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Compare the pair: politics and public policy in Tasmania and the ACT

By Brendan O'Reilly - posted Tuesday, 11 March 2014


The Tasmanian Forest Peace Deal is believed to have involved the Commonwealth in well over $100 million in assistance over recent years.

I could go on.

Apart from (substantial) benefits related to being the site of the national capital, the ACT receives little in the way special treatment from the federal Government. The ACT has benefitted from long term growth in the size of government. The quid pro quo is that, when the Australian Public Service (APS) suffers significant cutbacks, the ACT goes into recession. There was a deep recession in the ACT during the early years of the Fraser and Howard Governments (which turned around towards the end of their terms). Some expect the same for the next couple of years under Abbott.

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The ACT never wanted self government, which was rejected in a 1978 referendum with 68 per cent of voters recording a 'No' vote. Despite this, the Hawke Government forced self-government on the Territory in 1988, presumably because Labor was expected to be the "natural" party to govern. Self-government is perceived by Canberrans as having resulted in higher taxes and lower quality services. There was a general feeling prior to self-government that the federal Government had used Canberra as a "showcase" for many types of services, and that this could not be kept up by a locally funded administration. Partly as an inheritance from the earlier era, the ACT currently has (for its size) the biggest public housing sector in the country, the biggest loss-making public bus company, and amongst the most expensive-to-run public schools and hospitals.

A stagnating state economy with high unemployment is said by some media to have generated a broad sense of despair in Tasmania. A particular issue is said to be the obsession of Tasmanian Labor and Greens with "progressive" policy priorities - same-sex marriage, euthanasia, animal welfare, light rail and removal of plastic bags from supermarkets, when "bread and butter" issues should be the priority.

To someone living in Canberra this sounds all too familiar.

The ACT Government last year went ahead with same-sex marriage legislation despite warnings that it would be over-ruled by the High Court. The ACT Greens and some within ACT Labor also have a euthanasia agenda, though this is currently also thwarted by Commonwealth legislation. The ACT Government also not long ago banned sow stalls and battery hen cages, in what it claims is the most far-reaching legislation in the country. [Given the ACT has no intensive pig farms nor battery egg farms, the measures seem somewhat redundant. The Pace Farm battery hen facility at Parkwood on the outskirts of Canberra had already been induced to convert to barn eggs following a $7.5 million deal with the ACT Government in July 2013.]

Both respective Labor-Greens administrations have flirted with light rail and introduced legislation discouraging disposable plastic bags.

The outgoing Tasmanian Government is proposing a light rail link from Franklin Square in Hobart, past Glenorchy to the Museum of Old and New Art. Stage One is estimated to cost $70 million to $100 million.

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The ACT Government, on the other hand, is actually going ahead with its Capital Metro light rail link (running from Gungahlin to Civic) at a whopping $614 million cost. This is despite its ACTION bus network losing around $100 million a year, Canberra being too spread-out for effective public transport, and most Canberrans preferring to use their cars. While the Tasmanian light rail proposal is unlikely to survive past the election, there is a very real risk that the ACT's Metro might get built and be a financial millstone around the neck of ACT taxpayers for decades. If this happens, it might haunt ACT Labor in years to come.

South Australia was actually the first state/territory to pass legislation aimed at removing disposable plastic bags from retail outlets. It has now been followed by the ACT and Tasmania, which are both also promoting renewable energy. Last November the Tasmanian Government released a climate change strategy aimed at 100 percent renewable power usage by 2020. The ACT Government more recently announced a swath of new auctions for renewable energy projects involving wind farms and solar projects. The ACT will more than double the cap on large-scale feed-in projects to 550 megawatts, which is more energy than the city currently uses, and will allow the government to reach its target of 90 per cent of energy from renewable sources within six years (supposedly at no extra cost to consumers).

The ACT's main claim to fame in the area of renewable energy relates to the largesse of its household solar energy schemes. The most generous was its first scheme, which came into operation in 2009 paying 50.05c/kWh for systems up to 10kw capacity and 40.04c/kWh for up to 30kW capacity. (Later schemes paid lower but sill premium rates.) All contracts are valid for 20 years from their starting date. What was generous about the original ACT scheme is that it was a gross metered scheme (as opposed to much more common net-based schemes) meaning that owners got paid a premium rate for all electricity produced by their installation with their own usage being metered and charged separately at the retail rate. Currently ACT retail electricity prices are about 18.3 c/kWh and wholesale energy is worth about 7 cents.

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About the Author

Brendan O’Reilly is a retired commonwealth public servant with a background in economics and accounting. He is currently pursuing private business interests.

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Creative Commons LicenseThis work is licensed under a Creative Commons License.

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