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

I am very pleased to be able to speak on these appropriation bills today, representing as they do a very central part of government—the need to appropriate money to run the activities of the government. The word 'appropriation' is quite relevant because it is a strong word. To appropriate means to take, and the reality is that what governments do, through the force of law, is say to their citizens that they are required to pay certain amounts through taxation and then the government seeks to use those funds for the betterment of the community. It is done through the force of law, and members of our community are required to comply with government rules about taxation and so on. As a result, it is incredibly important that, when we do appropriate money from the people and businesses of Australia, we use that money wisely, because it cannot be morally right to take money from the people of Australia unless we are using that money in the most sensible fashion possible.

There is an immense contrast here. Under the previous government, the levels of appropriation rose to record amounts and the inefficiency with which that money was spent also rose to record levels. My electorate of Banks has many characteristics, and one of the characteristics is that people in my electorate do not like to see their money wasted. They absolutely accept the need to pay tax to contribute to the caring of people less fortunate in our society and the many other things that government does. What they object to, and rightly so, is when that money is wasted or used in a bad way, and that is exactly what happened under the previous government.

What I want to do this morning is talk a bit about where we have come from, after the six years of a Labor government, and where we are now with respect to the use of government money and where we might go back to should the ALP ever come back into power. As the shadow Treasurer described it, the 'opening salvo in the battle of ideas' has been launched in the form of tax No. 1 from the ALP in recent weeks. I think it is important to reflect a little on what might happen there, which I will do in a moment.

Let's talk a bit about the evidence of the six years of Labor. One thing that is extraordinarily consistent is that, in every year of ALP budgets, they ended up having to appropriate more money than they forecast they would. So, for every single budget, they said they would need a certain amount of money but they ended up taking more every time. The amounts vary. In 2009-10 they were only out by $1 billion; they thought it would be $338 billion but it was actually $339 billion. What is $1 billion between friends? In 2010-11 they were out by $1.5 billion; they thought it would be $354.6 billion but it was actually $356.1 billion. In 2012-13 they got it wrong by $6.3 billion; they thought it was going to be $376 billion but it was actually $382 billion. The year 2011-12 was not so good; they got that wrong by nearly $12 billion. They said in the budget that they would spend $365.8 billion but they actually spent $377.7 billion. So that was a $12 billion difference, which is quite extraordinary. In 2008-09, which won the award here, they projected that they would spend $292 billion but they actually spent $324 billion. They spent $32 billion more than they had forecast in their own budget. So, every single time, they spent more than they said they would. That is a very consistent theme and it sends a very clear message about the manner in which they manage the budget.

I want to move to a small indicative example of budget management under the previous government. This concerns a relatively small program, a program in an area which is an important area of public policy, and that is dementia. When the Labor Party were in government they said that they would introduce a dementia supplement to assist people suffering from that condition. Clearly, on both sides of the House, we would acknowledge the importance of providing assistance where we can to people in that situation. Jacinta Collins, the senator who had the responsibility for this, described these as historic reforms, saying that these were the most substantial reforms to Australia's aged-care system in a generation and that they followed extensive community consultation. The consultation must have been, at least to some extent, inadequate, because Senator Collins thought this would cost $11.7 million in 2013-14 but it actually cost $135 million. That is about an 11 times difference. That figure is dramatically out. It really speaks to this issue of having the capacity to plan in a sensible way and to understand operations, to understand how things will play out in the real world, as opposed to being able to issue a press release. That is a damning indictment. They thought it would cost $12 million and it cost $135 million. In the scheme of the federal budget, that is a relatively small amount, but there were so many of these examples right across the previous government's unhappy tenure. The good news is that we now have a government in place that is managing the funds of Australia in a much better fashion. The evidence of that is very clear.

Let's have a look at immigration. There was an extraordinary blow-out in immigration costs under the previous government. There are a lot of things in the immigration portfolio, but the key reason for the blow-out was the complete loss of control of Australia's borders: $11 billion, 50,000 people arriving and the tragic humanitarian consequences of that policy. Under this government, the cost of the immigration portfolio is declining; it is coming down substantially. It was $4.4 billion in 2013-14, and in the current year it comes down to $4.2 billion. It is expected to come down to $3.5 billion the year after that, $3 billion the year after that and $2.8 billion in 2017-18. That can happen because of the very effective stewardship of the Minister for Immigration and Border Protection, both the previous minister and the current minister. That is an extraordinary contrast. Under the previous government it was completely out of control in a humanitarian and a financial sense, but, through the strong management of the current government, it is very firmly under control.

We see the same thing with the NBN. Someone will inevitably have the job of chronicling the six years of the Rudd-Gillard-Rudd governments in some detail. When they do that, someone will have to write a very lengthy chapter about the NBN, because the mismanagement and rank amateurism that we have seen in the planning of the NBN is really in a class of its own. They originally said it was going to cost about $10 billion, and the government was going to put in $4.7 billion. Then they said, 'No, actually, sorry, it is going to cost $43 billion, but private investors are going to put up 49 per cent of that'—which did not happen. That is a big increase, from $10 billion to $43 billion. Then, when we conducted a proper and thorough review of this soon after coming into government, it turned out it was on track to be about $72 billion—that is a lot more than $10 billion. This is a particularly interesting point: the estimate of $72 billion was based on the assumption that it would cost about $2,200 to $2,500 to wire up each premises with the fibre-to-the-premises strategy.

As we found in Senate estimates last week, it turns out that it was actually costing $4,300 per premises, not $2,500. It was $73 billion on the assumption that it would be about $2,500 per home, but it was actually $4,300 per home. That means that even the estimate of $73 billion was low. So a program that was originally supposed to cost the taxpayer $4.7 billion was on track to cost well in excess of $73 billion. That is absolutely scandalous. What we are seeing under the Minister for Communications, so ably assisted by his parliamentary secretary, is a much more sensible rollout, a rollout that makes use of a range of technologies, not just one—because there are a lot of different ways of getting high-speed broadband to the home—and at a much, much lower cost. Importantly, it is actually happening. We are not saying construction has commenced, when there is simply a piece of paper showing someone would have liked construction to have commenced. Construction has commenced if construction has actually commenced. That is a very important contrast.

Infrastructure is another one. Not a lot happened in infrastructure under the previous government. The M5, particularly the M5 East, is a big issue in my electorate of Banks. I do not know if you have ever travelled on the M5 East in Sydney, but if you have it can be a very unpleasant experience, due to the traffic. The previous government said they would provide some funding to the New South Wales government to help build the M5 East, but with a whole range of completely untenable conditions. As a consequence, it did not happen. No money was provided. This government, under the leadership of the Prime Minister, said if you commit to building productivity-enhancing infrastructure we will back you. We will back you 100 per cent. We provided $1.5 billion in cash plus a concessional loan of $2 billion. That has meant that the M5 East duplication—it is actually more than a duplication, because it is going to go from four lanes to 10—is actually happening. We expect that duplication to be in place in 2019, which is a fantastic improvement and a good example of when you appropriate money for the purpose of running a government you must do so cautiously and carefully, but to appropriate money for the purpose of building infrastructure that a) helps business to do business more quickly, and b) helps people to spend more time with their families—that is a very sensible appropriation indeed.

The third thing I wanted to talk about is what happens under the alternative model. There were some very illuminating newspaper articles and various comments made, particularly in January, when the opposition was surprisingly open about its plans. The shadow Treasurer said very clearly, 'Revenue measures are on the table.' Part of the Year of Ideas—I suspect pretty much all of the Year of Ideas—will be so-called revenue measures. Generally, that means tax increase—'revenue measure' sounds a bit better, but basically it means a tax increase. On 27 January the shadow Assistant Treasurer wrote this fascinating op-ed article in The Australian, where he really wept at the grave of the carbon and mining taxes, really lamented their demise. He said:

… the Abbott Government has thrown out significant sources of revenue like the carbon price and the mining tax …

He actually provided some advice to the Assistant Treasurer, saying that Mr Frydenberg should be pressing his colleagues to 'reconsider some of the decisions' related to the carbon tax and the mining tax. I am very confident the Assistant Treasurer will not take that advice, because it is very poor advice indeed. These were job-killing taxes that significantly increased the cost of household living expenses.

The opposition has said clearly that revenue measures are coming. There is going to be a whole range of announcements, we can assume, about revenue measures and tax increases. We had the first one this week. This was a somewhat complex issue that relates to the capitalisation rules for foreign entities. There have been big headlines saying it is going to raise $2 billion. It would raise absolutely nothing of the sort. It was described by the shadow Treasurer as the opening salvo in the battle of ideas—quite a grand pronouncement. But that is a salvo from a very small popgun. Because this proposal, as the Business Council of Australia said, has 'the potential to slow economic growth and further diminish Australia's competitiveness'. The Chamber of Commerce and Industry said it has the potential to 'make Australia a less attractive place for international investment, thereby pushing new projects offshore and hurting jobs'. That cannot be a sensible thing. We do wait with interest for the Year of Ideas. I am very confident that the vast majority of the ideas will be new taxes leading to further appropriations of money from the Australian people and Australian companies, and that is the wrong path. This government has demonstrated the right way to manage the nation's finances.

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