Tim Watts (Gellibrand, Australian Labor Party) Share this | Hansard source

Thanks to a Liberal Party focus group somewhere in the lead-up to the budget fairness is now the rhetorical terrain in which we engage in this chamber. But, because it is a Thursday afternoon, let's put aside the political rhetoric and talk about the reality outside this building for a minute. Inequality is the defining economic trend of our time. It is at a 75-year high in this country. Inequality is growing at such a rate around the world that most economists, including those long hairs at the IMF, now view it as a major brake on economic growth. Inequality is becoming so pervasive that it is now interfering with fundamental dynamics in our economy and our society that we used to rely on—dynamics like reward for effort and equality of opportunity. This inequality is leaving average people feeling like they have no control over their prospects, no way to improve the lot of themselves or their families—leaving them feeling like the rules of the game are rigged against them by forces they have no power over. And it is this inequality that this government seems absolutely oblivious to.

The dynamics of the modern economy, driven by technology change and globalisation, mean that we are seeing increasing returns to capital and shrinking returns to labour. Through the Menzies era, hourly labour income and productivity grew at about the same pace. The labour share stayed roughly stable and growth in inequality was kept in check. But, since the turn of the millennium, wages growth has decoupled from productivity and the real hourly labour income received by workers has failed to keep pace with their productivity growth. As a result, the labour share fell by 5.2 per cent in the first decade of the 21st century and a further 0.6 per cent so far in the second decade. Wages growth is at record lows, at just 1.9 per cent per annum, below the inflation rate. Underemployment, the number of people in the workforce who want to work more but are prevented from doing so, is at a record level. More than 1.1 million people or 8.7 per cent of the workforce want to work more but cannot. Wherever you look, working Australians are struggling. Living standards are stagnating and people are anxious and angry about it.

There are no easy answers to these structural challenges, but government should not be actively intervening to make things worse. Yet that is exactly what the Turnbull government's unfair budget does. According to the ANU Centre for Social Research and Methods report, released today, 60 per cent of Australians—working Australians—are worse off under this budget. Only one per cent of Australians are better off. And you know which one per cent—those top income earners getting a $20 billion income tax cut in this budget. Let us put it simply. This is a budget that increases income taxes on everyone earning more than $21,000 a year—people like registered nurses, whose average salary is $55,000; teachers, $66,000 a year; fireman, $60,000; paramedics, $61,000; and police, $56,000. These are people whose wages are growing at the lowest rate on record. And this is all to fund tax cuts for millionaires—to give people earning a million dollars a year a $16,000 per year tax cut; to give Ian Narev, the CEO of the CBA, a $171,000 tax cut; to fund $65 billion in tax cuts for banks and multinationals; and to protect $37 billion in tax breaks for property investors.

And who are these property investors? They are not the middle income earners that the Prime Minister absurdly claimed in question time today. According to the ATO, only three per cent of cleaners negatively gear, nine per cent of nurses and 12 per cent of teachers. And what is the average tax benefit that they claim from negative gearing? It is less than $100 a year for cleaners, around $200 a year for nurses and around $300 for teachers. In contrast, the 20 per cent of lawyers who negatively gear benefit by around $1,700 a year and the 30 per cent of surgeons who negatively gear benefit by around $3,900 a year, all the while putting the prospect of an Australian average income earner buying their first home further and further out of reach.

This budget exacerbates the inequality that I was talking about earlier and that sense in the general community that the rules of the game are rigged against average Australians. And that is not fair.

You know that the government knows this too, because they tried to hide it. Previous governments of both political persuasions used to publish tables in the budget overview, showing the impacts of the budget measures, taken as a whole, on the incomes of different kinds of families. They are gone now. And we know why: because those tables would show a very unfair story indeed, with low and middle income earners going backwards while high income earners go forwards.

One of the things that scares me the most about being a member of parliament today is that sometimes I can feel the wheel of progress slipping backwards—feel the gains we have made in building an egalitarian society, where everyone has an equal chance to reach their full potential, somehow slipping away. If we want an egalitarian nation, we need to fight for it in this building against those macro trends I was talking about earlier. Those of us on this side of the chamber will fight for it. We will fight for it in the schools. We will fight against the unfair $22 billion funding cut to our schools. We will fight the attacks on our universal healthcare system and the funding there. And we will fight it in our tax system because middle income earners should not pay for tax cuts for millionaires. (Time expired)

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