The GST carve up

[DaftPunk]

What are you talking about? The interim report released today recommends changes.

Including:

http://www.smh.com.au/wa-news/review-panel-raises-hopes-of-more-gst-for-wa-20120423-1xh7n.html



Or were you so excited by the thought of being right that you didn't actually bother to check your sources?

They flat out rejected any notion of floor rates and per capita distribution. Held up the standing theory of services equalization. So really, they aren't going to change it a great deal at all.

 

[Max zero]

They flat out rejected any notion of floor rates and per capita distribution. Held up the standing theory of services equalization. So really, they aren't going to change it a great deal at all.

http://news.ninemsn.com.au/article.aspx?id=8456093

But he said the report's authors did not seem keen on the WA government's suggestion of a floor of 75 cents in the dollar for WA's GST share.

But the report did suggest limiting relativity changes which would be similar to a floor system, the treasurer said.

That was about the only thing that was rejected from WA. The report recognizes that in the medium term WA's GST share could drop to zero and that is a problem. If the report's recommendation that no state should lose GST revenue in absolute terms year to year was implemented WA would of gotten an extra $600 million already.

http://news.ninemsn.com.au/national/8456089/swan-releases-interim-gst-review

It also raised the question over whether there should be a shift in the fundamental goal of the GST distribution from pursuing the same fiscal capabilities for jurisdictions towards a "broader concept of providing comparable capacities".

Finally, the panel asks whether there should be incentives for reform, which may mean making room for other goals in the distribution process.

The review was the result of complaints from the mining states, particularly Western Australia, that they were getting less GST in the annual carve-up, under the so-called horizontal fiscal equalisation, because their economies were doing so well.

The interim report agrees that the arrangements do not appear to recognise mining-related infrastructure costs, mining expenses and economic development costs "appropriately".

The panel encourages resource states to consider a series of recommendations that include using part of the GST pool temporarily for states' mining-related infrastructure costs and other mining-related expenditure.

So far it seems the report agrees with the resource rich states on the majority of their complaints.

The final bolded part makes me laugh. How are we going to set aside some GST revenue for infrastructure if the government gives us ZERO (as forecasted in the future)?

There is a loser here but it ain't WA. There is a reason Barnett is cautiously optimistic and the Tasmania and SA government have already started to whine.

 

[DaftPunk]

http://m.theaustralian.com.au/natio...n-bid-to-fix-gst/story-fn59niix-1226336628567. 'Sharing one state's bounty with weaker neighbours had served Australia well and needed to continue to ensure equivalent standards of living across the country, the report found.'
'"States that are fiscally weaker at any given time must continue to have the capacity to provide substantially similar levels of services and infrastructure to their citizens," it said.
Tasmanian Premier Lara Giddings welcomed the findings and hit out at the "self-interest and hypocrisy" of the larger states, while NSW Treasurer Mike Baird and his Victorian counterpart Kim Wells expressed disappointment at the outcome.'. Also in that ninemsn article it states that the report has basically rejected the floor proposal from wa , but has said its not desirable for a state to see continued GST cuts. Your treasurer has interpreted that as 'basically supporting a floor percentage'. Each to their own.

 

[DaftPunk]

Sorry about the formatting, iPhone and all!

 

[Max zero]

http://m.theaustralian.com.au/natio...n-bid-to-fix-gst/story-fn59niix-1226336628567. 'Sharing one state's bounty with weaker neighbours had served Australia well and needed to continue to ensure equivalent standards of living across the country, the report found.'
'"States that are fiscally weaker at any given time must continue to have the capacity to provide substantially similar levels of services and infrastructure to their citizens," it said.
Tasmanian Premier Lara Giddings welcomed the findings and hit out at the "self-interest and hypocrisy" of the larger states, while NSW Treasurer Mike Baird and his Victorian counterpart Kim Wells expressed disappointment at the outcome.'. Also in that ninemsn article it states that the report has basically rejected the floor proposal from wa , but has said its not desirable for a state to see continued GST cuts. Your treasurer has interpreted that as 'basically supporting a floor percentage'. Each to their own.

Sharing the bounty, no problems. But rewarding poor performance and punishing success? How exactly are the resource rich states meant to keep the gravy train going if they are given ZERO dollars to build and expand the infrastructure? Don't you realise that if resource rich states tanks EVERYONE suffers? Who is going to be writing the cheques?

I notice you ignored a number of bolded points.

It also raised the question over whether there should be a shift in the fundamental goal of the GST distribution from pursuing the same fiscal capabilities for jurisdictions towards a "broader concept of providing comparable capacities".

Finally, the panel asks whether there should be incentives for reform, which may mean making room for other goals in the distribution process.

The interim report agrees that the arrangements do not appear to recognise mining-related infrastructure costs, mining expenses and economic development costs "appropriately".

As for the formatting, get the Tapatalk app. Makes it much easier to use BF on the iphone.

 

[Hill2Pav]

Here's an idea South Australia and Tasmania start living within their means and stop using other states money to support their current lifestyle!

 

[DaftPunk]

Sharing the bounty, no problems. But rewarding poor performance and punishing success? How exactly are the resource rich states meant to keep the gravy train going if they are given ZERO dollars to build and expand the infrastructure? Don't you realise that if resource rich states tanks EVERYONE suffers? Who is going to be writing the cheques?

I notice you ignored a number of bolded points.







As for the formatting, get the Tapatalk app. Makes it much easier to use BF on the iphone.

Comparable capacities? So really no fundamental change will occur. You reckon after the SA government has chopped over 5000 public jobs and canceling major projects and having major departments not being able to stay within their reduced budgets (health!), that taking $1b out of SA's budget will give comparable capacities? Of course I support investment in growth assuring infrastructure , but I'm not as stupid to realize that most Perthites aren't thinking of a railway out north but a freeway down south.

 

[DaftPunk]

Here's an idea South Australia and Tasmania start living within their means and stop using other states money to support their current lifestyle!

We're just living it up over here!!! Thanks for the money WA.... Sorry BHP*

 

[Hill2Pav]

We're just living it up over here!!! Thanks for the money WA.... Sorry BHP*

Maybe you can make cuts to your expenses by cancelling your planned football stadium for a start; how many millions of others states money would be saved; $500 million?

 

[The_Reaper]

Maybe you can make cuts to your expenses by cancelling your planned football stadium for a start; how many millions of others states money would be saved; $500 million?

Funnily enough we are funding the Adelaide Oval redevelopment.

 

[Eagle87]

Funnily enough we are funding the Adelaide Oval redevelopment.

Yep, while we continue to use Subi ...

Brilliant

EDIT: and don't we also pay an AFL levy on our Subi seats to help struggling clubs ... like Port?

 

[maelcoluim]

My understanding is that there is considerable resistance in Canberra to NT becoming a state. Something to do with the number of Senators they would be entitled to, which might upset the balance of power.

They had a referendum on NT statehood in the late 90's which was narrowly defeated, they were only guaranteed the same 2 senators IIRC, but they would of course have the advantage of greater independence in that the Feds couldn't repeal local laws.

The requirement of 12 senators and 5 HoR members only applies to the original states, any new admissions may be admitted on a lower guaranteed minimum.

 

[fairdinkum]

Abbott's response unsurprising.

http://www.theaustralian.com.au/nat...or-new-gst-split/story-fn59niix-1226343720537

 

[Eagle87]

Abbott's response unsurprising.

http://www.theaustralian.com.au/nat...or-new-gst-split/story-fn59niix-1226343720537

The bastard ...

 

[DaftPunk]

Maybe you can make cuts to your expenses by cancelling your planned football stadium for a start; how many millions of others states money would be saved; $500 million?

SA stadiums haven't received any state funding in nearly 3 decades (western grandstand was funded through fed funding & debt). Through the $500m AAMI stadium will be decommisioned and SA will go from having 2 stadiums to 1.


Thats a lifetime reduction in expenses. Well done SA.


in 2010, SA cut 4,000 government jobs. Implemented massive cuts across a swag of departments. Rural hospitals were closed. revenue was bumped up across nearly every government charging sector.This was to save roughly $300m a year in the budget.

http://www.abc.net.au/news/2010-09-16/jobs-pain-in-foleys-ninth-sa-budget/2263106

In 2011, The government stated that the savings weren't enough. Instead of going into a surplus they were now going into a def to the tune of 300m (primarily because a lower than forecast GST distribution). 400 PS jobs were cut, SA lotteries sold. Economic stimulators such as first home buyers grants were slashed, major projects deffered and new taxes brought in.

http://www.abc.net.au/local/stories/2011/06/08/3239020.htm

http://www.adelaidenow.com.au/news/...lia-rural-sector/story-fn8x9piw-1226072478171




Now lets look at WA.
http://www.ourstatebudget.wa.gov.au/

784m surplus tick, forecast 442m surplus next year tick

Billions in extra services, subsidies (power), easy retention of triple A credit rating. Forecast for 4-5% growth for the next two years. Record infrastruture spend.






Now you tell me you economic master, what would happne if you were to rip $1b out of SA, to put it into your lovely state.


Now think of the consequences for that, and times it by 10 for Tassie and by 20 for the NT.


BTW Abbott is just confirming he is a complete economic failure by backing a per capita distribution. It wasn't a per capita under howard who oversaw the original design. And a committee involving libs and economic advisors even said it was a stupid idea. It would create a multi billion dollar burden on the federal government through the extra funding the territory would require also. Not unlike him to oppose something though.

 

[DaftPunk]

Yep, while we continue to use Subi ...

Brilliant

EDIT: and don't we also pay an AFL levy on our Subi seats to help struggling clubs ... like Port?

Incompetent government perhaps? How long have you been talking about your precious $1b+ 'world class' stadium now? 10 years?

 

[Chops_a_must]

Barnett's wishes would mean taking $2.2 billion out of the territory.

It's different for the NT however, given the lack of ability to raise funds, without being a state.

I think SA should be looking at other things than a new stadium though. There are bigger priorities.

But in the NT, a lot of things are close to third world.

 

[DaftPunk]

Barnett's wishes would mean taking $2.2 billion out of the territory.

It's different for the NT however, given the lack of ability to raise funds, without being a state.

I think SA should be looking at other things than a new stadium though. There are bigger priorities.

But in the NT, a lot of things are close to third world.

AAMI stadium needed a major redevelopement. The stadium issue was huge in SA. It was either redevelope AAMI (which was seeing long term declines in crowds), build a new stadium ($1b) or redevelope Adelaide Oval ($500m) and sell AAMI (nett SANFL $100+m)


The NT is a financial drain, but your only going to create more problems then you solve by taking the money out of there.

 

[Chops_a_must]

AAMI stadium needed a major redevelopement. The stadium issue was huge in SA. It was either redevelope AAMI (which was seeing long term declines in crowds), build a new stadium ($1b) or redevelope Adelaide Oval ($500m) and sell AAMI (nett SANFL $100+m)

How is that different to Subi?

I do agree though that Barnett stuffed that up with his Monkey business.

 

[DaftPunk]

How is that different to Subi?

I do agree though that Barnett stuffed that up with his Monkey business.

I wasn't comparing it to WA.


I was arguing that to simply say 'you can't redevelope a stadium because your poor' doesn't reflect the true situation. It was either spend money on option 1, 2 or 3.

 

[Scotland]

You missed option 4: Stick with what you've got.

 

[Hill2Pav]

SA stadiums haven't received any state funding in nearly 3 decades (western grandstand was funded through fed funding & debt). Through the $500m AAMI stadium will be decommisioned and SA will go from having 2 stadiums to 1.


Thats a lifetime reduction in expenses. Well done SA.


in 2010, SA cut 4,000 government jobs. Implemented massive cuts across a swag of departments. Rural hospitals were closed. revenue was bumped up across nearly every government charging sector.This was to save roughly $300m a year in the budget.

http://www.abc.net.au/news/2010-09-16/jobs-pain-in-foleys-ninth-sa-budget/2263106

In 2011, The government stated that the savings weren't enough. Instead of going into a surplus they were now going into a def to the tune of 300m (primarily because a lower than forecast GST distribution). 400 PS jobs were cut, SA lotteries sold. Economic stimulators such as first home buyers grants were slashed, major projects deffered and new taxes brought in.

http://www.abc.net.au/local/stories/2011/06/08/3239020.htm

http://www.adelaidenow.com.au/news/...lia-rural-sector/story-fn8x9piw-1226072478171




Now lets look at WA.
http://www.ourstatebudget.wa.gov.au/

784m surplus tick, forecast 442m surplus next year tick

Billions in extra services, subsidies (power), easy retention of triple A credit rating. Forecast for 4-5% growth for the next two years. Record infrastruture spend.

Now you tell me you economic master, what would happne if you were to rip $1b out of SA, to put it into your lovely state.


Now think of the consequences for that, and times it by 10 for Tassie and by 20 for the NT.


BTW Abbott is just confirming he is a complete economic failure by backing a per capita distribution. It wasn't a per capita under howard who oversaw the original design. And a committee involving libs and economic advisors even said it was a stupid idea. It would create a multi billion dollar burden on the federal government through the extra funding the territory would require also. Not unlike him to oppose something though.

That's because your state has been a basket case for decades and has continued to live beyond its means, and other states money.

It would create a multi billion dollar burden on the federal government through the extra funding the territory would require also.

It would require states like your to start living within your means and stop living on other states money.

Thats a lifetime reduction in expenses. Well done SA.

SA expenses have increased by an annual rate of 6.9% per year

http://www.cgc.gov.au/__data/assets/pdf_file/0012/23331/2012_Update_report.pdf

Your state has been a net recipient of others states money from the GST distributions since its inception, your state has continued to increase expenses at an unsustainable during this period (6.9%) and will continue to receive other states money for the foreseeable future.

Maybe your state wants to work out why the economic growth in your state is below average, your young people are leaving for elsewhere, and why you continue to think you deserve to hand your lifestyle supported by others?

 

[Hill2Pav]

I wasn't comparing it to WA.


I was arguing that to simply say 'you can't redevelope a stadium because your poor' doesn't reflect the true situation. It was either spend money on option 1, 2 or 3.

Option 4, doing nothing and stay at the current stadium and return the $500 million to the original states that earnt it.

 

[The_Reaper]

Option 5, let the SANFL help fund the stadium by converting AAMI Stadium into housing.

Why should they get a free ride?

 

[prattsta]

Why should they get a free ride?

Because they're in SA. Obviously.