THE LOCAL GOVERNMENT REFERE14DUM
SPEECH BY THE PRIME MIiISTER,
THE HON, E. G, ' HITLA1, M. P.,
TO THE 1971' CONFEREACE OF
THE 111STITUTE OF IUNICIPAL ADMINISTRATION,
( RAYMOND WEST ORATIOi)
MELBOURNE, 19 FEBRUARY 1974,
I SHOULD BEGIN BY EMPHASISING THE PROFOUND
COMMUNITY OF INTEREST BETWEEN THE AIMS AND OBJECTIVES OF
YOUR INSTITUTE AND THE AIMS AND OBJECTIVES OF MY
GOVERNMENT. YOUR ORGANISATION WAS AMONG THE FIRST TO
RECOGNISE THAT MUNICIPAL ADMINISTRATION IS AS MUCH A
NATIONAL AS A STATE OR LOCAL CONCERN. YOU WERE AMONG
THE FIRST TO PERCEIVE THAT THE PROBLEMS AND CHALLENGES
OF LOCAL GOVERNMENT HAVE NATIONAL IMPLICATIONS QUITE
DISTINCT FROM THEIR RELEVANCE TO PARTICULAR LOCALITIES.
WHEN YOUR INSTITUTE WAS ESTABLISHED ON A FEDERAL BASIS IN
1952, YOU CONCLUDED TO USE YOUR OWN WORDS THAT " WHILE
LOCAL GOVERNMENT IS LOCAL AND, IN FACT, DERIVES ITS FUNCTIONS
FROM EACH RESPECTIVE STATE', THE DEVELOPMENT AND STRENGTH OF IT
IS A MATTER OF NATIONAL IMPORTANCE AND OF NATIONAL CONCERN." I @/ 2
2
YOUR ACCEPTANCE OF THAT PRINCIPLE WITH WHAT I
BELIEVE ARE ITS INEVITABLE CONSEQUENCES WAS DUE IN LARGE
MEASURE TO THE VISION AND ENERGY OF THE LATE RAYMOND WEST,
AN ADMINISTRATOR OF EXCEPTIONAL GIFTS AND RARE DEDICATION.
I MIGHT REMIND YOU THAT IT WAS IN THAT SAME YEAR, 1952,
THAT I FIRST ENTERED PARLIAMENT. FROM THAT MOMENT,
IN ALL MY SPEECHES, IN ALL MY ACTIONS, I SOUGHT TO
PERSUADE MY COLLEAGUES AND MY PARTY THAT THE FUTURE OF
SO MANY OF OUR INSTITUTIONS AND SERVICES HEALTH,
TRANSPORT, SEWERAGE, HOUSING, ENVIRONMENTAL STANDARDS,
CHILD CARE, ALL THE THINGS THAT MAKE FOR THE BETTERMENT
AND HAPPINESS OF OUR PEOPLE DEPENDED ON STRONG LOCAL
GOVERNMENT AND A MEASURE OF NATIONAL RESPONSIBILITY
FOR LOCAL GOVERNMENT. So I APPLAUD WHAT YOUR INSTITUTE
STANDS FOR. YOU ARE DEDICATED TO BETTER AND MORE
EFFICIENT LOCAL GOVERNMENT; SO AM I, YOU PERCEIVE THE
NATIONAL IMPORTANCE OF LOCAL GOVERNMENT; SO DO WE.
YOU BELIEVE THAT SOUND LOCAL GOVERNMENT IS FUNDAMENTAL
TO THE WELL BEING OF OUR PEOPLE; SO DO WE. .1/ 3
3
ONE IN FACT KJO'. S LETTER THAN YOU TIE LONG
AND SORRY HISTORY OF LOCAL GOVERNMENT IN THIS COUNTRY, THE
YEARS OF NEGLECT AND INDIFFERENCE FRCii WHICH IT HAS
SUFFERED, AND THE ATMOSPHERE OF PERPETUAL FINAINCIAL
CRISIS THAT HAS SURROUNDED IT FOR GENERATIONS. I HAVE
OFTEN MARVELLED AT THE DEDICATION AND FORTITUDE OF MEN
WHO HAVE CONTINUED TO SERVE LOCAL GOVERNMENT IN THE FACE
OF SUCH ODDS,. So LET ME PUT TO YOU SOME PROPOSITIONS
WHICH ARE CENTRAL TO MY GOVERNMENT'S WHOLE APPROACH TO
LOCAL GOVERNMENT AND WHICH I BELIEVE WILL HAVE YOUR
ASSENT AS THE MEN AND WOMEN MOST CONCERNED, AND EXPERT,
IN THIS FIELD. PMY FIRST PROPOSITION 13 THAT NO ONE,
WHATEVER HIS PARTY, WHATEVER HIS BELIEFS, CAN BE SATISFIED
WITH LOCAL GOVERNMENT AS IT IS. BASICALLY THIS IS A
QUESTION OF THE RESPONSIBILITIES OF LOCAL GOVERNMENT
OUTSTRIPPING ITS MEANS. LOCAL GOVERNMENT IS CALLED
UPON TO PROVIDE MORE AND MORE SERVICES TO MORE AND
MORE PEOPLE. THIS IS NOT SOMETHING IT HAS SOUGHT
FOR ITSELF; IT IS SOMETHING DEMANDED BY THE PEOPLE.
AND THE RESOURCES OF LOCAL GOVERNMENT ARE MANIFESTLY
INADEQUATE TO MEET THOSE DEMANDS. / 4
i'
1IY SECOND PROPOSITION IS THAT FUNDAMENTAL
CHANGES ARE NEEDED TO GIVE LOCAL GOVERNMENT PROPER ACCESS
TO THE NATION'S FINANCIAL RESOURCES. FOR THAT REASON
WE PROPOSE, AS YOU KNOW, TO ASK THE AUSTRALIAN PEOPLE
TO APPROVE A CONSTITUTIONAL AMENDMENT THAT WILL REMOVE,
ONCE AND FOR ALL, THE PRESENT FINANCIAL PARRIERS TO
EFFICIENT LOCAL GOVERNMENT AND ITS FULL AND EFFECTIVE
PARTNERSHIP IN A FEDERAL SYSTEM.
AND MY THIRD PROPOSITION IS THAT UNLESS THAT
REFERENDUM IS CARRIED, UNLESS IT IS SUPPORTED BY ALL ' WHO
HAVE THE TRUE INTERESTS OF LOCAL GOVERINENT AT HEART,
UNLESS IT HAS THE VIGOROUS WORKING SUPPORT OF MEN SUCH
AS YOU, LOCAL GOVERNMENT WILL BE CONFINED FOR FURTHER
GENERATIONS IN ITS PRESENT STRAITJACKET OF STAGNATION
AND IMPOVERISHMENT. / s. 1
I DO NOT THINK WE CAN APPROACH THIS QUESTION
RATIONALLY UNTIL WE CLEAR OUR MINDS OF IRRELEVANT CANT
PHRASES AND TIRED SLOGANS ABOUT " CENTRALISM" AND " STATE
RIGHTS". I CONFESS THAT I FIND IT STRANGE THAT A
GOVERNMENT SUCH AS MINE, DEDICATED NOT ONLY TO THE
GROWTH BUT TO THE GREATER AUTONOMY OF LOCAL GOVERNMENT,
SHOULD BE ACCUSED OF CENTRALISM ON THAT SCORE.
THE VERY REVERSE IS TRUE. ' HAT WE SEEK TO DO IS
LIBERATE LOCAL GOVERNMENT FROM ITS FORCED DEPENDENCE
ON STATE ADMINISTRATIONS THAT CANNOT GIVE IT THE
RESOURCES IT NEEDS. ARE NOT SEEKING TO DENY
EITHER POWER OR FINANCIAL RESOURCES TO THE STATES.
WHAT WE ARE SEEKING IS A PROPER AND RATIONAL BALANCE
BETWEEN THE THREE TIERS OF GOVERNMENT NATIONAL,
STATE AND LOCAL THAT WILL ENABLE EACH TO FUNCTION
EFFICIENTLY AND DISCHARGE ITS RESPONSIBILITIES TO THE
FULL.
r
S-UJ
IN THIS CONTEXT I SHOULD LIKE TO RECALL TO YOU
SOME WORDS USED BY AR JUSTICE ELSE MITCHELL, CHAIRMAN OF
THE ROYAL COMMISSION INTO NEW SOUTH 4ALES LAND VALUATION
RATING SYSTEMS IN 1965. HE SAID: " PRESENT CENTRALISED
POLICIES, WHICH HAVE REDUCED LOCAL GOVERNMENT TO A STATE
OF VASSALAGE AND COUNCILS TO THE ROLE OF MENDICANTS,
NEED DRASTIC REAPPRAISEMENT, THOUGH I WONDER IF STATE
GOVERNMENTS ARE VERY ANXIOUS FOR LOCAL AUTHORITIES TO
GAIN ANY SUBSTANTIAL MEASURE OF FINANCIAL INDEPENDENCE
OR TO DEVELOP QUALITIES OF STRONG LOCAL AUTONOMY."
HIS HONOUR HIGHLIGHTED A FACT THAT IS FREQUENTLY
OVERLOOKED WHEN ACCUSATIONS OF " CENTRALISM" ARE BANDIED
AROUND. AND IT IS THIS: WITHIN THEIR OWN BORDERS
THE STATES TEND TO BE MUCH MORE CENTRALIST AND
CENTRALISED THAN CANBERRA HAS EVER ASPIRED TO BE
WITHIN THE CONTINENT. / 7
7
THIS HAS BEEN SO SINCE LONG BEFORE FEDERATION.
ONE HAS ONLY TO REMEMBER THAT THE MAINLAND COLONIES,,
WITH THE EXCEPTION OF . UEENSLAND, BUILT THEIR RAILWAY
SYSTEMS TO ENSURE CENTRALISATION UPON THEIR CAPITAL CITIES.
WHY SHOULD CENTRALISM, SO CALLED, BE LESS BANEFUL WHEN
PRACTISED BY A STATE GOVERNMENT THAN WHEN PRACTISED BY
THE COMMONWEALTH? IT IS ABSURD TO SUPPOSE THAT COMMUNITIES
SUCH AS SHEPPARTON OR ARMIDALE, FOR EXAMPLE, SHOULD FEEL
ANY GREATER KINSHIP WITH MIELBOURNE OR SYDNEY THAN THEY
DO WITH CANBERRA. IT IS ABSURD TO IMAGINE THAT THERE IS
SOME NATURAL LOGIC IN A SITUATION THAT REQUIRES A SEWERAGE
PROGRAM IN BOURKE OR A ROAD PROGRAM IN GEELONG TO RE LY ON,
THE BENEVOLENCE OF MACQUARIE STREET OR SPRING STREET.
WHAT MAGIC FORMULA DO THE STATES POSSESS FOR R EDUCING
INEQUALITIES WITHIN THEIR OWN BOUNDARIES? OUR WHOLE
HISTORY HAS SHOWN THAT THE INEQUALITIES BETWEEN REGIONS
WITHIN THE STATES ARE AT LEAST AS GREAT AS THOSE BETWEEN
THE STATES THEMSELVES. IN EACH STATE THERE ARE REGIONS AND
DISTRICTS WHICH CANNOT, BY REASONABLE EFFORT, FUNCTION ON
THE STANDARD OF OTHER REG! ONS AND DISTRICTS. IT IS NO0 ANSWER
TO THESE PROBLEMS, THESE INHERENT AND CHRONIC INEQUALITIES,
TO ARGUE ABOUT STATE RIGHTS. IT IS NOT THE FEDERAL GOVERNMENT
BUT STATE GOVERNMENTS WHICH HAVE CENTRALISED LOCAL GOVERNMElJT.
IT IS UNDER STATE GOVERNMENTS THAT LOCAL GOVERNMENT HAS
STAGNATED AND DECLINED. W4HAT I ASK YOU TO DO IS LOOIK AFRESH
AT THESE PROBLEMS, TO START FROM THE BASIC ASSUMPTION THAT
LOCAL GOVERNMENT MUST BE GIVEN THE RESOURCES TO DO ITS JOB,
AND TO IGNORE THESE FUTILE AND IRRELEVANT ARGUMENTS ABOUT
RIGHTS AND AREAS OF RESPONSIBILITY. I 1 / 13
8
I THINK I CAN BEST DISPOSE OF THE CENTRALIST
RED HERRING BY REFERRING TO SOME REMARKS I MADE IN
NOVEMBER 1971 AT A SEMINAR ON THE FUTURE OF FEDERALISM
AT THE AUSTRALIAN NATIONAL UNIVERSITY. YOU WILL SEE
THE CONSISTENCY OF MY PARTY'S APPROACH, AND MY GOVERNMENT'S
APPROACH, TO THESE QUESTIONS, I SAID: " THE FUTURE
OF AUSTRALIAN FEDERALISM DEPENDS FAR MORE UPON
MUNICIPALITIES THAN UPON THE COMMONWEALTH OR THE STATES.
FEDERALISM IS THREATENED NOT BY THE DRIFT OF ' POWER FROM
STATE CAPITALS TO CANBERRA BUT BY THE STATES IMPOSING
UPON MUNICIPALITIES FUNCTIONS WHICH ARE BEYOND THEIR
MEANS. IT IS NOT THE COMMONWEALTH BUT THE STATES WHICH
MUST RESIST OR FEAR A REASSESSMENT OF FUNCTIONS IN OUR
FEDERATION, FOR THE STATES TREAT MUNICIPALITIES EVEN MORE
FRUGALLY THAN THE STATES CLAIM THAT THEY THEMSELVES ARE
TREATED BY THE COMMONWEALTH." THAT WAS OUR POSITION
BEFORE THE ELECTION; IT IS OUR POSITION TODAY, ALL OUR
POLICIES HAVE BEEN DIRECTED TO ACHIEVING THOSE AIMS, TO
ELEVATING THE STATUS AND IMPORTANCE OF LOCAL GOVERNMENT
WITHIN THE FEDERAL SYSTEM. FAR FROM ADVOCATING CENTRALISM
OR CONCENTRATION OF POWER, I BELIEVE THERE IS A PRESSING CASE
FOR DECENTRALISATION OF AUTHORITY SO THAT MANY GOVERNMENT
FUNCTIONS IN CRITICAL AREAS, SUCH AS WELFARE, CULTURE AND
THE ENVIRONMENT, WILL BE PERFORMED BY LOCAL GOVERNMENT
AUTHORITIES EQUIPPED WITH THE RESOURCES THEY NEED. / 9
IE SHOULD NEVER, FORGET THE DISGRACEFUL WAY L-OCAL
GOVERNMENT HAS BEEN NEGLECTED AND DOWNGRADED SIN4CE TlF! E
VERY BEGINNINGS OF OUR FEDERATION. ANYONE LOOKING BACK
ON THlE HISTORY OF LOCAL GOVERNMENT MUST FIND IT INEXPLICABLE
TODAY THAT THE FRAHERS OF THE CONSTITUTION MADE NO MENTION
OF LOCAL GOVERN4MEN4T AT ALL. AS LATE AS 1927, WHEN THE
FINANCIAL AGREEMENT BETWEEN'THE COMMONWEALTH AND THE
STATES WAS DRAWN UP, LOCAL GOVERNMENT WAS STILL IGNORED.
IF THE FINANCIAL AGREEMENT WERE BEING DRAWN UP TODAY IT IS
INCONCEIVABLE THAT THESE AUTHIORITIES WOULD BE OVERLOOKED.
IT WAS NOT UNTIL 1936 THAT TH4E LOAN COUNCIL BEGAN DEALING
WITH THE BORROWINGS OF LOCAL GOVERNMENT AUTHORITIES. YET
IN ALL THAT TIME, AND ESPECIALLY SINCE THE WAR, THE
SCALE OF OPERATIONS OF LOCAL AND SEMI-GOVERNMENT
AUTHORITIES HAS BEEN STEADILY TRANSFORMED. WE HAVE ONLY
TO LOOK AT THlE FIGURES OF COMPAFr'ATIVE DEBTS. THE INDEBTEDNESS
OF THE COMMONWEALTH HAS NOT GROWN SINCE THE WAR BUT THE DEBTS
OF LOCAL GOVERNMENT AND SEMI-GOVERNMEN4T AUTHORITIES HAVE
MULTIPLIED MORE THAN TWELVE TIMES. LOCAL GOVERNMENT
AUTHORITIES ARE NOW BORROWING MORE EACH YEAR THAN THE TOTAL
AMOUNT OF THEIR OUTSTANDING DEBT ONLY 20 YEARS OR SO AGO.
AT THE SAME TIME THERE HAVE BEEN ACCELERATING DEIMANDS QUITE
NATURAL AND PREDICTABLE DEMANDS ON THE SaCRVICES WHICH LOCAL
GOVERNMENT PROVIDES. YET NOTHING W". AS DONE TO REDRESS THESE
DEFICIENCIES; NOTHING WAS DON! E TO CORRECT A SYSTEM" THAT
ALLOWED THEM TO WORSEN YEAR BY YEAR.
9A
IN THIS CONTEXT I CAN HARDLY DO BETTER THAN REFER
YOU TO SOME OF THE FINDINGS OF THE RECENT REPORT OF THE
COMMITTEE OF INQUIRY INTO LOCAL GOVERNMENT .'. REAS AND
ADMINISTRATION IN IIEW SOUTH vALES, KNOWN AS THE OARNETT REPORT.
THE COMMITTEE POINTED OUT THAT LOCAL GOVERNMENT'S SHARE OF
TOTAL GOVERNMENT EXPENDITURES HAS BEEN SHRI,' KING STEADILY
IN AUSTRALIA. IN 1969-70 IT REPRESENTED 7.11' 7 OF TOTAL
GOVERNMENT EXPENDITURE IN AUSTRALIA, COMPARED WITH 21.670
IN CANADA, 25,14% IN THE UNITED STATES AND 34.6% IN GREAT
BRITAIN ( WHERE, IT MUST BE SAID, THERE ARE NO STATE GOVERNMENTS),
THE COMMITTEE REPORT'ED THAT IN THE VIEW OF MOST SHIRE COUNCILS
IN [ JEW SOUTH ' IALES, " THEIR AREAS COULD rNOT SURVIVE WITHOUT
A CONTINUANCE OF LARGE CENTRAL GOVERNMENT GRANTS AND,
WITHOUT EXCEPTION, COUNCILS BELIEVED THE AUSTRALIAN GOVERNMENT'S
INVOLVEMENT IN FINANCING LOCAL GOVERNMENT WAS ESSENTIAL."
THE COMMITTEE, AS YOU KNOW, RECOMMENDED SOME AMALGAMATION
OF LOCAL GOVERNMENT AUTHORITIES, THIS IS AN ISSUE THAT
NEED NOT CONCERN US HERE, THOUGH I SHOULD SAY THAT THE
COMMITTEE'S BELIEFS HAPPEN TO ACCORD WITH MY OWN, IT IS
SUFFICIENT TO RECALL THAT BOTH THE LOCAL GOVERNMENT
ASSOCIATION AND THE SHIRES ASSOCIATION, TOGETHER REPRESENTING
ALMOST ALL LOCAL COUNCI-LS IN NEW SOUTH WALES, AGREED THAT
THERE WAS A NEED FOR A REVIEW OF THE LOCAL GOVERNMENT SYSTEM,
IN THE WORDS OF THE REPORT, " THEY POINTED OUT THAT NO
INSTITUTIONS COULD STAND STILL, LEAST OF ALL GOVERNMENT
INSTITUTIONS, YET MAJOR REFORMS IN LOCAL GOVERNMEINT HAD
BEEN FEW AND FAR BETWEEN." it e I!
i0
THE FACT IS THAT FOR. AT LEAST TWO DECADES
SUCCESSIVE GOVERNMENTS STOOD BY WHILE SERIOUS DEFICIENCIES
DEVELOPED IN MANY OF THE PUBLIC SERVICES AND FACILITIES
WHICH IT WAS THE DUTY OF THE STATE-LOCAL GOVERNMENT
SECTOR TO PROVIDE. PARTLY THIS WAS DUE TO INSUFFICIENT
RESOURCES.; BUT IT WAS ALSO A REFLECTION OF PROCESSES
OF PLANNING AND DETERMINING PRIORITIES WHICH WERE
INADEQUATE OR NARROWLY BASED. HiY GOVERNMENT HAS SET
ITSELF THE TASK OF HELPING TO REMEDY THESE DEFICIENCIES
IN CO-OPERATION WITH THE STATES AND THEIR AUTHORITIES.
.4E HAVE MADE A STRONG BEGINNING WITAESS THE NEW OR
ENLARGED ALLOCATIONS IN OUR BUDGET FOR 1973-74 FOR
EDUCATION, COMMUNITY HEALTH, PUBLIC HOUSIIG, SEWERAGE
SElVICES, LAND MANAGEMENT, URBAN TRANSPORT AND GROWTH
CENTRES. TOTAL ALLOCATIONS TO THE STATES IN 1973-74,
INCLUDING THE STATE GOVERNMENTS' LOAN COUNCIL PROGRAMS,
BUT EXCLUDING UNEMPLOYMENT RELIEF GRANTS, ARE ESTIMATED
TO BE NO LESS THAN 2Lt PER CENT GREATER THAN T: iE
CORRESPONDING ALLOCATIONS IN 1972-73.
1~ 1-
IT IS NOT, HOWEVER, SIMPLY A MATTER OF PROVIDING
MORE MONEY. AT THE RISK OF VOICING A TRUISM, LET ME SAY
THAT THE IMPORTANCE OF LOCAL SOVENIMENT DERIVES FROM
THE VERY FACT THAT IT IS LOCAL THAT THE SERVICES
AND FACILITIES IT PROVIDES HAVE SUCH A CLOSE AND DIRECT
IMPACT ON THE WELFARE OF THE POPULATION IT SERVES.
IT IS OUR AIM, IN PART, TO MAKE AVAILABLE TO LOCAL
GOVERNMENT FUNDS MORE ADEQUAFE FOP ITS FUNCTIONS.
BUT OUR AIM IS LARGER THAN THAT. IF LOCAL
GOVERNMENT IS TO PLAY THE FULLER AND MORE EFFECTIVE
PART THAT I BELIEVE THE COMMUNITY WISHES IT TO PLAY,
THEN WE MUST ALSO INCREASE THE EFFECTIVE INFLUENCE
LOCAL GOVERNMENT EXERCISES Ii RELATION ro THE
FUNDAMENTAL DECISION-MAKING AFFECTING ITS ACTIVITIES.
IT WILL REPRESENT A MOST SIGNIFICANT STEP TOWARDS
REAL FEDERALISM,, REAL LOCAL PARTICIPATION IN, PUBLIC
AFFAIRS AND, INDEED, REAL DECENTRALISATION OF
GOVERNMENT WHEN THIS IS ACHIEVED. / i11
12
WE HAVE ALREADY TAKEN-SEVERAL IMPORTANT
INITIATIVES IN THAT DIRECTION. IN ITS AUTUMN SITTINGS
LAST YEAR WITHIN SIX M9NTAIS OF THE ELECTION THE
AUSTRALIAN PARLIAMENT PASSED A NEW~ GRANITS COMMISSION
ACT AUTHORISING THAT BODY TO INOUiRE INJTO APPLICAVIOIS
FOR ASSISTANCE BY REGIONAL ORGANISATIONS OF LOCAL
GOVERNMENT. ANY ASS ISTANCE RECOMMENDED BY THE COtIMI SSION
AND APPROVED BY THE AUSTRALIAN GOVERNMENT WILL BE PAID
TO THE STATES UNDER SECTION 96 OF THE CONSTITUTION ON
CONDITION THAT IT BE PASSED ON T0 THE LOCAL GOVERNMENT
ORGANISATIONS CONCERNED. ADDITIONAL MENSERS HAVE SEENJ
APPOINTED TO THE COMIMISSIO! AND ITS STAFF IS BEING
EXPANDED TO ENABLE IT TO DEAL WITH THIS LARGE NEW
RESPONSIBILITY. IT IS HOPED THAT APPLICATIONS SY
REGIONAL ORGANISATIONS WILL BEGIN TO BE RECEIVED AND
CONSIDERED EARLY THIS YEAR. FROM NOW ON, THE COMMISSION
WILL PLAY THE SAME ROLE IN REDUCING INEQUALITIES BETWEEN
REGIONS AS IT HAS BETWEEN THE STATES SINCE 193). I SHOULD
STRESS THAT THIS REFORM PAYS DUE HEED TO THE NATURAL
RIGHTS AND INTERESTS OF THE STATES. A'NY REGIONAL AUTHORITY
THAT APPLIES FOR SPECIAL ASSISTANCE WILL BE REQUIRED TO
NOTIFY THE APPROPRIATE STATE JINISTER, AND THE COMMISSION
ITSELF WILL BE REQUIRED TO CONSIDER ANY SUBMISSIONS FROM
STATE flINISTERS ON THE APPLICATION. 1013
13
OUR SECOND GREAT IITIATIVE LAST YEAR WAS
TO SEEK A VOICE AND A VOTE FOR LOCAL GOVERNMENT ON THE
LOA1N COUNCIL. OUR PURPOSE WAS, AND STILL IS., TO ADMIT
REPRESENTATIVES OF ALDERMEN AND COUNCILLORS FROM EACH
STATE AND ENABLE THE COMMONWEALTH, ON REQUEST, TO
RAISE APPROVED LOANS OHi BE!. IALF OF SEMI-GOVERNMENT
AND LOCAL GOVERNMENT AUTHORITIES. THEY WOULD TIUS
HAVE THE ADVANTAGE OF THE LONGER PERIOD AND LOWER
INTEREST RATES THAT APPLY TO LOANS RAISED BY THE
COMMONWEALTH ON BEHALF OF THE STATES. THIS WAS A
FIRM UNDERTAKING IN MY POLICY SPEECH AT THE LAST
ELECTIONS. I FIRST RAISED THE PROPOSALS WITH THE
PREMIERS AT THE CONSTITUTIONAL CONVENTION IN SEPTEMSER
LAST YEAR AND I REMIND YOU THAT IT WAS AT THE EXPRESS
INSISTENCE OF MY GOVERNMENT THAT LOCAL GOVERNMENT
REPRESENTATIVES WERE ADMITTED TO THE CONVENTION'S
DELIBERATIONS. MADE IT CLEAR FROM THE START THAT
WITHOUT YOUR PARTICIPATION WE WOULD HAVE NO PART IN
THE CONVENTION AT ALL. I DOUBT IF ANYONE, IN
RETROSPECT, WOULD CLAIM MUCH SUCCESS FOR THAT
CONVENTION, BUT IT IS WORTH RECALLING SOME WORDS THAT
I USED TO THE PREMIERS WHEN EXPLAINING THE PURPOSE OF
OUR PROPOSALS. , I14
I1!
I TOLD THE CONVENTION: " I HAVE NO DOUBT THAT
THE OVERRIDING CONSIDERATION IN MANY MINDS HERE RELATES
TO THE FINANCIAL RELATIONS BETWEE; I THE AUSTRALIAN
GOVERNMENT AND THE STATES. SOtlE OF YOU MAY PREFER
TO BELIEVE THAT THE OVERRIDING CONSIDERATION IN MY
MIND IS TO CONTINUE AND. EVE;-COMPOUND THE PRESENT
SITUATION BY WHICH THE 1. ATIONALI GOVERNMENT DOMI! JATES
THE FINANCIAL RELATIONS BET'iEEN IT AND THE STATES,
THAT IS NOT TRUE. IIY OVERRIDING CONSIDERATION
AND CONCERN IN THIS CONTEXT IS TO BALANCE THE
FUNCTIONS AND FINACES OF THE AUSTRALIAN GOVERNMENT,
STATE AND LOCAL GOVERNMENTS TO ENSURE ADEQUATE
SERVICES AND DEVELOPMENTS OF RESOURCES. I WISH
EACH LEVEL OF GOVERNMENT TO BE IN A POSITION TO
PERFORM BETTER ITS ASSIGNED FUNCTIONS, FOR THE
BETTER WELFARE OF ALL OUR CITIZENS, WHEREVER THEY
LIVE."
15
IN OCTOBER LAST YEAR A SPECIAL PREMIERS'
CONFERENCE WAS HELD TO DISCUSS THESE QUESTIONS. AT
THAT CONFERENCE IN CANBERRA I AGAIN PROPOSED THAT
LOCAL GOVERNMENT HAVE BOTH A VOICE AND A VOTE ON THE
LOAN COUNCIL AND THAT THE AUSTRALIAN GOVERNMENT BE
EMPOWERED TO BORROW MONEY ON LOCAL GOVElNMENTS'
BEHALF. SPECIFICALLY I SUGGE.' TED THAT REPRESEFNTATIVES
OF ELECTED LOCAL GOVERNMENT BE ADMITTED TO ALL LOA; J
COUNCIL DISCUSSIONS, WITH A RIGHT TO VOTE ON THOSE
MATTERS DIRECTLY AFFECTING THEIR INTERESTS ESSENTIALLY,
THE BORROWING PROGRAMS FOR THE BODIES THEY REPRESENT
AND THE ALLOCATIONS OF THESE PROGRAMS. I NLED HARDLY
REMIND YOU OF THE RESULTS OF THAT MEETING. JUR
PROPOSALS WERE TURNED DOWN. TIlE IMPORTANT POINT
TO REMEMBER IS THAT THE PROPOSED CHAiJGES COULD
HAVE BEEN EFFECTED QUITE SIMPLY AT THAT MEETING BY
AN AGREEMENT IN PRINCIPLE BETWEEN THE PREMIERS AND
THE AUSTRALIAN GOVERN;. IENT TO AMEND THE FINANCIAL AGREEMENT,
IF THAT HAD BEEN DONE, NO CONSTITUTIONAL AMENDMENT WOULD
HAVE BEEN REQUIRED. BUT WHEN THE PREMIERS REJECTED OUR
PROPOSALS WE HAD NO ALTERNATIVE BOUND AS WE WERE BY OUR
MANDATE FROM THE PEOPLE BUT TO PROCEED WITH A REFERENDUM.
THAT REFERENDUM, IF CARRIED, WILL EMPOWER THE NATIONAL
PARLIAMENT TO BORROW ON BEHALF OF LOCAL GOVERNMENT AND
GRANT FINANCIAL ASSISTANCE TO LOCAL GOVERNMENT DIRECTLY. ,/ 16
if)
IT MUST SURELY STRIKE YOU AS ODD THAT, ' HILE
WE HAVE ESTABLISHED ARRANGEMENTS FOR BORROWINGS DY STATE
GOVERNMENTS TO BE UNDERTAKEN ON THEIR BEHALF BY THE
AUSTRALIAN GOVERNMENT, LOCAL GOVERNMENT AUTHORITIES ARE
LARGELY LEFT TO FEND FOR THEMSELVES IN THE CAPITAL MARKETS.
' ITH THE GROWING COMPLEXITY AND SOPHISTICATION OF THESrE
MARKETS THEY ARE HANDICAPPED AS BORROWERS. THEY MUST
COMPETE ON THE MONEY MARKET AMONG THEMSELVES, AGAINST
THE AUSTRALIAN GOVERNMENT AND AGAINST OTHER FINANCIAL
ORGANISATIONS. GIVEN THE NATURE AND RANGE OF PUBLIC
SERVICES AND FACILITIES THAT LOCAL GOVERNMENT AUTHORITIES
ARE CALLED UPON TO PROVIDE, WHY SHOULDN'T FHE AUSTRALIAN
GOVERNMENT, WITH ITS SUPERIOR CAPACITY AS A BORROWIER,
UNDERTAKE BORROWINGS ON THEIR BEHALF?
THE COSTS OF SERVICING THEIR BORROWINGS BEAR
HEAVILY AND INCREASINGLY SO ON THE BUDGETS OF LOCAL
GOVERNMENT AUTHORITIES. IHILE THE PICTURE DIFFERS
FROM STATE TO STATE, AND BETWEEN INDIVIDUAL AUTHORITIES,
OVERALL INTEREST PAYMENTS BY LOCAL GOVERNMENT AUTHORITIES
WOULD NO'WY BE EQUIVALENT TO ABOUT 12 PER CENT OF THEIR
REVENUES. INTEREST PAYMENTS PLUS CAPITAL REPAYMENTS
AMOUNTED TO $ 177.5 MILLION IN 1970-71, EQUIVALENT TO
ABOUT 25 PER CENT OF REVENUES. ./ 17
17
You HAVE HEARD IT SAID AND NO DOUBT YOU WILL
HEAR IT AGAIN THAT IF WE WANT TO HELP LOCAL GOVERNMENT
THEN ALL WE NEED . DO IS GIVE MORE MONEY TO THE ) TATES AJD
LET THE STATES DISBURSE IT OR RAISE FUNDS IN THE USUAL
WAY. THAT ARGUMENT IGNORES AN" D OBSCURES THE REAL
ISSUES IN THIS REFERENDUM, FOR ONE THING IT IS A MISTAKE,
AS I HAVE SAID, TO SUPPOSE THAT T; 1IS ARGUMENT IS ABOUT
MONEY ALONE, THOUGH MORE MONEY 13 CERTAI: LY ;! EEDED,
IT IS VERY MUCH AN ARGUMENT. ABOUT BALAIJCING AVAILABLE
RESOURCES, AND FLEXIBILITY IN THE C2EATIONI AND APPLICATIONJ
OF THOSE RESOURCES, IT IS ALSO AN ARGUMENT A30UT THE
ULTIMATE STATUS OF LOCAL GOVERNMENT ITSELF. Is IT TO
REMAIN A VASSAL OF THE STATES, A POOR RELATION OF THE
STATES, OR IS IT TO BE GIVEN ITS RIGHTFUL AND HONOURED
PLACE AS FAR AS POSSIBLE, AN INDEFPENDE!' T AIND DISTINCTIVE
PLACE AS AN EQUAL PARTNER IN THE FEDERAL SYSTEM?
FOR MY PART I HAVE NO WISH TO SEE LOCAL GOVERNMENT BECOME
AN APPENDAGE OF THE NATIONAL GOVERNMENT ANY MORE THAN I
WANT IT TO REMAIN AN APPENDAGE OF THE STATE GOVERNMENTS,
BUT I DO WANT IT TO HAVE ADEQUATE AND REASONABLE ACCESS
TO THE NATION'S FINANCIAL RESOURCES. . IE ARE NOT SEEKING TO DENY
ANY RIGHTS OR POWERS OR RESOURCES TO THE STATES. INDEED
I WOULD BE THE FIRST TO ACKNOWLEDGE THAT THE STATES THEMSELVES
HAVE OFTEN BEEN DEPRIVED OF THE FINANCIAL RESOURCES THEY
NEED, A GREAT NUMBER OF OUR INITIATIVES IN OUR FIRST YEAR
OF OFFICE, A GREAT PART OF THE THRUST AND PHILOSOPHY OF OUR
FIRST BUDGET, WERE CONCERNED WITH REDRESSING DEFICIENCIES
IN THE REVENUES OF THE STATES. AND JUST AS I WANT THE STATES
TO HAVE THE MEANS TO DISCHARGE THEIR RESPONSIBILITIES
ADEQUATELY, SO I PRESS THE SAME CASE ON BEHALF OF LOCAL
GOVERNMENT. ., 11
13
W; HY SHOULD LOCAL GOVERNMENT BE " 4HOLLY DEPENDENT
ON THE STA-rES? WHY SHOULD IT BE DENIED THE RIGHT TO
DEAL DIRECTLY WITH THE NATIONAL GOVERNMENT? THERE
ARE MANY MATTERS WHERE THERE ARE DISTINCT ADVANTAGES
IN DIRECT DEALING BETWEEN LOCAL GOVERNMENT AND THE
NATIONAL GOVERNMENT. I GIVE YOU A RECENT AND HIGHLY
TOPICAL EXAMPLE OUR FLOOD RELIEF PROGRAM. ', IE HAVE
GUARANTEED TO THE PEOPLE OF'QUEENSLAND AND iEW SOUTH
4ALES FLOOD RELIEF AND RECONSTRUCTION PROGRAMS THAT
ARE VIRTUALLY OPEN-E4DED, OUR RESPONSE TO THE DISASTER
WAS, QUITE NATURALLY, IMMEDIATE AND GENEROUS, IT IS
EQUALLY NATURAL AND OBVIOUS THAT THE BEST WAY TO DISTRIBUTE
AND ALLOCATE THOSE FUNDS IS BY DIRECT CONSULTATION
BETWEEN THE AUTHORITY PROVIDING THEM AND THE REGIONAL
AUTHORITIES WHO WILL BE USING THEM. AGAIN, AS YOU KNOW,
WE HAVE AMBITIOUS PROGRAMS FOR SEWERAGE WORKS AND CHILD
CARE FACILITIES AND HEALTH CENTRES. " IE HAVE EMBARKED ON
OUR LONG-TERN PLANS FOR THE RENOVATION OF OUR SUBURBS AND
THE CREATION OF NEW CITIES. IN THE NEXT FEW MONTHS WE SHALL
BE MAKING ARRANGEMENTS WITH THE STATES TO ALLOCATE FUNDS FOR
ROADS FOR THE NEXT FIVE YEAR PERIOD. IN ALL THESE AREAS
IT IS QUITE ESSENTIAL AND I SHOULD HAVE THOUGHT, QUITE
OBVIOUS THAT SUCCESS WILL DEPEND IN LARGE MEASURE ON
OPPORTUNITIES FOR DIRECT DEAL-ING AND DIRECT FINANCIAL
RELATIONSHIPS BETWEEN LOCAL GOVERNMENT AND THE AUSTRALIAN
UOVERNMENT. So LET US BE QUITE CLEAR THAT THOSE WHO RESIST
THIS REFERENDUM ARE NOT MER-LY FRUSTFRATING THE PROGRESS OF
LOCAL GOVERNMENT; THEY ARE DOING THEIR BEST TO BLOCK THE
NATIONAL GOVERNMENT'S PLANS FOR SOCIAL WELFARE AND REFORM
ON AN UNPRECEDENTED SCALE.
19
I SAID AT THE OUTSET THAT THE SUCCESS OF THIS
REFERENDUM, WITH ALL ITS PROFOUND IMPLICATIONS FOR THE
FUTURE OF LOCAL GOVERNMENT, WOULD DEPEND LARGELY ON YOUR
SUPPORT, YOUR KNOWLEDGEABLE AND EXPERT SUPPORT AS
ADMINISTRATORS IN THIS FIELD. I THI YOU MUST ASK
YOURSELVES WHETHER YOU ARE CONTENT WITH LOCAL GOVERNMENT
AS IT IS, WITH ITS GROWING ACCUMULATION OF DEBT, ITS
WIDENING GAP BETWEEN RESPO4SIBILITIES AND RESOURCES,
ITS ENDLESS NEED TO FORCE UP RATES AND CHARGES, ITS
DEMEANED AND DIMINISHED STATUS IN ThE IhIERARCHY OF
GOVERNMENT, ITS FRUSTRATIONS AND DISAPPOINTMENTS.
IF YOU BELIEVE THAT LOCAL GOVERNMENT IS CRYING OUT FOR
A NEN DEAL THEN I ASK YOU TO SUPPORT THIS REFERENDUM.
YOU MUST BE THE OPINION MAKERS ON THIS ISSUE; YOUR
THOUGHTS, YOUR OPINIONS, YOUR LETTERS, YOUR INFLUENCE
ARE WHAT WILL COUNT. I MAKE NO APOLOGY FOR APPEALING
TO YOU IN THIS WAY BECAUSE I THINK THE ISSUES ARE
CRUCIAL AND THE CHOICE FUNDAMENTAL TO OUR WELFARE AND
PROGRESS. WE DO NOT SEEK CHANGE FOR CHANGE'S SAKE.
WE SEEK CHANGE BECAUSE IT IS DEMANDED OF US, FORCED
UPON US BY INCREASINGLY DIFFICULT AND COMPLEX PROBLEMS
OF SOCIAL PLANNING AND ECONOMIC MANAGEMENT. ' 4E CAN NO
LONGER CLING TO OLD CONCEPTS, TO DOCUMENTS AND RULES
AND AGREEMENTS DRAWN UP IN THE DISTANT PAST, TO IRRELEVANT
OBSESSIONS WITH BOUNDARY LINES AND THE DEMARCATION OF RIGHTS
AND INTERESTS. LET US ACKNOWLEDGE THAT OUR FIRST TASK
OUR ONLY TASK IS TO ELEVATE LOCAL GOVERNMENT TO ITS PROPER
PLACE IN AUSTRALIAN SOCIETY AND GIVE IT THE MEANS TO CARRY
OUT ITS WORK FOR THE LASTING BENEFIT OF THE AUSTRALIAN PEOPLE.