David Coleman (Banks, Liberal Party) Share this | Hansard source

Mr Deputy Speaker Jones, I take this opportunity to congratulate you on your recent ascension to the Speaker's panel. I am thrilled to have the opportunity to speak on the appropriations bill this evening because this is absolutely at the heart of the government's agenda. Indeed, it is at the heart of the distinction between the government and the sorry, sorry record of those opposite. We all understand the fundamentals about bank accounts. We understand that one wants to have money in the bank rather than a very large debt. That applies whether you are a family, a small business in any electorate or, indeed, a government. When the previous government came to power they were in the tremendous situation of having about $50 billion in the bank. What would be the logical human reaction to that? I think it would be to say, 'We should do whatever we need to do to preserve this fantastic economic situation which we have inherited.' That would be the logical thing to do. That would be the right thing to do by the people of Australia. But that is not what happened, of course. That is, unfortunately, not what happened at all.

In six short years that $45 billion to $50 billion of cash in the bank went to almost $200 billion of net debt. That is a debt that not only increased very rapidly in a six years but is increasing at an increasing rate—so much so that, if the government does not act, we are on track for debt of $667 billion within a decade. That introduces a new word to the Australian economic lexicon, which is 'trillion'. That is because $667 billion is two-thirds of $1 trillion. We are a mid-sized economy. We are not the EU or the United States. We are not used to throwing around trillions of dollars, but that is the reality of where we are headed unless we change course—and change course we will, because we need to.

The spending growth under the previous government was projected to be the fastest in the OECD from 2012 to 2018. In order to understand why that was happening you have to look at the underlying motivations of those opposite and contrast them with the government. Those opposite never saw a government program they did not like. They fundamentally believe that government is here to solve every single issue—'If you only get a few politicians and bureaucrats around the table you can fix every problem and really dictate to the nation how things should be.' As we know, that is not how the economy works. That is not how the real world works because government does not create wealth. Wealth is created by the enterprise and expertise of business and individuals. What we saw from the other side in those six sad and sorry years of government was an incapacity to manage right across the board. That was the only consistent characteristic.

We talked this morning about the NBN. Unfortunately, we only had five minutes to address that issue and it was very difficult in that time to cover off on all the incompetence. The NBN was an extraordinary example of the mismanagement of government funds. The former Prime Minister, from your own state of Queensland, Mr Deputy Speaker, was gravely intoning back in 2009 that the government would step forward and build this NBN, which was going to be wonderful and done very quickly. Of course, what we saw by the time of the 2013 election was that even though $6½ billion had been spent on the NBN only three per cent of homes were actually covered. There was a real lack of operational capacity and a real lack of regard for the taxpayers' money.

We saw that in border protection as well. Those opposite like to assert humanitarian superiority on this matter, but that is entirely inappropriate because the previous border protection policies were an absolutely failure from a humanitarian perspective and they were an absolute failure from an economic perspective, with a blow-out of some $11 billion for border protection—or, indeed, the lack thereof. With the borders once again under control under the leadership of the minister for immigration, we now see savings of $2½ billion through the closure of redundant detention centres. We also see a humanitarian benefit that those opposite do not like to dwell on, and that is the introduction of about 4,000 additional places under the special humanitarian visa program for people who perhaps did not comply with the strict letter of the UN convention but nonetheless are in desperate situations. Those people were not being allowed in in any significant numbers under the previous government because the illegal boat arrivals were overwhelming the system. That has been fixed, with a fantastic economic and humanitarian benefit.

It is not a good idea, when seeking to manage funds, to send cheques to stimulate the Australian economy to people who (a) do not live in Australia or (b) are in fact dead. That is not going to stimulate the Australian economy, but the previous government did that and that contributed to its appalling record. There were no budget surpluses under the previous government after 1989—a very long time ago. It was a different era then, some 25 years ago: 1989, 1990, 1991, 1992, 1993, 1994, 1995 and 1996, then you go into more recent memory from 2007 to 2013, but there were no surpluses at any stage during that entire period. If it happened once or twice you might say it was a difficult time, perhaps it was an aberration, but for 12 or 13 years in a row? That is just a way of life. That was the way of life under the previous government.

Turning to the solution, which these appropriation bills embody, we will be going from a deficit of $50 billion in financial year 2014 right down to $3 billion in financial year 2018. That is a huge reduction in the operating result of the Commonwealth, saving $300 billion in debt over that period. That is a truly dramatic saving. On top of that, of course, there is the saving on the interest which you would otherwise have paid on the $300 billion. Right now, with net debt of around $200 billion, we are paying interest of a billion dollars a month and we are borrowing money to pay that interest. It is really interesting to reflect on what we get for our billion dollars a month. What we get for that billion dollars is the capacity to not go into any further debt. We basically get to stand still. We do not pay off any principal for that billion dollars, we simply pay the interest which is accumulating on a daily basis. We are basically going out to the markets, borrowing more than $30 million every day and at the end of the day saying, 'We didn't increase the principal on our debt'—but nor did we paid it off if we are only paying that interest bill. So we face a very difficult situation.

There are structural issues that need to be addressed in the budget. Good governments tackle problems. Just as, in life, you have to be honest, in government you have to confront issues and you have to address them in a serious and sober fashion. What you cannot do is just kick them down the road to another day. What you cannot do is sleepwalk into the future, pretending everything is okay, when it is not. We are not going to do that. We are not going to sleepwalk into the future. We are going to address the economic mess that the previous government so shamefully left our nation in.

It is important to talk a little bit about some of the specific measures that are contained in these appropriation bills, because one thing I have learned in the brief time that I have been in this parliament is that misinformation is quite common in this whole area of politics. Lots of misinformation has been promulgated by those opposite in relation to the budget, so it important to reflect on some of the reality.

I turn to hospital funding. When you manage the budget in a sensible way—when you make the difficult structural decisions—you find that it is possible to make some investment in important areas, where it is appropriate to do so. Hospital funding is going up by 40 per cent in the next four years. And, indeed, thereafter it will increase by CPI each year. The notion that hospital funding is being cut is absurd, because every single year we will be setting a record. Hospital funding will go up by nine per cent, then nine per cent, then nine per cent and then six per cent, and then by CPI every year after that. So ever year will be a record year when it comes to hospital funding.

Funding for schools is similar—34 per cent in four years. Indeed, as the member for Mitchell well knows, we will be putting an additional $1.2 billion into schools that Labor had so cruelly taken out of the school budget. School funding will also increase by CPI every year. So it will be a record every year. Within the envelope of sensible economic management it is possible to provide for these important areas.

Pensions will increase every single year. There will be important structural reform of universities. We should have a university system that competes with the world. We should not sit idly by while nations around the world grow their university sectors more effectively than we do. And that is why the initiatives contained in the Minister for Education's plans are so important; they will enable universities to stand on their own two feet and compete.

To address those myths that, unfortunately, get promulgated from time to time it is important to note that no student, under these reforms, is required to pay up front. No student is required to pay back their HELP debt until they earn at least $50,000 a year. And the total contribution of students to their education relative to the contribution of taxpayers will be about 50 per cent. That sounds fair to me. Obviously, many of us in this chamber derived a big benefit from studying at university. It is appropriate that we make a contribution side by side with the taxpayer because there is a personal benefit in addition to a public one.

And what about infrastructure? Infrastructure is so critical because it is the economic gift that keeps on giving. If you build a road—you take that hard decision and go through the very complex planning and financial processes—at the end of the day you have something that will be there, not for a couple of days or a few weeks, but for decades. The productivity benefits are delivered on day 1, day 100, day 1,000 and day 10,000. That is so important in Sydney—in particular in my electorate, where WestConnex will provide a fantastic benefit. WestConnex will provide 20 to 25 minutes quicker travelling time from Beverly Hills to the city.

I know, Mr Deputy Speaker Jones, there are probably limited traffic issues in Townsville, where you are from, but certainly in Sydney there are very substantial traffic issues and 25 minutes less in travelling time from Beverly Hills to the city is a massive win for the people of my electorate. That has been made possible by both a $1.5 billion cash injection and a $2 billion concessional loan from the Commonwealth—a fantastic initiative.

If those opposite really care about the standards of living and the cost of living of ordinary Australian families, there is something very, very simple that they can do. It is something we have been talking about for a long time now. It is a simple measure. All that is required is the Leader of the Opposition to get in touch with his senators, perhaps gather them in a room and it just say to them, 'It's time to stop getting in the way of the removal of the carbon tax.' The removal of the carbon tax will save the average family $550 per year, and that is a very substantial saving. It will provide broader economic benefits, because it means that the small businesses and broader businesses that are currently shackled by that tax will be unshackled and much more free to compete. I am delighted to speak in favour of these appropriation bills and I commend them to the parliament.

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