Joe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | Hansard source

I am immensely pleased that the Treasurer has decided to debate me in the chamber on this occasion, because previously he has contracted that out to the Assistant Treasurer, who is mysteriously not here today. It should come as no surprise that much of the work of the Treasurer these days is contracted out. The Prime Minister just contracted out the financial integrity of the recovery in Queensland to a former Liberal finance minister, which must be just a touch humiliating for the Treasurer, but we move on.

Last year the Treasurer said that his banking reforms would deliver lower interest rates over time—‘Banking overhaul will bring down rates, says Swan’. He went on to say that essentially the banking reforms that he announced last year would bring interest rates down. The Treasurer has previously said that consumer confidence is fragile. He has previously said that retail sales are not as strong as we would like. He has also on numerous occasions, in fact on more than 25 occasions, warned that the banks should not go beyond the Reserve Bank in increasing interest rates.

Australia is not immune to the challenge of natural disasters. On this occasion it has come in threes with flood, with fire and with cyclone. But Australia now seems to always, during the Christmas period, suffer some sort of disaster that inevitably will have an impact on the Australian budget. The question is: how prepared are we from a fiscal perspective for this challenge? How prepared are we? Over the next four years this government is going to spend $45 billion on interest alone to repay the debt that has come as a result of deficit budgets over the past few years. And over the next four years this government is going to spend—and hopefully it will not get the opportunity to spend all of it—$1.5 trillion, which is a huge amount of money.

At this crucial moment we are arguing the case that now is not the time to punish Australian households with a flood levy. Now is not the time to raise the burden on everyday households with an additional cost to the rising interest rates that are going to come about, which the government has contributed to with its reckless waste and spending, and the challenges associated with higher inflation, high vegetable prices and higher fruit prices as we have seen in recent months and will see over the next few months. Households are also going to face the impact indirectly, and in some cases even directly, of a mining tax and a carbon tax.

All of these factors coming together over the next 18 months will have a profound impact on the cost of living of everyday Australians. To add to that burden, more and more data indicates that electricity prices are going to rise substantially over the next 12 months, even without a carbon tax. Water prices are going to rise substantially over the next 12 months as states seek to recover some of the costs associated with infrastructure. In addition to that the states themselves, in their ever-growing search for new revenue, will be increasing taxes and charges on everyday Australians.

Even with an unemployment rate of around five per cent, even with a growing economy, the impact on every dollar of everyday Australians matters. It really does matter, because those people are now facing charges that their parents never had to pay—significant toll road charges, for example; additional costs of schooling that my parents, for example, never had to pay, yet my generation and generations beyond will have to pay; even university fees and so on. The additional cost on everyday households is something this government does not understand. That is best illustrated by the fact that when asked the simple question in question time today, ‘How many Australians are going to pay the flood tax?’, the Treasurer did not know. He did not know how many Australian households would be affected and how many individuals would have to pay an additional levy. He is the Treasurer of Australia and he did not even have the brief in his file. He turned to Jenny Macklin and said, ‘Do you know?’ and she shook her head. This guy is meant to be running the country!

No wonder the Prime Minister rang up John Fahey and said, ‘Help us to stop the waste.’ No wonder the Prime Minister rang a former Liberal finance minister and said: ‘Please oversee Wayne Swan. I don’t trust him with the money.’ If the Prime Minister does not trust the Treasurer with the recovery in Queensland, how can she have him deliver a budget in May? We know what is going to happen: ‘Hello, Peter, this is Julia. I need your help. We’ve given you an AC, but we need you to deliver a budget.’ I can see what is going to happen. The Prime Minister is going to be making a series of calls over the next 12 months. She will be ringing the Leader of the Opposition saying, ‘Come back as health minister.’ She will be ringing Peter Reith to come back and fix the wharves. She will be ringing Philip Ruddock and saying, ‘Come back and stop the boats.’ Oh my goodness! If the Prime Minister does not trust her own government, how can we trust her? With $350 billion a year and an economic recovery in Queensland, she proudly announces the Treasurer is going to lead the recovery effort. But because she does not trust the Treasurer, she rings up a former Liberal finance minister to make sure there is no waste. Only the Liberals stop the waste. It is as simple as that. Only the coalition has the courage to stop the waste.

And do you know what? What surprised me most was poor old Lindsay Tanner down in Melbourne with his abacus waiting for the phone to ring. He was the one that rang the bell on the BER, wasn’t he? He was the one that said, ‘Julia, it doesn’t stack up.’ Of course, we know what happened to him. It defies logic to expect that a government would have to revert to the integrity of its political opponents in order to survive on the treasury bench. Can you imagine John Howard after Cyclone Larry ringing up Ralph Willis and saying, ‘Mate, I need your help. I don’t trust my own Treasurer; I don’t trust my own finance minister—I am going to ring up Ralph Willis or John Dawkins or Paul Keating.’ We miss Paul Keating and I bet Julia Gillard does as well.

There are some economic challenges that we have to deal with. The first challenge is to get the budget back to surplus. Why? It is because that takes some of the upward pressure off interest rates. It is because getting the budget back into surplus means that you do not have to spend $45 billion every four years just on interest. It means that for $45 billion you can rebuild Queensland about eight times over. It also means that you can deliver the programs that you really want to deliver. The hypocrisy of this government is exceptional. The Treasurer stands up in this place and talks about our deferred spending cuts. You know what? The Treasurer has $1½ billion of deferred spending cuts as some of his so-called cuts just like the $80 billion of so-called savings when nearly half of the so-called savings from the Labor Party in government have in fact been tax increases.

Now the logic of the Labor Party is that if it increases taxes for Australians it increases savings for those Australians. That is as illogical as the rhetoric of the government itself. Out of all of this, even with Australia’s most favourable terms of trade in modern times, even with a strong growth rate, even with an unemployment rate of around five per cent and even with the coalition having the courage to lay down now $52 billion of savings—even with all of that—this government does not have the courage to default to what every Australian family has to do. When it is facing a financial challenge every Australian family has to look at the family budget and work out how it is going to live within its means. That is what Australian families do, but not this government. The Labor Party defaults to a new tax.

That is the Labor way—default to a new tax. Over the last three years they have increased taxes on cars, they have increased the tax on alcohol, they have increased the tax on cigarettes and now, in this year alone, they want to increase the tax on people’s income, they want to introduce a new tax on mining and they want to introduce and increase taxes on carbon and electricity. They want to do that in 12 months.

In the course of four to five years the Labor Party has shown its true colours—increased taxes. This government will be defined by its reckless spending. This government will be defined by its determination to increase taxes. This government will be defined by the fact that it has not got any ticker. The starting point for this government after the floods was not to say, ‘We will cut first.’ Its starting point was to say, ‘We will tax first.’ As the Leader of the Opposition said so eloquently, it has turned out to be a mateship tax.

There is no precedent whatsoever for a government to literally beg the Australian people to donate money to a worthy cause and then afterwards to tax them for the same cause. There are lots of precedents for levies and there are lots of precedents for cuts, but there is no single precedent where you ask Australians to be generous—they were generous and they are generous—and then after they have done that, when they have given their all, to go and hit them between the eyes with a new tax. There is no precedent.

I met a truck driver in Rochester who gave up his fuel and his truck for three days of income to carry away the sodden carpet, the wrecked fridges and freezers and the broken furniture from a home I visited there. That man is now going to have to pay that tax. He has already sacrificed thousands of dollars. As the member for Brisbane said a little earlier, a small business person in Queensland has had their business suffer substantial loss and yet now is going to have to pay the tax on top of that.

What was the reaction of the Prime Minister? She said, ‘This is a personal income tax.’ The Prime Minister was unable to set apart the big impact on a small business that has to pay out from the family income the pain associated with the flood and then has to pay out a tax. There are millions of Australians who do not differentiate between their business income and their personal income because they run small businesses, and that is a constituency the Labor Party will never understand.

We have had the courage to match our words with deeds by laying down a plan to pay for the $2 billion that the government is going to have to raise with its flood levy. We have been fair dinkum with the Australian people. There can be a horde of critics about the composition of it, but we have shown the courage that the government does not have. We have shown a determination to preserve the economic credentials not just of a nation but in particular of the family home because we believe a government should behave no differently in many ways to how Australian families have to behave. When there is a challenge, you have to meet it. When the money is to be spent, you spend it, but, most significantly of all, when you have to make hard decisions about your family budget, it is only the coalition that has the courage to do just that. We will not run away from hard decisions and now we will not let a weak and insipid Treasurer run away again from making the hard decisions that make life a little bit easier for Australian families. (Time expired)

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