THE ACT government should consider creating its own bank, potentially using Australia Post outlets as branches, a Canberra academic has said in a submission to the ACT budget.
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The territory government could harness the power of community credit to slash the cost of funding capital infrastructure by at least 50 per cent, Kevin Cox, an academic in the Faculty of Information Sciences and Engineering at the University of Canberra, has predicted.
''The ACT government can change the course of ACT economic development for the better by taking control of community credit and using it for the benefit of the community,'' he said.
''It requires imagination and courage but no legislative or banking changes.''
ACT Treasurer Andrew Barr has called for submissions in lead up to the 2012-13 budget about how the government's resources should be allocated and where possible efficiencies could be achieved.
Mr Barr said that the budget was expected to deliver an underlying surplus of $1.6 million in 2013-14.
Dr Cox said he believed the government could use its money more wisely.
''The ACT government has control of investments of over $3 billion,'' he said.
''These funds can be leveraged without risk, through the banking system, for the government to generate loans to the community it serves.
''The ACT government could use an existing bank … or if necessary create its own bank capitalised with the $3 billion in existing ACT government investments.''
Dr Cox said such a bank could also offer business loans, home loans and credit cards.
''In the same way that the cost of a house can be halved through reducing finance charges so the cost of ACT infrastructure can be halved,'' he said.
''This means the ACT can build twice the infrastructure for the same cost. The system is self-perpetuating because, as old loans are paid off, new loans can be given.''
