Alex Hawke (Mitchell, Liberal Party, Assistant Minister to the Treasurer) Share this | Hansard source

No, I did not say 'bludgers'; you said it. We have a generous safety net. We have family payments. We already have in place measures that support people on low incomes. But we also have to be fair to people who work very hard and pay tax. As a government, we have to ensure that we provide incentives for people to continue to work hard and do not punish them when they earn more and more money up the scale in the middle and average brackets. That is what we have to do, and that is what this government is doing. That is what our economic plan is designed to do—a far cry from the most unfair thing the Deputy Leader of the Opposition has ever seen. I think she should really cast her eye over the plan again. If you lower the tax on average full-time income earners in this country, you are doing the right thing to provide incentives for people to get ahead.

What has been missed in the debate from the Labor Party and the Deputy Leader of the Opposition this week is that, with our business enterprise plan, we are increasing the threshold for small business from $2 million in turnover—not a dollar of profit has necessarily been earned at this point—to $10 million in turnover and reducing the tax rate. These are Australian small businesses. These are mums and dads who run small businesses. These are hardworking people who work their guts out running their own enterprise every day—turning over money and keeping the economy going. These small businesses actually employ about three million people in this country. We are providing them with a growth plan for the future. We are cutting their tax. It is what every business lobby in this country has called for. It is what the Leader of the Opposition called for before he came to parliament. It is what he said in last year's budget-in-reply—and I am going to get to this year's budget-in-reply in a minute. I would remind everybody here that in last year's budget-in-reply he said that he wanted the government to join with the opposition in a bipartisan way to lower the business tax rate in Australia to 25c in the dollar. That is what he said. That is how he began his speech.

In our plan for jobs and growth in this economy and in the economic plan that we are outlining, the government is lowering the business tax rate to 25c over a decade. The reality is that a big business in this country will not get a tax cut for eight to 10 years. But a small business or a medium business—a person who wants to grow their business and add more workers; a person who wants to add more shifts and employ more young Australians—will get a tax cut. These businesses, 90,000 of them, will get a 2.5 per cent tax cut immediately. They will be able to add that extra worker. They will be able to put on that extra shift. They will have access to the government's instant asset write-off program. They will now be able to take advantage of spending money through the transactions this economy needs, and they will spend money on their businesses to grow their businesses, to add those employees, to add those extra shifts—and this is how you grow an economy.

How else do you grow an economy? If Labor is going to oppose us on increasing the threshold from $2 million of turnover—this is not profit; this is just a business generating $2 million of turnover—to $10 million of turnover, if Labor does not accept that small and medium businesses in Australia deserve a tax cut, how else will you grow this economy? How will you get more jobs? Every person you get a job for gets off welfare. Every payment that the government does not have to make increases our ability to get back into surplus.

Of course, that is an obscenity in this place. Every time a Labor member rises and talks to us about debt and deficit, we know the reason this country has debt and deficit. Every Australian knows. Every member of the public will remember why Australia has a debt and deficit problem. It is because of the six Rudd-Gillard-Rudd years—one of the most wasteful times in our nation's history—which saw the racking up of the largest debt and deficit that has ever been racked up in such a period. Now we are dealing with the legacy of that. When you look at the difference between the economic plan that the government has and that which the Leader of the Opposition will propose tonight you will see a sustainable path to surplus and living within our means, which are the kinds of things that households and businesses want to see the government doing. The government has to live within its means as well.

Opposition members interjecting—

There is a collection of shadow ministers opposite me—the big-spending group of the opposition you could call them because they are the big spenders. They are members of the Gillard supporter group. When Julia Gillard said to the state premiers, 'You think of a figure for your education and I'll sign anything that you like,' without any ability to ever fund it, there was not a tax regime that you could come up with to fund the promises that Julia Gillard made. You would never be able to fund it.

We have learned in recent weeks that your great plan has been to link tobacco tax funding, a declining revenue, to health and education funding. You have hypothecated health and education funding to a declining tax. Every economist in the country has said you will never get $47 billion of revenue over a decade out of cigarettes. The point of increasing the price of a pack of cigarettes to $35 or above is to have a decline in the smoking rate. It is to have less smoking. You will get less revenue. If you believe that your changes will bring $47 billion into the government from cigarettes, say so tonight. Tell us tonight if you are going to use cigarettes to fund your education promises.

It is very important that when governments make promises there is real money attached to them. That is what Australians want to see. When we promise increased health funding, as we have, and increased education funding, as we have, Australians want to see that they are reasonable amounts and that they are actual, real dollars that have been offset. Whenever you go through the budget papers—and I would bet my bottom dollar not many shadow ministers have actually opened a budget paper, but I am going to open one for them and go through it—everything is costed. What you will see is our 10-year enterprise plan. If you go to Budget measures: budget paper No. 2: 2016-17, page 41, you will see 'reducing the company tax rate to 25 per cent', and in the forward estimates everything is pay for. Every dollar of spending has been offset by a saving, and that is a sustainable way to run a budget and run the country.

But tonight we are going to hear from the Leader of the Opposition about their plans. What we do know is that they have a big, massive—or supermassive, I should say, in the lingo of the time—black hole in their costings, which already starts with $20 billion. That is true: they have a big, supermassive black hole. Some members of the opposition have allegedly referred to $20 billion as a 'rounding error'. We are still trying to round up who those people were!

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