Garnaut Fitzgerald Review of Commonwealth-State Funding

CHAPTER 4: Allocation of General Purpose Grants
FIGURE 4.1: Aggregate transfers as a percentage of GSP
1.4
1.2
Recipient States: QLD, SA, TAS, ACT and NT
1.0
0.8
Per cent of GSP
0.6
0.4
0.2
0.0
-0.2
-0.4
-0.6
Donor States: NSW, VIC and WA
1998–99
1999–2000
2000–01
2001–02
2002–03
2003–04
2004–05
2005–06
Note: Estimates used for 2003-04 to 2005-06 from South Australian Department of Treasury and Finance (unpub.)
4.4 Issues around horizontal fiscal
equalisation
The summary of the CGC’s HFE process suggests it is orderly and precise (see Section
4.3). However, the process has many contentious aspects.
Currency of data
This use of historical data means that there is a lag of two to six years between changes
in States’ circumstances and their impact on the CGC relativities. For example,
additional State revenues generated by the Sydney Olympics for New South Wales in
2000–01 became part of that State’s budget in that year, but will be shared among the
States by the CGC over the years 2002–03 to 2006–07.
FINAL REPORT [54]