Page 2766 - Week 08 - Tuesday, 23 June 2009

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by 2011. However, the recovery is expected to be much more subdued than might normally be the case. The World Bank underlines that the financial markets remain unsettled, investor confidence remains fragile and credit remains tight. The World Bank warns that the world is entering an era of slower growth that will require tighter and more effective oversight of the financial system.

The largest drop in the ACT’s revenue base in the past year has come from the fall in GST receipts. Between last year’s budget and now, the fall in GST receipts in the ACT has totalled $487 million over five years. These GST receipts are linked to the level of consumption in the national economy and, despite the forecast recovery in the ACT economy in 2009-10, GST receipts are likely to remain weak until the national economy recovers. This is likely to take much longer than the forecast recovery in the ACT this budget year.

Other factors impacting on the ACT’s budget which are outside this government’s control are the reductions in interest revenue. Between last year’s budget and this year’s, the reduction from interest revenue totals $322 million over five years. Furthermore, the reduction in superannuation earnings as a result of lower interest rates totals $193 million. Both of these revenue lines are directly affected by interest rates in global financial markets.

These are simply quite unprecedented numbers. It is how our government responds that reveals its true colours. In the budget handed down by my colleague the Treasurer, we have responded without panic and without the infliction of needless pain. Those opposite may believe that the grab-bag of odds and sods that they took to the October election and the careless and random cuts they promised to inflict on the men and women of the ACT public service still represent a valid plan for this community in June 2009. But, thankfully and obviously, no-one else believes them.

The government’s plan has been broadly applauded by economists and ratings agencies—by those accustomed to discerning a real plan from flim-flam. But any Canberran picking up a copy of the estimates report relating to this year’s ACT budget could be excused for wondering if they were reading a report relating to another world. It is an estimates report from a committee that is in denial, a committee oblivious—it is clear from reading the report—to the fact that we are in a recession. You would not know or believe from reading this report of this estimates committee that the world is suffering its worst financial crisis for almost a century. It is in that context and that environment that we have crafted a budget for these times.

Proposed expenditure agreed to.

Proposed expenditure—Part 1.5—Department of Territory and Municipal Services, $312,574,000 (net cost of outputs), $273,752,000 (capital injection) and $385,000 (payments on behalf of the territory), totalling $586,711,000.

MR COE (Ginninderra) (8.52): The TAMS budget is a failure of the government to learn the lessons of the past and their inability to properly plan for the future. The budget has some big ticket headline failures and a litany of shortcomings throughout the portfolio. There are, as we all well know, plenty of questions surrounding this

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