George Christensen (Dawson, National Party) Share this | Hansard source

I rise to speak on this matter of public importance: the failure of the government to address Australia's deteriorating fiscal position. It is good to follow the Minister for Trade, but I cannot say that much of what he detailed here in the chamber was relevant to the topic. Perhaps he could have been more relevant if he gave us one of his 'improv' karaoke renditions of Horror Movieand maybe it could be in tune this time—because a horror movie is really what we have got with Australia's current fiscal position. Indeed, it is because of that that it is a matter of urgent public importance. The fiscal mess that this government is creating is a mess that the public will be left to clean up.

Today's debt is tomorrow's taxes. Our children will pay the price of this government's reckless waste through taxes and lost opportunities. This government's failure to address Australia's deteriorating fiscal position is this government's selling-out of our children's future. But, according to the Treasurer, 'That's not a problem.' Our escalating debt is not a problem, he reckons: 'Move along—nothing to see here.'

If you want to know why this Labor government is failing to address the problem, it is because it denies there is a problem in the first place. Here is what the Treasurer said about this nation's debt—the excuse for incompetence that he dusts off and trots out on a weekly basis. He says, 'Compare with other major advanced economies.' He just loves to compare Australia to a handful of the worst performing economies in the world—not the big resource economies that are out there like ours but the ones that are floundering and are currently groaning under enormous debt levels. That is his aim. That is where he wants us to be.

He knows we are a long way back, but, boy oh boy, he is trying to catch them. It was a late start, because he had to overcome the handicap of actually having some cash in the bank and a strong economy when he took the reins, but he is coming—he is coming through with a late surge! He has got the blinkers on and he is riding that one-trick pony home, and he is going to catch them. He is! And here is how much he is gaining on them. In the outline of the economy, he laments the fact that the size of the task before him might actually be beyond him. He says:

Even at its peak, net debt will be a tiny fraction of the average of the major advanced economies.

Then there was this encouragement from the cheer squad, the Prime Minister, in a speech to the Queensland Media Club on 12 October 2012, where she said:

Australia's debt is lower than any major advanced economy—our net debt will peak at 6 per cent of GDP in 2011-12.

Let us skip ahead to what the Treasurer said in MYEFO, the mid-year budget update in October last year:

The average net debt position of the major advanced economies is projected to peak at 95 per cent of GDP in 2016, almost 10 times higher than the expected peak in Australia's net debt of 10.0 per cent of GDP in 2011-12.

So, from October 2010 to October 2012, Labor's forecast for net debt changes from six per cent to 10 per cent of GDP. He is catching them. He is coming in with a late run.

The truth is that those opposite actually have no idea when net debt will peak, because in government Labor will never see net debt peak; it will just keep going up and up, because they have got no idea how to stop it from growing. It is very easy, Wayne: just spend less than what you earn. There are seven million households in Australia, in the real Australia out there, who understand that fact. But the world's luckiest Treasurer, or whatever Euromoney magazine named him, cannot quite grasp that fact. Poor old Swanny. He cannot get his head around how a household budget actually works, and he wants to. He tries really, really hard. I can picture him, sitting there at the kitchen table, doing his homework with a firm grip on the crayon and a wrinkled brow, biting his tongue. And, after much constipated endeavour, he works his sums hard enough to come up with the debt analogy that he loves the most. Even the Prime Minister has picked it up and run with it. I return to a quote of hers that I used earlier, from the Queensland media club, where she said:

… our net debt will peak at 6 per cent of GDP in 2011-12 …

Her next line was straight out of Swanny Junior's big book of sums. She said that that was:

… equivalent to someone who earns $100,000 a year taking out a $6,000 loan.

Mr Perrett interjecting—

I am sorry—it was straight out of the Treasurer Junior's big book of sums:

… equivalent to someone who earns $100,000 a year taking out a $6,000 loan.

Well, that is what she said. A couple of months earlier, the Treasurer used the same line in a doorstep. On 4 August 2010, when net debt was at six per cent, he said:

That’s the equivalent of someone who’s earning $100,000 a year borrowing $6,000 a year.

But, on 22 November 2011, we had the then Minister for Financial Services and Superannuation upping the ante:

… Commonwealth government debt is at seven per cent. That is the equivalent of $7,000 out of a GDP of $100,000.

By the latter half of the next year the Treasurer was crowing on ABC on 16 October 2012:

Our debt in international standards is very, very low. It's like someone earning $100,000 a year owing a modest $10,000 …

Up and up it goes, and that is lovely.

But the problem is that comparing your debt to everyone else's is not a very good analogy. Viewing debt as a percentage of GDP might be useful if you are comparing it with other countries'—especially if the other countries have similar economies that are resource based. But to use the figures to compare to a mortgage is just as reckless as your spending—as the government's spending, Mr Deputy Speaker Scott, not yours.

GDP is produced by everyone. The seven million households out there have their own debts to worry about, and when their mortgages are paid off they will actually have a house. But what will the government have? What the Treasurer will have to service his debt is government income, raised mainly through taxes. Government income, which can be used to service government debt, was $329.9 billion in 2011-12. That is what we collected in revenue last year: $329.9 billion.

So let us take the Treasurer to the bank manager and see if he can get a loan like the one he describes as 'tiny' and 'very, very low'. Let us imagine Mr Swan saying to the bank manager, 'I want a loan for $144 billion, Mr Bank Manager.' That is the net debt that we have currently. The bank manager: 'Certainly, Mr Swan; what was your income last year?' Mr Swan: 'It was roughly $330 billion.'

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