Luke Hartsuyker (Cowper, National Party) Share this | Hansard source

It gives me great pleasure to speak on Appropriation Bill (No. 1) 2006-2007 and cognate bills. This legislation implements a budget that is physically sound, that provides a balance between the provision of services and revenue and that sets the stage for the future growth of this country. This budget is not the result of the events of the last four months; it is a budget that has been delivered as a result of 10 years of solid economic management. It is a result of this government’s ability to pay back $96 billion in Labor debt, to keep real incomes rising, to keep inflation low, to lower unemployment and to create 1.7 million new jobs. It is a budget that reflects good management by this government. Gone are the days when we talked of the recession we had to have. This government believes in creating opportunity, and this budget goes down that path to continue creating opportunity.

Tonight I want to speak on six key areas: tax cuts, the changes the budget makes in the areas of superannuation and retirement, support for business, support for infrastructure, support for families and seniors, and the important area of health. There is something in this budget for every taxpayer. Some $36.7 billion in tax cuts will be delivered over the next four years. The low-income offset will increase to $600 and the phase-out will go up from $21,600 to $25,000. The 30 per cent tax threshold will increase. The 42 per cent marginal tax rate will be reduced to 40 per cent and the threshold will increase to $75,000. The 47 per cent marginal tax rate will be reduced to 45 per cent with the threshold increasing to $150,000. It is important that we create incentive for people to be productive. It is important that we create incentive for people to invest in their own professional development so that they can earn higher incomes. I believe the changes in the tax rates are an important step in creating incentive.

For senior Australians, the SATO threshold will increase to $24,867 for singles and $41,360 for couples. A family with two children will pay no net tax until their income exceeds $48,000. That is a very good figure. As a result of this budget, more than 80 per cent of taxpayers will face a top marginal rate of 30 per cent or less. In percentage terms, the lowest income earners get the greatest tax cut. The OECD noted that the top marginal rate was around the international average but cuts in at a relatively low income. This budget does a great deal to reduce the disincentive that high marginal rates cause. It is very important that we create incentive. It is very important that we maintain the momentum this government has developed so that people are encouraged to achieve and generate income for themselves and for the wider community.

I will now turn to superannuation. This government is very focused on the needs of an ageing population. The Intergenerational report has noted the startling statistics that the number of people aged above 65 will double by 2042 and the number of people aged above 85 will quadruple. The result will be a relatively smaller workforce to sustain a larger, ageing population. This government has put in place a range of measures to address this. Our retirement policies are based around three pillars: compulsory superannuation, encouraging savings for retirement and the safety net provided by the age pension. The budget builds on this approach. The abolition of tax on superannuation benefits from taxed funds will be a major benefit for older people in our community. I have certainly had a lot of positive comment on that. The abolition of the reasonable benefit limit, the extension of the co-contribution to the self-employed and the extension of the full tax deduction for contributions to the self-employed are all important measures.

The halving of the pension assets test taper rate is also a vitally important issue. People save for their retirement and accumulate assets. But what was the system doing? It was cutting their pension. Whilst we all concur with the view that people who are well off should have less access to social security, we think there is an equity issue and that people who have saved for their retirement should be supported as much as possible by the community. The reduction in the assets test taper rate will be welcomed by many senior Australians. The budget makes investing in superannuation far more inviting and it makes saving for retirement far more attractive. It provides a practical approach to the issue of retirement savings.

Another important thing I was very keen to see approved in this budget is the issue of curtilage. There is an anomaly in our social security system. If you live in a residential property in a major metropolitan centre or a regional city, that property is not included in the assets test, but if you live on a rural property—perhaps you are 80 years old, you have lived there all your life, you are too old to farm the land but you do not want to leave your property—except for the curtilage around the home, the agricultural land is deemed to be an asset for the purposes of the assets test. As a consequence of that, many rural families—elderly farmers—were basically living on the poverty line because they did not have access to the age pension.

The notion of extending the same sort of coverage to people who are using a property as basically a residence is a great and equitable step that was introduced by the budget. I would like to commend the current Minister for Families, Community Services and Indigenous Affairs. I also commend his predecessor, Senator Kay Patterson, for the great work that she did in pushing forward the notion of extending age pension eligibility to a much larger number of people in the rural community. Many people in my electorate will benefit from this change. It is welcome. It is a change that I have been working towards in my time in parliament.

This budget provides great support for business. We see a benefit to business of some $435 million over four years. There will be improved access to the small business capital gains tax concession by replacing the current controlling individual test with a 20 per cent significant individual test and increasing the net assets threshold from $5 million to $6 million. The incorporation fee will be halved. There will be more encouragement for venture capital investment and increased incentives for investment in new plant and equipment through accelerated depreciation. These are great measures that should substantially enhance business.

Infrastructure is another important area. I was delighted to see in the budget a contribution of $160 million to the Pacific Highway, which is to be matched by the New South Wales state government with a further $160 million—an additional $320 million being invested in the Pacific Highway. That means a total investment in the Pacific Highway over the years 2006 to 2009 of $1.3 billion—a very important expenditure indeed. It is a road that desperately needs upgrading. I am delighted that the federal government is able to assist the state government with that road. In my area, we have a number of vitally important projects, one being the Bonville deviation and a second project being the upgrade of the Sapphire to Woolgoolga stretch of the highway, which will be able to proceed apace through this additional funding that has been made available under this budget.

Roads are a very important matter, but we cannot just leave the issue with spending more money on our highways. It is important that we divert as much of the freight task as possible onto rail. Previously, this government announced $450 million to upgrade the rail line between Sydney and Brisbane, diverting some 120,000 containers a year off the road and onto rail by the year 2011—a very important step. If we did not do that, our roads would just clog up. If we do not attend to rail, if we do not get rail carrying its share of the freight task, we are going to see our roads clogged no matter how much money we invest in them. So I was delighted with that earlier announcement of some $450 million under AusLink. This budget complements that with $270 million being added to that allocation to upgrade the line between Melbourne and Brisbane. This is for vitally important work covering things such as upgrading signalling systems, reducing the gradients of hills, reducing the radii of curves and increasing the length of passing loops, making rail more efficient and giving it the opportunity to compete effectively with road—a vital part of this government’s strategy.

Also, local roads are vitally important. One in four jobs in regional Australia is created by exports, and all exports from regional Australia start their journey on a local road. It is important that we have good local road infrastructure. We have seen various state governments, particularly the New South Wales government, putting increasing responsibilities on local councils but not providing them with the sorts of financial resources to provide for those responsibilities. As a result of that, we see much of local council infrastructure in a very dilapidated state.

The Roads to Recovery program has been a great initiative of this government, and I was delighted to see that, as part of this budget, the councils in my electorate—as with councils right around the country—are receiving additional funding to provide for much needed upgrades of our local roads to provide for much safer travelling on our local roads and an improvement in the local government infrastructure. Coffs Harbour City Council, for instance, will receive an additional $768,000 from this measure; Bellingen Shire Council, an additional $337,000; Clarence Valley Council, an additional $1.3 million; Kempsey Shire Council, $712,000; and Nambucca Shire Council, $464,000.

This money is being paid direct to councils. No money is being skimmed off to cover overheads in Macquarie Street. This money is being paid directly to local councils so that they can spend on the priorities that they identify, that the community is telling them they need. I think that is part of the success of this program: upgrading local infrastructure in response to local needs, not some edict that has come down from on high from a state government or the federal government but from the people who really know what needs to be done—the local engineers and the local communities. It is a great initiative, and I commend it.

Families are the cornerstone of our community. Once again, the government has shown in this budget its commitment to families. In 2006-07, the government will spend some $28 billion in assistance for families with children. That is double what was spent in 1996-97. The maximum rate of family tax benefit part A per child has been increased by 75 per cent over the same period and is now at the rate of $4,200. From July, more families will receive the maximum rate and they will be able to earn up to $40,000 per year without having their entitlement reduced. More than 12,000 families receive this benefit in my electorate. Some will also benefit from the extension of the eligibility for the large family supplement of $248 to families with three children, as opposed to the previous level which was for families with four children or more. It allows for support for our larger families. It is a move which I commend. The government has also made provision for the cap on the number of outside hours care and family day care places to be removed, which should create another 25,000 places. This is great support for families, and I commend these changes.

The budget also contains $586 million to help older Australians and carers meet their living costs. There are a range of measures involved in this. There is the $102.80 utility payment to assist our older Australians to meet their various utility bills, and I know from the calls to my office that this is a welcome payment. Carers are real achievers in our communities. They always punch above their weight in the care that they give their loved ones. We are again supporting carers in this budget through the carer payment and carer allowance, with a one-off payment of $1,000 and $600 respectively being provided. Some 3,700 people in my electorate will benefit from that payment—a very welcome payment indeed.

I think that we cannot spend enough on health. I commend the initiatives that this government has taken in the field of health. We have seen great improvements in bulk-billing rates, for instance, as a result of the measures of this government, providing incentives to GPs to provide services on a bulk-bill basis. I welcome the huge increase in investment in medical research, increasing to more than $700 million. It is very welcome. The money we spend on research will create huge benefits downstream, relieve great suffering and provide tremendous economic benefit to our community.

I think also that the investment in additional training places, with 400 places for medical students, many of them bonded, will be welcomed in rural and regional areas. Labour force shortage, particularly in regional areas, is a vital issue. This government implemented the idea of the rural clinical school, one for training medical professionals in regional and rural areas with a view that they are more likely then to practise in regional and rural areas when their training is complete. It is a great initiative by this government, one that is commended very widely.

I think the mental health initiative is vitally important. The level of mental health services in this country has been very lacking. The $1.9 billion commitment by this government to improve mental health services is going to be welcomed around the country. There are huge problems in the delivery of mental health services. There is a great lack of provision of services for these people in need, and this initiative will go some way to improving mental health services. It is a great first step in what I think is going to be a long road in improving our mental health services over time.

In conclusion, this is a budget that has as its basis strong economic management over a long period of time. It is a budget that has been delivered by a government that is committed to reform. It is a budget that has been delivered by a government that is committed to keeping interest rates low, keeping this economy growing at a fast rate, ensuring that we continue to create jobs and ensuring that we continue to create opportunities. It is a budget that has been well received in the community. Many constituents in my electorate have complimented me repeatedly on the measures that are in this budget. It is a budget that delivers to people right across the spectrum of our community. It is a budget that is going to deliver into the future. It is a budget that sets the stage for the continued future growth of this country. I commend the bills to the House.

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