Commonwealth Grants Commission report Fri 15 March 2013 Lara Giddings Premier Today's report from the Commonwealth Grants Commission confirms Tasmania's share of the GST pool will increase in 2013-14, as predicted in the State Budget. The Premier and Treasurer, Lara Giddings said the result confirmed that the model adopted by Treasury to predict Tasmania's share of the GST is more accurate than the figures contained in the Commonwealth Budget, which forecast a decline in Tasmania's per capita share. "The Commonwealth's 2012-13 Budget was forecasting a decrease in Tasmania's per capita share but the CGC's Update has confirmed that we will receive an in increase, albeit slightly lower than what we were forecasting," Ms Giddings said. Tasmania's share of the pool will rise from 1.58088 in 2012-13 to 1.61454 in 2013-14, primarily reflecting the higher cost of delivering services in Tasmania and below average increases in Commonwealth payments. "Based on these results, Tasmania will receive $1.838.8 billion from the GST pool in 2013-14, which is $31 million less than forecast in the 2012-13 Budget," Ms Giddings said. "While this drop in expected revenue is disappointing, it is significantly better than the 1.52185 per capita share prediction in the Commonwealth's 2012-13 Budget papers." Ms Giddings said the Commonwealth predictions differed from the final determination of the CGC because they did not take into account the effect of one-off funding like the Royal Hobart Hospital project on relativities. "I explained at the time of the last Budget that as the effects of this one off capital funding flowed through the system, we could reasonably expect our GST payments to bounce back and that is exactly what has occurred." "All Australian states now use a similar model for predicting their GST share. "Obviously any loss in revenue places additional strain on the Budget but the Government remains committed to returning the Budget to a sustainable position. "The full impact of the new relativities will be reflected in the 2013-14 Budget, which will be released on May 23." Ms Giddings said the possibility of a Tony Abbott led coalition government was still the biggest risk to Tasmania's finances. "Mr Abbott and his Tasmanian Senate team have repeatedly failed to rule out adopting a per-capita distribution system which would rip up to $700 million out of Tasmania every year. "All the Liberals need to do is rule out changes to the current system and this issue will go away but instead they have been hiding behind tricky wording like 'Tasmania will not be left worse off'. "Under the Liberal Party's no worse off scenario, Tasmania could not expect its share of the GST to rise, as it has today."