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Legislative Assembly for the ACT: 1996 Week 12 Hansard (21 November) . . Page.. 4125 ..

Part 12 - ACTION

Proposed expenditure - ACTION, $41,785,000

MS HORODNY (2.41 am): Mr Speaker, the Government has not demonstrated that the budget of ACTION can be cut without services being cut. The Government keeps justifying these cuts to bus services by saying that no-one is on the buses. It is no wonder that fewer people are catching buses. Not only have fares gone up, not only have routes been cut, but also there are fewer buses on other routes. Disadvantaged people and the environment are suffering as a result of these cuts.

The Estimates Committee recommended that the Government develop environmental community service obligations for ACTION, which recommendation was noted by the Government. The Government explained the difficulties in defining in dollar terms the environmental obligations of ACTION. I do not doubt that this is a difficult task, but the Government has created this dilemma itself. They decided that ACTION and other government agencies should be run as businesses on commercial grounds. In recognition of the fact that government is not a business, the concept of CSOs was invented. CSOs are a mechanism for acknowledging and trying to take account of ways of financing social and community services when they are being considered in an economic framework. If you are going to use this model, you have to use it properly. Surely, an essential element of a public transport system is its contribution to reducing the environmental and real economic impact of cars. The Government assured last year's Estimates Committee, through Mr Walker:

... what it is we are producing is that we can enter into CSO contracts with organisations like ACTION that seek to define the real costs of providing the service, and that will include the question of environmental externalities and the externalities relating to road costs. So, the process of implementing these financial reforms will actually allow us for the first time to focus on the real costs and benefits of providing those services and I think what this financial reform program is about is doing just what you are suggesting needs to be done.

To say that you cannot quantify environmental effects is a pathetic cop-out. That was our whole criticism of the model from the beginning. It is about translating very complicated social obligations of government into specifically measurable terms. It also sets up a very dangerous situation where the provision of social obligations - let me remind members that this is the whole point of why we have government - becomes an add-on which, I am afraid, can be conveniently knocked off when funding gets tight. Government is not a business. We are a community of citizens; we are not merely customers. We had a whole committee report that considered the problems this poses and came up with a number of recommendations, which the Government responded to rather poorly. Questioning during the Estimates Committee hearings also revealed that the sale and lease-back of the buses is not likely to be a very good proposal from a financial perspective. Mr Whitecross's line of questioning revealed that it might result in the operating costs of ACTION actually going up. The main justification for this and other sale and lease-back arrangements is that other jurisdictions are entering into similar arrangements. What a good reason! Where is the cost-benefit analysis?

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