David Gillespie (Lyne, National Party) Share this | Hansard source

This matter of public importance is really central to life in Australia at the moment, because the cost of living is really putting families and businesses under stress. Across the board, all the costs of living—health, food, education, housing, electricity, gas prices, transport costs—are up. There were 19,000 businesses, small businesses mainly, that went into insolvency in the last reporting period. We have to face the fact that the fundamentals of our economy are all out of balance.

As the Reserve Bank explained, as clear as day, the government is spending too much money—taxpayers' money and borrowed money. But we're not getting anything to see for it. There is no productivity gain in all this spending. It's just playing catch up. We need to have policies that improve productivity. The latest tranche of legislation that came through in the last two sessions has set the scene for a huge lack of productivity, with pattern bargaining and widespread wage claims.

Everyone supports a wage rise, but productivity needs to be improved to pay for it. Small businesses know this. That's why so many of them are now under stress: they're not getting the productivity. With the industrial relations changes coming down the barrel towards small businesses in my area, they will realise that the unions will be in command of how they run their businesses and that they will get much easier entry into their businesses and on pretty flimsy grounds.

The reason for inflation is the fundamentals of what makes an efficient economy: small amounts of government spending, spending that leads to productivity growth, and tax rates and interest rates that mean the cost of money for businesses and individuals isn't too high. We've seen 12 interest rate rises since this government came to power. Australia's core inflation rate is the only one in our peer OECD countries that is going up. It's all Australian-grown inflation, whereas it's going down in other countries. Even though there have been some wage rises, real household disposable income and the number of things you can buy with your income have gone down.

The latest disposable income figures show that, since the Labor government took over the Treasury benches and running government, real disposable income has fallen 7.8 per cent on a per capita basis. The force that is putting rent up and occupancy down is unbridled immigration. In the last annual figures, 638,000 new people were living in Australia. Former Labor Party governments have always been loose on immigration because each immigrant that comes here brings economic activity—we hope—and investment. With these current immigration settings, temporary migrants, who aren't highly skilled and who aren't bringing capital, aren't giving the lazy economic boost.

When you look at the GDP figures, compared to the number of new people, there's negative growth for all this massive population shifting into our beautiful country. That's why vacancy rates were around four per cent when we were in government—and the latest vacancy rates across Australia average out at 1½ per cent. Mortgage rates have gone up enormously, such that, to service their mortgage, the average Australian uses 48 per cent of their disposable income. Many renters are paying 55 per cent of their income. (Time expired)

See this speech in context