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Legislative Assembly for the ACT: 2001 Week 5 Hansard (2 May) . . Page.. 1352 ..

MR HUMPHRIES (continuing):

occur to the ACT sometime in the next couple of years, then I think there is a case for a bigger surplus than the one we are projecting for the next couple of years. We do not anticipate such a tragedy and therefore we do not anticipate that we will need to have a surplus of that size.

The suggestion in particular that was made by Mrs Carnell that we would need to have a surplus large enough to cover our capital works program is a suggestion which frankly I do not believe is sustainable. What that means is that you do not have to borrow at all for your capital works program. As it happens, we do not need to borrow for our capital works program, because we have a very strong cash position and therefore the capacity to pay for our capital works without significantly borrowing more than we have already borrowed.

Even if that was not the case, I would say that there is a strong argument for borrowing to a significant extent to fund your capital works program. There is a philosophical question involved in that. When you build something such as a school, a hospital or a new road, and you pay for it from a single year's budget, you get the taxpayers of that particular year to meet the whole cost of that particular asset. But the taxpayers of many years in the future will continue to enjoy the benefit of that asset. There is an argument that says that the taxpayers who are enjoying the benefit should be paying the cost had the money been borrowed and was being repaid in each year.

In summary, I do not support the view that we should have a surplus large enough to cover our capital works program. Indeed, I do not believe we should have a surplus which is larger than it needs to be, barring any economic tragedy.

Mr Berry: I knew I would win you over one day, Gary.

MR HUMPHRIES: We know what Mr Berry's philosophy about these things was-when you have cash you spend it. This is "Working Capital" all over again.

Mr Berry: Keynesian-

MR HUMPHRIES: Leave Mr Kaine out of it. When you have the cash sitting in an account somewhere, you spend it. That was your philosophy of running a budget, Mr Berry. If I were you, I would be the last person in this place to interject in a debate like this.

Mr Berry: Do you want to bet?

MR HUMPHRIES: Yes. Have a look at "Working Capital". You want to spend cash.

Mr Berry: How many promises have you picked up?

MR SPEAKER: Order! I will not have interjections across the chamber.


: I do not believe in spending cash to fund recurrent programs, as some others in this place have advocated. I think cash could and should be spent on capital programs. I think borrowing for capital programs is also an appropriate thing to

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