Julie Owens (Parramatta, Australian Labor Party) Share this | Hansard source

I am pleased to hear the member for Casey speak so strongly about the need for us to engage in a full review of the issues before we cherry pick, and I am looking forward to him raising that matter in his own caucus next time the opposition speak about pensions. The Tax Laws Amendment (Political Contributions and Gifts) Bill 2008 is an important little bill and it is sad to see it bouncing backwards and forwards between this House and the Senate. I did not speak on it the first time it reached this House, but I am taking the opportunity to do so this time.

Blocking bills in the Senate is a very powerful act. The world we live in is not about politics; it is about governance. I fear that the behaviour of the opposition in the Senate over the last few months has been more about politics than governance. It is a very powerful environment in which to play that game. If you look at the range of bills which, it is threatened, will bounce backwards and forwards, you will see that we have issues such as the alcopops tax, the luxury car tax, Fuelwatch, the Medicare levy surcharge and now political donations. The member for Stirling, in his speech to this House the first time the legislation passed through, let the cat out of the bag by confirming that this is very much about protecting donations to the Liberal Party; it is clearly very much a political issue and not one of governance.

At a time when families have been struggling under the pressure of back-to-back interest rates for the last seven years—in fact, we have just had the first decrease in interest rates in seven years—and at a time when keeping a strong budget surplus is absolutely essential for the people in my electorate, as well as those around the country, the behaviour of the Liberal Party in blocking budget measures is quite extraordinary. At a time when families need relief and at a time when we need to keep downward pressure on interest rates we see them blocking this $10 million revenue measure. We also see them retaining the loophole in the alcopops tax, also blowing a hole in the surplus, and retaining the luxury car tax at pre-election levels, also contributing to a growing hole in the budget surplus. When families need relief, we see the opposition fighting against Fuelwatch so that families cannot find out every day the cheapest price for petrol. And yesterday we saw the blocking of the Medicare levy surcharge changes, which would have provided individuals and families with an opportunity to decide for themselves whether to take out private health insurance.

The opposition are attempting to blow a hole in the budget surplus. Let us hope we can stop them from doing that at this most important time. They would blow a hole in a surplus that is doing exactly what we need that surplus to do: keep downward pressure on inflation and therefore on interest rates. They are also doing something quite extraordinary in that they are blocking the government from doing things that we committed during the election to do. We went to the election on this issue. We announced it prior to the election and the people voted. We had an absolute mandate to remove the tax-deductible status from political donations. Like blocking bills in the Senate, voting down something that a government has a mandate on is a very serious business. There might be times when any one of us might need to do that—and I can imagine issues on which I might like to do that—but this is not one of them.

The opposition clearly has a different view. Having read all of the speeches that were presented the first time this bill came around in this House and those made in the Senate, I have to say the opposition’s opposition to this measure cannot be taken seriously. Remarkably, it has been over the top. For example, we heard from the member for Wentworth, who said:

This is a big moral issue. It is not just a financial issue; it is not just a political issue. It goes to the very heart of our democracy.

We have heard that it is an assault by the Australian Labor Party on democracy itself. We have heard that it is poisonous to democracy itself. We have heard that what is at stake here is democracy itself. Those are extraordinary over-the-top statements. In fact, you would think it was the end of democracy, as we know it, because we are proposing to remove tax-deductible status on donations up to $1,500.

But it is worth pointing out to the House that, prior to 2006, the deduction limit was $100. The previous Howard government increased that threshold to $1,500 in 2006. They expanded the deduction to include donations to Independent candidates and members and to donations made by business. If this is the end of democracy as we know it, then democracy only started in 2006, and before that time it was clearly the democratic Dark Ages. Some of us would think that the period from 1996 to 2006 was the Dark Ages, but I know that is not what those opposite are referring to. I can imagine people in 2006, just two years ago, waking up in the morning, rubbing their eyes, walking outside, and thinking, ‘Thank goodness John Howard increased the tax-deductible threshold for political donations to $1,500. Democracy is here.’ How did democracy survive before 2006?

Let us have a look at exactly what we are doing. Let us put the overblown rhetoric aside and the ridiculous notion that returning this nation to a situation similar to what we were in before 2006 would somehow end democracy as we know it. The government is reintroducing legislation to remove tax deductibility for contributions and gifts to political parties, Independent candidates and members. This measure was an election savings commitment. We promised to do it. The measure was originally introduced into parliament on 13 February 2008 in the Tax Laws Amendment (2008 Measures No. 1) Bill 2008, before being referred to the Joint Standing Committee on Electoral Matters. Although the committee recommended that the measure be passed by the Senate unamended, the measure was voted down in the Senate on 26 June.

We on this side of the House introduced the bill quickly because it was an election commitment and because it applied from 1 July 2008. It was a clear part of the Labor Party’s election campaign. It is not a new commitment of the Labor Party. We have been consistent on this issue for 10 years. We argued against tax deductibility each time the previous government tried to introduce it. In all, they tried to introduce it three times. They tried firstly in 1998, and that particular measure lapsed when the 1998 election was called. Then they tried again after the 1998 election and it was rejected in the Senate. In 2006 they tried a third time and, third time lucky, with control of the Senate, they succeeded.

The Labor Party opposed those measures and campaigned at the last election with a clear policy of removing the tax deductibility of election donations. We were clear on this with the people of Australia. We clearly said that Australian taxpayers were already subsidising political parties through the electoral funding procedures. They already provided money to political parties for the democratic process, and that was a transparent process with parties treated equally.

We do not believe that they should provide more for the election process through tax deductions for individuals and businesses. We clearly said that we do not believe it is appropriate that Australian taxpayers subsidise donations to political parties—that, just because someone wants to make a donation to a political party, other taxpayers should be required to put their hands in their pockets and pay even more in public funding than they currently do. But since 2006, when the previous government finally got its legislation through, Australian taxpayers have been putting their collective hands in their pockets and contributing effectively an additional $10 million per annum to political parties. We are seeking to remove that loophole, providing an efficiency gain to the Commonwealth. I would have thought that anyone in this House would see that as a responsible course of action.

I say to the opposition: there is considerable cynicism out there about what we do in this place and the way we behave. One responsibility of each of us as custodians of the important positions that we hold is to leave those positions in better shape than we found them. There are many things that we can do better. One very important thing which we on this side of the House are doing—and it should be a very basic thing for all elected governments but unfortunately it has not been—is to honour our election commitments in full. Another thing is to be honest with the Australian people about how and how much they pay for us and to be careful about what we ask taxpayers to pay for in the way we operate. The government have already taken a knife to some of the excesses of the previous government. We have cut back on printing budgets, which increased dramatically in the last years of the previous government. We have reduced our capacity to carry funds over. We have introduced responsibility into our own offices and new rules for government advertising. We still have a long way to go, and the measures in this bill are part of that.

If the opposition want the taxpayer to pay more for the political side of the democratic process, they should be honest and say so. If you are asking the taxpayer to pay $10 million more to political parties so that they can spend even more on television advertising, have the guts to put a big sign on your chest, or at least a big header on your press release, and say so. This is $10 million of taxpayers’ money. I know the opposition are concerned about all those people who might not now make donations to the Liberal Party because they will not get a tax deduction. That is fine. That may happen to both sides. But we should also show concern for all the taxpayers out there who do not want to give any more of their money to the political process and who do not want to be dragged into bigger taxpayer contributions by the donations made by others under tax-deductible status.

This is a sensible measure. It is honest and a sound budget measure. It undoes something that has only been part of our democratic system since 2006. The fearmongering on this—that this is the end of democracy as we know it—is beyond belief. It is sound policy, and I commend the bill to the House.

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