Budget relief - GST cash flows to NT again

Scott Morrison.
Scott Morrison.

The Federal Government will provide new funding to boost services in the Northern Territory, having reached agreement with the NT Government on future funding for remote indigenous housing, public hospitals, and housing and homelessness.

“We are taking responsible action to protect the Northern Territory from the extreme outcomes resulting from the 2018-19 GST distribution that has placed essential services under pressure,” Treasurer Scott Morrison said today.

The NT’s GST relativity will fall from 4.66 in 2017-18 to 4.26 in 2018-19 as a result of recent recommendations made by the independent Commonwealth Grant Commission; a significant concern given GST revenue represents around half of the NT's total revenue. This has compounded the Northern Territory Government's budget pressures.

“This was clearly an outcome I was not comfortable with,” Treasurer Morrison said.

“To help the NT Government deliver essential services, including to remote communities, the Federal Government will provide financial assistance of $259.6 million.

“Our additional funding represents the Commonwealth's estimates of what the Northern Territory could have received from the increased GST pool if their relativity had remained the same as it was in the 2017‑18 financial year; a fair outcome for Northern Territorians. This funding agreement is the result of good faith discussions between Treasurers initiated at the Council on Federal Financial Relations meeting earlier this month.”

NT Treasurer Nicole Manison said the Territory Government had fought hard for the Territory's GST and welcomed the top up, following a steep drop in GST funding over the past two years.

"50 per cent of the Territory's revenue comes from GST, and with our small population and remote communities, this funding is critical to enable us to provide vital services to Territorians.

"We will work with the Australian Government to look at long term GST issues for the Northern Territory to ensure we have sustainable funding.

"We have worked hard to get the best deal for the Territory we'll continue to work constructively with the Australian Government to develop the North, close the gap on Aboriginal disadvantage and grow the NT's economy."

The Federal and NT Governments have also reached agreement on remote housing and public hospital funding, providing certainty for essential services in the Territory.

To help address the housing needs of Aboriginal and Torres Strait Islander people in remote communities, the Turnbull Government has committed $550 million for five years to support remote housing in the Territory.

This funding will start in 2018-19 and will be matched by NT Government contributions, with the NT Government retaining responsibility for sub-leasing arrangements in these remote communities for the five-year period.

Minister for Indigenous Affairs Nigel Scullion said this new investment will help address severe overcrowding in remote communities.

"This $550 million funding commitment comes on top of the $1.7 billion investment into remote housing in the Territory since 2008.''

"Our focus will be ensuring Aboriginal community control is at the heart of our investment, from decision-making to employment and business procurement to ensure we deliver long term sustainable change in remote communities.''

The Federal Government also welcomes the Northern Territory's commitment to sign the Heads of Agreement on public hospital funding and health reform, which will extend and increase funding arrangements for public hospitals for another five years.

The two Governments have also reached substantive agreement on the National Housing and Homelessness Agreement (NHHA), which, once finalised, will provide funding equating to $98.5 million over the next five years to the  NT to support the delivery of affordable housing and homelessness services.

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