Adam Bandt (Melbourne, Australian Greens) Share this | Hansard source

If you had a pot of money of $4 billion and you knew that that was going to grow bigger and bigger over time, what would you spend it on? There would be some who might say, 'Well, if there's $4 billion and rising that can be found in the budget, let's put it into Medicare.' Some might say, 'Let's put $4 billion into hospitals so that whoever gets sick in this country knows that they have a hospital to go to. Let's put it into schools. We know public schools are incredibly underfunded, so let's put it there.' Some might say, 'If there's a spare $4 billion and rising lying around, let's put it into lifting the level of Newstart for people who are trying to find a job, because they're living below the poverty line, which means they can't afford to buy new clothes or get a haircut or go into training and do all the things that you need to do in order to get yourself a job.' Some might say, 'Well, if there's $4 billion to be found in the budget and rising, let's put it into building renewable energy, getting solar plants and wind turbines going around this country and creating the thousands of jobs that come with that in places like South Australia, where we know they are needed, or Victoria, where very high unemployment is looming as the manufacturing crisis hits.' If you are a deficit hawk on the government's side, you might say, 'If you have a spare $4 billion or more lying around, let's put $4 billion into paying off the deficit,' given how important they keep reminding us it is.

If you asked the majority of Australians how they would spend an extra $4 billion and rising, what most people would not think is, 'Well, let's give a tax cut to above average income earners.' But that is exactly what the government and Labor have just stitched up in a deal. In these times when the government has told us that we need to get the budget into shape and when Labor has said we need budget repair that is fair, they have said, 'As the first expenditure item straight after the election, let's spend $4 billion on tax cuts for above average income earners that they won't even notice.' The Australian Bureau of Statistics told us a couple of months ago that the average annual wage in this country is about $60,000. This bill that we are dealing with talks about people who earn above $80,000. One report that I read suggested that that is the top 25 per cent of taxpayers. So the top 25 per cent of taxpayers are going to benefit from this bill. In one fell swoop, Labor and the Liberals are saying: 'Let's take a scarce $4 billion and give it not to the bottom 25 per cent or the bottom 50 per cent but to the top 25 per cent of taxpayers in this country. Let's not put $4 billion into schools. Let's not put $4 billion into hospitals. Let's not put $4 billion into nation-building infrastructure. Let's give it to above average income earners.'

Do you know how much the people who are earning above $80,000 are going to benefit? You are talking about, for many of them, around $6 a week. They used to talk about the 'sandwich and a milkshake' tax cut. In most inner city cafes in Melbourne you cannot really get a sandwich for $6. Six dollars a week is something people who are in the top 25 per cent of taxpayers probably will not even notice.

But I tell you what would be noticed: $4 billion going into propping up Medicare so that average income earners do not have to keeping paying more and more to see the doctor. I tell you want would be noticed: $4 billion going into schools so that parents do not have to keep paying these so-called voluntary fees every year as the cost of a public education goes up and up and up.

To rub salt into the wounds, not only are Labor and Liberal saying that the first big act of this parliament—the first big expenditure—is to give a tax break to those who are doing very well comparatively, thank you very much, and ignore those at the bottom, we know the other thing they have done this week is work out how they are going to fund this money going to the top. They are going to rip money out of renewable energy to pay for it. They ripped half a billion dollars out of renewable energy yesterday to pay for this. They are ripping money out of the Student Start-up Scholarships to pay for this. So university students—who are not exactly the richest in this country, who are living under enormous pressure with rising rents, who are finding it hard to find work and to balance work and study—are going to end up with less money. They are getting cut to pay for this.

We know, because Labor and the Liberals agreed to it yesterday, they are going to take money out of aged care to pay for this. We know, because they agreed to it yesterday, that newly arrived migrants to this country are going to suffer because they have to wait longer to get payments. This is all to pay for a tax cut for the top 25 per cent of income earners. What is this rubbish from Labor about repairing the budget fairly, when the first thing they do is crawl over to the government benches and ask, 'How can we help you give a tax cut to a high-income earners who probably won't even notice it?'

We also know that this is going to be paid for by cutting funding for research and development. There is a research and development tax break which is going to help create the jobs of the present and of the future in this country. It is actually making a difference. Companies in Australia say that the research and development concessions that we get make Australia an attractive destination to come and set up and to continue to do business. We hear all this talk and this rhetoric about becoming an innovation nation. The way that you do it, and the way that other countries do it, is to give tax breaks to companies that want to come and invest in research and development here. And what are we doing with this? The Liberals and Labor are saying they will cut the R&D tax concession to give a tax break of $6 a week to people who probably will not even notice it.

I suggest to the Australian people this is probably how the next couple of years are going to roll out. You might hear stuff before the election such as: 'Oh, they're going to privatise Medicare. You can't vote for them. Oh, they're going to wreck the economy. You can't vote for them.' But as soon as the election results are declared, as soon as we are back here, within a fortnight, what happens? There is a dirty deal between Labor and the Liberals to rip money out of renewables and off low-income earners to fund an income tax cut for those on above-average incomes, and everyone else can go and get stuffed. There is nothing in the first couple of weeks from parliament for you. It is a dirty deal that is rammed through quickly. Why are we here in the Federation Chamber with everyone speaking for only a few minutes on one of the most significant expenditure items that we are probably going to see this year? It is going to mean $4 billion less in the budget—it is $4 billion and rising—to spend on all the services that Australians expect.

I expect this kind of Thatcherite economics from the government. I expect this kind of Thatcherite economics from the Liberal Party, because they say: 'If we just keep cutting taxes and cutting taxes then it will mean less money available to spend on social services—less money for schools, less money for health, less money for hospitals.' But what astounds me is that every time the Labor Party falls for it! The Labor Party says, 'Oh, well, we don't want to be accused of not wanting to give tax cuts, so we'll sign up to whatever the Liberal Party suggests.'

What does that mean? When you do that, two things happen. One is that you end up with less money in the kitty to spend on services, and you have to go and do ridiculous stuff like cutting support for students, aged care and research and development in order to pay for it. Secondly—and I plead with the Labor Party to rethink their position on this—you shift the terrain of the political debate. It becomes normal to turn every election into a tax cuts arms race in which we ask, 'Who can compete on tax cuts?'

The problem is we know that we have a looming revenue crisis in this country. We know it because organisations as diverse as the Business Council of Australia and left-wing economists, and also the rating agencies, are telling us, 'Look, Australia needs to address the revenue side of the equation as much as the expenditure side of the equation.' So we should be having a discussion in this country about what a reasonable level of tax is that people would be prepared to pay in return for which kinds of services. What kind of social welfare safety net do we want? What kind of access to schools and hospitals do we want? How much are we prepared to pay for it?

If we had that kind of discussion, I suggest to those sitting on the opposition benches that it would be much, much easier. If we could have a sensible and honest discussion with the Australian people about the appropriate level of tax and who it should come from, it would be much, much easier to fund things like an expanded Medicare system. It would be much, much easier to deliver on the Gonski reforms. But, instead, Labor keeps creating a rod for its own back by signing up to unnecessary tax cuts and then doing what must come next—signing up to unfair cuts to social spending to pay for it.

If we keep going down this road, the right is going to win. The hard right is going to win. Because if every time they bowl up a tax cut for above average income earners and the Labor Party says, 'Yes, let's get this through parliament as quickly as we possibly can,' then we are going to find ourselves in trouble. There are better ways of spending $4 billion than a $6-a-week half a sandwich for people on above average incomes. But we do need to ask ourselves: where should we be bringing the money from to fund the services that Australians expect? There are plenty of places where we can find that money. We could go and ask the likes of Gina Rinehart in the mining sector and say, 'If you paid the same on your diesel fuel as every Australian pays on their petrol when they go and fill up, and we stopped giving you that tax break, that's an extra couple of billion dollars a year.' Keep the tax break for farmers and those in agriculture—there is a legitimate case there. But what possibly is the case for subsidising the likes of Gina Rinehart to buy cheap diesel fuel? It does not exist. We could go to the banks and we could say, 'You have your world-leading record profits, and you're doing it, the IMF tells us, off the back of implicit support from the government and the public, so you could probably afford to pay a bit more,' instead of taking the axe to renewable energy or taking the axe to students in higher education.

We could have that debate, but, the thing is, that requires a bit of spine. It was interesting that yesterday on the first anniversary of the Prime Minister's time in power, one Labor wag went out and presented the Prime Minister with a backbone. It is interesting that they took it back after the stunt was done and took it back into their office because, on many occasions, that is where it belongs. One of the jobs of an opposition should be to oppose when the government is doing something bad. The clue is in the job title—'opposition'. When the government says, despite all the rhetoric of tight budgetary restraint, we are going to give a tax cut to high income earners who probably do not need it, truth be told, as much as many others in our society, the job of a good opposition should be to say, 'No, that's not something that we're going to support.'

From here on in, let it be known that the Greens are not going to be participating in this tax cut arms race, and we are going to hold Labor and Liberal to account when they do these dirty deals to fund tax cuts for the top 25 per cent of income earners at the expense of low-income earners, because that is what Labor has done this week. Labor has helped the government redistribute wealth upwards. Labor this week has said: 'We don't mind if you take money off students to give to those on $100,000 or $200,000 a year. We don't mind if you take money out of aged care to give it to those on $300,000 a year.' That is what they have done this week. Bravo, Labor! You expect this from the Liberals, but you expect better from the Labor Party.

The Greens are very, very happy to call this out for what it is: it is unfair and it is bad economics because it slices out a big chunk of revenue from the government's coffers at the time when we are looking for ways to fund the services that people expect, and it sets an extraordinarily bad precedent. If this is what can be done in the first couple of weeks of this parliament—if Labor is not going to oppose it but they are going to crawl cravenly over to the government benches and sign up with every bad idea—I fear for what is going to happen over the next couple of years in this place.

Question negatived.

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