Nick Champion (Wakefield, Australian Labor Party, Shadow Assistant Minister for Manufacturing and Science) Share this | Hansard source

That was a fine contribution by my colleague the member for Canberra. I don't think I could quite match it, though I do like the member for Ryan and commiserate with her, as I think all members do. Politics is a tough life, and even tougher when your protege seeks to replace you. It's a pretty cruel act, even if you take gender right out of it. It's a bit of a dog act, isn't it, to do a deal with someone, to be their protege, to accept their support and advice and all the rest of it, and then turn on them come preselection time. It's not a very good entry into this place, and I suspect—

Ms Brodtmann interjecting—

Yes, it does. It will cost the young man in the long term, I suspect, when he comes to this place. He'll come with that hanging around his neck.

But I really want to talk about taxation and about wages, the two things in this budget that really tell you about the government's way of doing things, their priorities in doing things and their approach in doing things. This is a contest of values, and, of course, we've got the government's values, which are to play political games with people's taxes and political games with the nation's fiscal strategy. The government—and we've made this clear through the amendment to the second reading motion for the Treasury Laws Amendment (Personal Income Tax Plan) Bill 2018—can have the tax cuts for 1 July 2018 sail through this place, if only they split the bill. They can split the bill and have the tax cuts for 1 July 2018. Indeed, they could adopt Labor's plan and have increased tax cuts for 1 July 2018 without delay, without political games and without any problems, and then we can properly debate stages 2 and 3 and their impact on the budget. Of the $140 billion of costs that the Treasurer refers to in question time, we know that most of those costs lie over the medium term in stages 2 and 3, so why not split the bill, have the tax cuts secured for 1 July 2018 and have all those other tax cuts properly debated in this House and not delivered on the never-never like this government would have us do?

There are important reasons for this. Basically, we haven't been given the full picture by the government about their taxes. We don't know the full implications of those on higher incomes or on the fiscal strategy. We do know that the government's plan to deliver flatter taxes will mostly benefit those on high incomes—and you don't need to believe me.

Ms Brodtmann interjecting—

Yes, who would have thought this government wants to deliver for people on higher incomes!

But we know that this budget is built on some other issues. It's not just about the sorts of games they're playing on taxes—pretty pathetic games in question time, trying to turn this into a choice for Labor. It's not a choice for Labor; it's a choice for the government to split the bill and have it sail through this House. Then consumers and taxpayers and everybody else, including small business, will have certainty. Arguably one of the most important things that we can do for the public and for small business is to have that certainty out there. But of course the government won't split the bills. They'll try and play this ham-fisted political game and, of course, that will have an impact on the real economy.

The other area which I think this budget has issues with is wages policy. And we know this because the government's own budget papers, Budget Paper No. 1, actually talks about it. It says:

While wage growth remains subdued, it is expected to strengthen as growth in the economy picks up to an above-potential pace and spare capacity in the labour market is absorbed.

But then later it says:

Domestically, there are key uncertainties around the strength of the pick-up in non-mining business investment and the degree of spare capacity in the labour market. There are also risks around future household consumption and saving behaviour.

That's why Moody's have said:

… uncertainty persists on whether wages growth will pick up significantly enough to support revenues.

Of course, the Commonwealth Bank says:

Wages are the key to many parts of the economic and policy story at the moment. A sustainable improvement in the Budget bottom line is difficult to achieve without the revenue flow from higher wages.

So this budget is built on the presumption of wages growth, but this government is doing everything in its power to send a message not just to employers but to workers as well that they shouldn't ask for a pay rise. We've had the government's support for penalty rate cuts for hospitality and retail workers.

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