Mr Tony Burke (Watson, Australian Labor Party, Shadow Minister for Finance) Share this | Hansard source

I rise to open the debate on behalf of the opposition on the three appropriations bills which form the additional estimates for 2014 and 2015: Appropriation Bill (No. 3) 2014-2015, Appropriation Bill (No. 4) 2014-2015 and the Appropriation (Parliamentary Departments) Bill (No. 2) 2014-2015. In total, these three bills seek to appropriate an additional $1.7 billion for the current financial year. I am hardly breaking suspense when I say that Labor will not be blocking supply and that we will be supporting these bills.

The amounts in these bills are actually already factored into the budget bottom line as presented in the Mid-Year Economic and Fiscal Outlook, MYEFO, which was presented last year. The three appropriations bills reflect changes in expenditure as a result of those MYEFO decisions, as well as machinery of government changes that were announced as part of the ministerial reshuffle prior to Christmas last year—and in advance of the next reshuffle, which we presume is imminent. These machinery of government changes included renaming the departments of education and industry and moving responsibility for child care to the Department of Social Services. The 2014-15 MYEFO measures that are subject to the appropriations in these bills include additional funding for Defence overseas operations; additional funding for a number of agencies, including the Federal Police, Customs and ASIO, for counterterrorism activities; and a further measure for community engagement programs as part of the Countering Violent Extremism program. I would note that there is a concern from the opposition as to how quickly the government is able to make sure that that money is in fact out and into the community. Funding for the Department of Parliamentary Services and the Australian Federal Police to enhance the security of Parliament House will, according to MYEFO, include upgrades to CCTV and access systems, additional Parliamentary Protective Service staff and an increased AFP presence here.

Also covered here is funding for the Department of Employment in relation to the Job Seeker Compliance Framework measure; $90 million for the Department of Agriculture for concessional loans under the Drought Recovery Concessional Loans Scheme; funding for the Department of Foreign Affairs and Trade for the establishment of a temporary embassy in Ukraine; funding for the Department of Health to provide upgrades to the Metricon Stadium facilities for the Gold Coast Suns AFL club; and—as appears in my notes, and I think my staff have put this in to make me feel bad, given the NRL Grand Final last year, but I am sure the member for Grayndler will be pleased to know that these bills include this—funding for the South Sydney Rabbitohs Community and High Performance Centre of Excellence. So $10 million is going to the club that defeated mine in the Grand Final last year. Notwithstanding that, we are still not blocking supply. There is funding for the Department of Finance in relation to the Kenbi land claim on the Cox Peninsula.

But what the MYEFO showed—which needs to be noted in the context of these bills, regardless of what we often hear from the dispatch box from those opposite—was an increase in the budget deficit in comparison to the 2014-15 budget, and a $44 billion blow-out over the forward estimates. This represents a $202 million blow-out in the budget deficit over the forward estimates by the Liberal-National government for each of the 216 days between the May 2014 budget and MYEFO last year—blowing out their budget by $202 million a day, while all the time turning up to the dispatch box each day claiming that they were doing something about debt and deficit. Blowing it out by $202 million a day does not exactly meet the criteria that the government have claimed or the spin that they have put out into the community. To put it another way, since coming into government, based on the figures in the independent PEFO document prepared by the public servants under the Charter of Budget Honesty, the budget deficit in 2014-15 has blown out by $16.4 billion—from $24 billion then to $40.4 billion now.

We heard prior to the election from the then opposition that if debt was the problem more debt was not the answer. Yet debt keeps on increasing over the forward estimates. Gross debt is $100 billion higher. Net debt is $146.3 billion higher in MYEFO than it was in the 2014-15 budget. Overall, debt is higher now than it was when the Liberal-National government took office. Gross debt in 2014-15 was forecast in the pre-election forecasts to be $330 billion. It is now $367 billion. Net debt, under the Charter of Budget Honesty, was forecast to be $212 billion. It is now $244 billion. We are aware of the falling commodity prices, particularly iron ore, and the effect that that has on the budget bottom line. However, this does not account for the majority of the deterioration in the budget bottom line.

We were told by those opposite that there would be an instantaneous adrenaline charge to our economy—an instantaneous surge of confidence—if the coalition were only voted in. But take a look at the other economic indicators. Unemployment is at 6.4 per cent, up from 5.7 per cent at the time of the last election—5.7 to 6.4 since the election. That is the highest it has been since August 2002, when the current Prime Minister was in charge of employment. Consumer confidence remains low—nine per cent lower now than it was at the time of the last election according to Westpac and the Melbourne Institute.

Anybody from the government taking heart from the last Westpac and Melbourne Institute consumer confidence figures—which did show an increase, with the index showing more optimists than pessimists for the first time since February 2014—should understand why consumer confidence increased: the Reserve Bank had cut interest rates for the first time since August 2013 as a sign of a weak economy; petrol prices had seen a 21 per cent decrease on average in the last two months; and there was a surging share market, with a 9.7 per cent increase in the share price index in the last month. These are things that were really out beyond the control of the government. Most interestingly, the leadership tension within the Liberal Party—the unrest in the government—certainly showed in a sharp fall in the confidence amongst coalition voters, but confidence of ALP supporters, third party voters and the undecided was boosted significantly, to deliver the overall positive result. Business confidence remains below long-run averages.

The 2014-15 MYEFO itself shows the impact of increased unemployment and weakness in the economy, reflected by its slower wage growth, with taxes from individuals being revised down by $8.6 billion over the forward estimates. So the economy is weak, unemployment is high and confidence has not really recovered since taking a battering after the last budget. You cannot expect confidence to increase when you are attacking the household budget.

Let us not forget that the budget bottom line, as shown in this MYEFO document, still incorporates a series of broken promises. They are factored into the budget blow-out. So those opposite cannot say, 'Oh, the budget blow-out's because legislation hasn't made it through the Senate.' These numbers presume that the government has been able to get all of its legislation through the Senate, and, notwithstanding that, we see that it is still blowing debt and deficit out. Measures such as the introduction of the GP tax, for which we saw a revision of in the 2014-15 MYEFO but around a month later in January saw another key element of the new measure in an increase to consultation times, jumped. That is not reflected in these figures.

The government is thoroughly confused on these issues. First it was a co-payment, then a price signal. We have latest heard that it is a value signal—not that the minister or anyone opposite is able to explain exactly what the difference is. The savings from this were supposed to go into the medical research future fund, which was supposed to be set up on 1 January 2015, and there are signs that the government is now wavering on this as well. We have consistently said that we support medical research, but we do not support funding medical research by putting a tax on people on the condition that they are sick.

Cuts to pension indexation lead to what the Australian Council of Social Service estimated to be an $80 per week cut to pensioners, and this cut is very clearly budged for. Page 203 of budget paper No. 2 shows the $449 million cut through indexing the pension and other payments by the consumer price index. The Parliamentary Budget Office has calculated the impact over the decade of the government's budget measures, including the change to indexation of the aged pension. What the Parliamentary Budget Office found was that the change to indexation would cut $23.4 billion from the aged pension over the decade 2024-2025.

Cuts to various family payments, including measures such as restricting access to family tax benefit part B to families with children aged under six, reducing family tax benefit part A and B supplements and freezing family tax benefit payment rates for two years lead NATSEM to estimate $6,000 being cut from a typical Australian family's budget per year.

There are measures here that essentially leave job seekers with nothing to live on for a period of six months. A measure we saw the other week was one of the Prime Minister's captain's picks. Plans for $100,000 university degrees through its plans for university deregulation and the increases in the petrol tax are here as well. These bills also deal with the cuts to the ABC and SBS, where the MYEFO saw a further $250 million cut to ABC and SBS following on from the budget measure which had already cut $43½ million from the two broadcasters. And foreign aid had a further $3.7 billion cut in MYEFO following the $7.6 billion cut in last year's budget. That is a total of $11.3 billion cut from foreign aid. These cuts collectively have made foreign aid as a percentage of our gross national income the lowest it has been since records have been kept.

Of course, with all of that, for all that these figures represent policies that we oppose, it would be irresponsible for us to do anything other than support supply and to see these appropriation bills go through. But be in no doubt: those in the opposition will be making sure the full impact of these bills is well understood. With that in mind, I move:

That all the words after "That" be omitted with a view to substituting the following words:

"whilst not declining to give the bill a second reading the House notes that:

(1) the 2014-15 Mid-Year Economic and Fiscal Outlook showed a $44 billion blow-out in the budget deficit over the forward estimates from the 2014-15 Budget, which represents a $202 million blow-out in the Budget deficit by the Government each and every day;

(2) Government debt is higher now than it was when the Government took office;

(3) the Budget bottom line in the Mid-Year Economic and Fiscal Outlook incorporates a series of broken promises, including: the introduction of the GP tax, increasing the petrol tax, cuts to pension indexation, $6,000 cuts to a typical Australian family, plans for $100,000 university degrees, cuts to the ABC and SBS, and a $11.3 billion cut from foreign aid;

(4) the Government continues to undermine business and consumer confidence with its unfair Budget, which are now below the levels at the 2013 Federal Election; and

(5) the Government's failure to have a clear plan for economic and jobs growth has led to the unemployment rate increasing to its highest level since August 2002, when the current Prime Minister was the Minister for Employment and Workplace Relations."

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