The Independent Member for Denison, Andrew Wilkie, has criticised the Tasmanian Greens for misleading the community over Federal funding and putting that funding at risk. He has written to the Prime Minister asking her to disregard the Greens concerns.
“The Greens have criticised the $340 million I secured for the Royal Hobart Hospital rebuild because the Commonwealth Grants Commission will consider it, and numerous other factors including hospital payments to other states, when calculating how to carve up the GST between states in future years,’’ Mr Wilkie said.
“This is a deliberately misleading position for the Greens to take, not least because the Tasmanian Labor-Green Government has at every turn welcomed the funding from Canberra that formed part of my agreement with the PM. Moreover the Tasmanian Labor-Green Government, in a recent response to the Commonwealth Grants Commission, accepted that there is no argument for exceptional GST treatment of the RHH redevelopment payments.
“On the face of it the Greens do not support the rebuilding of the RHH. Or they do, but are more interested in political point scoring against me than they are in the public interest.
“Nor do they support apparently the more than $600 million of Special Purpose Payments that are coming to Tasmania in fiscal year 2011-2012 because these payments are treated the same way as the money I negotiated for the RHH.
“If the Greens’ position is accepted then the $41 million Kingston Bypass would not have been funded. Neither would Building the Education Revolution improvements to numerous schools, the upgrade to chemotherapy and cancer facilities at the Burnie Regional Hospital, essential upgrades at the Launceston General Hospital or affordable housing programs.’’
Mr Wilkie said the Tasmanian Greens could not have chosen a worse time to send such a dangerous message to Canberra.
“The Federal Government has ordered a review of the GST amid concerns from richer states like Western Australia that states with larger economies are penalised for economic success, while smaller economies like Tasmania are rewarded for economic underperformance.
“The Tasmanian economy is very soft and many Tasmanians are doing it tough. There is simply no scope for any reduction in our fair share of GST.’’
Mr Wilkie said the Tasmanian Greens had wildly overstated the impact of the $340m for the RHH on Tasmania’s future share of the GST.
“The Greens’ don’t seem to understand state-commonwealth financial relations, or they do and ignore the facts when it suits them.
“There is a delay between states receiving payments from the Commonwealth and them impacting on GST revenue. The advice from Federal Treasury is that it is not dollar for dollar and the impact of a payment in any one year is spread across a number of future years.’’
Mr Wilkie said the Commonwealth Grants Commission considered many factors when it determined how to divide GST revenue.
“For example the Commission cited changes to stamp duty, mining revenue, investment, wages and above average increases in Commonwealth payments to Tasmania in the form of Building the Education Revolution and rail investment when calculating Tasmania’s share of the GST for next financial year.’’
Download Wilkie’s letter to the PM
PM_letter.pdf
• What the Greens said yesterday: Wilkie panics over RHH deal
• AMA ECHOES GREENS’ CONCERNS OVER RHH FUNDING DEAL
Paul O’Halloran MP
Greens Health spokesperson
The Tasmanian Greens said concerns expressed by the Australian Medical Association today over the $340 million Royal Hobart Hospital funding deal highlights how Tasmanians were misinformed over the promise of new funding.
Greens Health spokesperson Paul O’Halloran MP said that with the AMA now echoing the Greens concerns that the Wilkie deal will not deliver new money into the Budget, it’s time for those involved in the original negotiations to place all the facts on the table.
“The Australian Medical Association has made it clear that the concerns raised about this deal by the Greens nearly two weeks ago were spot on,” Mr O’Halloran said.
“When Andrew Wilkie announced the deal to put the Julia Gillard into government, Tasmanians were under the impression that he had secured $340 million in new funding, over and above the state’s normal revenue.”
“The Greens have always supported the push for a new Royal Hobart Hospital, which is exactly why we want Tasmania to get a better funding deal than what now appears to have been delivered by Andrew Wilkie in September last year.”
“This deal did not deliver what was promised, and instead of lashing out wildly and blaming others for his mistake, Andrew Wilkie should be doing everything in his power to renegotiate this deal in the interests of all Tasmanians.”
“Considering that this deal locked the state into spending all $225 million of its share in the redevelopment, the Wilkie deal has enormous ramifications for the state health budget at a time when resources are already stretched.”
“Both Mr Wilkie and Premier Lara Giddings should be writing to the Prime Minister should be explaining to the public how this Royal Hobart deal will not impact upon Tasmania’s health budget or its allocation of the federal GST carve-up.”
“Federal funding for the Mersey Hospital funding and the Forests Intergovernmental Agreement are exempted from the Commonwealth’s fiscal redistribution process, and Tasmanians deserve an explanation for why the Royal Hobart deal isn’t,” Mr O’Halloran said.
• AMA: WIlkie tricked
GovernmentTasmania tricked so that Labor gets GovernmentTasmania tricked so that Labor gets Government Tasmania tricked so that Labor gets Government Tasmania tricked so that Labor gets Government
Last year after the Federal Election Andrew Wilkie had been elected as the new member for Denison and found himself in a position where his support would determine who formed Government and who became Prime Minister.
Mr Wilkie negotiated funds for the redevelopment of Royal Hobart Hospital selecting the ALP’s $340 million over the $1 billion offered by the opposition. But he was tricked. The funds Mr Wilkie negotiated were not new additional money but simply “early” access to our already due GST entitlement! The funds Mr Wilkie achieved, in order for Ms Gillard to become Prime Minister, were nothing more than an advance on our “pocket money” from Canberra. Premier Lara Giddings agrees, in Parliament last month she said, “the reality is, it is not additional, it is just a matter of when we get the funding”.
At the time these funds were allocated there was talk of a submission having to be lodged and approval gained however there was never any mention that the money was to come from Tasmania’s own future GST revenue.
Mr Wilkie was tricked, the Tasmanian government complicit (they signed up) and the Prime Minister took power by default.
Where does this leave Tasmania? Quite simply, funding for all but $12m of the RHH redevelopment comes from Tasmania’s own budget! Tasmania pays $553 million of the $565 million overall cost not just the $225 million we thought. Money “we don’t have” at a time when the health system in Tasmania is failing to deliver through draconian state government cuts to the health budget. How stupid and unnecessary.
If only:
1. Mr Wilkie had sought better advice and got a better deal for Tasmania; he had the power.
2. The State Labor/Green Government had not succumbed and signed up to this bad deal from Canberra; knowing full well that all this deal would do is rob the future to pay for the present.
3. And Ms Gillard had been genuine in her dealing with Mr Wilkie and Tasmanian people.
As elective surgery in Tasmania is being cut and health workers sacked, Tasmanians were under the false belief that the RHH redevelopment funding was additional to the state coffers.
In order to solve the problem and fix the mess the AMA calls on the Prime Minister to instruct the treasurer, Mr Swan, to exempt the RHH redevelopment funds from the grants commission GST equalisation process as should have occurred at the time.
This would mean the RHH redevelopment funds become additional funds and would restore Tasmania’s GST funding over the forward estimates to original levels. Not to do this leaves an even bigger black hole in Tasmania’s budget especially in light of the further GST revenue cuts announced by Mr Swan last week.
For the sake of the Tasmanian health system it is essential this exemption occurs.
Ms Gillard, Ms Giddings and Mr Wilkie, Tasmania needs you to get this right.
• Wilkie: AMA wrong
The Independent Member for Denison, Andrew Wilkie, has rejected claims from the AMA about the impact of federal funding for the Royal Hobart Hospital on Tasmania’s future share of GST.
Mr Wilkie said the facts are:
As a result of the funding the Tasmanian Government will end up with much more money in its pocket and a redeveloped RHH.
The exact impact of the $340m for the RHH will not be known until March next year and will be spread across three financial years from 2012-13, so any predictions now are premature and baseless.
But to give a sense of the scale of such calculations, according to Federal Treasury between 2007-08 and 2009-10 Tasmania received an average of $1.07b a year in Commonwealth payments for specific purposes and GST revenue in 2011-12 is to be reduced by only $102.7m as a result.
Therefore the AMA’s calculation that the State Government will lose all but $12m of the $340m in offset GST is plain wrong as it fails to consider the billions in funding that other states and territories receive in Commonwealth infrastructure payments.
The AMA’s $12m calculation does not take into account Commonwealth funding for infrastructure projects in other states which is redistributed to Tasmania and which offsets the impact of RHH funding on Tasmania’s GST share.
For example funding for projects such as $3.2b Regional Rail Link in Victoria and the Gold Coast Light Rail have delivered additional GST to Tasmania through the same process as have the many billions of dollars in infrastructure the Commonwealth has funded Australia-wide.
The situation with the RHH funding is identical to most Commonwealth payments for specific purposes in Tasmania. This means federal funds for the Kingston Bypass, Building the Education Revolution improvements to numerous schools, the upgrade to chemotherapy and cancer facilities at the Burnie Regional Hospital, essential upgrades at the Launceston General Hospital and affordable housing programs all have an impact on GST to Tasmania and are treated in the same way as the RHH funding. It is also the same rule for other states and territories.
The Tasmanian Labor-Green Government, in a recent response to the Commonwealth Grants Commission, accepted that there is no argument for exceptional GST treatment of the RHH redevelopment payments. (See attachment – p. 7)
The Federal Government has ordered a review of GST amid concerns from richer states like Western Australia that states with larger economies are penalised for economic success, while smaller economies like Tasmania are rewarded for economic underperformance. It is a perilous time for Tasmania, which does relatively well out of the GST, to be arguing for further special treatment when other states have already labelled it a leach on the national economy.
Mr Wilkie said he understood and shared the concerns of the AMA that elective surgery is being cut and health workers sacked.
“But the fact is Tasmania’s dire budget situation is a result of years of financial mismanagement by successive state governments and a smaller pool of GST to be carved up across the nation,’’ he said.
“The fact is the $340m for the RHH has had no impact on current GST receipts and is being used as a red herring to shift blame for the terrible and avoidable situation Tasmania finds itself in today.’’
