Three tax alternatives to restore sovereignty to Australia’s states

Gregory Melleuish, University of Wollongong

If it happens it will overturn nearly a century of the Commonwealth accumulating power at the expense of the states, commencing with the Engineers Case in 1920.

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The Uniform Taxation Act in 1942 helped to accelerate the process by giving the Commonwealth exclusive control over income tax.

The long-term consequences have been that while the states continue to deliver crucial services to the public, especially in health and education, they lack the financial capacity to fund those services without Commonwealth assistance. Hence, beginning in the 1950s, the Commonwealth began funding education, firstly universities and later schools, as the states proved incapable of providing sufficient funds for them.

This condition where the central government raises more money than it needs and the states are incapable of doing so is referred to as vertical fiscal imbalance. It means, in practice, that the Commonwealth is able to use its excess funds to dictate policy to the states. The states become subordinate entities to the Commonwealth.

It is interesting to note that Turnbull refers to the states as sovereign entities. They are in their areas of responsibility, but the power conferred on the Commonwealth through vertical fiscal imbalance has seriously eroded that sovereignty. The states have become mendicants who regularly go to Canberra to beg for money.

Equally of note is the use of the word “subsidiarity” in the Commonwealth government’s first federation issues paper from 2014:

“subsidiarity, whereby responsibility lies with the lowest level of government possible, allowing flexible approaches to improving outcomes.”

If subsidiarity is to be a fundamental principle of governing in Australia, then those responsible must also be financially responsible. Otherwise they cannot be sovereign and just become tools of the central government.

In the final analysis it all comes down to finance and financial independence.

The problem is that at present the Commonwealth holds the whip hand in financial matters. To achieve subsidiarity and make states genuinely responsible they will need to find sources of funding outside of going to the Commonwealth.

Unfortunately, the cards are stacked against them as the High Court has ruled that “excise”, which Section 90 of the Constitution says is granted exclusively to the Commonwealth, also covers sales taxes. This is why the Commonwealth became the exclusive owner of the GST, which it distributes to the states.

As the states lost the capacity to levy income tax in 1942, their taxation options are very limited. There is land tax (including council rates), stamp duty and payroll taxes, none of which raises an enormous amount of money. They also run lotteries. This is why income taxes are viewed as the best way of restoring some of the financial independence of the states.

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If the states are to levy income taxes, it only makes sense if, in the longer term, each state can determine the rate of that income tax. The great fear is that this will contravene the principle of horizontal fiscal equalisation, or the idea that each state should have the same level of service as the others. Competition, it is argued, will lead to a “race to the bottom”, with the consequence that lower taxation will lead to a lower quality of service in health and education.

But to truly restore sovereignty and the principle of subsidiarity, some power to tax income must revert to the states.

Alternative options

Turnbull has sought to encourage innovation and “agility”, and perhaps there may be other ways out of this dilemma. Here are some possibilities.

Give states power over sales tax

As the High Court defines sales tax as excise, the wording of Section 90 could be changed so that sales tax is explicitly excluded from the definition of excise. This would require a referendum, but it would give the states much greater flexibility in their taxing regime. It wold mean that states could, in effect, raise their own equivalents of the GST, as happens in some other countries, thereby allowing the Commonwealth to lower the rate of its GST.

Expand land tax

Whenever this topic is raised one response that is invariably raised is that the states should look at ways of expanding their land tax. This could be done by increasing the rate at which land is taxed and/or lowering the threshold at which payment begins.

Restore inheritance taxes

The states once raised funds through inheritance taxes, but these were abolished some 40 years ago. Given the amount of money now locked up in real estate in places like Sydney and Melbourne, there could be significant sums to be raised in this way.

Moreover capital acquired by simply living in a house for a certain number of years can hardly be compared to the money one earns working at an occupation. Beneficiaries of an estate cannot be construed as having deserved their inheritance.

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In all of the cases listed above the imposition of any such state taxes would need to be matched by a decrease in Commonwealth taxes.

The restoration to the states of some power to impose income tax appears on the surface to be the best way of both restoring sovereignty and embedding subsidiarity into the practice of government in Australia. There is much to be said for doing it. But if we are to grasp the opportunities of the present we need to consider other possible options.

What matters is less the means than the end: to restore Australia to a genuine federation.

Gregory Melleuish receives funding from the Australian Research Council. He is a member of the Academic Advisory Board of the Menzies Research Centre

Aboriginal artefacts found at Sydney light rail site

Thousands of Indigenous artefacts have been uncovered during excavation works for Sydney’s light rail project in the eastern suburbs.

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The project managers have stopped work on the site for now, but there are calls for a complete halt, with concerns it could be a mass Aboriginal grave.

The New South Wales government is not confirming whether it will continue construction on a section of Sydney’s new light rail line where thousands of Indigenous artefacts have been found.

About 20,000 artefacts were discovered in excavation pits around the rail line’s proposed tram stable yard in Randwick, in the city’s east.

They include items believed to have been traded from the state’s Lower Hunter Valley which have never been seen before.

Transport for New South Wales recognised the significance of the find between late 2015 and January this year, but has not said if it will stop work on the $2.1 billion project.

Altrac Light Rail chief executive Glen Bentley says the company is communicating with all the stakeholders.

“With the heritage experts and Aboriginal stakeholders, with all that evidence, we’ll be able to put together the story of what happened here.”

Indigenous heritage advocates have called for the site to be classed as an Aboriginal heritage area.

Some of the excavations could contain graves.

A cultural heritage specialist with the consultancy Tocomwall, Scott Franks, says it is a significant find.

“This is a site of significance, nationally. Whatever means, we need to know. It’s holding the Australian government to account, or the Crown. It’s about understanding what happened here, so our old peoples can rest.”

Another cultural heritage specialist with Tocomwall, Danny Franks, says the range of objects is of major historical significance.

“The density of artefacts that were found go into the tens of thousands, and a higher proportion of them were tips, blades. Now this leads us to suggest there was conflict here, which very well was a high probability of meaning there was death associated with this site.”

Citing journals from 1791, Scott Franks says it could have been the site of conflict between traditional landowners and Governor Arthur Phillip’s troops.

“This site represents a clear confrontation of women, children and men who were taken from the land. Ripping this up and not treating it like a proper archaeological dig is criminal.”

While the objects have been recovered and catalogued, there is no guarantee the site will be protected.

Altrac Light Rail’s Glen Bentley says it is too early to tell what will be done with the discovery.

“So there’s no works happening in this area, where we’re continuing with this investigation. So, until we finish that investigation, there will be no further works. The social value of this to the local Aboriginal community is immense, and we’re very committed to continue working with Aboriginal stakeholders to unlock the puzzle.”

 

 

 

 

 

Kyrgios into Miami Masters semi-final

Like him or loathe him, Nick Kyrgios is the new king of Australian tennis after breaking new ground in Miami.

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Kyrgios will crack the world’s top 20 and leapfrog Bernard Tomic to become Aussie No.1 on Monday after upsetting power-serving 12th seed Milos Raonic 6-4 7-6 (7-4) to reach his maiden Masters 1000 semi-final.

Three weeks shy of his 21st birthday, the volatile talent is the youngest man ever to make the last four in Miami and first Australian to do so since Lleyton Hewitt in 2002.

He next faces Japanese sixth seed Kei Nishikori for a likely shot at world No.1 Novak Djokovic in Monday’s (AEST) title match.

Raonic has been one of the hottest players on tour in 2016, downing Roger Federer to win the season-opening crown in Brisbane and racking up 17 wins from 20 matches.

His only previous losses this year came against Andy Murray in a five-set Australian Open semi-final thriller and to Djokovic in the Indian Wells Masters final.

But the Canadian was on the back foot from the outset after Kyrgios made a flying start by breaking Raonic in the opening game of the match.

“To be honest, I didn’t think I was going to break during the match,” Kyrgios said.

“I came out really energetic and got pretty lucky. That definitely made me more relaxed.

“I really learned how to return this year. That’s the major thing this year. I am giving myself so many more chances and getting so many more opportunities to take over matches.”

On Monday, Kyrgios is guaranteed to rise to at least 20th in the world and eclipse Tomic to become only the third player to hold Australia’s top ranking in the past seven years.

Tomic ended Samantha Stosur’s unbroken six-and-a-half-year stint as the country’s highest-ranked player – man or woman – last September, but is projected to fall out of the top 20 next week after skipping Miami with a wrist injury.

Nishikori overcame five match points to deny Frenchman Gael Monfils 4-6 6-3 7-6 (7-3) in their quarter-final.

The 16th-seeded Monfils was soaked with sweat on a sweltering afternoon but rallied from a 4-1 deficit in the final set.

Nishikori fell behind 0-40 serving at 4-5 but erased those match points and another in that game, and overcame one more match point serving in the 12th game.

He played a solid tiebreaker and closed out the victory with a forehand winner.

Djokovic faces Belgian 15th seed David Goffin in the first semi-final on Friday (Saturday AEDT) before Kyrgios takes on Nishikori.

Five things to know about Japanese royals ahead of first abdication in nearly two centuries

Here are five things to know about Japan’s royals:

Ancient history

The Japanese imperial family is believed to be the world’s oldest, with a myth-filled history that dates back more than 2,600 years.

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Akihito is the 125th emperor since Emperor Jimmu, said to be a descendant of the legendary sun goddess Amaterasu.

Emperors have played a crucial role in the country’s native Shinto religion, conducting various annual rites and prayers for the prosperity of the nation.

RELATED STORY:Constitutional symbol

The greatest threat to the imperial family’s long history came with Japan’s defeat in World War II.

Some in the Allied camp wanted to end the monarchy in whose name Japanese armies marched through Asia-Pacific.

But US General Douglas MacArthur, who led the post-war occupation, called for it to be retained, though its power was greatly curbed.

The current US-imposed constitution took away the emperor’s semi divine status and turned him into a national “symbol” as part of a radical democratisation.

Akihito, the son of wartime emperor Hirohito.AAP

Popularity

Unlike in some countries with royal families, there is no republican movement in Japan and the emperor and royal family have won the admiration of the vast majority of the country.

Emperor Akihito and Empress Michiko journey to sites of natural disasters to console victims, most notably after the 2011 earthquake, tsunami and nuclear disaster.

Akihito, the son of wartime emperor Hirohito, also repeatedly warned that Japan must not downplay its 20th-century militarism and actions in World War II.

His remarks have been seen as a rebuke to the nationalist stance of Prime Minister Shinzo Abe and like-minded conservatives.

Emperor Akihito’s oldest son Crown Prince Naruhito will assume the Chrysanthemum Throne.AAP

Gentlemen’s club

The family operates under hereditary, male-only succession rules, although there have been eight empresses in past centuries.

Upon the abdication of Akihito, his oldest son Crown Prince Naruhito will assume the Chrysanthemum Throne. 

Naruhito’s younger brother, Prince Akishino, is next in line. The only other male heir, 10-year-old Prince Hisahito, Akishino’s son, is third in line to the throne.

The future

If Hisahito only has daughters, the family is likely to face a succession crisis unless laws are changed.

The scarcity of young men in the family has prompted talk of alternatives, including letting women ascend the throne, though traditionalists abhor the idea.

Some have suggested that female members of the family who marry commoners should stop losing their royal status, as will happen to Akihito’s granddaughter Princess Mako when she weds her college sweetheart.

Others advocate expanding the family to include distant relatives.

The lower house attached a recommendation to the law, calling on the government to “consider” plans to allow female members to stay in the royal family even after their marriage with commoners.

Emperor Akihito’ abdication will be the first in nearly two centuries. AAP

Police want witnesses over M5 near miss

Police have praised the quick actions of a truck driver who prevented what could have been a “catastrophic” collision with a school bus in Sydney.

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Frightening footage released by police shows the bus – carrying 15 students – pulling onto the M5 into the path of the semi-trailer after 7.30am on Thursday.

The truck driver jumped on the brakes with his semi jackknifing and skidding to a halt in a plume of white smoke. The bus continued down the motorway.

“I have no doubt the truck driver’s actions have prevented what could have been a catastrophic motor-vehicle accident,” Detective Inspector Dean Johnstone told AAP on Friday.

“It was remarkable, given the way the truck ended up, there were no other collisions.

“No one’s injured, everyone’s gone about their daily lives today. It’s just unbelievable.”

Det Insp Johnstone said the truck driver had been traumatised by the event but “showing full courage” returned to work on Friday.

“It’s a testament to the character of the bloke.”

Det Insp Johnstone said drugs and alcohol were not factors in the incident.

The 59-year-old bus driver Kazem Afkhamisaddoghi apologised and said he thought he had enough time to pull out.

“Unfortunately I made a mistake … and I am so sorry about this incident,” he told the Seven Network.

The students were on an excursion from Mount St Joseph’s Girls’ College to an AFL gala day at West Hoxton when the incident occurred.

Det Insp Johnstone confirmed the students were not harmed.

He said dangerous driving charges will be laid against the bus driver and called on witnesses to contact police.

The bus company will offer their driver more training.

“I will really need to train him and make sure that next time he knows better,” GHP Australia spokesman William Matar told Network Ten.

EU, China back Paris pact after US pullout

Chinese Premier Li Keqiang and top officials from the European Union are set to reaffirm their commitment to a landmark climate change agreement a day after President Donald Trump said he was pulling the US out of the Paris accord.

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Climate issues are expected to dominate discussions between Li, who is leading a large delegation of ministers to Brussels, and EU Council President Donald Tusk and European Commission President Jean-Claude Juncker.

Speaking to European business leaders alongside Li, Juncker said EU-China ties are underpinned by “a rules-based international system.”

He said that Brussels and Beijing believe in “the full implementation, without nuances, of the Paris climate agreement,” and underlined that there can be “no backsliding” on the pact.

At their short summit, the EU and China – two of the world’s major polluters – are set to issue a statement reaffirming their stance on global warming following Trump’s announcement Thursday.

According to a draft, they will express their determination “to forge ahead with further policies and measures for effective implementation of their respective nationally determined contributions.”

They will also “call on all parties to uphold the Paris agreement” and “to strengthen efforts over time, in accordance with the purpose and provisions of the agreement.”

Separately on Thursday, European heavyweights France, Germany and Italy said in a joint statement that they regretted the United States’ decision to withdraw from the accord, while affirming their “strongest commitment” to implement its measures. They also encouraged “all our partners to speed up their action to combat climate change.”

While Trump said the United States would be willing to rejoin the accord if it could obtain more favourable terms, the three European leaders said the agreement cannot be renegotiated, “since it is a vital instrument for our planet, societies and economics.”

Germany’s environment minister underscored that Friday, saying “there will be no new deal with the United States” on climate change.

Barbara Hendricks told reporters in Berlin that other countries will fill the leadership vacuum left by the United States and the global climate would “survive” Trump’s maximum presidential term of eight years.

Frozen berries recalled over Hep A fears

A Victorian struck down with Hepatitis A was one of four cases nationally that prompted a recall of frozen berries across the state.

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Entyce Food Ingredients has voluntarily recalled the Creative Gourmet Mixed Berries 300g product, sold at at IGA, Foodworks, Foodland, SPAR and Supabarn with a batch code of PP150118.

Victoria’s Deputy Chief Health Officer Dr Brett Sutton released a health alert to warn that the frozen berries were potentially linked with an outbreak of Hepatitis A infection.

“As of 2 June 2017, Australian health authorities have identified four cases of hepatitis A infection that were acquired in Australia in 2017 and involve the affected strain of hepatitis A virus,” the alert said.

“One of these cases is an individual who resides in Victoria.”

Anyone who has consumed Creative Gourmet frozen mixed berries 300g packs with a best-before date of 15 January 2021 may be at risk.

Food Standards Australia New Zealand chief executive Glen Neil said agencies were still testing to determine whether the mixed berries were the cause of the outbreak.

Entyce Food said that batch of berries were no longer being sold and no other batches were impacted.

The Victorian Health department said an initial test was inconclusive for Hepatitis A, while a secondary test cleared the berries of containing traces of the virus.

Two years ago multiple frozen berry brands were found to be contaminated with the virus, and a country-wide recall was issued.

The contaminated fruit was imported from China and Chile, but was packed in the regional Victorian town of Bairnsdale.

How a tax technicality is fuelling Australia’s black market shisha trade

A decade-old change in the way shisha tobacco is taxed may have opened the window for a booming black market trade, according to Australian Border Force officials.

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The smugglers involved in the illicit trade of molasses tobacco, commonly known as shisha, could also be involved in larger trafficking rings, the officials said.

Law enforcement became suspicious when they noticed a drop in the amount of imported shisha declared to Customs, but no drop in the number of shisha smokers frequenting bars in Melbourne and Sydney.

“That tells me, indicatively, that we have an illegal molasses importation problem,” Border Force chief Roman Quaedvlieg said.

Officials told a Senate inquiry there was good evidence to suggest many importers were avoiding tax.

“The amount [of illegal shisha] we were seizing, compared to the amount that’s been declared for the purposes of duty…there was a big disparity,” Border Force’s Michael Outram said.

In 2008 tariff rules were changed so molasses tobacco was taxed based on its overall weight. That’s despite the wet, heavy substance containing more ingredients than just tobacco.

“Shisha contains sugar, it contains water,” said Nick Xenophon Team Senator Skye Kakoschke-Moore, who sits on a parliamentary inquiry into illicit tobacco.

“And so what happened was in an attempt to properly tax a tobacco product, I think it’s actually driven the market for this underground.

“When the tax office changed their treatment of shisha, I don’t think that they anticipated it would drive the market underground to the extent that it did and that in 10 years time we’d be in a situation where the majority of our shisha has been imported illegally.”

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A “sensible policy-maker” would have anticipated that outcome, Senator Kakoschke-Moore told SBS World News.

The effect, according to business owners, has been a massive increase in cost.

One Melbourne shisha cafe told SBS World News prices had “doubled”, while another said they had “tripled”.

A third said they had switched from real molasses tobacco to herbal alternatives because they could no longer afford it.

“We lost 30 to 40 percent of our customers, due to the price rise,” Ali Adam, the owner of the Cafe Asmara shisha bar in Melbourne, told SBS World News.

He said the tax hike in 2008 left him with no choice but to pass costs on to his customers.

He said the black market trade for shisha is a “huge market”.

“[If] we start charging fair tax for this product, that will stop the smugglers. It will stop everything,” Mr Adam said. 

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Border Force officials agree that there is a potential link between the high tax rate and the scale of the illegal trade.

“Obviously, when you get a change in regulation and a change in behaviour, some people will choose to comply and others will choose to try and avoid the duty,” Mr Outram told the Senate committee.

Border Force said they were “looking into” the problem and confirmed investigations had been carried out by the government’s Tobacco Strike Team, which received an $8 million funding boost in last year’s federal Budget.

One operation saw the seizure of 1.2 tonnes of molasses tobacco, a quantity that would avoid more than $1 million in tax, according to the Department of Immigration and Border Protection.  

Smugglers conceal loads in iron shelving, plates, bowls and industrial equipment, the department said.

“One of the areas of potential concern is the amount of money that can be raised and then sent back to other parts of the world for nefarious purposes,” Mr Quaedvlieg said. “That is another angle we are looking at.”

Senator Kakoschke-Moore agreed that those bringing in the illicit shisha may be involved in other kinds of trafficking.

“It could be quite sophisticated criminals operating in a broader criminal network,” she said.

“The AFP have said that they would only look at this issue if they believed that there was a link between the importation of shisha and broader criminal network involvement.”

THE FEED: Black Smoke – the illegal tobacco market

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Fukushima activates underground ‘ice wall’

The Fukushima nuclear plant has activated an underground “wall of ice” built around the reactors, to help contain spills of contaminated water into the Pacific Ocean.

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The system comprises underground pipes that will freeze the ground and create a physical barrier around the four units that were damaged by the earthquake and tsunami of March 11, 2011, a spokesperson of the plant’s operator, Tokyo Electric Power Company, or TEPCO, has confirmed on Thursday.

The installation of the system, the cost of which was estimated at $US307 million ($A399.95 million), has taken two years and while TEPCO presented the project in 2013, Japan’s Nuclear Regulation Authority, or NRA, had not approved it till now as it was analysing the safety of the project.

On Wednesday, the NRA greenlighted the first phase of the “wall of ice”, which flanks the Fukushima Daiichi plant, overlooking the sea on the west.

The second phase of the system will extend to the north and southern parts of the plant, covering approximately 95 per cent of its total perimeter, explained the spokesperson.

The operation of the first segment of the ice barrier will take about a month and a half and will ensure water from the underground aquifers does not get inside the buildings, housing the reactors, and mix with polluted refrigerant.

The goal is to reduce the amount of radioactive water that accumulates in the basements of the buildings and prevent its leakage into the Pacific Ocean.

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Once the ice barrier is operational, the amount of water that seeps daily into the nuclear plant will be reduced from approximately 200 tonnes to around 50 tonnes, according to TEPCO.

This amount could be reduced further if the third phase of the underground barrier is completed, sealing the eastern side of the plant, which the NRA is yet to authorise.

TEPCO “will carefully monitor” the levels of water on the subsurface throughout the process of activation of the wall to prevent new spills, added the spokesperson.

Watchdog takes private college to court

A private college will face action in the Federal Court over allegations it used misleading information and unconscionable conduct in signing up students for courses that saddled them with Commonwealth government debts.

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The Australian Competition and Consumer Commission (ACCC) and the Commonwealth government have alleged Australian Institute of Professional Education Pty Ltd (AIPE) marketed courses to “some of the most vulnerable and disadvantaged groups in the Australian community”.

Among the claims from the regulator is that AIPE allegedly promised students a free laptop or tablet to sign up to courses costing up to $19,600, when the computers were in fact on loan.

The watchdog also alleges that AIPE breached consumer laws by making false or misleading representations and engaging in unconscionable conduct by marketing VET FEE-HELP loan scheme-funded courses.

The college used door-to-door sales, face-to-face marketing and telemarketing to sell courses in NSW, Queensland and Western Australia, the ACCC said.

ACCC chairman Rod Sims said the watchdog alleged AIPE marketed courses to vulnerable groups including consumers from low socio-economic backgrounds or with intellectual disabilities.

“Some people were enrolled who had limited reading and writing skills, could not use a computer and were not able to use email,” Mr Sims said.

“We allege that AIPE failed to take adequate steps to ensure that it was not taking advantage of these vulnerable consumers.”

The ACCC alleges AIPE enrolled 15,426 students between 2013 and 2015 for courses costing between $12,160 and $19,600, and that AIPE was paid $210.9 million by the Commonwealth for the enrolments.

The court action is seeking to have students’ debts wiped and repayment of course fees made to AIPE under the VET FEE-HELP loan scheme.

AIPE told AAP on Thursday it had not yet received formal notification of any court proceedings.

The college said it was a “leading provider of vocational education” and that it sought to comply with all obligations under Australian consumer law.

AIPE said it terminated working arrangements with all agents it used to sign up prospective students last year after an audit by the Australian Skills Quality Authority.

The federal court action follows a joint investigation by the ACCC and NSW Fair Trading into the conduct of private colleges.

Gas sector could take decade to recover

Western Australia’s subdued oil and gas sector may have to wait a decade for a recovery, a prominent academic says.

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Natural gas prices have fallen as new projects come online and the outlook is unlikely to improve as more US projects are commissioned over the next few years, University of Western Australia chair of economics Peter Hartley said.

“Our own modelling work, trying to forecast what might happen with natural gas, it’s not a great story for WA,” Mr Hartley told a business lunch.

“It indicates that probably not until the second half of the twenties will there be a substantial opportunity for Australian natural gas projects.”

Australia is facing a weak market for liquefied natural gas (LNG) after the completion of seven major local LNG projects in recent years, and a collapse in oil prices, Mr Hartley also warned.

He predicts oil prices will trade around $US33 a barrel by March 2017, down from the current price of $US38 a barrel.

Iron ore prices are also unlikely to recover over the next year, Mr Hartley said, predicting a price of around $US48 a tonne in March 2017, down from the current price of $US55.

A global oversupply of iron ore has weighed on prices as Chinese steel demand continues to soften.

Also speaking at Thursday’s event, BHP Billiton’s Vice President of Strategy, Development and Planning Tony Ottaviano defended the company’s high production levels in the face of the oversupply.

“When I hear the doomsayers say iron ore is yesterdays news, I sit back and I say $70 to $80 billion of investment needs maintenance, needs replacement, needs sustaining, needs new skills and when you see the sort of EBITDA margins we make I cannot understand why we wouldn’t operate these assets to their full potential,” he said.

School principals back Gonski funding

School principals say funding being received under the Gonski model is making a difference.

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The Turnbull government argues a new school funding agreement is needed post-2018 to replace Labor’s model of extra money for disadvantaged schools, which stemmed from a report by consultant David Gonski.

But the latest State of Our Schools survey found 95 per cent of schools that received over $200,000 in increased Gonski funding said it had made a positive difference.

Schools were spending the money on teacher training, student support staff, specialist literacy and numeracy teachers, individual support for students with learning difficulties and extra classroom teachers.

But 45 per cent of principals say their school is still either under-resourced or significantly under-resourced.

The figure was up to 65 per cent in Victoria, where Gonski funding was delayed until this year.

Australian Education Union federal president Correna Haythorpe, who commissioned the survey, said the Gonski model should continue.

“We need Malcolm Turnbull to match Labor’s commitment to funding Gonski in full and investing an extra $4.5 billion into our schools in 2018 and 2019, to allow schools to build on the success they are already starting to deliver,” she said.

School principals also reported that fundraising by parents was a mainstay of school budgets.

Sixty per cent reported fundraising was used for classroom equipment, 46 per cent for sports equipment or uniforms, 43 per cent for textbooks and 28 per cent for basic maintenance.

“These are things which should be provided to schools without the need for them to do their own fundraising,” Ms Haythorpe said.

MP stands by NQ state despite criticism

Federal MP George Christensen is standing by his push for a referendum on north Queensland becoming a separate state, despite the state’s treasurer rubbishing the idea.

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The federal member for Dawson is lobbying politicians north of the Tropic of Capricorn to support a vote by north Queenslanders only on the breakaway plan.

Treasurer Curtis Pitt, whose Mulgrave electorate starts south of Cairns, says revenue from mining and tourism, the north’s key industries, would be nowhere near enough for the region to fund essential services.

But Mr Christensen told AAP the state would have numerous revenue options including pushing for a share of GST revenue and taking advantage of the Turnbull Government’s plans to have states raise their own income tax.

“We have 60 per cent of the state’s export industries above the Tropic of Capricorn,” he told AAP on Thursday.

“That says a lot.”

Mr Christensen has been speaking to economist Colin Dwyer, who he says is “adamant” the move can be made.

But, the Townsville-based economist and longtime proponent of secession said more rigorous modelling was needed before north Queenslanders went to the polls.

He based his argument on the idea that the new state, which would have about 20 per cent of the Queensland population, would need the same portion of the current budget in revenue, supplemented by mining royalties and borrowings.

Mr Dwyer said the northern state would have to pay the south for some services, especially in its early days.

But he didn’t know which services the new government would be unable to provide.

“You wouldn’t be having the plebiscite immediately,” he said.

“We could get something up and running (detailed research) within 12 months, possibly even six months.”

Mr Pitt said the state would have difficulty funding the creation of a new government, while Mr Christensen said the cost wouldn’t change dramatically because the region already has politicians and bureaucratic infrastructure, like department offices, in place.

The idea of a separate northern state has long been floated by other disgruntled politicians concerned the region hasn’t received the attention it deserves.

Mr Christensen said a government aligned with the interests of the north would have approved mining in the Galilee Basin already.

“The Galilee Basin is part and parcel of why this push is probably gaining momentum,” he said.

“We have seen absolute stagnation on issues like this for years.”

Mr Dwyer previously ran for the LNP in the seat of Mundingburra but says he’s no longer a member of a political party.

He said he’s given advice to numerous politicians, including Rob Katter.