Andrew Nikolic (Bass, Liberal Party) Share this | Hansard source

What we have just heard from the member for Throsby on this Tax Bonus for Working Australians Repeal Bill 2013 is an exemplar of revisionist history. The people considered both the actual history, the economic history, of our country from 2008 to 2013 and what we just heard from the member for Throsby and they cast their judgement on 7 September last year. They highlighted the version of history that they believed. Deputy Speaker, I would argue that, if you were to do a word association test with the average Australian using the words 'government waste' as the cue, the most common responses would be 'pink batts', 'school halls' and '$900 cheques'. Those are emblematic failures of the Labor government from 2008 to 2013 and they are evidence of Labor's callous disregard for taxpayer dollars. It was a period of our political history characterised by extravagance in relation to the spending of taxpayer dollars and by a total lack of evidence based policy making. I will go into the reasons for that shortly.

It was clear to Australians on 7 September last year, having cast their eye back over the previous six years of Labor and Labor-Greens government, that the bonfire of Labor vanities was fuelled by an endless supply of borrowed money. As Kenny Rogers used to say, 'There'll be time enough for counting when the dealing's done.' The counting of Labor's time in government tells a very sad story indeed.

I heard the member for McMahon earlier talk of Labor's economic record as a source of great pride, a record to celebrate. He was followed by the member for Hotham, who made the extraordinary statement: 'Labor left the budget in excellent shape.' Let's consider that record. Between 2008-09 and 2012-13, Labor delivered deficits totalling $191 billion. The 2012-14 MYEFO forecasts deficits to 2016-17 of a further $123 billion unless urgent corrective action is taken. Because of Labor, the net debt figure for this financial year is forecast to be $192 billion, rising to $280 billion in 2016-17. The Treasurer has said repeatedly that, unless we do something, peak debt is forecast to rise within a decade to $667 billion. Cast your mind back to where that debt was when they took power in 2007—zero. Debt is projected to rise, unless we do something, to $667 billion, two-thirds of $1 trillion. We pay $12 billion in interest payments on that debt each year—a huge, recurring opportunity cost. I would love to be getting some of that $12 billion in my electorate of Bass and putting it towards the many unmet needs in my community. But, sadly, every year $12 billion goes in interest payments because of that debt.

The member for Hotham earlier trotted out the usual Labor talking points, comparisons of Australia's debt with those of European countries. But reasonable people around this country will ask the obvious question: why are we benchmarking ourselves against European countries that have been spending unsustainably for decades, European countries with debt-to-GDP ratios above 100 per cent? Why is that the test that Australia seeks to set for itself in terms of its economic performance? Why doesn't Labor ever talk about the speed of growth of our debt since 2007? If you compared the speed of growth of our debt with those of some of our competitor countries, you would get a far more valuable benchmark in terms of how our economy has travelled in the last six years. The reason they do not is that it is a most unflattering comparison and it highlights the extent to which Labor breached the people's trust.

Why don't members opposite ever benchmark our economic performance against Australia's economic health at the time that they won the 2007 election? Why don't they reveal, for example, that under the Howard government the Australian economy grew at an average annual rate of 3.6 per cent, compared to the average annual growth rate under Rudd-Gillard-Rudd of 2.5 per cent; or that real GDP per capita grew at an average annual rate of 2.3 per cent, compared to the average annual rate under Labor of 0.7 per cent? Why don't they reveal that Howard and Costello delivered an average surplus of just over $8 billion and surpluses averaging 0.9 per cent of GDP? Surpluses are something which the member for Throsby was unwilling to comment on. When asked, 'When was the last time that Labor delivered a surplus?' he refused to answer that very simple question. What chutzpah by the member for McMahon and his colleagues earlier today to suggest that we should somehow celebrate Labor's achievement. Why would we want to celebrate the fastest deterioration in debt in modern Australian history?

I noted also that the member for McMahon and every other Labor speaker so far this morning extensively quoted Professor Joseph Stiglitz in relation to Labor's stimulus package. They omitted some important detail on their economist of choice. In 2005 Professor Stiglitz co-authored a book with a gentleman called Andrew Charlton. Charlton, of course, went on to become former Prime Minister Kevin Rudd's senior economic adviser during his first stint as Prime Minister. The book they co-authored was titled Fair Trade for All: HowTrade Can Promote Development. When I did some searching on Professor Stiglitz, I came across an article by Michael Stutchbury in The Australian on 17 November 2009. He attributed Mr Rudd's breathless attack on neo-liberalism in The Monthly as drawing heavily on Mr Charlton's mentor, Joseph Stiglitz. Stutchbury said:

Stiglitz has made his fabulous career by highlighting the reasons why markets don't always work. Now he famously claims that the global financial crisis will be for global capitalism and free markets what the fall of the Berlin Wall was for communism 20 years ago.

Yet, for Australia, the Stiglitz critique is of little use. … it's in our interest for China and India to become more, not less, pro-market.

The member for McMahon and the others opposite might wish to reveal whether their passionate referencing of Professor Stiglitz reflects their own belief in the end of capitalism and free markets. That would be an extraordinary position for any sensible person to take—and I know the member for Throsby would never take that position—much less someone who professes to be the alternative Treasurer of this country.

The Stiglitz disciples might explain why we should be proud of Labor's $900 cheques, which they claim were designed to deal with the global financial crisis. Are they seriously suggesting that we should continue to issue these cheques in response to what was, let's face it, a relatively short-lived global event with only a modest impact on Australia, and that happened years ago? Are they seriously suggesting we should celebrate policy decisions by Labor that have put our economy and our budget in such difficulty? Consider, for example, how the NBN morphed into the mess confronting Australia today. When the private sector knocked back Mr Rudd's $4 billion broadband thought bubble, he said, 'No trouble; we'll fund it from taxpayer money at 10 times the cost.' And who can forget that famous Tony Jones-Senator Conroy interview on Lateline, where the minister admitted he had no business case to rely on before entering negotiations with the telcos on what was a multibillion-dollar spendathon with taxpayers' money? What extraordinary dysfunction!

The tax bonus for working Australians is another example of wanton profligacy that is straight out of the drunken sailor playbook. It is a GFC stimulus measure from Labor that keeps on giving, 4½ years after the initial payments in 2009. Most sensible commentators on the GFC will tell you that it was a relatively short-lived event that had only a modest impact on Australia. Those opposite are keen on quoting Professor Stiglitz's views on the GFC; let's consider the analysis of someone less connected to key figures in the former Labor government.

The member for Bendigo said, 'The GFC is not over yet,' as a means of justifying continuing with these $900 cheques. Let's look at what Reserve Bank Governor Glenn Stevens said about this:

The whole crisis—

and he was referring here to the global financial crisis—

was very much a North Atlantic crisis. It was really only a global crisis for six or eight weeks …

Certainly by 2009 the unemployment figures as they came through were reinforcing the fact that GFC impacts on Australia were relatively modest and that the need for stimulus had passed. But the Labor government continued to use the GFC as a crutch—a prop—for wasteful spending.

The coalition made a commitment to end this waste during the 2013 federal election, and this repeal bill partly delivers on that commitment. We made this promise on the logical basis that stimulus to the economy in 2013-14 is no longer required. We are acting to make absolutely sure that further tax bonus payments cannot be made by the ATO by repealing the tax bonus act.

And there are so many reasons why we should repeal this bill. A lot of the $900 cheques have not been issued yet and, unlike those opposite, we believe that even one unnecessary $900 cheque is one too many. The last thing we want is to add even one more dollar of pressure on a budget that is unsustainable and that we inherited from those opposite. As I said earlier, MYEFO has forecast $123 billion worth of cumulative deficits over the forward estimates and $667 billion of peak debt unless we take action now. That is why we must end these unnecessary payments, 480,000 of which—and in excess of $400 million—were made following the original payment of stimulus cheques from July 2009 to the present time. The total amount borrowed by the government to spend on stimulus payments to date with these cheques is estimated to be in the order of $7.7 billion.

I know that for many of those opposite, the words 'million' and 'billion' are loosely interchangeable, but let us put some context around those dollars. If you consider that it costs about a billion dollars to build a new teaching hospital, that is the equivalent of about eight new teaching hospitals around our country—one for every state and territory. It is potentially a new Royal Hobart Hospital or a new Launceston General Hospital in Tasmania. It costs around $50 million for a new school, so $7.7 billion is about 150 new schools around the country. That is the opportunity cost of wasteful spending. Imagine if we could also save the $12 billion in interest payments it costs taxpayers to service our debt? Against those benchmarks of $1 billion for a new teaching hospital and $50 million for a new school we could certainly do a lot.

Despite eminent commentary, the 'age of entitlement' has not yet ended. To the contrary, Labor's entitlement legacy lives on in this misplaced tax bonus: inflated, ill-conceived in terms of its implementation and still turning up in people's post boxes. When $900 stimulus payments turn up in people's letterboxes four years after the GFC it begs the obvious question: 'If I am still receiving stimulus cheques from Labor today when they are no longer in office and when I don't need it, what else have they wasted my hard-earned taxes on?' Pink batts come to mind, as do the Julia Gillard memorial halls.

'Stimulus payment' is a euphemism for a Labor government that was 'drowning, not waving'; clueless in terms of critically assessing the actual measurable negative impact of the GFC on an economy that was perfectly capable of absorbing economic shocks. No surprises as to why that was the case, because the economy was cushioned by the economic legacy of the Howard government—its fiscal constraint and sound budgetary management.

The $900 stimulus payments did of course stimulate Australia's international aid effort: Millions of cheques were mailed out in 2012-13, including to foreign backpackers who had been in the country during 2007-08. And for those recipients the 'Lucky Country' had a cheque attached: 'Thanks for coming, please come back, and here's a lazy $900 from the taxpayer to tide you over.' Cheques also went to dead people, at least 21,000 of them.

And so we see landmines in Labor policy, including this one, which has extended beyond their life in office. And we see complexities: the 'just terms' clause of the Constitution could provide the basis of a challenge on the grounds that those yet to receive the payment could sue the Commonwealth if the government halts the scheme, because the stimulus cheque could be regarded as property under section 51 of the Constitution and that would have to be acquired by the Commonwealth on just terms.

The Treasurer is right: no matter what roadblocks are put in front of us, we will get rid of this bill. In the high court of common sense and public opinion 'just terms' would see this Labor stimulus cheque fiasco end with the swift passage— (Time expired)

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