Goods and Services Tax

Mr MARSHALL (Dunstan—Leader of the Opposition) (15:05): Thank you very much. My question is to the Premier. Now that the opposition leader, Bill Shorten, has ruled out adopting an increase to the GST as policy, does the Premier believe it will be possible for federal Labor to deliver on its education policy?

An honourable member interjecting:

Mr Marshall: I'm sorry—

The Hon. A. Koutsantonis interjecting:

The SPEAKER: The Treasurer is warned.

The Hon. J.W. WEATHERILL (Cheltenham—Premier) (15:05): We are talking about two separate issues here. The federal funding cuts in relation to health and education fall largely in the health area. The lion's share of the $80 billion of cuts are in the health area. So, while the reinstatement of years five and six of Gonski is welcome—it is a tremendous contribution, and the fact that it has a funding plan to reinstate that funding should not be diminished by the federal Labor Party, so without wishing to belittle that at all—the larger part of the task has still not been responded to by federal Labor or federal Liberal.

We as a state are going to have to grapple with this ourselves on our own if there is not a federal response to this. It is in the interests of South Australia for me to stand up and put this on the national agenda in the lead-up to the federal election. Now, does that make life a little uncomfortable for some of my federal colleagues? Yes. I am sorry about that, but my responsibilities are to this state and to this parliament, to ensure that our children get the education they need and our patients get the treatment they need in our public hospital system. I am duty bound to pursue those issues. I would have thought that those opposite would join in common cause with me in relation to those matters.

Mr Gardner interjecting:

The Hon. J.W. WEATHERILL: Well, there is one small detail that actually occurred since the last election: it is the $80 billion cut to health and education. I would love there to be an alternative solution. I would love somebody to come up with an alternative solution than the ones that I have proposed, but I am yet to hear them. I have yet to hear a coherent, sustainable plan to actually respond to the health and education cuts.

Now, I have certainly put forward a range of ideas. All we can hope for is not a 10 or 15-year plan. If all we can hope for is something to get us through the next five years, which are going to be hard enough, then expanding the GST to financial services is an idea I have advanced, and that raises between $3 billion and $4 billion. It suffers from none of the same concerns about a disproportionate effect on low-income earners.

I think it is something which has been recommended by a range of inquiries into the taxation system in this country. It broadens the tax base on to a growing sector of the economy, and financial services, Ken Henry and other reviews recommend that it is a proper approach. Of course the banks don't like it, but, well, that would not be the first time they have complained about things.

I think that it is inappropriate that some sector of the economy is quarantined in that way from the GST. So, that does provide us with a positive way forward. If the GST is off the table, and it appears to be at least in terms of increasing the rate, broadening the base to cover financial services may provide a short-term solution at least to some of our funding difficulties.

The SPEAKER: I warn the members for Morialta and Hartley for the second and final time, the Treasurer a second and final time, and I call to order the member for Mount Gambier. Leader.