Crucial time for Tasmania in fight for our taxation fair share
Cutting the state’s GST revenue will plunge our health and education systems into crisis, says Julie Collins
TODAY the Productivity Commission will hold a public hearing in Hobart to look at the way Goods and Services Tax revenue is distributed to state and territories across Australia.
The hearing comes at a crucial time for the future of Tasmania’s share of GST revenue.
Our fair share of the GST has been under sustained attack since the Turnbull Government initiated an inquiry into the distribution.
The inquiry was forced on the Turnbull Government following persistent concerns from other states and territories who believed they were not receiving a fair share.
Instead of acting on these longstanding issues, the Turnbull Government sat on its hands until it launched its Productivity Commission review into Horizontal Fiscal Equalisation (HFE).
HFE is just a fancy way of saying every state and territory should have the same ability to provide services and associated infrastructure at a comparable level.
This means every Australian should have the same quality of healthcare, education, and roads and transport.
As well as being an aspiration, HFE is the formula used to distribute GST revenue collected by the Grants Commission.
Tasmania stands to lose billions of dollars in the long term if this formula for distributing GST revenue is changed.
The Productivity Commission’s draft report released earlier this year recommended changes to HFE that have the potential to have a significant impact on Tasmania’s share of GST.
Equally concerning was Treasurer Scott Morrison’s comments following the release of the draft that smaller states would require “transition plans” under the recommendations.
This is a clear admission Tasmania could lose billions.
Economist Saul Eslake has estimated potential changes could see 20 per cent less money for health, education and police services.
Our state’s hospitals and schools are already suffering from Liberal cuts — any further funding shortfalls would plunge our health and educations systems into deep crises.
It should never have come to this. The Turnbull Government had multiple opportunities to fix the issues faced by other states and territories without hurting Tasmania, but it failed.
Sadly, our state now stands to lose with the hastily announced Turnbull Government review.
What’s worse, not one senior member of the Turnbull Government, including the Prime Minister and Treasurer, has committed to ensuring Tasmania receives its fair share. This is in contrast to Labor which has made it clear Tasmania will not be left worse off.
The state and federal Liberals have failed to work together to deliver the best for Tasmania.
They failed when the Australian Federal Police’s permanent presence was removed from Hobart Airport in 2014.
They failed when billions of dollars of funding was cut from Tasmania’s hospitals and schools in Tony Abbott’s horror 2014 Budget.
They failed when Malcolm Turnbull started rolling out the second-rate fibre to the node NBN instead of the superior fibre to the premise that Labor would have delivered.
But none of the failures jeopardises our state’s future more than changes to the distribution of GST revenue.
It’s not enough for the Tasmanian Liberals to come out and angrily denounce federal Liberal decisions after they’ve already hurt our state.
If they had any influence they would be preventing these decisions.
We deserve state and federal governments that work to lift Tasmania up, rather than rip billions of revenue from our state.
After today’s hearing the Hodgman Government will no doubt say it has stood up for our state. But until Will Hodgman has a firm commitment from the Turnbull Government that our state will not lose revenue, these words are hollow.
Labor will keep fighting for Tasmania’s fair share of the GST, and on all issues that impact our state, working at a state and federal level to get the best for our state.
It is past time the Turnbull and Hodgman Governments started doing the same.