Wilson Tuckey (O'Connor, Liberal Party) Share this | Hansard source

Whilst I noted within the comments of the previous speaker, the member for Sydney, that she kept pointing out recommendations, suggestions and policy positions of the opposition with regard to the bulk of the provisions in this legislation, let me say that they are entirely an invention of the coalition government under Prime Minister Howard. They are among the great reforms of tax law and social support that have been implemented in the 20-odd years that I have been a member of this parliament. They recognise a fundamental principle that, irrespective of your wealth, the raising of children, as many of us would know, is a very expensive business. I get quite concerned from time to time when certain people are quoted in the press as saying there are too many benefits for functional families with children and they should be extended in some form to single people or couples in employment with no children.

I do not think it would be an exaggeration at all to say that a family on $40,000 a year—after tax even, for the purpose of the example—would be $20,000 a year worse off with one child, and certainly with two, compared to a couple on the same income with no children. Therefore, in recognition of this, the government provides this very strong support for functional families and the retention of same. Might I put on the record a quote oft said by my mother, who knew a bit about it: when poverty walks through the door, love flies out the window. Whilst it should not be said in a callous way, the pressures that families experience during hard times certainly can eventually lead to family breakdown. So every effort the government can make to keep families together and to assist parents in the fashion that the bulk of this legislation does is of course to be commended. I am delighted that this support has been increased.

Various aspects of the explanatory memorandum talk about the financial impact of increases in the family tax benefit part A income-free area. From 1 July 2006, the lower income-free area for family tax benefit part A will be further increased to $40,000. The amount will then be indexed in accordance with movements in the consumer price index on 1 July 2007 and on each subsequent 1 July. The cost to the revenue is listed as being $241.8 million in 2006-07 and $256.3 million by 2009-10. The member for Sydney made approving comments about the large-family supplement, and the explanatory memorandum advises me:

From 1 July 2006, families with 3 or more children will be eligible for an additional amount of family tax benefit Part A, known as the large family supplement.

And of course my remarks regarding small families become exponential as we move to talking about large families, notwithstanding the fact that there is another little homily I can draw to the attention of this House concerning the actual nominal value of the wages that people receive, and I think that male total average weekly earnings are now of the order of $900 a week. It is interesting that people struggle with that amount of money, but that is the downside effect of the more we pay ourselves the more it costs us to live situation. This comes to the real terms argument that the government puts forward when it says it has improved the spending power of families and wage earners by 16 per cent. That is an improvement in their living standard simply because the balance has been towards higher wages and lower increases in costs. But when, as we experienced for probably 50 years in this country, there was a situation where as soon as one wage increase was approved the next one was applied for, we saw a change.

It is my personal observation that my father was able, on ₤6 a week, to keep four kids and own a motor car and his own home—a careful man, I might add, who had a wife who never had paid employment. So one might wonder just what we have gained between six quid a week and $900-odd a week, other than that the latter is a lot of money and typically the tax commissioner has an ever increasing share, which we politicians then take credit for as we distribute it in manners such as the one that we are dealing with at the moment. Nevertheless, that is a matter of history and it is nice occasionally to put it on the record. In truth these measures are a redistribution of that tax revenue in a very appropriate way. The large-family supplement will also represent a cost to the revenue in 2006-07 of $113.7 million and $129.4 million in 2009-10. That is a substantial amount of money paid only to people who have large families.

I come to the extension of eligibility for utilities allowance. Also from 1 July, the eligibility for utilities allowance will be extended to ‘persons who are under pension age and are receiving mature age allowance, widow allowance or partner allowance’. The impact of this starts at $7.5 million and actually decreases to $6.4 million as time goes by.

There are other provisions in this bill. For the Australian government disaster recovery payment there is an expenditure that is not that large, but of course it is a very important one where it applies. The payment is to be exempt from all Australian government means-testing arrangements and will be non-taxable. In other words, a disaster is something that can attack the wealthy and the less well off in equal terms, and it should be addressed in the way provided in the bill. The amounts of money range from $4.3 million to $3 million. There are other extensive measures in this bill. I think they are all a case of spending money to help people, so they should be supported accordingly.

In fact, I will be making some further media comment in half an hour on a Perth radio station, at their request, resulting from an interview I gave yesterday that resulted from a journalist coming to me and saying, ‘Well, here’s what we asked the people in the street. It was whether they would take a job in the Pilbara.’ Each person was unemployed, as I recollect. The interesting thing was that one fellow said, ‘I don’t know if I could go to the Pilbara. I don’t know that there would be enough sport.’ I can tell him, as others who have lived in that part of the country could, that there is plenty. People in small communities rely heavily on sport and support sports clubs with their own money and time.

As for the point that I really want to make, not long ago I read a letter to the editor from a woman who said she was a qualified school teacher. I think she was a single mother with children. The basis of her argument, which has been put in this place more particularly by the member for Jagajaga, is that if someone moves from welfare to a job their wages have to be calculated on the basis of first deducting the welfare benefit. That argument, if taken to its logical conclusion, says that every kid leaving school and seeking work should ask for a $1,000 a week on the basis that, if they did not seek work, they would get a certain level of welfare payment. That raises a very interesting question. Over the years this parliament has made the welfare safety net fairly generous. I support that where a person genuinely needs that support. But what about people who say, ‘I’m not going to work because the discounted rate after tax and a few other things means I only get paid’—as the member for Jagajaga used to claim—‘90c an hour’ or ‘$2 an hour’? You can make that calculation, but everybody is in that situation and of course everybody does not do that. They work and pay their taxes, and it is their taxes that support other people.

If people take the attitude that they do not need work, then there is a question that I would rather not have debated but think should be put on the record: are our welfare benefits too high? I do not think so. I think that if you have a genuine problem, whether it be disability or a lack of employment opportunities, you should have benefits. I was more than sympathetic to the million people who were thrown out of work by the ‘recession we had to have’. But I reject totally the argument that you have a right to stay on welfare in a very buoyant labour market because you do not get a 100 per cent increase over and above your welfare payment. That is not a fair argument. It is an imposition on taxpayers and, as things stand, it is also an imposition on our economy. It is ridiculous to complain about overseas workers when people take that attitude.

This is a matter of concern. In my electorate, prior to the last harvest, TAFE offered training courses to people of both sexes to learn how to drive harvesting equipment. The equipment used today is not just a steel seat, sitting out in the sun. There is highly sophisticated equipment which is fully airconditioned and very safe. It is an interesting point to know, when one considers what sex might be found at the driver’s wheel, that in the Pilbara and in the mining sector of the Pilbara women are preferred for the driving of large equipment like dump trucks because they treat the equipment better than some of the fellows do. So when those particular courses were offered, and we had a significant number of people in my electorate claiming single parent benefits and other benefits, why were they undersubscribed? People did not volunteer to learn. It might be because of the argument that I have just promoted, and which I reject.

So it is no good people saying that overseas workers are taking their jobs when they do not even turn up to learn for the job opportunities that exist. I can tell you that there is many a farmer who, from time to time, has the kids in the cab of the harvester because the wife is indisposed or otherwise. I had a classic case brought to my attention in that regard. A woman had to go away in the early stages of her pregnancy and her two small children, for the lack of any other assistance, went around in the header all day with dad; just what condition he was in at the end of the day I would like to know. What I am saying is that these sorts of things can and do happen if you are on a farm, but apparently others who do receive these welfare benefits believe that it should not happen to them. I wanted to take the opportunity to put those remarks on the record, because I think this is an issue we must confront.

Let me say of the buoyant labour market, as someone was saying to me the other day, that there are still plenty of people who can take a job in Australia because they are still five per cent of the participating workforce, if we can put it in that context. When I did economics at Perth Modern School they taught me that four per cent unemployment means full employment, and that that four per cent is just the number of people shifting from one job to another. Of course, as a statistical measure, it would be a wonderful circumstance to think that we could throughout the country get the figure below four per cent. So at five per cent we have not got a lot of people who should be actively employed, which is another argument for why we bring people in from other parts of the world: to retain our industry, our GDP and our tax base. I think doing that on a temporary basis is very sensible in terms of the employment of Australians because, later on, there may be a downturn in the economy, but I hope there will not be.

I note by the way that the state governments are going to borrow billions of dollars; the bond market is thrilled to bits about that. If they are going to increase competition for money, we are going to have the same outcome that occurs when there is overcompetition for any commodity, which is that the price goes up. In the case of money, that price is interest rates. If that were to happen, no doubt we would have members of the frontbench of the opposition attacking the Treasurer for these increases, which of course would have been generated by the borrowings of Labor governments. They are back into it again, as has been demonstrated in my state of Western Australia. We have a huge works program to build a railway line, which is competing with the mining industry and everybody else for available workers. These people are rushing into infrastructure programs because they neglected them throughout ‘the recession we had to have’, and Mr Keynes, the one-time noted economist, would have told them that it was the right time to spend the money. They did not spend it then, and now they want to spend it and put more pressure on the labour market, particularly in infrastructure areas, when of course the private sector needs those people. These are peripheral issues, but interest rates are extremely important to the people whom we intend to assist with this legislation.

I welcome this legislation. As I said at the beginning of my remarks, I think it is one of the best initiatives that has been brought to parliament because it is targeting people. I often speak of funding people not institutions. Institutions always cover their mistakes and failings by telling the government of the day, ‘You didn’t give us enough money.’ In education and health it is quite a simple process to follow the basic principles we see here of direct, targeted payments to people. In the case of education it will probably not be cash but a voucher. Of course, the education establishment reckons that is a dreadful word. But a cheque is a voucher, and I have never seen anyone knock one of those back as long as it is cashable.

The reality is that we could give every secondary school parent in this country a $5,000 voucher a year to contribute to their children’s education. That is what we give state governments anyway—about half the cost of running their schools. If we gave it to parents directly, everybody would get the same. There is an opportunity for targeting on socioeconomic and geographic grounds, but otherwise there would no longer be all this hoo-ha about whether the King’s School gets more than some small state school, because parents would get the money. That is the basic principle of this legislation. When the parliament decides this is the best way to help people with their education and the education establishment is answerable to parents—and they will vote with their feet, as they do now, at significant cost in many respects—people will get a better service. I raise it because this is an example of how that is working. I thank members of the House for giving me their attention.

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