States go toe to toe over their GST share

Queensland Treasurer David Janetzki’s repeated claims that the state’s GST revenue has propped up Victoria’s poor policy decisions have been dismissed by the Victorian Premier.

Queensland Treasurer David Janetzki. Picture: NewsWire / Glenn Campbell

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Queensland Treasurer David Janetzki’s repeated claims that the state’s GST revenue has propped up Victoria’s poor policy decisions have been dismissed by Victorian Premier Jacinta Allan as ­“bullshit”.

The Victorian Labor leader wholly dismissed any suggestion that the state was at fault for Queensland’s ballooning debt, as Mr Janetzki accused the independent body charged with deciding the GST carve-up of failing to equally and fairly disperse the funds for years to instead underpin the pandemic-era budgetary decisions of Victoria.

Speaking at a Committee for Economic Development of Australia lunch in Brisbane on ­Monday, the LNP Treasurer said the Commonwealth Grants Commission’s March decisions to strip Queensland of $2.3bn ­penalised the state for investing in energy sources and would act as a dampener on productivity and ­investment.

But Ms Allan responded by saying there was no basis to Mr Janetzki’s claims.

“Perhaps let me put it in ­language in a way the Queensland Treasurer can understand: it’s just bullshit,” the Premier said on ­Monday.

“Because when you look at the history of the GST, Victoria has been a net contributor to the tune of $31bn, and the Queensland budget’s … $8bn plus black hole has got nothing to do with the circumstances here in Victoria.

“I don’t want to quibble with another state, I don’t want to quibble with the Queensland Treasurer. What I’m focused on is not on nonsense like this, but on making sure Victorians get their fair share.”

When asked to respond to Ms Allan’s comments, Mr Janetzki said the numbers “speak for themselves”.

The CGC uses a complex equation that compares the ­revenues generated by the state to the population’s needs to determine the carve-up over a three-year average.

Queensland’s controversial super coal royalty tax was a contributor to half of the state’s ­reduced share of GST.

Over the past decade, ­Queensland’s share of GST has increased 28 per cent since the 2015-16 financial year, which is far lower than the 58 per cent increase in NSW, and 118 per cent increase in Victoria.

Western Australia’s portion has risen 317 per cent, largely linked to the sweetheart funding deal the state struck with the Turnbull government to ensure a floor was placed under its share.

“Any fair-minded person would look at the numbers and see the growth in GST and other jurisdictions over the last decade and see that Queensland has fallen behind,” Mr Janetzki said.

“We have been penalised because of our investment in those industries, like gas, that other ­jurisdictions will not invest in.

“I don’t think we should be penalised for that.

“We were stripped of $800m to reimburse NSW and Victoria for Covid-19 policy failures, five years after the fact.

“I don’t say this simply as a spurned treasurer of a state with an inconvenient drop in GST revenue. I say it because it is essential to improve national productivity and prosperity.”

He said the current algorithm failed to account for the diverse needs of a decentralised state, or “ideological decisions” to stop investment in revenue-generating industries such as gas.

“(The commission) effectively assumes that the cost of servicing a resident in Ballarat, 113km from Melbourne, is the same as ­someone being serviced from Brisbane to Mackay, which is 968km.

“Our state’s unique challenge as the most decentralised population in the country, and our support for sectors critical to the national interest, demand true horizontal fiscal equalisation.”

Ms Allan said Mr Janetzki would “be better off focusing on the facts” and working with the federal government to secure infrastructure funding and GST allocation.

“These nonsensical pot shots across state borders are just that, complete nonsense,” she said.

Mr Janetzki has twice written to his federal counterpart, Jim Chalmers, to ask for a review of the funding allocated by the commissions but has been rebuffed each time.