Scott Morrison (Cook, Liberal Party) Share this | Hansard source

This MPI addresses the government’s failure to address the impact of rising costs on struggling families. This is an important matter to be discussing because it is the government which has raised the expectations on this matter. It is the government which, when in opposition, went out there and created a very real expectation on the part of the Australian people that it was going to do things about the cost of living, that it was going to do things about petrol prices, that it was going to do things about grocery prices, that these things were actually going to produce a result and that people would not have to face rising costs under a Labor government. In that same election campaign, the opposition, as it then was, made a range of claims about what the government at the time was saying about interest rates. You could argue that it was somewhat successful in prosecuting an argument that, if interest rates were to rise, the government should be accountable for those things and, as a result, the government should not be elected.

If it is good for this government, it is good for us. The government has created the expectation out there in the Australian community that it can control the revolution of the planets, that it can go out there and it can control the universe. It can control petrol prices. It can control grocery prices. We will come to how it actually plans to do this, but this is the expectation that the Prime Minister in particular has created. He has created it knowingly, he has created it willingly, and he has created it enthusiastically. So it is a fair thing—a very fair thing—for the people of Australia to hold this government to account for that pledge. Government members can come in here and argue the toss on words, but one thing is very clear: as I walk the streets of my electorate, people tell me that the government—as it is now known—made a pledge to control petrol prices and grocery prices. The price of everything from Weet-Bix to Chupa Chups is going to be controlled by this government, so it is very important that we discuss this matter today.

I also want to add that we are talking specifically about struggling families. The government likes to talk about working families, but a number of people have come to me, particularly from my own electorate, and said, ‘Who are these working families?’ Small businesses ask the question: ‘Am I a working family?’ Under the government’s definition, they are not. They are not a working family. Small businesses are not working families. And what about single working people? What about pensioners? What about self-funded retirees? Do these not fit into the spectrum of people who are the target of this government’s policies, or do they just have to wait their turn until the government is finished trashing our economy?

Let us examine what the government actually has done and make a few comments. Firstly, the government makes a lot of noise about inflation. It says it has a five-point plan on inflation—a plan whose features, as the shadow Treasurer revealed yesterday in question time, failed to receive acknowledgement by the Governor of the Reserve Bank. There was no mention of at least three of the five points. My maths may not be the best in this place, but that leads me to believe that the Governor of the Reserve Bank gave the Treasurer two out of five for his inflation plan—which is a fail.

What are those five points? Firstly, there is fiscal restraint. What I think the Treasurer fails to understand is that there were 10 consecutive surplus budgets under the previous government, and consistently in the last three at 1½ per cent of GDP plus. The Prime Minister comes in with the hairy-chested announcement that he is going to be able to bring in a budget surplus at 1½ per cent of GDP. That is like running a four-minute mile today and claiming that you have made some great athletic achievement. It is just nonsense. In addition to that, the fiscal restraint agenda which is outlined by the government opposite is silent on state debt—an $80 billion-plus debt binge on the part of the states. It is silent on tax reform at a state level. It is prepared to bankroll the incompetence of state governments all around this country.

Secondly, the government talks about private savings. I am staggered, because I like to follow what happens in politics, I like to follow what governments do, and if I remember correctly it was actually the government prior to the election of this government that introduced the single greatest reforms to superannuation in our history—unquestioned. That is what I call a private savings initiative. The government might like to take some notes about how to implement its five-point plan based on the success of the previous government in addressing these issues.

Then there is the skills crisis—a skills crisis caused by having the lowest unemployment in over 30 years, now at four per cent. The government’s answer is to close trade schools and drive up unemployment. That is how they are going to fix the skills crisis. They will just have more people out of work, increasing the pool of available workers to the marketplace. There were 418,800 apprentices being trained at the time of the last election. That compares to 154,800 when the previous government came to office.

Then there are the bottlenecks that the government is going to clear. It is the responsibility of the states to develop infrastructure. This was discussed in the Infrastructure Australia Bill 2008. While I am sure there are many examples in other states, in my home state of New South Wales the state government has made an absolute mockery of state infrastructure planning. For years under Treasurer Egan, the government did nothing to actually reduce the state’s debt. It is a worthy initiative, but if to reduce state debt you do nothing, you spend nothing on infrastructure and you effectively allow the house to fall into disrepair, you build up the desire for a binge of state debt to address the imbalance of previous years’ obfuscation of responsibility.

Then the government talks about the participation rate. This is from a government who when in opposition opposed welfare to work reforms. This is from a government that seems to misunderstand that we have the highest level of workforce participation on record. This is a five-point plan with a five-star blind spot. It says absolutely nothing about containing wage pressures. Something that the shadow Treasurer, remarking in an earlier debate today, made very clear was that different between the mid-1970s and today are the changes in particular in our labour market. We have a more flexible labour market. That is what enabled us to achieve a 21.5 per cent increase in real wages under a government that was prepared to do the right thing in our workplaces and create greater flexibility that enabled people to be employed in this country and enabled businesses to move forward.

The government’s plan says nothing about containing inflationary expectations. The shadow Treasurer has made the point extremely well that the Treasurer of this country stood in this place today and confirmed ‘the genie in a bottle’ comment. It is bad enough for the Treasurer to go recklessly bumbling around our financial markets, making reckless statements on the state of our economy and talking about genies coming out of bottles on the eve of Reserve Bank meetings where they set interest rates, but the Prime Minister also stood in this place today and confirmed the state of our economy in the way he did. Inflationary expectations—I have made the point on a number of occasions—in the December quarter were at 4.3 per cent. After the election of this government, inflationary expectations, while previously sitting on 3.8 per cent, have gone up to 4.3 per cent. I suspect that it will only get worse from there because, while this government continues to talk up inflationary expectations, we will continue to see inflation rise and we will continue to see a claim being made, as is currently being made in New South Wales by Unions New South Wales, for a 4.8 per cent increase in wages. What is that based on? Expectations of inflation. Who is setting those expectations of inflation? Those who sit opposite, who simply do not know how to run a strong economy.

Since the election of the Rudd government, which has created the expectation out there that it will be able to do something about rising petrol prices, petrol prices in Sydney, as the Leader of the Nationals said today, have gone up by 4.8c, in Melbourne by 4.9c and in Adelaide by 7.1c. Grocery prices have also continued to rise. The government’s response on all of these things, as it is to everything, is to establish a review and/or a committee. In fact, there have been 47 reviews established by this government since it took office in November. It has got a bit more work to do because it announced 55, so we can expect more reviews to come from this government. (Time expired)

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