Jim Turnour (Leichhardt, Australian Labor Party) Share this | Hansard source

I rise today to support the Nation-building Funds Bill 2008, the Nation-building Funds (Consequential Amendments) Bill 2008 and the COAG Reform Fund Bill 2008, which are being debated in parliament today. These bills are critical to the long-term economic security of Australia. They underpin the Rudd government’s microeconomic reform agenda—an agenda that is firmly focused on driving improved productivity through investing in nation-building infrastructure in a new era of federal and state relations.

In May this year the Rudd government delivered its first budget: a responsible budget, a budget that is about modernising Australia, a budget that puts Australia’s long-term interests centre stage. For too long we had a government that lacked courage, foresight and initiative—the Howard government. Despite a resources boom, the Howard government failed to invest the proceeds in nation-building infrastructure. Independent commentators, like Access Economics in their budget monitor this week, have backed the Rudd government’s response to the global financial crisis and, again, highlighted the failure of the former Howard government to invest the proceeds of the resources boom in long-term nation-building infrastructure. The Rudd government will not squander the budget surpluses. We are committed to using the surpluses to steer the economy through these difficult global economic times.

The member for Cook when speaking earlier effectively said that he did not support our economic security package and that he did not support us using the surplus to invest in the economic security package. We do not know where the opposition stand on our response to the global financial crisis, because one day they say they support the bank guarantees and our economic security package and the next day they come into parliament and pick holes in it and say they do not support it. We have a long-term plan for this country and a long-term commitment to support infrastructure and productivity growth in this country. It is disappointing that the opposition continue to act irresponsibly when it comes to economic management.

The budget delivered in May this year established three funds: the Building Australia Fund, the Education Investment Fund and the Health and Hospitals Fund. These three funds are important investments in our future and are critical to our long-term future. They were welcomed by a range of commentators in the market. They do contrast very significantly with the actions of the former government. The OECD made this good response:

Over the past few years, there has also been a sharp rise in spending, the quality of which was not always ensured.

They are talking about the Howard government there, of course. They continue:

The recent creation of funds that will channel budget surpluses into financing investment in infrastructure, education and health could play a valuable role in improving the quality of spending, especially since the intention is to select projects on the basis of cost/benefit analysis.

They are saying that the Howard government did not spend money on quality projects. The OECD welcome the Rudd government’s commitment to these three funds and see that we will do proper analysis and invest appropriately in the future of this country.

These nation-building funds will focus on infrastructure—on restoring our national transport network, our roads, rails and ports, and on improving broadband; on education—helping to deliver the government’s education revolution, renewing and refurbishing universities and vocational institutions, and improving research facilities; and on health—financing our nation’s hospital and medical research. In order for the country to move forward with the implementation and operation of these three key funds, the Nation-building Funds Bill 2008, the Nation-building Funds (Consequential Amendments) Bill 2008 and the COAG Reform Fund Bill 2008 must be passed.

The COAG Reform Fund Bill 2008 establishes a vehicle through which these funds may be distributed to the states and territories. In my first speech to this parliament I spoke about the need for reform of federal-state relations through the Council of Australian Governments. These bills are an important part of the Rudd government’s plans to deliver on these aspirations. In a report for the Business Council of Australia, Access Economics estimated that cost-shifting, duplication and other inefficiencies in Commonwealth-state funding arrangements cost some $9 billion per year. Of this, $5 billion is related to spending inefficiencies, including around $1 billion for health related inefficiencies.

When I doorknock and run mobile offices in my electorate people say they are tired of the buck-passing and the blame game on health. They want a federal government that will work in cooperation with state governments to help fix the health system. We need to reform those relations, and these bills are a very important part of the ongoing commitment of this government to work in partnership with the states and territories to tackle difficult areas like health.

The COAG reform fund and nation-building funds form part of this government’s modernisation of federal financial relations. Improving the relationship between the federal government and the states and territories—the way we interact, the way we conduct business and the way funds are allocated—is a major objective of the Rudd government. It is clear that effective and meaningful progress is being made. The Prime Minister stated on 26 March at a COAG meeting in Adelaide:

The COAG Reform Agenda is underpinned by a common commitment to clear goals, genuine partnership and the governance and funding arrangements needed to deliver real reform.

A fresh spirit of goodwill has delivered breakthrough agreements in areas unresolved by COAG for too long.

It will move on from the blame game to make federalism again work to deliver real outcomes in the national interest.

We have a government that understands the importance of getting the relationship between the federal government and the states right. It is through a reform of COAG that we are seeking to boost productivity, increase workforce participation and deliver improved services to the community. I have already spoken about some of the real waste that goes on in health because of a failure of the federal and state governments to work effectively together. We also have key policy areas in education where we are making progress. It is through COAG that, for the first time, all governments have agreed to drive the productivity agenda through substantial reform in education, skills and early childhood development. COAG has adopted national targets for schooling. This includes progressing toward a national curriculum, lifting the year 12 or equivalent attainment rates across the country and providing universal access to quality early childhood education for children in the year before formal schooling.

The COAG Reform Fund and the nation-building funds are a critical tool that will enable serious action to be taken on key policy areas like education, as I have just mentioned, that impact on all Australians. Money in the three nation-building funds—whether it be the Building Australia Fund, the Education Investment Fund or the Health and Hospitals Fund—can be transferred to states though the COAG Reform Fund. As stated in the explanatory memorandum of this bill, financial assistance will be provided to a state or territory for the purposes of supporting the delivery of specified outputs or projects through appropriations from the nation-building funds and facilitating the implementation of nationally significant reforms and rewarding jurisdictions that deliver nationally significant reforms, through national partnership payments. This COAG Reform Fund will replace a complex, bureaucratic arrangement of distributing federal funds to the states and territories.

The COAG Reform Fund Bill requires that the terms and conditions on which financial assistance is granted through the COAG Reform Fund are set out in a written agreement, known as a national partnership agreement. A national partnership agreement is an agreement between the Commonwealth and the state or territory. It will set out performance benchmarks and the amount of the payment for meeting each benchmark. In the case of national partnership reward payments, financial assistance will be subject to the COAG Reform Council’s assessment of whether the performance benchmarks have been achieved.

This approach—these national partnerships—will drive reform. We are not giving the states a blank cheque; we are establishing a more effective and efficient way to work in partnership with the states. We are shifting to a more transparent and outcomes based framework, where there is greater incentive to deliver solid infrastructure projects and make reforms in health and education. By improving federal-state relations and coordinating infrastructure nationally, it is ultimately the people of Australian that will benefit. It is the people of Australia that deserve more efficient and effective services. This arrangement will reduce bureaucracy. It is a strategic approach that will provide leadership in the planning, financing and provision of significant national infrastructure projects.

On this Saturday, again, there will be a meeting of the Council of Australian Governments. I am sure there will be important progress made in the areas of health, education and infrastructure. These bills will enable these agreements to be delivered on.

Importantly, the Rudd government is very much focused on the long term. We are very much committed to ensuring that our investments in infrastructure, health and education are not about short-term political gains but about long-term investments in the nation’s infrastructure and interests. We have established Infrastructure Australia to provide the government with advice and to do proper assessments in relation to funds, particularly the Building Australia Fund.

Members of the public and business community were recently invited to submit their project ideas to Infrastructure Australia, the national body established to advise government, investors and owners of infrastructure, which will inform the government’s allocations from the Building Australia Fund. Projects will be evaluated and potentially placed on the national infrastructure priority list. The first priority list was initially planned to be presented to COAG in March 2009. However, the Prime Minister recently requested an interim report from Infrastructure Australia by December 2008.

Obviously there is no denying that the global financial crisis has affected and will continue to affect the way in which the government acts. The past few months have been unprecedented, but the government has acted quickly and decisively to support the Australian economy. Part of the government’s response to the global financial crisis was the acceleration of the rollout of our nation-building funds. As I have just touched on, a priority list of projects will be known soon, enabling us to consider key infrastructure projects in 2009.

We have also made other measures, including the economic security package. I am very pleased that in the next few weeks $4.8 billion will be delivered as an immediate down payment on long-term pension reform to Australian pensioners. I know that pensioners in my electorate of Leichhardt are looking forward to, and will welcome, those payments. Also $3.9 billion will be put in to support payments for low- and middle-income families and $1.5 billion investment to help first home buyers purchase a home. This is particularly important in my electorate, where the construction industry is a critical part of the local economy. Local developers and real estate agents have welcomed it and I know that young working families out there are taking up the opportunity the government has provided them to get into a home for the first time.

We also have $187 million to create 56,000 new training places in 2008-09. I know that the Building Australia Fund has been very much welcomed, particularly in our rural communities. I have a quote from David Crombie, the president of our National Farmers Federation, commenting on the budget:

Tonight’s announcement of a $20 billion Building Australia Fund is a positive move towards addressing critical transport and communications infrastructure. Too often Australia’s farmers face antiquated and grossly inefficient national and regional infrastructure in these areas, undermining the farm sector’s strong record of productivity growth.

I see the member for Kennedy here and I know he is a strong advocate for rural Australia. We have the head of the National Farmers Federation backing our Building Australia Fund and our investment in long-term national infrastructure. We hear bankers like Saul Eslake say in relation to the budget that in this budget the Treasurer has, ‘created a more compelling vision of how it will deploy the enlarged surpluses which it is projecting over the next four years’. This is exactly what the government should be saving its surpluses for.

He was commenting on what the former Howard government had done with their surpluses, that they failed to invest them appropriately in nation-building infrastructure and they failed to invest them in education that would drive our productivity agenda with the infrastructure investment. Whether it is the farmers, the bankers or the working families of Australia, what they are looking for is a government that acts responsibly economically, responds to the long-term interests of the nation and also responds appropriately to the global financial crisis that we are facing at the moment. And the Rudd government is doing that.

These bills are critical not only to our long-term agenda but also to our response to the current global financial crisis. They underpin the Rudd government’s micro-economic reform agenda, an agenda firmly focused on driving improved productivity through investing in nation-building infrastructure and the new era of federal-state relations.

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