Parliamentary record : Part I debates (11 November 1986)
Debates for 4th Assembly 1983 - 1987; ParliamentNT; Parliamentary Record; 4th Assembly 1983 - 1987
Made available by the Legislative Assembly of the Northern Territory
Northern Territory Legislative Assembly
Attribution International 4.0 (CC BY 4.0)
Legislative Assembly of the Northern Territory
DEBATES - Tuesday 11 November 1986 Even the world's greatest Treasurer has been forced to admit that the Australian economy faces grave difficulties, so grave that we are in danger of becoming a banana republic. The terms of trade have moved dramatically against Australia with a 10% decline in 1985-86. The Commonwealth government predicted a further worsening in the terms of trade during 1986-87. The world economic recovery has not been as strong as expected. There has been little favourable impact on the demand for Australian raw materials and that is the result, at least in part, of the rapid rise in alternative sources of supply. Australian agricultural exports are in serious difficulty with both the European Economic Community and the United States subsidising exports in Australia's traditional markets. Gross domestic product, the measure of Australia's production, slowed down to a sluggish 3.7% in 1985-86, coupled with heavily increased foreign borrowings associated with the resources boom and infrastructure programs of the early 1980s. This has led to large deficits on the current account and the alarming and unprecedented collapse of the dollar. In the year ahead, the gross domestic product is expected to grow only by 2.5%. In real terms, unemployment growth is expected to be 1.75%. Monetary and fiscal policies have been tight. High interest rates have discouraged borrowings for investment. Putting it bluntly, Australia stands on the brink of a recession. Not only was the NT budget prepared under conditions of financial stringency but in a state of uncertainty. We were mindful of the. Commonwealth's reference to the Grants Commission concerning alleged overfunding of the Territory in 1983-84 and 1984-85. This reference was unprecedented in relations between the Commonwealth and the states or the Northern Territory. It is retrospective, and seeks to suggest that the Territory could recreate money already received and spent in good faith. At the Premiers Conference, the Territory received only a 3% increase in monetary terms, which was a 5% reduction in real terms. In other words, the Territory received about $50m less than would have been required to maintain the 1985-86 status quo. By far the most significant item was the $40m reduction in general purpose,capital payments to the Territory. On top of these cuts, the tax-mad federal government has instituted a fringe benefits tax. While the economic outlook for Australia is very dim indeed, Territorians have reason to be optimistic about the future. Of course, the Northern Territory economy has not escaped the national economic downturn. Building starts are down, particularly in housing. World commodity prices have had a dampening effect on the mining industry although activity in gold and gas remains strong. Despite these unavoidable effects of Labor mismanagement, the Territory is still the land of hope compared with other parts of Australia. In the south, the feeling is that the nation is paralysed. Up here, the Northern Territory is on the move. Why? Because the Territory government has sound financial policies, promotes development and has confidence in the future. I want to turn now to some economic figures which indicate the health of the Territory. Population continues to grow at 3 times the rate for the rest of Australia. This is a result of government policies which promote employment opportunities and create jobs. Employment in the Territory continues to keep pace with population growth. In the year to March 1986, another 5300 jobs were created. Last month, unemployment in the Territory was only 4.3% compared to the national unemployment rate of 7.8%. Tourism is continuing to prove itself a dynamic and successful industry in the Northern Territory. It is growing at an even better rate than it did last year. Total takings for hotels, motels and caravan parks rose by 32.8%, from $28.1m for the year to June 1985 to $37.3m for the year to June 1986. Takings for hotels 813
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