GENERAL PURPOSE CAPITAL ASSISTANCE

In 1996-97, general purpose capital payments to the States were confined to payments under the Better Cities Programmes, which accounted for only 0.3 per cent of total general purpose payments. With the completion of the Commonwealth's contractual commitments under this programme no general purpose capital payments will be made in 1997-98.

The decline in the significance of general purpose capital assistance has mainly been a reflection of changes in Loan Council arrangements. Prior to 1987-88, capital payments to the States were made in the form of both loans and grants. After 1989-90, capital payments to the States were provided entirely by way of grants. At the 1994 Premiers' Conference it was decided to abolish the Loan Council capital grants programme from 1 July 1994. Between 1994-95 and 1996-97, Commonwealth general purpose capital assistance consisted only of grants under the Better Cities Programmes.

Table 17 shows general purpose capital assistance since 1993-94. Chapter IV of Budget Paper No. 4 1991-92 provided details of earlier developments in general purpose capital assistance.

Table 17: General Purpose Capital Payments to the States ($million)

(a) Estimates.

(b) In 1996-97, $2.1 million of total Better Cities funding has not been allocated among the States but is being distributed on an alternative basis.