Sidestepping Accountability: The Grant Did It

Not only does Australia have a damaging vertical tax imbalance, apparently there is some crazy formula directing the redistribution of state wealth through Commonwealth Grants.

NSW Transport Minister John Watkins complained;

This is really fantasy land stuff and it's about time the Grants Commission came into the real world and started to deliver to the needs of Australian citizens, wherever they live, and not penalise Sydneysiders because of the particular needs we've got here.

That is truly bizarre considering Sydney is Australia's premier city and when you consider the concerns of Sydneysiders wanting to improve transport infrastructure.

Why would the big states like NSW and Victoria put up with the federal government supplying fifty percent of their budgets through GST and Commonwealth Grants? Simple. Ministers like Watkins can get up there and blame the lack of an efficient transport system on the federal government rather than the state government neglecting infrastructure through poor policy and planning.

If the NSW and Victorian state governments had any ticker they would reject the federal government's ability to either raise income tax or GST in their states and take responsibility for policy/planning and the raising of revenue to support those policies/plans.

But that would take political courage.

The NSW, Victorian and Federal government's have been in government long enough that they are more interested in remaining in power than good government.

Permalink, Sidestepping Accountability: The Grant Did It, Mar 2006, cam

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