Dave Sharma (Wentworth, Liberal Party) Share this | Hansard source

Australia has been through a lot in the past year. We've been through a once-in-a-century pandemic, which tragically cost the lives of 910 of our fellow citizens; we've been through lockdowns; we've been through social distancing; we've been through personal hygiene measures that have had no precedent in the modern era in Australia; we've had weddings cancelled; we've had attendees at funerals limited; we've had significant days of national occasion, such as Anzac Day, cancelled or restricted; we've had people unable to visit their elderly or disabled relatives in care facilities; and we've had families cut off from one another, both interstate and overseas.

Undoubtedly this COVID-19 pandemic has also had a big impact not just on our lifestyles but also on our economy. At the height of the pandemic, we had 3½ million Australians on JobKeeper. In April last year 1.3 million Australians either had lost their jobs or had their hours reduced to zero, and Treasury feared that unemployment could reach 15 per cent and that our economy could contract more than 20 per cent. It was a time of great fear and great uncertainty in Australia and around the world. But, one year later, Australia is emerging exceptionally well from this COVID induced economic crisis.

Unemployment is now down to 5.6 per cent. There are more Australians in work now, at over 13 million, than there were before this pandemic first hit. Consumer sentiment is at its highest level in 11 years, and business confidence is also at record highs. Over 3½ million Australians have now received their first COVID-19 vaccination, and, by the end of this year—by Christmas—everyone who wishes to receive the COVID-19 vaccination should receive at least their first dose. There has only been one death from COVID-19 in Australia so far this year, 2021. The travel bubble with New Zealand is open. In short, our economy is roaring back to life. As Steven Kennedy, the Secretary to the Department of the Treasury, said last week:

Australia's economic recovery from the pandemic has been stronger than we expected, stronger than we have seen from any downturn in recent history and ahead of any major advanced economy …

This budget, through the Appropriation Bill (No. 1) 2021-2022 and related bills, maps our continued pathway out of this COVID-19 recession.

The world has been through an economic crisis unseen in this generation. We have seen a global contraction of around 4½ per cent, with many major economies contracting by more than this. But in Australia we are starting from a strong position. Our economy has only contracted 2.5 per cent. Our employment numbers are already above where they were before the pandemic struck. Last month, the month that JobKeeper ended, we saw unemployment figures come down yet again. We've retained our AAA credit rating and we've got low net public debt. These appropriation bills will help secure Australia's economic recovery. They'll help create more jobs, they'll help protect our health, and they'll help guarantee our essential services.

These appropriation bills support household incomes through the extension of the low and middle income tax offset. Around 10 million low and middle income taxpayers across Australia will receive up to $1,080 per year if they're individuals or up to $2,160 if they're couples. In Wentworth, in my own electorate, this will benefit up to 60,000 taxpayers. These appropriation bills are also supporting small and medium businesses to invest and grow—important, because eight out of 10 jobs are in the private sector.

We've extended the expanded instant asset write-off, which means that over 99 per cent of businesses employing over 11 million workers altogether can write off in full the value of any eligible asset they purchase. This has seen spending on machinery and equipment increase at its fastest rate in nearly seven years. So whether it's for a new ute for a tradesperson, a new coffee machine for a barista or new hairdressing equipment for a salon, new small businesses can invest and fully write off the value of these purchases.

We're also extending our small business loan scheme, which has already helped more than 40,000 businesses access low-cost finance, and extending the loss carry-back provisions for a further 12 months. All up, some 33,000 small businesses in my own electorate of Wentworth are eligible for the expanded instant asset write-off or the loss carry-back provisions.

These appropriation bills also help improve access to child care by allocating an additional $1.7 billion to support an increase in the affordability of child care. Up to 250,000 families across Australia will be better off by an average of $2,200 per year. This will give parents, and especially working mothers, the choice to take on extra work without being penalised, supporting increased labour force participation and giving working families greater choice.

These appropriations bills are also supporting innovation. They recognise that the nature of value creation is changing and that digital infrastructure and digital skills will be critical for the competitiveness of our economy in the future. We're investing $1.2 billion in our Digital Economy Strategy, we're expanding our cybersecurity innovation fund, we're undertaking a digital skills cadetship trial and we're continuing record spending on our R & D tax incentive. As a new measure we're also launching a new patent box, allowing income earned from new patents to be taxed at a concessional rate of only 17 per cent. Initially, this will apply to patents in the medical and biotech sectors, but we will be consulting on expanding it to the clean energy sector as well. We're also simplifying our treatment of employee share ownership schemes to align with the rest of the world and allow early-stage and start-up businesses to reward their employees in this well recognised fashion without paying a tax penalty.

This budget also has important steps to boost home ownership. We're helping another 10,000 first-home buyers to buy a new home with only a five per cent deposit through our First Home Loan Deposit Scheme. We're allowing people to save more through their super for their first home by increasing the amount that can be released under the First Home Super Saver Scheme from $30,000 to $50,000. We're also supporting single parents to purchase a home with a two per cent deposit under the Family Home Guarantee. This budget also guarantees our essential services. We're looking after our senior Australians by investing $17.7 billion in new funding to improve the quality and safety of aged care in response to the recommendations of the aged-care royal commission. This will increase the time nurses and carers are required to spend with residents. It will provide an additional payment of $10 per resident per day to enhance the viability of the aged-care sector. It will provide for new training places for personal carers and retention bonuses to keep more nurses in aged care. It will also increase to 275,000 the number of new home-care packages available.

This budget will also continue the trend of listing more medicines on the PBS. Since coming to government, we've listed more than 2,600 medicines on the PBS, or an average of almost one per day. In this budget we have measures to list medicines to treat breast cancer, lung cancer, severe osteoporosis, asthma and migraines. In last year alone there were 1.5 million free or subsidised medicines that were delivered in Wentworth, my own electorate, through the PBS, and this number will grow in the years ahead. We're also allocating $13.2 billion over four years to meet the needs of people with disability through increased funding for the National Disability Insurance Scheme. We're providing more funding for mental health services, including an expanded headspace network, increased funding for the treatment of eating disorders and greater access to psychiatrists and psychologists through Medicare, plus establishing a new national suicide prevention office. We've nearly doubled spending on mental health since coming to office, and this is an area that will continue to remain a focal point of this government.

These appropriations bills recognise we live in a more uncertain world, where Australia's strategic environment beyond our borders is changing and where we face new challenges to our sovereignty and our freedom of action within Australia. This budget continues our record investment of $270 billion over 10 years to engage in a once-in-a-generation upgrade of our defence capabilities, and it also provides an additional $1.9 billion over the next decade to strengthen our national security, law enforcement and intelligence agencies to deal with the threats of foreign interference here in Australia. The budget continues to allocate money to look after our environment, with $480 million in new funding including $100 million to protect our oceans. It will provide money to upgrade our recycling capabilities and reduce the waste that's being sent to landfill in Australia. It will support major energy storage projects like the Battery of the Nation and Snowy 2.0. It will also invest a further $1.6 billion to fund priority technologies, including clean hydrogen and energy storage, to continue Australia's pathway and, indeed, accelerate our pathway to net zero emissions.

This budget also contains important measures to improve the safety of women. One in four women in Australia experience violence from a current or former partner, and this number is unacceptably high. This budget will allocate $1.1 billion to measures to improve women's safety, delivering more emergency accommodation, more legal assistance, more counselling, more financial support, including cash payments for those escaping abusive relationships. This pandemic is far from over and, though we can see our way out, it's important to recognise that the journey on the way out may not be linear. Indeed, in Europe, we've seen a double-dip recession; in India, we've seen a terrible further wave of COVID infections hurting the population there. There could be further twists and turns in the road ahead and it's important that we be ready for this. While our recovery to date has been stronger and sooner than expected, we need to be prepared for uncertainty ahead.

Our economy, according to the Treasury, is forecast to grow by 1.25 per cent in this financial year, 2020-21, rising to 4.25 per cent in 2021-22. Our deficit this year is already going to be $52.7 billion lower than anticipated six months ago, mainly because the recovery has been stronger and sooner than expected. But, with that said, our deficit will still reach $161 billion this year, and our net debt will rise to $617 billion this year, or around 30 per cent of GDP. Our net debt will peak at $980 billion, or 40.9 per cent of GDP, in 2025 on current estimates. Whilst this is low by international standards—around half that in the United Kingdom and half that in the United States and one-third of that in Japan—it's important that we look at measures to address this over time.

We don't want to rush to austerity in this budget. Part of the lesson in the recovery from the global financial crisis, particularly in Europe and America, was that, when fiscal policy was tightened too soon, those economies suffered. The way we will get through this debt burden and reduce it over time is for the economy to grow faster. The measures in this budget will allow this to happen. Provided our nominal GDP is growing at a faster rate than nominal interest rates are, then debt as a percentage of GDP will shrink over time. This is how Australia reduced its debt servicing burden but also its net levels of debt in the wake of the Second World War—the last major economic shock.

These appropriation bills provide a way forward for Australia out of this economic crisis, the COVID pandemic. They support jobs. They look after health and critical services. They look after our most vulnerable and disadvantaged Australians, including the elderly, people with a disability and women, and they provide a pathway forward for our economic recovery. I commend these appropriation bills to the House.

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