for money to continue to employ people in their works programs but they have been assured that when they sack them and they go into the Commonwealth Employment Office, provided there is 3 per cent employment in that district, money may well be available under Government schemes for some kind of reemployment. Step by step throughout Australia the story in virtually every municipal and shire council is that they are restricting their administrative and works programs, they are sacking people and their costs are going up by about 30 per cent to 40 per cent. To compensate for this a $56m grant has been made, representing in terms of the overall spending of the municipal and shire councils in Australia approximately 4 per cent. That is in perspective. Running costs are up 30 per cent to 40 per cent because of Government policies and the Government is crowing because it provides 4 per cent. That is the broad picture that has arisen.

Some time ago when the Grants Commission Bill 1973 was debated in the Senate the Opposition drew attention to the quite dangerous provisions of that Bill. We said then that the aim of the Commonwealth Government was to carry cut the policy enunciated many times by Mr Whitiam. That policy was to destroy the States, to by-pass the States, to amalgamate forcibly the municipal and shire councils into regions and then to deal with 40 to 60 regions. Lest the Government challenges this, I refresh the minds of senators by reading the definitive statement by Mr Whitlam in his printed book entitled 'Labor and the Constitution'. He stated:

Much can be achieved by Labor members of the State parliaments in effectuating Labor's aims of more effective powers for the national parliament and for local government. Their role is to bring about their own dissolution.

There Mr Whitiam is saying that the way to strengthen the national Parliament and local government is for the Labor members of the State parliaments to dissolve the State parliaments. Mr Whitlam went on to point out- Senator Wheeldon acknowledges that it is Labor Party policy and will no doubt acknowledge also the statement by the Prime Minister- that approximately 932 municipal and shire councils in Australia were too many, that that number should be reduced and that all we should need to govern Australia is one House of Representatives, no Senate, no State parliaments, about 12 city groupings for the major cities and about twenty-five regional groups. That, acknowledged by Senator Wheeldon, the Minister in the chamber, is the stated policy of the Labor Party.

The ACTING DEPUTY PRESIDENT (Senator Milliner)- Senator I draw your attention to the title of the Bill. Please confine your remarks to the Bill, and do not address yourself to Senator Wheeldon.

Senator CARRICK - Mr Acting Deputy President,Hansard will show that I said to you, Sir, that Senator Wheeldon has acknowledged this fact. I am addressing my remarks pertinently. I hold the report of the Grants Commission in my hand. If honourable senators read pages 18 to 20 they will note that they are devoted to the discussion of whether regions should be the areas that should be adopted and that the instruction of the Government to the Grants Commission was to use regions. So, I said to you, Sir, that Senator Wheeldon had nodded his head. I addressed my remarks to you. The Grants Commission in its report, at pages 1 8 to 20, states that it had been instructed by the Government, through the Treasury, to work through regions. This, of course, was in implementation of the Whitlam Government's instruction to force the amalgamation of local councils into regions so that the Government would by-pass the State Governments and deal only with some 50 or 60 regions. It is well to recall that the Grants Commission, with eminent good sense, said that could not be done. It pointed out that the Government could not deal with regions because it would be averaging a region and overlooking the important point that each municipal and shire council has a particular local and fundamental problem both in expenditure and revenue.

If the Grants Commission report does nothing else it draws to the attention of the people of Australia and to the Government the fact that the idea of averaging through regions and forcing the dialogue through regions is impracticable, is wrong-headed and should not be used. The Grants Commission said:

After considering the views put to it, the Commission decided that in relation to applications made in 1973-74 it would base its recommendations on an assessment of the relative fiscal needs of individual local governing bodies. This should ensure that account is taken of disparities within regions while the summation of the grants for individual local governing bodies gives a measure of the differences in fiscal need between regions.

I remind the Senate of the major attempt made by the Labor Party to destroy State governments and to destroy individual councils and of the good sense of the Grants Commission in going to the fundamental bodies of local government, the municipal and shire councils. What is the aim of the grants recommended by the Grants Commission? The Grants Commission says that its objective is what it calls fiscal equalisation- that is, to look at each of the municipalities and shires and to see what funds should be given to them to provide some equality of opportunity, whether in revenue raising or in particular aspects of expenditure. So, the Grants Commission has come out with this report.

I make no reflection whatsoever on the Grants Commission. One could not help but acknowledge that one of the greatest Australians of our time was the Chairman of the Grants Commission, Sir Leslie Melville. Tribute should be paid to him. One should remind the Senate that the Commission is doing the work set for it by the Whitlam Government. In doing that work it has disclosed fundamental flaws in the intended policies of that Government. Any municipal or shire council in Australia today will expound its problems of higher administration costs, rates being put up by 30 per cent, inability to borrow money and the need to sack people. They would then say: 'We have been deluged with paperwork in an attempt even to keep some kind of level of our staff; we have sought through every device that the Federal Government says is available to us to get funds; we have filled in form after form; we have answered questions; we have written letters; we have been interviewed; and with almost no exception we have got nothing. We have sought the National Employment and Training scheme, the Regional Employment Development scheme, the area improvement scheme, the Australian assistance program, the recreation and sports programs and others. We have tried and tried for months and we virtually got nothing '.

Senator Wheeldon - Cheer up.

Senator CARRICK - The message of Senator Wheeldon to them is 'Cheer up'. That might be some consolation. I can tell the honourable senator of one main municipality in Western Australia, the State from which the honourable senator comes, that proposes in the next 7 weeks to sack 100 members of its 140 working staff. I visited the council the other day. It is in bleak despair, having been to this Government seeking funds. Faced with the prospect of the sacking of 100 people, Senator Wheeldon grins. That, of course, is the solution.

The Senate will be delighted to know also that the same people are being visited at this moment by Grants Commission members solemnly taking information for the year 1975-76. Grants Commission members are solemnly going round now trying to predict what the needs and the requirements of municipalities and shires will be in nine to ten months' time. When the programs of the Federal Government change every day, when no one can predict the rate of unemployment, the destruction of works programs and the kind of inflation we will have, the Grants Commission members are solemnly going round at this moment filling in forms.

Let us have a look at what this Grants Commission situation means. We said last year when the Bill came before us that the right thing to do was for each of the States to have grants commissions. If money is to be allocated for local government it should be allocated by the Loan Council to the States and through the States to local grants commissions. Everywhere we go we hear the story that no matter how it tries the Grants Commission could not hope to comprehend the real needs of people. It is interesting to see the test applied by the Grants Commission. The Grants Commission says, of course, that these grants are being made without strings. Of course this emphatically is not so because in the investigation by the Grants Commission, in the desideratum laid down to reach conclusions and in its considerations the Grants Commission in fact puts on a coercion. I shall now demonstrate that to honourable senators. The Grants Commission says that it is seeking information from each municipal or shire council to show whether that municipality or shire is under-rating. If it is under-rating in the opinion of the Grants Commission it gets nothing. The Grants Commission has become the rating authority for Australia and for municipal and shire councils. Let that not be in any way disputed.

Senator Button - It is desideratum.

Senator CARRICK - Right. I am always grateful for the intellectual outbursts from my left. They are so infrequent one should applaud them. The Grants Commission has decided to be the rating authority for Australia. It wants to be able to say to a council that it is under-rating. I would have thought that in a democracy the people who should tell the councils of Australia whether they are under-rating or over-rating are the ratepayers of Australia and nobody else. The only people the local government bodies should be answerable to are the ratepayers of their municipalities. As soon as the Grants Commission applies the test that money will not be provided if in its view there is under-rating, the Grants Commission becomes the tail wagging the dog. Does it go along and say: 'Tell me your problems. What do you want? Do you want something extra for this?' Not on your life! What it says is: 'Tell me the whole of your programs. Tell me the whole of your expenditure for administration and works. Let me look at the whole lot of it. If you are good I will give you a marginal extra.' Anybody knows that the one who financially controls that marginal extra controls the whole program and, by section 96, imposes his will on the whole of the works and administrative programs of municipalities and shires in Australia.

What has happened, therefore, is this: Some 2 years ago the Whitlam Government was elected on a fraud. It said to the municipalities and shires of Australia: 'We will give you direct access to the Grants Commission'. Senator Wheeldon is very helpful. He acknowledges that that was contained in the policy speech. There is no direct access for municipalities and shires. They must first form themselves into regions of Mr Uren's choosing. They must then put up their submission on a regional level and, if Mr Uren says it is a good idea, they can then apply it. Here was a broken promise. Senator Button smiles. He ought to now because it would be hard to recollect a promise made and a promise kept. What in fact happened was that they were forced into regions. They were forced to make submissions through regions. That in itself, with all these schemes, has become a tragic failure. If an attempt is made to average out local government bodies over a region then the fundamental nature of the local government body is destroyed. The vital characteristic of a local government body is that it should be local, that it should represent a particular community or communities, that it should have the right to be different and that it ought not to be compromised into averaging over a whole region. The local government bodies are now realising to their horror that they were seduced into something that will destroy them.

Let anybody go now to a municipal or shire council and tell it about the Commonwealth aid roads grants. About $56m is to be handed out in grants. What about producing a document showing the money for road grants that was taken away from them forcibly by the Commonwealth Government? What about telling the people of Australia about all the people now being sacked by local government bodies because of the withdrawal of funds by the Commonwealth Government from the municipalities and shires? If this matter is to be put into perspective, first of all one must realise that what the Opposition said in the Grants Commission Bill debate last year has come true- that an attempt was made to bypass the States, to create regions and to destroy local government. What must be said is that the Grants Commission itself has faced up to the Government and has said that the concept of regions is wrong; there must be an approach to the local government body.

In the light of the huge expenditure forced on councils by inflation, in the light of the underborrowing, in the light of the unemployment, it must be said that what has been given is as nothing compared with the robbery that has gone on elsewhere- the robbery by inflation, the robbery by the credit squeeze and the robbery by the withholding of road grants. What ought to be understood by the Senate is that this Government is pursuing a deliberate policy of centralising power in the House of Representatives. That policy has taken a further step forward. It is trying to force local government bodies to conform with Canberra. It is creating a whole host of bureaucrats who are racing around demanding that forms shall be filled in and that questionnaires shall be answered. The Government is failing to respond to letters and it is failing to respond to any approaches. Let me remind the Senate that at this moment literally hundreds of councils are attempting to approach this Government to obtain funds. They are told: 'No. Go away and borrow it yourself. But when the staff becomes unemployed we will help them through the dole.' Senator Bishop kindly assured us today that the 300,000 people to be unemployed will be on the dole but it will be a better dole than last time. That is what he said That is the comfort offered by the Government. The Opposition has pressed upon the Government the need for a speedy passage of this $56m so that it can go into local government areas and be spent in the hope at least of maintaining some of the staff and some of the works programs. Therefore, the Opposition will neither oppose nor delay the Bill.

Senator Button - You have taken half an hour.

Senator CARRICK - Some honourable senator is bewailing the fact that I have taken some 26 minutes so far to talk on this important subject. That is the Government's perspective of the collapse of councils, of unemployment and of people on the dole. The Government is trying to deny the right of the Opposition and the people of Australia to see this problem and to expose it. Is this what the Government has said? It is true, of course, that the Government is in absolute disarray in its economy policies which come so thick and fast that it does not even know which one of its Ministers holds which portfolio at any one time. It hides behind alibis to change its Ministers. Against that background let me say that the Opposition when in government will work upon the basis that local government shall work in conjunction with the States as units, that local government will be maintained in its individual areas as authentic community bodies, and that a Liberal-Country Party government will encourage the formation of grants commissions in each State.

Senator Mulvihill - Will you give an undertaking -

Senator CARRICK - It was the Askin Government that established the first local government grants commission in New South Wales- a pacesetter for Australia. The Commonwealth Government simply took the idea and sought to create centralisation. If Government supporters cannot answer by logic of argument at least Senator Mulvihill cannot be criticised for the lack of volume in his shouting. I give him the prize for inarticulate volume of shouting in this Parliament. If he wants it, we will award him that prize.

I conclude by saying that not only would a government of the Liberal-Country Parties set up grants commissions in each State similar to that in New South Wales, but it would also restore proper sovereignty to local government. It would not attempt to bypass the States. It would not attempt to emasculate councils by forcing them into the compromise of a region. It would restore them to their true sovereignty as the third tier of government.

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