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

It is good to have the opportunity to speak on the Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015. The changes proposed in this bill take place not in a bubble but the broader context of the economic situation that the government faces, particularly the budgetary situation that the government faces. The reality is that all aspects of government have been affected by the appalling legacy of debt that was left behind by the previous, incompetent Labor administration. Left untouched, the trajectory of government debt under the previous regime was heading towards $667 billion. The numbers get so big that they become difficult to conceptualise, but that is two-thirds of a trillion dollars—that is, 'trillion' with a 't'. That is where things were headed under the previous government. We do need to reflect on that because this, like all legislation, occurs within a context of the absolute need for budget repair.

One of the reasons things got so bad under the previous government was that, even when they projected they would spend more in a particular year, they spent even more again. The projection would have said: 'Well, actually, spending is going to go up quite a lot next year'; but then, not only did they spend the extra money they said they were going to spend, they spent more on top of that.

It happened basically every year under the previous Labor government. In 2009-10 they spent $1 billion more than they said they would in their budget. In 2012-13 they spent $6.3 billion more—the actuals versus the budget. If you are a business and you say, 'Our costs this year are going to be $1 million', and it turns out they are maybe $1.2 million or $1.3 million, that is a big problem—as it has been for Australia. In 2011-12 they spent $11.9 billion more than the large amount that they projected to spend. In 2008-09 they spent $32.1 billion more than they themselves projected in their budget. This is the type of administration that the Australian people rightly rejected. The Australian people reflected on a whole range of things that went wrong from a financial perspective during the last term of government.

Speaking, as we are today, broadly about the communications area, one of the things on which the Australian people reflected was the absolute monstrosity that was the management of the NBN under the previous Labor government. You would recall the stories—the breathless, short conversations taking place in various plane trips around the country as the former minister for communications sought an audience with the then Prime Minister. He was very difficult to find. The conversations were very short, but they had lasting and dramatic negative consequences. What happened under the previous government in regard to the administration and planning of the NBN will be remembered in Australian history as one of the worst examples of rank economic mismanagement that our nation has ever seen. To purport to commit tens of billions of dollars of spending literally on the back of a couple of coasters is something that should never be forgotten. I am sure when historians reflect on the Rudd-Gillard-Rudd years no area will be more symptomatic of the failure and incompetence than that one.

You would remember that the NBN was going to cost a total of $10 billion, but only $4.7 billion of that would be borne by taxpayers because private investors were going to come in and buy or invest in the rest of it. That did not happen. It was then going to cost $43 billion, and again private investors were going to come in and buy 49 per cent of it. That did not happen either. Private investors sort of said: 'Okay, well, you have some projections. How's this thing going to make money?' When they examined the reality, they found that there was really nothing under the bonnet in terms of the substantive work that needs to be done when you are contemplating even a small investment let alone tens of billions of dollars.

The review that was commissioned late in 2013 found that the NBN was going to cost $73 billion, 100 per cent of which would have been borne by the taxpayer. Just extraordinary. This was something that was committed to, without detailed work being done, on the basis of a couple of verbal conversations while flying around the country, at the level of the highest office in the land. We should always remember that, because it really does reflect very accurately and indeed very poorly on the previous government. We do have a difficult budget context, because so many bad decisions were made.

It is interesting to look at the proposals of the current opposition. You would have thought that, having gone through that very difficult six-year period—we will learn more about that period in an upcoming ABC documentary—some sort of internal analysis, a bit of reflection, might have been called for and that might have resulted in a more prudent and modest approach to planning in the future—certainly, to at least do your numbers.

We had a very curious situation recently, just in the last two weeks, when the Leader of the Opposition in his budget reply speech made the commitment that $100,000 degrees in what is known as STEM—science, technology, engineering and mathematics—would be HECS-free. That was all part of the opposition leader's plan to position himself as something of a champion of the modern economy, which is absurd based on the previous government's record. The calculation is pretty simple. You have $100,000 degrees. How much is the average HECS debt for a STEM student? You multiply $100,000 times the debt, and you get the amount. That is it. It is not that complex. You would think that it would have been quite easy to come into this chamber with a very clear understanding.

But what in fact happened, curiously, was that on budget night the cost was estimated by the opposition to be about $300 million. At some point, somehow, and do not ask me for the detailed backstory on this, it became $45 million. It was only going to cost $45 million. Then the next day it was over $1 billion. We obviously had to cost this policy, and it turns out that it is $2.25 billion. The average cost of a STEM degree is about $22½ thousand in HECS. If you multiply that by $100,000, it is $2.25 billion. It is really quite a simple calculation. This is really quite extraordinary and demonstrates that no lessons have been learnt by the other side.

The opposition leader wants to be perceived as a forward-thinking investor in technology with the start-up investment fund he bravely announced. As the Minister for Communications said earlier, the notion that an opposition with no business experience and no personal understanding of the technology sector could lead a technology boom in this country is really quite absurd. You will recall Kevin Rudd with a laptop in 2007—this time it is the opposition leader clutching some convertible notes. In both cases, it is a very unimpressive spectacle.

We do have problems with the budgetary situation. One of Labor's proposals is to tax the hardworking people who have saved diligently for their retirement through the superannuation system. That is a bad plan. It will affect more than 100,000 people and do very little for the budget. It will punish people who have done the hard yards and saved for retirement—in many cases, over 40 or 50 years.

Under Labor, costs were running at about 3.6 per cent a year above inflation. That is an unsustainably high level. What we have done is bring that down to about 1.5 per cent per year above inflation. So obviously, in order to effectively stand still, government spending would have to keep pace with inflation. Our budget proposes about 1.5 per cent above inflation. Government spending under our budget does increase but it increases at a markedly more modest rate than we saw under the previous government. That is entirely appropriate, because we are not here to spend people's money on a whim. We are not here to throw it around like it is ours—it is not. We must always remember that taxation is paid not voluntarily but through the force of law, and there are significant penalties for people who do not pay their taxes. We are saying, in taking that tax revenue, we have a very solemn obligation to spend it as sensibly as possible and as modestly as possible. This government is very committed to that.

Part of this broader picture is the area of communications. There are many public broadcasters around the world that have some form of advertising on their schedules. Channel 4 in the UK is a well-known public broadcaster. About 84 per cent of its revenue came from advertising, in 2011. CBC, the Canadian Broadcasting Corporation, has had no restraints on advertising since 2009. So the government believes it is sensible, in an environment of difficult economic circumstances, to enable SBS to have a further limited capacity to take on advertising. The increase in the capacity of SBS to take advertising, particularly around prime time, will enable it to generate some modest additional revenue. We believe this is sensible in the context of a very difficult budget position—which has been created entirely by those opposite.

As we reflect on SBS and the change in its rules related to advertising it is appropriate to think about the broader context in which this is occurring, which is the significant change in the television industry itself. I used to work in TV for quite a few years and have some understanding of the industry. It is an industry that is undergoing immense change. We had a situation, until very recently, where the only way you could get a moving picture into a home was through broadcast spectrum. Broadcast spectrum is parts of the air that are conducive to sending out a broadcast signal. That was an incredibly compelling business opportunity, because people wanted to watch moving pictures in the home and no-one could do it other than through free-to-air broadcasters.

The compact reached between the broadcasters and government of the day was that they would pay for that special privilege through licence fees. Licence fees are levied as a proportion of revenue. Historically, in Australia, the rate was very high—around nine per cent of total revenue was paid in licence fees. In recent years those numbers have reduced. It varies from broadcaster to broadcaster but is around 4½ per cent; it has approximately halved. That was done by the previous government to reflect the changing circumstances, the fact that the free-to-air television industry had given up a large amount of broadcast spectrum—to be used for other purposes—which could then be sold. Indeed, they have been subsequently.

As we look at the changing media industry—we see the launch of subscription video-on-demand services; we see the proliferation of literally hundreds of thousands of sources of online video—it is an argument to look at the regime that governs the free-to-air industry, just as we have looked earnestly at SBS and the package of measures before the House today. It is appropriate to look more broadly, to consider whether or not the regulatory regime that we have in place in free-to-air television is entirely appropriate or could be updated. And it is appropriate to consider arguments related to license fees and other issues, in that context. This legislation is important. It helps to repair the budget and I commend it to the House.

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