State Government hands back Haughton Pipeline cash over ‘broken promise’
In a bold move the Queensland Government will hand back $195 million to the Federal Government in a bid to protect North Queensland’s water security.
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In a bold move the State Government will hand back $195 million to the Federal Government in a bid to protect North Queensland’s water security.
Claiming Federal MP Phillip Thompson “broke his promise” on delivering funding for the Haughton Pipeline Stage 2, the State Government will now fund the project on its own.
This will break the deadlock and allow Townsville City Council to get construction underway.
The two levels of governments have been at odds over the project for months with the Queensland Government calling for the project to be exempt from GST calculations.
But the Federal Government stood firm in opposition to the proposal, signing over the money for the project in July.
Mr Thompson said the Commonwealth Grants Commission calculated the GST allocation, and looks at each state’s capacity to pay for services for its people, taking into consideration Federal Government grants.
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Queensland Treasurer Cameron Dick said despite handing over the $195 million last month, the Federal Government was going to “clawback” $156 million through the state’s GST allocation.
“It turns out that Phillip Thompson’s promise is worthless, giving $195m with the one hand but taking back $156m with the other, through a GST clawback that hurts Queensland,” Mr Dick said.
“Now, more than ever, we need to invest in critical infrastructure to create jobs, and that $156m would create around 500 jobs for North Queenslanders. The people of Townsville need more than the measly $39m the Federal Government is offering for this project, so we have taken the decision to kick them out.”
But Mr Thompson has previously called into question the State Government’s GST calculation, suggesting the $156m figure was wildly inaccurate.
“The Commonwealth Grants Commission process hasn’t happened for this financial year, so this $156m figure couldn’t possibly be accurately calculated,” Mr Thompson said last month.
“The misleading comments by the State Government about $156m aren’t about stage two of the Haughton pipeline.
“This made-up figure is what they think it could be for the whole state if all the projects funded by the Federal Government throughout Queensland – not just Townsville – are included in the GST allocation calculations by the grants commission.”
State Mundingburra MP Coralee O’Rourke said the last time Queensland received an exemption was when the LNP was in power.
She said other states and territories had received exemptions for projects like Haughton Pipeline State 2.
“It’s just not good enough for the people of North Queensland,” she said.
“We call on the Federal Government to provide this money to Townsville through a payment that will not be subject to a GST clawback.”
Townsville MP Scott Stewart said the Federal Government had given exemptions for New South Wales and Victoria for $6.2bn for the Snowy Hydro Scheme.
“That didn’t affect their GST take by a single dollar,” he said.
“Why should North Queenslanders take a hit of $156m?”
The $200m Haughton Pipeline Stage 1 is complete and runs from the back of the Ross River Dam to the Haughton Channel.
Stage 2, which was part of the LNP’s 2019 election promises, extends it 36.5km to the Burdekin River at Clare.
Originally published as State Government hands back Haughton Pipeline cash over ‘broken promise’