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Legislative Assembly for the ACT: 2003 Week 1 Hansard (18 February) . . Page.. 92 ..

MR QUINLAN (continuing):

For the firefighting effort and whatever we are up for, we are presuming something well in excess of $8 million in recovery expenditures. These are elements we are going to have to work through. At this stage the best estimate I am able to give, or I have-and I will not sign my name to it because, given the pervasiveness of the damage and the pervasiveness of the issues that arise out of the process of recovery, there are a few things that are going to come out of the woodwork later-is that we expect to be directly out of pocket by $19 million to $20 million. And we have not counted the shrubbery down the middle of Cotter Road in that.

MR CORNWELL: With the involvement of the Federal government-you mentioned $19 million as a ballpark figure-why are you calling for fire levies and cutting budget expenditures?

MR QUINLAN: First, $19 million or $20 million is no small amount in the context of the ACT budget. We have a budget in excess of $2 billion, but it is a combination of local government budget and state government budget. The level of discretion expenditure is only a small fraction of the overall budget. Tomorrow we will have hospitals, schools, garbage collection and all those things, no matter what. We will not have choices in many of the services we provide. Every government since self-government has been budgeting at the margin, as we will be. At the margin, this amount of money does loom as quite a substantial amount.

Let us get a couple of things clear, because some issues get legs. The media asked the Chief Minister fairly early after the bushfires, as they might when they were looking for information and angles on the process, "Will we be out of pocket?"Answer: "Yes.""How will we recover that?"Answer: "Everything is in the mix."Nod if I am getting this wrong, but I think the media then said, "Would that include a fire tax?"Answer: "Everything is in the mix. You have to consider everything."So because it is emotive, fire tax takes off. That is about the level of the government's commitment to, or association with, a specific fire tax at this point.

Beyond that, I have said for public consumption that the budget coming up will be difficult not only because of the bushfires. The major factor contributing to the difficulty in budgeting this year will be the bath we are taking on our superannuation investments. If you had the superannuation in a trust, which I think somebody stood in this place a few times over about four years and said we ought to, and you looked at the operation separately, then you would get a better bead on where we are at. It is probable that if you took the superannuation out the territory has never been in surplus. Maybe it could have been in surplus a couple of years ago when premium conveyancing duties came in at an absolute peak. But other than that, the territory, on a narrow tax base, faces considerable fiscal pressure to provide services at the level we provide them in Canberra. That has been a constant for every Treasurer, and it remains a constant.

When you garnish that with actual capital losses on your superannuation investments-on some predictions, returns will remain very low through to about 2006-then we have a genuine problem. Like it or not, there is a whole level of services we need to provide and a raft of possibilities in how we provide them.

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