APPROPRIATION BILL 2008 Second Reading Speech

Northern Territory Second Reading Speeches

APPROPRIATION BILL 2008

(This an uncorrected proof of the daily report. It is made available under the condition that it is recognised as such.)

Ms LAWRIE (Treasurer): Madam Speaker, I move that the bill be now read a second time. I table the 2008-09 Appropriation Bill and related papers.

Budget 2008-09 is the Labor government’s 8th budget and my first as Treasurer. It delivers on the Henderson governments key priorities of: growing our economy and cutting taxes; Closing the Gap on indigenous disadvantage; tackling crime; quality education and health services and investing in infrastructure.

The Henderson government is delivering on these priorities to make sure the Territory remains the best place in Australia to live, work and raise a family. Budget 2008-09 delivers for Territory families today and it provides for a bright future. Where ever you live in the Territory Budget 2008-09 invests in the fundamentals of a fair society, extending services throughout the bush whilst strengthening our towns and capital city.

As Treasurer I inherited a strong economy and a healthy budget. Under Labor we have now had five consecutive budget surpluses and today we are projecting cash surpluses for the next five years. Strong financial management is the cornerstone of a strong economy. It is no accident that our economy is forecast to have the strongest growth in the country over the next five years. Access economics has forecast the Territory’s economic growth to be at 7% next financial year. We are a little more conservative and today’s budget papers forecast growth at 6.6%. Growth forecasts are remarkable and the highest in the country. Growth forecasts are driven by strong growth in exports from the mining and manufacturing industries. The major contributors to the growth in exports will be the increased production of alumina from the Alcan Gove refinery and lead zinc from the McArthur River Mine as well as recovery in offshore oil and gas production following temporary shutdowns of the LNG plants and associated gas field and the Corallina Oil Fields in late 2007.

Importantly, new projects are coming on line in 2008-09 including oil fuelled developments in the Timor Sea, the ongoing development of the Black Tip Gas field and the expansion of the Gemco manganese processing facility at Groote Eylandt sustaining engineering activity.

So far this year three Henderson government ministers including the Chief Minister have been to China to talk up the Territory and what we have to offer. Obviously China is important to our extractive industry but the future of our relationship with China goes beyond just resources and includes tourism. Engaging China and promoting the Territory will continue to be a focus of this government’s economy strategy. The Territories labour force is expanding strongly in 2007-08 with resident employment increasing by 4.8%.

More than 5 000 jobs have been created in the year since the last budget. This is a testament to the success of the Henderson government Jobs Plan 3. Business and consumer confidence is high and retail spending is the highest in the country. At the same time as we are experiencing strong economic, employment and consumption growth Darwin also has the second lowest annual inflation rate in the country.

The Darwin CPI is estimated to moderate to 3.1% in 2008 from 3.4% recorded for 2007, and forecast to reduce further in 2009 to 2.8%. Our population is increasing and is estimated to grow by 1.9% in 2008, compared to 1.5% nationally. The outlook for the 2008-09 is positive, with the high levels of investment of recent years, driving Territory exports and strong economic growth.

The benefits of a strong economy must flow through to Territory families. This is the underlying structure of Budget 2008-09. There are tax cuts for families, improved home affordability, new and improved schools, improved hospitals and health services, and a record infrastructure spend. Budget 2008-09 delivers for Territory families while continuing to focus on fiscal responsibility and sustainability.

There is no greater threat to our growing economy than irresponsible financial management. We cannot go back to the days of black holes. We cannot go back to the days of a capital works program without cash. Three years ago, we said that the budget would be in balance by Budget 2008-09. In fact, we have now delivered five consecutive surpluses and are projecting cash surpluses in all the years from 2007-08. Long-term surpluses mean that government can plan for the future and deliver both service expansion and new infrastructure development. We can deliver for families now and invest in the Territory’s future.

Long-term surpluses give business the confidence required to invest. A surplus of $5m is projected for 2007-08. This is a $45m improvement in the estimated outcome, and includes $20m set aside for future infrastructure and superannuation requirements.
During 2007-08, there has been a significant increase in both receipts and payments. Receipts have increased by $333m to $3.723bn, largely due to an increase in Commonwealth revenue of $246m and taxes and mining royalties of $47m. The higher Commonwealth revenue is the result of higher GST revenue of $51m, due to increased Territory population and the size of the GST pool. The remaining $195m of Commonwealth revenue is the result of additional special purpose payment funding, with much of it related to the federal intervention. The balance of the increase is due to higher dividends and taxes from government’s business entities of $11m, increased interest revenue of $21m, and a minor increase in agency revenue.

Payments in 2007-08 are estimated to be $3.718bn, $331m higher than the original budget. This growth is largely attributable to additional Commonwealth revenue and initiatives associated with Closing the Gap of Indigenous Disadvantage. For the 2008-09 budget, total receipts are estimated to be $3.855bn, and payments are estimated to be $3.846bn, resulting in a projected surplus for 2008-09 of $9m. Nett debt for 2008-09 is projected to be $1.58bn, with a nett debt to revenue ratio at 38%, falling to 36% by 2011-12. Nett debt plus employee liabilities is expected to be $4.4bn in 2008-09, with a ratio to revenue of 106%, falling to 101% by 2011-12. This is a significant reduction on the 134% inherited in 2001. It demonstrates the sound, fiscal responsibility of this government while, at the same time, improving the services delivered for Territory families.

Budget 2008-09 will continue to deliver jobs growth critical to Territory families. Jobs Plan 3 continues with more Territorians in training than ever before. Budget 2008-09 also provides for improved community safety with funding for 60 additional police dedicated to the streets of our suburbs. The benefits of economic growth needs to be applied to strengthening communities, bringing harmony through opportunities for all.

Budget 2008-09 delivers critical funding towards the Northern Territory government’s Closing the Gap initiatives to tackle indigenous disadvantage. Closing the Gap is supported by a five-year investment package of $286m. Budget 2008-09 delivers a range of new investments in child protection, education, housing, community safety and regional economic development. Our child protection and out of home care services budget is now $48m, compared to less than $8m when we came to government, and there are 106 more child protection workers than in 2001. As part of the Closing the Gap initiatives, $5.9m expands the Child Abuse Task Force, which involves 24 extra police and 23 extra Family and Community Services workers. There is also $7m for a range of child protection and family support services, designed to assist families in crisis and prevent child harm.

Last week, the Deputy Chief Minister outlined a comprehensive reform agenda for improving indigenous education. This is a priority for the Henderson government and is a key element of Closing the Gap. Budget 2008-09 delivers education initiatives, including over $17m towards education in our remote areas.

The Territory government will spend $6.6m over the next five years to develop partnership programs to improve student engagement and community involvement in our remote areas. Funding of $2.67m is also provided for the National Accelerated Literacy program to improve the literacy skills of students who have failed to make appropriate literacy gains.

To accommodate increases in enrolments in the bush, school facilities are being upgraded and improved, with $10m-worth of school and education centre upgrades and new classrooms.

In supporting access to education, community safety is critical, and Budget 2008-09 delivers additional funding for community safety initiatives in the bush. Aside from the extra 47 staff in the Child Abuse Task Force, there is an additional $4.5m being provided for increased policing, community courts, court clinicians, corrections officers and the expansion of the Indigenous Family Violence community-based program.

A total of $7.76m will be funded by the Commonwealth for the construction of the Galiwinku Police Station and police officer accommodation. There is also $1.8m being provided in Budget 2008-09 to support the Closing the Gap initiatives in cracking down on the curse of alcohol abuse, which so often is at the core of family sand community dysfunction.

Madam Speaker, while we address need, it is also critical to provide opportunities. The Territory government is working to increase indigenous participation in the workforce and this budget includes the following initiatives to meet this priority:

· development of a new Indigenous Employment and Career Development Strategy;
· $830 000 for targeted indigenous ranger programs, including the Marine Ranger Program; and
· funding for the Indigenous Arts Strategy.

In conjunction with the Commonwealth, the Territory has contributed $100m, taking the total to $893m, for the five-year commitment to improving remote indigenous housing. Budget 2008-09 includes:

· $108m for indigenous housing and infrastructure;
· implementation of a new housing management framework for remote communities and town camps; and

· $38m for the construction and replacement of remote government employee houses.

This will build the bush socially and economically. Closing the Gap is an absolute priority of the Henderson government, and we will monitor its progress and work with communities and the Commonwealth to ensure that we succeed.

Budget 2008-09 cuts taxes, with comprehensive reforms in stamp duty. The government continues to be the most tax reforming government in the Territory’s history. Budget 2008-09 cuts stamp duty and cuts payroll tax. The tax cuts in Budget 2008-09 deliver for Territory families and businesses. These tax cuts mean the Northern Territory will remain the lowest taxing jurisdiction for small businesses in Australia.

The Henderson government has taken the step of being the first jurisdiction to cut conveyance stamp duty rates for all purchases and properties. From today it will be more affordable to buy your own home, an investment property or a business in the Territory. The minimum tax rate will be just 1.5%, down from 2.1% and the maximum rate will be reduced to 4.95% from 5.4%. The top rate will apply to properties valued at $525 000 or more, up from $500 000. First home buyers will also benefit with an increase in the tax free threshold from $350 000 to $385 000. These cuts are estimated to deliver savings of some $12m in 2008-09 for Territorians.

Budget 2008-09 cuts the payroll tax from 6.2% to 5.9%, a saving of $7.2m for business. The lower rate and the Territory’s tax free threshold of $1.25m means that Territory businesses with wages up to $5m pay the lowest payroll tax in Australia and businesses of up to 100 staff continue to pay the lowest recurrent taxes in Australia.

Budget 2008-09 cuts taxes and it cuts red tape. We are harmonising payroll tax to provide a simpler system consistent with other jurisdictions to make doing business in the Territory easier. We will introduce payroll tax exemptions from 1 July 2008 for a range of allowances that will save businesses $1.7m per year.

This government also delivers an enhanced HomeNorth scheme, which will help more Territorians own their own home sooner. The main improvements are increased income thresholds, an increase in the value of properties that can be purchased and an increased level of government equity. Based on sales over the last year, these changes will enable an average Territory family with two adults and two children to access over 65% of the units and a quarter of the houses on the market.

The government recognises that the Territory has not been isolated from the national decrease in home affordability. While Darwin remains the second most affordable capital city, we need to ensure that affordability improves for Territory families. Stamp duty cuts and HomeNorth improvements in Budget 2008-09 will help deliver improved home affordability for Territory families.

The stamp duty and payroll tax cuts will help small business, the families that run them and the Territorians employed by them. It should also be pointed out that in Budget 2008-09 the Northern Territory remains the only jurisdiction not to impose a land tax, an annual tax on commercial properties that does not exist in the Northern Territory.

Budget 2008-09 also includes a range of other initiatives for improving business in the Territory. An additional $2.4m will be provided over three years for government/industry partnership to increase mineral exploration in the Territory. This is on top of the $12m provided under the Bringing Forward Discovery program that we commenced in Budget 2007. It is no accident that one of our key economic drivers, the minerals boom, is delivering results. The budget continues to fund the industry development support programs including peak business related organisations, industry development grants and regional development grants of $1.8m.

Budget 2008-09 provides $4.5m for the Land Development Corporation to continue the development of industrial land including the Defence Support hub, waterfront industrial land and Stage 2 of the business park.

Tourism NT will have a budget of $35.7m in 2008-09. There is funding to develop niche travel packages that appeal to global experience seekers who travel with a key purpose or special interest in mind such as indigenous culture, wildlife and art.

Madam Speaker, talk to almost any Territory business big or small and they will tell you that their biggest problem is getting staff. Notwithstanding the fact that more than 5000 extra jobs have been filled in the last year, the skill shortage remains a key issue for Territory businesses as it does for business Australia wide. Under Jobs Plan 3, there are now more Territorians in training than ever before and we have the highest number of people in training on a per capita basis in Australia.

Budget 2008-09 maintains the government’s commitment to maximising employment opportunities for all Territorians and developing a highly skilled labour market that meets industry needs. This budget will invest $6.3m in strategic jobs and training initiatives. There are now over 3300 apprentices and trainees in training. This is an increase of 1150 since 2001; of those 1760 are in skill shortage areas. Budget 2008-09 continues to invest in the vital services provided to Territory families in community safety, health and education. Budget 2008-09 is tough on crime, with more police and funding to support our tough new laws.

Budget 2008-09 for NT Police, Fire and Emergency Services is now at $247m, an increase of 81% since 2001. In Budget 2008-09, the Henderson government is providing an additional 60 police over two years dedicated to suburban streets. There will also be 10 additional auxiliaries placed in call centres by the end of next year. This is on top of the 40 police staff provided as part of Closing the Gap and taking the additional police resources approved since the 2007 budget to 110. The Safer Streets initiative will increase the number of patrols and assist in targeting youth crime and public disorder. Budget 2008-09 is providing new and expanded police facilities. The new police station at Casuarina has been increased by $2.5m, taking the project to $7.34m. This station will provide state of the art facilities for police and for the public. To further assist police in their work, this budget includes $5.16m to upgrade the digital radio network. We are providing the police with the tools they need to do the job.

To strengthen community safety, Budget 2008-09 includes additional funding of $2.5m for a range of initiatives to address antisocial behaviour including $1.5m for a first response patrol and a Darwin area night patrol and $110 000 for a 24 hour antisocial behaviour reporting hotline. Ongoing funding of $650 000 is being provided to install and monitor a closed circuit TV network in the Darwin CBD. Funding of $750 000 is also provided in Budget 2008-09 for extra transport safety officers and more resources to reduce antisocial behaviour on the Darwin Bus network.

Budget 2008-09 backs the government’s commitment to crack down on youth crime, where parents fail in their responsibility to their children, the government will step in. Juvenile offenders will be targeted with $2.5m towards tough new measures including family responsibility agreements and orders and new youth camps to stop the revolving door of youth offending. Assisting victims is important and as part of an ongoing package, an extra $427 000 has been provided in Budget 2008-09 to expand the operation of the Crime Victims Services Unit and victims register. Work will commence on a detailed design of a new 1000 bed prison in the Darwin region. The government is committed to improving community safety and Budget 2008-09 provides more police, better resources and increased funding to support our tough new laws.

The Henderson government is committed to improving health and wellbeing of Territory families. We have announced a new Department of Health and Families will be established from 1 July and will include NT Families and Children. The new Department of Health and Families will receive $915m in 2008-09.

Budget 2008-09 will deliver more money for hospitals with $229m for Royal Darwin Hospital, $130m for Alice Springs, $26.3m for Katherine, $18.8m for Gove, and $11.6m for Tennant Creek. In 2008-09, an additional six beds will be provided in Royal Darwin Hospital. Additional beds will also be opened in Alice Springs Hospital as the redevelopment of the Emergency Department and fire safety rectification works are progressed.

Budget 2008-09 delivers improved health facilities across the Territory including: a new $4.5m health centre at Milingimbi; new sobering-up shelters in Katherine and Tennant Creek to be funded by the Commonwealth; $1.7m for Stage 3 of fire upgrades at Tennant Creek Hospital; the Allied Health Service at the Alice Springs Hospital will also be expanded with the allocation of an addition $200 000. Hospital in the Home will be expanded at both Royal Darwin Hospital and Alice Springs Hospital to increase the service to a seven day per week operation.

An important Budget 2008-09 initiative is the expansion of the Northern Territory Patient Assistance Travel Scheme. Travelling interstate for medical treatment can be a difficult experience for patients and their families. An additional $2m has been provided to improve and expand the PAT scheme.

The Community Midwifery Program has been successfully implemented at Royal Darwin Hospital, and will be introduced to Alice Springs in 2008-09 with additional funding of $280 000.

Renal health is a chronic issue for the Territory, and Budget 2008-09 increases funding in this area by $1m.

As part of the Australian Health Care Agreement, additional funding of $3m will be provided to enhance hospital core services.

The newly established NT Families and Children will support Territory families and children by bringing together a range of services, including child protection, foster care, youth support and diversion programs. In line with these changes, the first NT Children’s Commissioner has been appointed.

An Office of Disability will be created. The office will streamline the way families and people with disabilities access services by providing a single front door service for the Northern Territory. $3.7m will be allocated to continue implementation of recommendations from the Northern Territory Disability Services Review. An additional $240 000 has been provided to increase the Taxi Subsidy Scheme and the Territory Independence and Mobility Equipment Scheme.

Spending on education and training this year will be $719m. This is in addition to the significant capital spending in both our urban and remote schools. I talked earlier about the initiatives being undertaken in relation to indigenous and remote education. Budget 2008-09 also continues to build and upgrade urban education infrastructure. The biggest urban initiative is the two new schools which will be built at Rosebery at a cost of $48.8m - a primary school for 600 students and a middle school for 850 students. This is an exciting new development and acknowledges Palmerston’s status as one of the fastest-growing regions in the country. Budget 2008-09 includes $9.5m for headworks, and both schools are due to be open in 2011.

Other urban school upgrades in Darwin and Alice Springs total $9.5m. Additional funding of $2.7m for school buses has been provided to cater for the introduction of middle year schooling and the introduction of seat belts on high-risk, regional school bus routes.

To assist students with intellectual disabilities and other special needs, this budget provides additional funding of $1.7m.

A growing economy requires infrastructure investment. Budget 2008-09 delivers the highest ever Territory infrastructure spend – a record $870m. Infrastructure spending creates jobs and has a flow-on effect through the whole economy. Perhaps the most important aspect of this record infrastructure spend is roads. When we came to government in 2001, the roads budget we inherited was $84m. In Budget 2008-09, the roads budget is $271m – a record. We have more than tripled the roads budget.

The biggest road project is the Tiger Brennan extension, which is being done in partnership with the Commonwealth. The $110m multi-year project has started, and will ramp up in 2008-09. Budget 2008-09 includes stage 2 of the project at $89m.

Other specific road projects include:

· $2.5m for passing lanes on existing parts of Tiger Brennan Drive;

· $35.8m for the multi-year Victoria Highway project;
· $4.3m for railway crossing upgrades in 2008-09 as part of our $6.4m program;
· $3.5m for Maryvale Road upgrade; and
· $4m for road access to Pine Hill horticulture area.

Improving our economic infrastructure is a key priority for the Henderson government. We are spending more than $60m improving our port, including a conveyor to increase the throughput of our bulk minerals.

2008 will see the delivery of stage one of the Darwin Waterfront development. The Convention Centre will have its official opening shortly. This $1.1bn development will be largely funded by the private sector and the costs of the precinct to government substantially offset by returns from property sales of well in excess of $100m. The wider economic benefit to the community has been estimated at $350m.

The provision of new land development is important for the growth of the Territory. Budget 2008-09 sees the continuation of a number of projects to increase available land to assist Territorians with home ownership. Our comprehensive land release strategy involves new residential housing for Darwin at Lyons, Muirhead, Bellamack and Berrimah Far. Our property market is showing signs of moderation and our land release strategy must ensure that excess supply does not distort the market.

Last year, we announced an $812m, five-year program for essential services infrastructure. This year, further projects have been added, with a total program of more than $1bn over the next five years, with a continued strategic focus on improving supply reliability and increasing capacity. The Territory will provide a $100m capital contribution to Power and Water to assist in this significant investment.

The government’s commitment to undergrounding powerlines gets a further boost in Budget 2008-09. Nightcliff has already been completed, and Rapid Creek will be finished by the end of this year. Budget 2008-09 provides funding of $16.6m to continue the undergrounding project into Millner, with completion expected by December 2009. This will take the total cost of the project so far to $50m.

Madam Speaker, while we are improving our capital city, we are determined to strengthen our regions. Local government reform and the new shires will make the bush a better place to live, work and raise a family, with improved services and investment in the regions. Further funding of $5m has been committed in Budget 2008-09 to assist the new shires with additional establishment and infrastructure requirements. This takes the total Territory government funding provided to local government reform to $27m.

Preserving the Territory’s environment is vital for all Territorians and contributes to the Territory’s fantastic lifestyle. The Henderson government is committed to addressing climate change and has announced a dedicated Office of Climate Change to lead the Territory in this important area.

This budget provides additional funding of $5m over three years to assist businesses and households to respond to climate change issues. In addition, $2m has been provided in 2008-09 to upgrade government buildings to appropriate energy efficient standards.

Other environment initiatives include: $1.2m for water and air quality programs; $3.5m for renewal energy rebates; $10.8m to deliver clean energy to remote indigenous communities; increased funding of $100 000 to the Environment Grants program for the inclusion of a wildlife category; $1.5m for control of weeds; $2.8m for the Solar Cities Renewal Energy program; $344 000 for three years to monitor the Daly River catchment under the Living Rivers program; continued funding of $100 000 for the Cool Communities initiative; continued funding of $100 000 for the Alice Springs and Tennant Creek water initiative; increased funding of $628 000 for the Environment Protection Authority; and $6.7m for the Bushfires NT program.

Preserving and improving our parks and reserves is not only in the best interests of the environment but also promotes tourism and enhances our great Territory lifestyle. This budget includes infrastructure for our parks and reserves of $4.4m to upgrade Litchfield National Park; $5.2m to upgrade Leanyer Recreation Park; $1.5m to rebuild the Fogg Dam boardwalk; $1.5m to develop the Red Centre Way Interpretive Centre for the West Macdonnell National Park.

Budget 2008-09 supports boat ramp improvements across the Territory including $4.6m for continuing works to provide a new boat ramp and associated facilities at East Arm; $1m to improve fishing infrastructure across the Top End; and $450 000 for a new pontoon at Dinah Beach.

Territorians love their sport. Involvement in sport also assists in diverting young Territorians from harm into positive outcomes. In total, $25.9m will be spent on sport and recreation by the Territory government throughout the Territory in 2008-09. Funding of $6.4m will be provided for grass root sport and recreation grants. Budget 2008-09 has also increased sporting grants by $1m. In the next 12 months the Territory will host more elite sporting events than ever before.

The arts and cultural events are also important to Territorians for the Territory becoming more recognised as a place to hold international events such as the Elton John concert later this month. This budget has also provided an additional $777 000 over three years for the Darwin Festival in August. This event is becoming more popular with Territorians and visitors from interstate and overseas. The Arts Grants budget for 2008-09 is $5.25m including $300 000 for a public art program.

Promoting our parks, our environment, our fishing, our sport and our arts is a very important component of the Henderson government’s commitment to continue to make the Territory the best place to live, work and raise a family.

This budget is one for all Territorians. It is full of new initiatives right across the Territory, more services, more infrastructure, less tax and a growing economy. Budget 2008 does all this while strictly adhering to financial responsibility and sustainability. It is this responsibility and the commitment to delivering surplus budgets that allows the Henderson government to plan and provide for Territory families now and into the future.

This budget delivers for Territory families and invests in our future. I thank the Under Treasurer, her staff and mine for their hard work on Budget 2008 and I commend the Budget 2008-09 to the House.

Members: Hear, hear!

Debate adjourned.

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