Wayne Swan (Lilley, Australian Labor Party, Shadow Treasurer) Share this | Hansard source

We are absolutely for them, Treasurer. Most notably, the budget fails to invest in high-quality universal preschool education for all four-year-olds, to give them the best start possible. As we know, Labor is committed to a $450 million package to provide play based learning for all four-year-olds. Labor has also committed up to $200 million for 260 new childcare centres on school sites.

We welcome the measures on apprentices, but there is nothing in this package which shows that the government comprehends the magnitude of the challenge before us and the nature of the education revolution we require if we are to deal with declining productivity.

The government has established its Higher Education Endowment Fund. That is a welcome initiative because the government has neglected this area for too long, but its way of paying for it is interesting. Its way of paying for it undermines the government’s case against Labor’s national plan for high-speed broadband. The government is proposing to pay for this measure by taking part of the surplus that would otherwise have gone to the Future Fund. And, just as the education endowment is an investment, so is Labor’s high-speed broadband initiative. The Treasurer simply can’t have it both ways.

That brings us to broadband. We saw in the parliament during question time that the Prime Minister simply does not get broadband. He does not comprehend how important broadband is for lifting productivity in this economy and that this country urgently needs a solution so that we can get high-speed broadband to all Australians. Its importance to business and to families is simply not comprehended by this Prime Minister.

That brings us to tax cuts, because the tax cuts in this budget are welcome. They do start to tackle some of the worst disincentives to workforce participation. As the Treasurer will well recall, it has been Labor in this House that has been making the case constantly for taxation reform to ease the high effective marginal tax rates which have been hitting second-income earners, who are predominantly women. All of a sudden, there is another conversion from the Treasurer. He has discovered part-time workers, he has finally discovered they are women and he has finally discovered that they, too, deserve an incentive, like everybody else in the tax system. Of course, that has taken 11 years. But we certainly welcome these tax cuts, and we also welcome the fact that they are staged, because to stage them will minimise the risk of inflationary pressures. But these tax cuts do not even hand back all the additional tax that the government is collecting as a consequence of the mining boom. Despite the tax cuts, the government will still collect more than $10 billion more in income taxes, excluding company taxes, from 2007-08 to 2009-10 than originally anticipated before the budget.

This is a high-taxing, high-spending government. What is important here is a stable macroeconomic environment. Labor is committed to disciplined fiscal policy. We are committed to running budget surpluses over the medium term, to not increasing tax as a proportion of GDP and to meeting our commitments by reprioritising spending in the budget and cutting out waste.

That brings us to climate change, because there is not a comprehensive program that this country needs being put in place to combat climate change. We know that the Treasurer is a well-known climate change sceptic. We know the record of the Prime Minister; we know the record of the industry minister. We know the view of the Treasury—that the government does not get it when it comes to combating climate change and dealing with problems in water. The government simply does not get this, and we know that from the speech given by Treasury Secretary Ken Henry over a month ago. He blew the whistle on the Treasurer, he blew the whistle on the Prime Minister and he blew the whistle on the cabinet about their inattention to climate change and water problems and their central importance to wealth creation in this community. That whistle was well and truly blown by the government’s chief economic adviser, who pinged them for what they are—completely irresponsible when it comes to dealing with one of the most serious issues which goes to the heart of future economic prosperity, job creation and environmental sustainability.

That is why we do not have an emissions trading scheme. That is why we do not have a serious response to renewable energy. That is why we do not have a serious response to demand management. All of these things are missing, but no doubt they will come—and why? Because Labor under Kevin Rudd and Peter Garrett, and also the member for Grayndler, have been putting out comprehensive plans to combat dangerous climate change. We have left the government for dead and they are so embarrassed that they are going to be forced to follow in the months ahead. It will be really exciting to watch the backflips and the U-turns and so on.

That brings us finally to where this economy should be going. The Treasurer would have us all believe that the economic reform process starts and ends with him. The reality is that much of our current wealth owes a lot to the reforms implemented by the Hawke and Keating governments. I would like to quote an eminent authority on this: the Secretary of the Treasury—the government’s pre-eminent economic adviser. This is what he had to say:

That macro performance owes much to decades of reform that have improved monetary, fiscal and structural policy frameworks.…            …            …Much of our recent macroeconomic and fiscal success is based on past reforms, assisted by the terms of trade.  A significant proportion of the latter may be transitory.

The Secretary of the Treasury is warning all Australians that the government is not prepared for the future beyond the mining boom and has not put in place the essential reforms required to lift productivity and create wealth beyond the mining boom. That is the warning from the Secretary of the Treasury; it is a damning indictment of the performance of this Treasurer and the performance of the Howard government. During this time, a time of plenty, it has been raining gold bars. There have been substantial increases in national income. Why haven’t we taken the opportunity to create a First-World, first-class education and training system so we can compete in our region and become even more prosperous and wealthy? Why has the government not done that? Because it has been complacent, tired and stuck in the past. (Time expired)

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