Malcolm Turnbull (Wentworth, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

I rise to speak on the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and cognate bills. Every time I meet a school group visiting this place I tell them that every member and senator is working hard to make Australia a better place for them to grow up in. I say that we often disagree but that everybody is focused on them and I tell those children that this parliament belongs to them, that everyone is committed to a better future for them. I wonder today if I can say that to them again, because every billion dollars that we spend, every billion dollars of debt that we incur, will have to be repaid by those children.

In government, we sought to take financial burdens off the next generation, and we did so. The Future Fund did just that, relieving those schoolchildren of the burden of over $100 billion of future payments for public sector pensions, and now a Labor government is piling those burdens on those children once again. In four years, net debt will be $70 billion, around $3,300 for every man, woman and child, and the government has asked for the right, just a moment ago, to borrow up to $200 billion—$9,500 for every man, woman and child in Australia.

The plan we were presented with by the Prime Minister yesterday reeks of nothing more than panic. Far from a steady hand at the tiller we have a government led by a man who lurches from one ill-considered, ill-thought-out economic decision to another. We have seen the catastrophic unlimited bank deposit guarantee develop without even speaking to the Reserve Bank. We have seen the enormous harm that it did through the community—the hundreds of thousands of Australians whose savings were frozen as a consequence, the finance companies who could not raise money and the motor dealers who could not get finance. All of that flowed from an ill-considered decision. But there have been so many others. We saw the cash splash just before Christmas. We have the incredible proposal of the Ruddbank to prop up commercial property values for the benefit of the big banks and their profits.

In the light of all of that, all of those errors—acknowledged errors, not in dispute; even the Prime Minister’s defenders acknowledge that he has made mistakes but hope that he will make fewer in the future—instead of carefully compiling a comprehensive response to this crisis over the summer, the Prime Minister spent his time writing a bizarre ideological treatise. It was as though he stepped into another world, a parallel summer fantasy dimension where Australia’s economy has been wrecked by lack of regulation by Liberal governments. Anybody reading his treatise could reach no other assumption and yet we see his own deputy, the Deputy Prime Minister, saying that Australia’s financial and prudential regulatory system was better than world-class and we see his small business minister writing in the Australian today that ‘Australia’s financial regulation is the envy of the rest of the world’. His own ministers are boasting of the stability of a financial system and its prudential and financial regulation that were put in place by the very men and women that their leader denounces as neoliberal extremists committed to letting the market rip and opposed to any form of regulation. It says a lot about the delusional nature of the Prime Minister at this time that not even his own ministers are prepared to sign up to his rantings.

We have said again and again that we are prepared to sit down and discuss with the Prime Minister the form of the responses to this economic situation. All of those offers have been rejected. Yesterday the government presented Australia with its package at 12 noon. We were briefed by a handful of bureaucrats who were not able to answer even basic questions about the details of the package. They are still coming back to us on some of those issues. At 2.30 pm the Prime Minister read his statement, which we had been given at 1 pm. The government then went on the attack: it was irresponsible of the opposition not to immediately endorse the $42 billion package. Moreover, it had to be passed through the House and the Senate by Thursday. In other words, the Parliament of Australia would be given about 48 hours to consider and approve the expenditure of $42 billion.

We support the Senate coming back next week, deferring estimates, to go through this plan in the greatest detail. It is vital that we do so. One can well imagine those schoolchildren of today who, as adults, years hence are paying high taxes to pay off the debt. When they complain about the high taxes they will be told by governments, by ministers, ‘Well, we’ve got this big debt. You’ve got to pay higher taxes to pay it off.’ They will ask us, ‘What were you thinking when you spent all that money? Why did you do that?’ We will have to answer, ‘Well, we didn’t have much time to think about it at all really.’

The opposition will vote against this package in the House and in the Senate. We know that this is not going to be a popular decision, but it is the right decision. The Prime Minister has made one easy decision after another. He has not made a hard decision since he took up that high office. But somebody has to stand up for what is right. Somebody has to stand up for fiscal discipline. Somebody has to stand up for the taxpayers of Australia and ensure that we do not impose staggering levels of debt on future generations. We will make that stand and we will make it knowing it is unpopular but recognising that the Australian people expect us to do what is right, and we will do that.

This stimulus represents about four per cent of GDP, almost all of which is to be spent over the next two years, following up on the one per cent of GDP cash splash in December last year. Despite the protests of the Treasurer, the fact that this stimulus follows so hard on the heels of the earlier one indicates that the December cash splash did not work. The general view among economists is that at least two-thirds of it was in fact saved. I am sure that most of the balance was well spent but not all of it was, as poker machine and hotel takings demonstrate. The fundamental problem, which the government refuses in its arrogance and in its blindness to acknowledge, is that, if you give people one-off windfall lump sums in uncertain times, they are more likely to save it than to spend it. That is a perfectly rational and prudent response. Indeed, the Prime Minister’s call at the end of last year on Australians to ‘spend, spend, spend’ was jarring. It was a jarring statement because most Australians—all of us, I am sure—know full well that at the core and instigation of this global recession was too much debt. In other words, whether governments like to hear it or not, a good old-fashioned conservative value of thrift and saving is going to come back into fashion, it is coming back into fashion and it ought to come back into fashion.

We do not reject the need for a stimulus at this time. The first question is: how big should the stimulus be today? Our judgment is that $42 billion is more than is appropriate right now. The government is looking increasingly like a frightened soldier who fires off all his ammunition in a panic in the first minutes of an engagement. This downturn may be very long lasting and we cannot possibly afford to spend larger and larger sums like this every quarter. Just think about it. If this package goes through, the government will have spent about one per cent of GDP in a cash splash in the December quarter and then there will be, just in the cash payments alone, another one per cent or somewhat more spent in the March quarter. It should not be overlooked by anybody that, just as the government times its announcements to coincide with Newspoll, so it is timing its handouts on a quarterly basis to avoid, no doubt, a quarter of negative growth. But where is that going to lead us? If we look at the cash handouts alone that the government is proposing to give away in March and that it gave away in December, what are we to expect in the budget and beyond? Are we going to rack up $40 billion or $50 billion a year in cash handouts alone?

We do not have access to any more financial information than that contained in the government’s Updated Economic and Fiscal Outlook which, as I said, we were given yesterday afternoon. But if the Prime Minister wants our support for a fiscal stimulus then he must be prepared to sit down and talk with us, he must be prepared to put the cards on the table and he must be prepared to negotiate. His current political hero, President Obama, probably the most popular political leader in the world, sits down with his political opponents. He is prepared to negotiate. He is prepared to engage the members of his legislature. This Prime Minister is so vain, so arrogant and so convinced that he and he alone is right that he is not prepared to do any more to his political opponents than to hold a gun to their head and say, ‘Stand and deliver and you’ve got two days to do it’.

Unlike the Prime Minister, we do not contend that the approaches we favour are the only way to go. There is an infinite range of policy options available at this time and all of them have detractors and supporters. None of them are certain of success. Let me give the House an indication of our views of the particular elements in this package and the elements that we believe would be more appropriate. This is a basis for negotiation with the government. First, as I said a moment ago, we believe the package is too big. We do not rule out supporting further stimuli in the future depending on the economic circumstances and their composition. We need to keep a few shots in the locker. Our judgement is that a more appropriate level of stimulus is in the order of 1½ to two per cent of GDP, or between $15 billion and $20 billion. That is a matter of judgment. There is no mathematical formula that gives you the right answer here, but our judgment is that that is the band within which the stimulus should be. If people believe that we are more prudent, more conservative in spending taxpayers’ money and that we err on the side of spending less rather than more, then they are absolutely right. That is our philosophical approach to these issues. It is not a question of letting the market rip; it is a question of taking other people’s money seriously, guarding it, protecting it and ensuring that it is spent wisely and well. That is our commitment.

We do not support a further round of cash handouts. That is a very unpopular thing to say and I acknowledge that, but it is the right thing to say. I think most Australians will recognise in their hearts that it is the right thing to say. It is extraordinary that the government would embark on this when there is no basis for concluding that the cash splash of December was effective. At the very least, the impact of the December payments needs to be taken on board. We need to know precisely what it is. Bear in mind that these handouts were paid two weeks before Christmas, and I said at the time that this was an interesting economic experiment. If ever a one-off handout, a one-off cash payment, was going to be largely spent it would be this one because the timing, being just before Christmas, was perfect for those people who wanted that outcome. Nonetheless, it appears that it was largely not spent, and bear in mind that the recipients in December were, for the most part, on low incomes—pensioners and others.

The beneficiaries of the payments in the government’s package today will include many Australians at middle-income levels. Furthermore, the economic climate is much more uncertain—or more uncertain, at least—than it was in December. The incentives to save rather than to spend are therefore a lot greater. So we would support as an alternative the bringing forward of the 1 July 2010 tax cuts to 1 January this year. This will have a budgetary cost. It is obviously spread over time and it is not as much as the cash payments in the Prime Minister’s plan, but it is temporary. It is a timing difference. It will benefit all taxpayers, but it will benefit most significantly those on low and middle incomes. It is therefore very well targeted. It does not put $950 in everybody’s pocket today, but that is the point. It increases permanent income and it therefore provides a greater incentive to work and to invest. And by the middle of next year, households will have more money in their pockets and the prospects of more money to come. They will have more money in their pockets immediately, of course.

The Prime Minister and the Treasurer have tried to portray anybody who doubts their analysis of quick cash handouts as some kind of economic quack. That just underlines both their lack of reading in this area and their incredible arrogance. There are many voices all around the world questioning whether the immense scale and scope of the fiscal measures being hastily implemented by many governments are the appropriate response. There are many reputable economists who wonder whether those measures will be effective and whether they represent the best use of taxpayers’ money. The Treasurer yesterday derided the views of the Stanford economist John Taylor as irrelevant and extreme. It is very interesting that the Treasurer of the Commonwealth of Australia would so personally and viciously attack one of the most distinguished economists in the world. Given the influence Taylor has had on central bank thinking around the world, this is simply outrageous. But, more importantly, there are plenty of other economists who are similarly sceptical over the headlong rush to huge deficits and heavy debt. They include Robert Lucas and Ed Prescott—both past winners of the Nobel Prize for Economics—Robert Barro, Eugene Fama and Gregory Mankiw among many others. These are not quacks. These are not extremists. These are not irrelevant. These are great economic thinkers who have a view that is respected around the world but not, apparently, by the all-knowing Treasurer that we have on the other side of the House.

Nor is it right to portray as ignorant extremism the coalition’s stance that tax cuts often provide a larger boost to the economy than public spending. Indeed, one of the most powerful and persuasive empirical studies in the United States—a study which has been much quoted in the financial media saying that tax cuts have a high multiplier; that is, they provide a larger bang for the buck to the economy than outlays—comes from none other than Christina Romer, now a senior economic official in the Obama White House. Now, clearly these are very difficult times and there are a range of economic opinions and interpretations. Nobody has all the answers. So it is the height of arrogance and intolerance for the Prime Minister and the Treasurer to declare that the only way is their way. It just indicates a lack of willingness to engage in a constructive way both with the wider community and with a wide range of views, not to speak of the views of other members of this parliament.

The next large element in the plan is an investment in schools. In government, we very heavily invested in schools. Indeed, one of our most successful and, I would say, popular programs was the Investing in Our Schools Program which the Rudd government has terminated. The $14 billion schools investment component of this package seems to have been selected largely because the government believes this building can be undertaken quickly. Experience suggests this will not be the case. The plan to work hand in glove with state governments reinforces everybody’s scepticism about that. We would welcome a renewal, indeed acceleration, of the Investing in Our Schools Program. However, we have to ask this question: is the most urgent infrastructure deficiency requirement in Australia primary school assembly halls and libraries? What about hospitals? What about nursing homes and aged care? What indeed about the National Broadband Network? What about water infrastructure, and what about expanding, and above all maintaining, our National Transmission Network? Labor’s response to this, of course, will be that there is more money to come for these measures, but there is the point. The finances of the Commonwealth are not a magic pudding. Everything has to be paid for at some time. Think of the faces and look into the eyes of those schoolchildren that come to parliament every day and remember that as these debts are piled up, billion upon billion, it is they who will have to pay them off.

In an indication of the specific responses we would bring to this plan, we would support a renewed Investing in Our Schools Program. Based on our experience, we believe that $3 billion over three years could be, and would be, well spent and, depending on demand, and of course on the economic conditions, consideration can always be given to allocating more funding. That is a very important point. The parliament is not going into perpetual recess. The parliament is always here. We can come back and if circumstances require a greater stimulus of a different kind and a different time, we can do that. The Prime Minister is in a panic. He is firing off all his ammunition at once. We need to keep more in reserve—prudence demands that.

The biggest gap in this package by far is jobs. The three top priorities this year must be jobs, jobs, jobs. Where is the assistance for small business in keeping employment high? The government will say that the insulators and the builders will be supported by these programs, and so they will. But most small businesses will not benefit from these spending measures. Fiscal stimulus should aim to invest in the Australian economy in a way that makes the whole economy more productive, efficient and competitive. Picking off one sector after another will always result in dislocations and discrimination against the sectors that are not privileged. That of course is why tax cuts are so effective, because every business and household benefits.

We believe an element of a stimulus package should be that it lowers the cost of employing Australians. A key focus should be making it easier to keep Australians in their jobs, especially for small business. The proposed accelerated investment allowance has some merit, but a small business which is struggling with declining revenues would be better off with additional cash flow that it can deploy as it sees fit. We want to discuss practical measures with the government that will put cash into the hands of small businesses. One proposal which we have seen and which has considerable merit would be for the Commonwealth to cover, for a period, a portion of the superannuation guarantee levy. Appropriately costed within the framework of a more prudent stimulus, this would provide support for small business, lower the cost of employment and provide an incentive across the board to every small business.

We welcome the government paying attention to the value of insulation. It is a great disappointment, as I noted in my speech a few weeks back, that the government’s election policy on insulation was left in complete abeyance. Nothing was done on it at all. Indeed, as of 20 January the government’s website dismally told anyone who was interested that the program details had not yet been developed—so much for efficiency. Insulation, however, is an energy efficiency measure that pays for itself, and government subsidies for insulation should recognise that. The $1,600 subsidy will, according to Mr Peter Ruz of Fletcher Insulation, who is quoted in the newspapers today, mean that over 90 per cent of jobs would be completed at no cost to the owner. The subsidy is not means tested. We would support an insulation subsidy of a lower amount, and I would suggest for the government’s consideration one that is, for example, $500 for all houses, increasing to $1,000 subject to a means test. That would reduce the cost of the measure considerably but remain a very significant incentive to the insulation industry. A similar approach could be taken to solar hot water.

This stimulus has to provide the appropriate level of economic stimulus, so it has to be directed in a way that is effective. While the cash handouts will be popular, we do not believe they will be an effective economic stimulus. We believe that bringing forward the 2010 tax cuts would cost less and have much greater economic effect. It would benefit households and small businesses right across the board. We believe that the key issue for the government is the scale of this stimulus, the size of it. We believe it is too large and not composed of sufficiently effective measures. I have given some indication of ways in which the measures could be more effective. Above all, the government must ask itself as it looks at this and no doubt other measures it will bring forward: are they going to provide a benefit across the board? Are they going to make Australia’s economy more efficient, more productive and more competitive? If they do not do that, the money will not be well spent. The reality is that while these times call for governments to invest more than they normally would—and we recognise that—the investment and spending decisions must be of the highest quality. We should not be investing in measures or programs which do not stand on their own merits. They have to be measures that we would invest in in good times or bad. Otherwise, we are literally wasting taxpayers’ money at a time when, depending on the development of this global recession, we may find ourselves in greater need of those resources in the years to come.

I recognise that much of what I have said will not be popular, but it is right. We must stand up for prudent financial management. Every dollar that this parliament approves to be spent belongs to somebody else. We are dealing with other people’s money. More significantly than that, we are dealing with the future of the young Australians who come here to visit this parliament. I do not want to have to look into their eyes and say: ‘When you grow up you will be paying higher and higher taxes because of the debt your parents’ generation racked up today.’ We recognise that these times call for investment and action by government. But it must be the right action, and governments must be prepared to take tough decisions, to take the right decisions and to have the courage of discipline. The Prime Minister has shown none of that. He has wanted to be Santa Claus—everybody gets a prize. The problem with everybody getting a prize today is that the children of today will be carrying a very heavy penalty in the years to come. We are committed on our side of the House to ensure, insofar as we can, that every dollar that is spent this year and in the years to come is spent wisely—always remembering those children, because it is those children who will have to pay off Labor’s debt.

Jason Clare (Blaxland, Australian Labor Party) Share this | Link to this | Hansard source

We stand here today in the middle of a global economic emergency, and listening to the Leader of the Opposition you would almost be forgiven for thinking that it does not exist and that the government is doing this just on a whim. It is perhaps worth reminding the House that this is the worst global economic crisis since the Great Depression, something that we only ever read about in history books or were told about by our parents or grandparents. Economies around the world are now being swallowed up by a global recession. So what do we do?

There are two options: the merchant banker model and the government model. The merchant banker model says: ‘Let the market take its course. The market will fix itself. Capitalism got us into this mess and it will get us out—sure, a few people will suffer along the way but a few people will get rich as well.’ It is the model that says, ‘Don’t use the economic stabilisers; avoid deficit at all costs; vote against these bills even if it costs jobs’—even if it costs the jobs of those young people the Leader of the Opposition talked about. On the other side you have the government model. The government model says that the market generates wealth and creates jobs, but sometimes it can spin out of control. It is the model that says that the market needs to be better regulated. It says, ‘Merchant bankers created this mess and we can’t rely on them alone to get us out of it.’ This is the model that says that government should step in and help out when markets fail.

We know who the architects of the merchant banker model are. They are economists like Milton Friedman and they are politicians like Herbert Hoover, a previous President of the United States, who said:

Prosperity cannot be restored by raids upon the public Treasury.

That is the model that is now being espoused by those opposite. We heard it from the Leader of the Opposition today. Their model is that the market should take its course. That is what the Leader of the Opposition said two weeks ago and that is what he is talking about again today. I think that the events of the last few weeks and months, spawned by the greed of merchant bankers, have proved that this is not the right approach—that markets spin out of control, that markets need to be better regulated and better managed and that there is an important role here for government. That is the approach that this government is taking. It is the approach that the new US administration is taking and it is the approach that has been adopted and recommended by the International Monetary Fund.

The depth and the nature of the crisis before us make for very ugly reading. Over the Christmas break the news continued to get worse. Every time you opened the newspaper there was more bad economic news. Last week the IMF released a report that projects that worldwide growth will fall to half a per cent this year and that advanced economies are going to go backwards by two per cent. For example, the United States economy will contract by 1.6 per cent, Germany’s will go backwards by two per cent, Japan’s will go backwards by 2.6 per cent, and the United Kingdom economy will contract by 2.8 per cent. We are caught in the vortex of this global economic recession.

We are in better shape and are better prepared than most countries, but inevitably our fate is tied to theirs because we live in a global economic community. Businesses here in Australia rely on businesses overseas in this interconnected world in order to trade, to do business and to hire new employees. Our biggest trading partner is China. China’s growth is going to contract by half over the next two years. Our second biggest trading partner is Japan; we now know that Japan is in recession. Our third biggest trading partner is the United States, and we all know what is happening there. In 2008 they lost three million jobs, in the last quarter of 2008 they lost 1½ million jobs and in December alone they lost half a million jobs. In the December quarter the United States economy shrank by 3.8 per cent in annual terms. They are just three examples—China, Japan and the United States. Six of our 10 largest trading partners are already in recession, and that is what is punching a $115 billion hole in the budget.

We have two options: the merchant banker model or the government model. We can sit on our hands, we can sit on the sideline, and let the market take its course, or we can get in there and help and protect Australian jobs. The world economy has stalled, and I think governments have to get in there and start the world economy up again in order to protect jobs. That also just happens to be the orthodox economic opinion. It is what we have to do. It would be irresponsible if we did not. It would be irresponsible to sit on the sidelines and just rely on the merchant banker model. If we do that, then all of the evidence and all of the modelling by Treasury suggest that things will get worse—that growth will be lower and that more jobs, 90,000 of them, will be lost.

I am acutely aware of just how important this is because I happen to represent an electorate where unemployment is already 50 per cent higher than the national average. My electorate is also a place where more people are already struggling to pay their mortgages than anywhere else in the country. You cannot pay the mortgage without a job, and that is why the priority of this government and this parliament has to be to do everything that we can to protect Australian jobs and to keep this economy growing. That is not just the opinion of the government; it is the opinion of every reputable economist in the country, it is the opinion of Treasury, it is the opinion of the IMF and it just so happens to be the opinion of the Business Council of Australia and a lot of other organisations. It is their opinion because it is the right thing to do and it is the responsible thing to do.

Ray Brooks, the chief of the Asia and Pacific division of the IMF, said on the weekend:

We emphasise spending—in particular, infrastructure spending. Temporary measures on the tax cut side, that should be targeted towards those who are likely to spend it, such as low-income earners.

That is exactly what the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and cognate bills do: (1) they provide temporary measures on the tax side, targeted at low-income earners, and (2) they provide funding of infrastructure that is badly needed and that is ready to go now. That is why the legislation is backed by almost every organisation in the country, except the opposition.

We have heard today from the Leader of the Opposition that the coalition are going to vote against these bills. They have said they are going to vote against them, and I am glad that they have finally revealed their true selves. They spent all last year hiding behind the veil, claiming that they no longer support Work Choices, but that is a thing of the past. Today we have found the true wolf that hides under the sheep’s clothing, the true position of the opposition—the merchant bank model. You can bet that what they are about to do will be unpopular. It will be unpopular because it is also irresponsible. It is everything that the IMF is telling us not to do; it is everything that every other country in the world is not doing. Have a look at what every country in the world is doing. They are injecting money to stimulate their economies. The opposition are effectively coming in here and saying, ‘It’s too big a package; it’s too big a risk; don’t do it.’ Well, they can explain that to the people who will not get those one-off tax bonuses of $950, and they can explain that to every school in every electorate around the country where there will not be a library or a hall built, where there won’t be roads built or boom gates or insulation batts installed because of the actions that the Leader of the Opposition in this place and those in the Senate are intending to take.

The opposition have spent a lot of time, not just in this debate but throughout the last few weeks, criticising and trashing this idea of one-off tax bonuses, one-off payments, by claiming they are not an effective way to stimulate the economy. They say they do not work, despite the fact that all of the data that is coming in indicates that they do.

Remember December, when the rest of the world effectively fell off a cliff. The US economy went back by four per cent, in annual terms. World trade collapsed by 45 per cent, in annual terms, and the United States alone lost half a million jobs. At that time, when all of this was happening, profits and demand grew here at home. Yet the opposition say that the things we did with the $10 billion stimulus package did not work, and they have said it again here in this debate today.

I will make one point, a point that was made yesterday: the evidence from Westfield alone points in the other direction, because their profits grew by 2.5 per cent last year in December, whereas in the United States they went backwards by 14 per cent. If you do not care to accept that argument, have a look at what Ray Brooks, the IMF Asia-Pacific chief, said on the weekend:

I would emphasise that what has been done so far by the authorities—

the Australian government—

was a very timely policy response … It has helped cushion the blow. This is an extraordinarily sharp contraction in global demand that caught forecasters by surprise.

That is the government’s position. A lot more could be said in this debate, but time is short. Let me just make this point: the government is being backed by every major organisation in the country because it is what the economy needs. It is what we have to do and it is what is right, and the opposition forget that at their peril.

Ms Julie Bishop (Curtin, Liberal Party, Deputy Leader of the Opposition) Share this | Link to this | Hansard source

The coalition, through long experience, knows that prudent management of the Australian budget has in the past and will in the future be the key to a strong economy, to higher standards of living for all Australians and to jobs for Australians now and into the future. The coalition also knows, as does the Australian public, that Labor governments, state and federal, are reckless when it comes to spending other people’s money. There is something eerily familiar about the new Rudd government. It is building on a long tradition of Labor governments, state and federal, and their addiction to debt.

The Whitlam government spent so recklessly that it ended up mired in the Khemlani loans affair. This might be a footnote of political history now, but it reminds us of the Rudd Labor government. The Whitlam government came up with a bizarre plan, through the Khemlani loans affair, to shore up its budget bottom line with dodgy loans from the Middle East. The Keating government went into so-called temporary deficit that grew exponentially until the nation was saddled with a $96 billion debt. And it would have kept going, had the coalition not been elected in 1996. The coalition then took 10 long years to pay off that debt in painstaking budget measures that, step by step, year by year, rebalanced the budget, put it back into surplus and then started providing savings for the future benefit of all Australians.

The history of Labor governments—I point to the New South Wales Labor government—is repeating itself. The night before the election the Prime Minister gave a clear commitment to the Australian people that he was an economic conservative. He said being an economic conservative:

… means a fundamental belief in budget surpluses. And you go back to my experience in this respect. I worked at a senior level in the Goss government in Queensland in the first half of the 90s.

When national economic circumstances were difficult, when there wasn’t a lot of money flowing into the economy particularly, there wasn’t the presence of a global resources boom, and budget after budget, we produced budget surpluses.

Let us cast our minds back to the time of Labor’s election win in November 2007. Labor inherited the best economic and budgetary circumstances of any incoming government in Australian history—a $20 billion surplus, zero government debt, $70 billion in savings, the lowest unemployment in more than 30 years and relatively low inflation. That is what sets Australia apart from the other economies in the world. That is why Australia is now better placed than virtually any other comparable country at this time of economic slowdown.

In November 2007, consumer and business confidence was strong and people were generally optimistic about the future, and the Rudd government promised to do what the Howard government had done—that is, bring fiscal prudence to the handling and management of the budget. But what did the Rudd government do with that legacy? This is a measure by which to judge the Rudd government’s ability to make prudent economic decisions. What the Rudd government did was to immediately embark on a course of trashing the economic legacy of the previous government and to embark on a deliberate scare campaign about inflation. This had a devastating impact on confidence. Despite the strong economic conditions at the time, confidence fell further and more rapidly in Australia than in comparable countries during the first half of 2008. Think of what was happening elsewhere in the world, yet in Australia confidence fell further and more rapidly. Many Australians locked in home loans at higher interest rates because the Rudd government convinced them that inflation was out of control and that interest rates would continue to rise, and these people are now paying the price of that reckless action by the Prime Minister. The Rudd government simply got it wrong, and they have continued to make poor economic decisions. They continue to get it wrong.

This package—the $42 billion spending package—fails to take into account the lessons of history. It fails to take into account the experience of other countries which in the past have attempted to stimulate their economies with large spending packages of taxpayer funds. Think of Japan in the 1990s. The government has failed to take into account the lessons—the harsh and bitter experience—of other countries. The package fails to embrace initiatives that will protect Australian jobs at this time. The package fails the government’s own test which it set itself for a fiscal stimulus. It said—based on the views of others, particularly the IMF—that fiscal stimulus packages should be temporary, targeted and timely. Even if you accept this as the test—and many do not—the government fails its own test. The package is not targeted at keeping people in their jobs; it is splashed across the economy. If you look at the cash handouts, there is clearly no strategic thought at all as to how those handouts will keep one person in a job and no apparent thought as to how the handouts will actually stimulate the economy—because they have been proven not to work elsewhere. There is no evidence that it will do what the government claims.

This package is not timely, in the sense that much of it is long-term infrastructure spending. Whatever the merits of infrastructure spending, the government should not try and con the Australian people into believing it will provide an immediate stimulus that will boost GDP and ward off recession. It is not temporary—that is the biggest lie of all. It is not temporary. This government is potentially taking out a $200 billion mortgage on our future and that of the next generation. This is the biggest con of all: the Prime Minister and the Treasurer saying that the massive budget deficit into which they wish to plunge Australia is temporary. It is not.

The actions of the Rudd government represent the biggest budgetary turnaround in Australian history. We should remember that in May last year this government was forecasting a $21.7 billion surplus; we are now looking at a $22.5 billion deficit. If you take it over the economic cycle, the turnaround in the budget goes from an $80 billion surplus to a $118 billion deficit. That is a $198 billion turnaround over the economic cycle. One of the most infamous budgets in Australian history was the 1975 Whitlam budget. Its gross mismanagement resulted in a turnaround from a forecast budget surplus of 0.3 per cent of GDP to a deficit of 1.8 per cent of GDP. The Rudd government’s turnaround is far more reckless, taking a forecast surplus of 1.8 per cent of GDP to a deficit of 1.9 per cent of GDP in just a matter of months.

The amendment that was so quietly brought in today by the Minister for Finance and Deregulation to the Commonwealth Inscribed Stock Act reveals the lie behind the Prime Minister’s claim that this is just a temporary deficit, for this legislation would increase the cap on the issuing of Commonwealth government securities from $75 billion to $200 billion. This is what we are facing—$200 billion—and this government wants us to give it a blank cheque to mortgage the future of Australians to the tune of $200 billion without giving us any opportunity to properly scrutinise the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and cognate bills. Think of the scale of this. The previous Labor government left a debt of $96 billion, and this Labor government is on track to leave a debt twice as large, no doubt with the intention that down the track another coalition government with the experience, credentials and know-how will have to pay it off.

But where will the money come from? This is not government money. Governments do not have their own money. It is not Labor or coalition money; it is taxpayers’ money. Any debt incurred by this government will eventually be repaid out of the efforts and earnings of wage and salary earners and through businesses. They will pay for it in higher taxes in the future or through reductions in public expenditure—in health, education and roads. But it will be the next generation who will bear the burden of this government’s reckless profligacy. This will be particularly the case if the debt has funded unproductive expenditures that do not increase gross domestic product, which would increase the capacity to repay the debt. The coalition has made it clear that public expenditure on physical infrastructure requires serious assessment of each project, and it is important that at this time the government have a measured plan for infrastructure spending over time—that it not panic and choose projects that have political appeal but which are poor choices in promoting long-run economic growth and the welfare of the Australian people.

It is deeply concerning that the announcement of $21.4 billion in public expenditure on schools and public housing does not give any explanation as to why these projects were chosen instead of many other alternative public and private projects that could have been undertaken. Of course spending on schools is good public policy. Of course the coalition believes in schools and in housing. But, at this time, when you are taking the country into debt with a $200 billion blank cheque, are these the best investments—at this moment, with this amount of money—to stimulate the economy and to create and protect jobs? That is what the focus should be: keeping people in jobs. There is no evidence produced by the government that any of these measures will protect or create any jobs in Australia.

The government’s latest forecast states that unemployment will rise from the current 4.5 per cent to seven per cent in 2009-10. It estimates that about 100,000 more people will be out of a job by 30 June this year. What is in this package to encourage small business, for example, to keep people on? What is in this package that says to small business, ‘We will help you keep your workers on’? There is nothing. There is no incentive for that. The government does not know how to come up with a package that will protect and create Australian jobs. This government chooses to make decisions on the run, without research or modelling to support its decision, without sensible assessments of what works and what does not, without consideration of failed policies of the past and without looking at what other countries have done, what has worked for them and what has not. But, worse still, it is clear that the government does not want to discuss alternatives. It will do anything it can to stop this parliament, or indeed the public, from discussing alternatives. The Prime Minister said, ‘Take it or leave it.’ The Prime Minister says it is his way or no way.

The Prime Minister reminds me of the leader of a bushwalking group that is lost in the bush, trying to find the way home. He does not have the answers but he insists on going down the path he chose, knowing that that path has not taken him home in the past. He insists on taking everyone down that path and, if somebody in the party says, ‘Well, maybe there was an alternative path,’ he turns on them, abuses them and accuses them of not supporting his efforts to get home by his route, even though he knows it will not get them there. He just wants to be seen to be doing something, to continue to walk. He does not want to be questioned, does not want the logic and does not want any analysis of what he is seeking to do.

Perhaps the Prime Minister thinks that democratic government should be ‘command and control’. Perhaps that is what the Prime Minister thinks. But that is not the way government in this country works. That is not the way a free and open democracy works. One of the primary roles of the opposition is to scrutinise the decisions of the government to ensure it makes the best possible decisions in the national interest. It is easy for an opposition to just roll over and say: ‘Oh well, the government’s come up with a package that will be popular. And the media will say that this is a good policy. Nobody will say that it will create a job, nobody will say that it supports small business, nobody will say that it will stimulate the economy, nobody will say that it wards off recession; but everyone will say that it is popular.’ Oppositions have a responsibility to the Australian public to stand up and say that a policy is wrong, that a policy is ill considered, when they truly believe that to be the case. The coalition is firmly of the view that, in the circumstances that Australia finds itself at this time, and taking into account what is happening overseas, this huge spend of $42 billion—on track to be $200 billion—is too much money at this time. It is bad public policy, and we must say so—and we do.

The Australian people might say, ‘Fine, another $950’—who would not say, ‘Yeah, I’ll put my hand out for that’? But in their heart of hearts they know that somebody has to pay for this one day and that it is going to be the taxpayers of the future. It is going to be their children. This is precisely what the coalition was faced with when we came into government in 1996. And this is precisely why we set about paying off the $96 billion debt left by the Keating government—because we did not want future generations of Australians to be saddled with the profligacy of a Labor government.

We made some really tough decisions in 1996. They were not popular, but they were right, because 10 years later we had paid off that debt. Standards of living in Australia had risen. The government had the ability to invest in schools, hospitals and infrastructure, because we did not have to pay the $9 billion in interest that accumulated every year on the $96 billion debt. There has not been any mention of that in the Prime Minister’s or the Treasurer’s comments to date. They have studiously avoided telling the Australian public that, when the government starts borrowing this amount of money in this fashion, plunging the country deeper and deeper into debt, we are going to have to pay interest on it. If a $96 billion debt attracted $9 billion in interest, just imagine what a $200 billion debt will do. That is money that cannot be spent on future infrastructure projects. It cannot be spent on schools and hospitals and it cannot be spent on government services, because you have got to pay off the interest.

That is why we are so gravely concerned that this government refuses to acknowledge that Australia’s particular circumstances have to be the basis of policy responses to the pressures we face from the deteriorating international financial and economic conditions. We do not need to import the problems facing other countries by adopting poorly thought through policy responses. We have seen that with the government. It has panicked every step of the way in relation to the economic slowdown. The unlimited bank deposit guarantee, which led to the freezing of the investment accounts of hundreds of thousands of Australians and caused disruption in other areas of the financial system, was a classic example of how this government, in reading the overseas circumstances, imported them to Australia and applied an ill thought through policy that caused more harm to the Australian financial markets. This, we fear, is what will happen if this government is given a blank cheque to spend $42 billion now, leading up to $200 billion in the future. The legacy of this government will be massive debt and a burden on this country that will be unsustainable. I for one am not going to stand here and see Australia’s economy deteriorate in that way. (Time expired)

Mark Dreyfus (Isaacs, Australian Labor Party) Share this | Link to this | Hansard source

The true measure of a government is not its performance during a time of prosperity but its response in a time of crisis. The Nation Building and Jobs Plan, coming on top of the Economic Security Strategy delivered in December, shows the depths of this government’s commitment to doing all it can to protect Australian jobs and families from the maelstrom that has engulfed the global economic system. The Deputy Leader of the Opposition, as we have just heard in her speech, wants to attack all this. We now know that the opposition wants to oppose this program, and it is clear that at least the Deputy Leader of the Opposition is simply out of her depth.

This package is designed to stimulate the economy in the short term to help support up to 90,000 Australian jobs and to ensure that low- and middle-income families and households receive the assistance they need during these tough economic times. But it does more than that: it commences the process of building Australia’s post-crisis economy and a fairer society. The Energy Efficient Homes Program will help to prepare Australian households for a low-carbon future. Building the Education Revolution builds on the education revolution we commenced last year to ensure that our children are equipped with skills that will be needed in an open, dynamic, high-skill, high-wage economy. And the Commonwealth social housing initiative is fairly described as the most significant federal government action ever undertaken in the field of housing.

These are carefully thought through packages. It is worth dwelling on some of the detail of these packages so that we are clear on what we are debating here with the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and the cognate bills that are before the House. The Household Stimulus Package is timely, it is temporary and it is targeted. It includes the tax bonus for working Australians, up to $950 for eligible taxpayers; the single-income-family bonus, $950 for families that have one main income earner; the farmers hardship bonus—the matter which the Leader of the Nationals did not want to hear about in the House yesterday—$950 to farmers and others receiving exceptional circumstances related income support; and the training and learning bonus, $950 to assist students, those returning to study or training and some income support recipients. That will benefit some 4,737 students and young people in my electorate of Isaacs. There is also the back-to-school bonus of $950, to assist low- and middle-income families eligible for family tax benefit A with school-age children. That will benefit 11,154 families in my electorate.

With the education package known as Building the Education Revolution, we will see a stimulation of demand in the economy. It will provide a much-needed boost to the construction industry and, in the longer term, it will help provide every single child in every single primary school, including all 38 primary schools and all the secondary schools—there are a total of 54 schools in my electorate—with world-class facilities that are necessary for a 21st century education. It will provide $12.4 billion to build new infrastructure such as libraries and multipurpose halls in every primary school. The package includes another billion dollars to build 500 science and language centres in our secondary schools. I know, having been to each of the secondary schools and all but a couple of the primary schools in my electorate, just how well used these funds are going to be and indeed how much they are needed to ensure that an appropriate level of facilities is provided in our schools.

The Energy Efficient Homes Program will be a further support to the manufacturing and construction industries and will help prepare our economy for a low-carbon future. There is an investment of almost $4 billion in the Energy Efficient Homes Program and, as we heard yesterday and heard again today from the Minister for the Environment, Heritage and the Arts, it will enable around 2.2 million Australian homes to install free ceiling insulation. This is something close to my heart because my electorate is home to two of Australia’s major insulation manufacturers. It is going to be an important shot in the arm for local jobs. The Insulation Council of Australia and New Zealand have their office in my electorate, and I spoke this morning to their CEO, Dennis D’Arcy. He told me that their rough calculations already have indicated that it is expected that this measure will generate some 4,000 jobs across the nation, in delivery, installation, supply and fixing of insulation, as well as office staff and trainers to train those who are going to install the insulation. That is before one gets to the possible increase in manufacturing jobs at the CSR plants in Brisbane and Sydney and the Fletcher plants in Sydney and Melbourne, the Melbourne plant being located at Dandenong South in my electorate.

It is perhaps worth repeating for the benefit of the House what Dennis D’Arcy, the CEO of the Insulation Council of Australia and New Zealand, said to me on this. He said:

We welcome this move. Energy efficiency is probably the most important step in reducing greenhouse gas emissions. Buildings are the most important component in improving energy efficiency. Australian buildings have by international standards low levels of energy efficiency. These measures will have an impact on reducing emissions. They will help meet the 2020 targets.

More importantly, said Mr D’Arcy, they will help every family without insulation to reduce household energy bills. Mr D’Arcy went on to tell me:

It will create jobs. It is a bold and welcome measure.

In addition, this package includes the Commonwealth’s social housing initiative, which is $6.4 billion for public and community housing, $6 billion over 3½ years. It will include also at least 20,000 low-income households being assisted by having access to housing. I spoke yesterday in the House about the regional and local government program, which is seeing an expansion from the $300 million announced at the local government conference held in this building in November, attended by mayors and chief executive officers of councils from all over Australia. I have heard repeatedly at that conference, which I attended with the Mayor of Frankston, the Mayor of Kingston and the CEO of the City of Greater Dandenong, both from them and from others who attended the conference, just how welcome was this initiative of the Rudd government to give direct access for local government to the Prime Minister and senior ministers and indeed the whole of the federal government. What the regional and local government package which is part of the package that is contained in this legislation will do is to permit the federal government to directly fund larger scale projects that have been selected by local government. They are local capital projects chosen by local people that are going to generate local construction activity and generate local jobs.

I come briefly to the approach of the Liberal Party and the National Party which we have seen unfold here today. Greg Evans, the director of industry policy and economics at the Australian Chamber of Commerce and Industry, was quoted in the Age newspaper this morning as saying:

The fiscal stimulus package, combined with the significant rate reduction announced by the RBA, will go a long way to alleviating the worst aspects of the economic downturn and indeed places us in a better position than every other advanced country around the globe.

That is Mr Evans from the Australian Chamber of Commerce and Industry. The opposition clearly does not understand that very plain language from the Australian Chamber of Commerce and Industry and indeed seemingly does not understand the seriousness of the crisis that this country is confronting.

Last night we were subjected once again to the member for Higgins, Captain Smirk, talking on ABC TV. His only interest would appear to be in defending his own reputation as Treasurer. He is apparently not even interested in assisting the opposition to develop a coherent response, which, as we have seen even here this morning, is assistance that they desperately need. The member for Higgins has no constructive criticism, and his attempt to create a supposedly glorious past and superlative economic performance on the part of the Howard government is simply false. This is the man who blew the prosperity of the resources boom, the man who had the opportunity to future-proof our economy as a result of the unprecedented revenues generated by the best terms of trade in a generation, and instead the member for Higgins and the government of which he was part wasted it by failing to rein in spending and fuelling inflation. It was lazy, it was politically expedient and, along with the failure to invest in infrastructure and to invest in skills, it helped to fuel the inflation that the Reserve Bank had to fight with one hand tied behind its back.

At least one can say that the member for Higgins has consistency in his favour, which is more than can be said for the present opposition leadership. They appear finally to have come to the conclusion that there is no role for fiscal policy in dealing with this economic crisis. We heard more of that from the Deputy Leader of the Opposition in her speech this morning preceding mine. In her speech we had some extraordinary suggestions: for example, that there was no explanation as to why the particular projects that have been funded by this package have been chosen. She said also that there was no evidence that these projects will create any jobs. The merest imagination that she could bring to bear on this would show her that these projects have been chosen because all of them are aimed at improving circumstances in our schools, aimed at improving the availability of housing in our country, aimed at getting local projects built and aimed at getting money spent and construction being commenced as quickly as possible. As for the suggestion that there is no evidence that these projects will create any jobs, clearly the Deputy Leader of the Opposition has not the faintest understanding of economic activity, because when a government announces projects of this scale obviously they are going to both create and support jobs. The opposition has failed to understand that fiscal policy and monetary policy need to work together and, particularly in times like this, they need to be responsive to economic conditions. The Liberals and the Nationals did not understand this when they were in government and they do not understand it now that they are in opposition.

Warren Truss (Wide Bay, National Party, Leader of the Nationals) Share this | Link to this | Hansard source

Money cannot buy happiness, the old proverb wisely says, but the Rudd government is certainly trying its hardest to prove that wrong. What the Prime Minister announced yesterday was a plan to use our children’s money to fund five minutes of sunshine—indeed, probably 30 seconds of sunshine or even less. Of course the majority of Australians will be grateful to receive any kind of cheque in the mail; they will be grateful to have any kind of assistance. But where do we go when the money runs out, when there is no more left for Labor to borrow? This is not money that is being simply manufactured out of thin air; it is debt being accumulated today which must be paid back by future generations.

We have just expunged from our memory Labor’s last debt, worth $96 billion. It took 13 years to accumulate, under the Hawke and Keating governments. This Rudd Labor government will eclipse that in one term. That is an extraordinary spending spree. The title of the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 includes the phrase ‘nation building and jobs’, but it does not build the nation and it does not create jobs. The timing is wrong. It repeats the failures of the previous package. There is no lasting investment or leverage for the future. There are handouts but no permanent fixes. At the end of this package, the pension will still be too low and taxes will be too high.

We are stealing from our children. This package of bills steals $200 billion from our children so that we can enjoy some sunshine for a few seconds. There are no new jobs. The government admits that this package creates no new jobs; all it does is sustain 90,000 jobs. That is something like $450,000 for every job sustained. There are no new jobs and no new permanent impetus for our economy—just 90,000 jobs sustained at a cost of $450,000 each.

How were these options chosen? How did we come to a situation like this? It is Labor pork-barrelling on a grand scale, with no clear plan and no vision for the future. It is splashing cash around following a decade or more of progress in our country, but it will lead to economic gloom and debt repayment for at least another decade.

As I said yesterday, little or none of this money will ever be repaid while we have a Labor government in office. They simply do not repay debt; they create debt. They create burdens that future governments have to alleviate. The job of paying back this debt will dwarf into insignificance what needed to be done when the Hawke and Keating governments left power.

Of course, people will like to get the $950 handout from the government that is being offered to them. But in return for the $950 handout they are also being given a $2,000 debt. What we are borrowing to fund this package is the equivalent of $2,000 for every man, woman and child in Australia. So, ladies and gentlemen of Australia, when you get your $950 cheque there will be some red ink on that paper as well—the $2,000 you will have to pay back in the future, along with your families, to fund what is happening today.

The Prime Minister is looking more and more like Paris Hilton running amok with a Visa card in a Melbourne clothes shop—except the Prime Minister does not have daddy’s credit card to fall back on; he has yours and he has mine. We are going to have to pay for this spending spree and it will be a constant burden on our economy for decades ahead. Taxes in the future will have to be higher because we are paying back this debt. Government expenditure will be lower because a bigger bite of the budget will have to go into interest. We will be further behind and we will have less money to spend on schools and education, health, defence and the important responsibilities of the Commonwealth in the future because we will be paying off this debt for decades.

The Prime Minister is already talking about a third stimulus package, even though the first one last October was a certified failure—except perhaps if you are a Chinese trinket manufacturer or you own a few poker machines. What about the $81 million of the last package that was sent to people who are living permanently overseas? How did it stimulate the Australian economy to send $81 million in cash grants to people who live overseas? The government has not learnt from these mistakes. In fact, the spending is getting out of control.

Perhaps the most alarming piece of legislation that is in this package before the parliament today is the proposal to increase the limit on the government’s bank card from $75 billion to $200 billion. The bank card is about to be loaded to the gunwales with more and more debt, and there is no end in sight. That $200 billion is $10,000 for every man, woman and child in Australia. So, in addition to having to pay off your own home and your own credit card bill, you now have to pay off Kevin Rudd’s and the Labor government’s credit card bill. Your share is $10,000; your baby’s share is $10,000; your grandmother’s share is $10,000. This is real money that will have to be paid for by ordinary Australians, working or not, for decades ahead as Labor spends monumentally out of control.

The Prime Minister has admitted that he does not even know if this package is going to work. It is a gamble; it is a wager on our future. That confirms that we are right when we say that thousands of Australians who are going to be losing their jobs will be loaded with the additional burden of massive government debt and years of deficits and new taxes. What if the Prime Minister is wrong and the package does not work—and the evidence suggests that his first package has not been successful? Then we will have a real fire sale of our national economy.

I would like to look at this stimulus package in a bit more detail. I would like to be able to talk in detail about the legislation, but the reality is that, like all members of the opposition, I am speaking about bills I have not read. I have not even seen a copy of the statement that the Prime Minister made last night because the government did not even print enough copies for opposition members to be able to read it. This is contemptuous treatment of the parliament. They did not show us the bill; there were no copies of the document. The only briefing the opposition had was a 45-minute talk with some Treasury officials who could not answer the basic questions—and we are being asked to approve in 42 hours $42 billion worth of expenditure we do not know the details of! This is the biggest ‘spend now, pay later’ program in history and we are expected to rush it through without proper consideration.

We do know that the fundamentals of this package are wrong. World debt is at the heart of the global financial crisis, and Australia has avoided the worst of the crisis because we have less debt, because we had a government that paid off the debt and was able to put money aside. Now we are going to join the rest of the world and throw away our advantage by spending huge amounts of money when we do not even know if it will work. The government acknowledges that the package is not going to create jobs and that it will not provide stimulus in the form of a lasting benefit for our national economy.

We need to look at the various measures in this package and what they are expected to achieve. I am interested that the centrepiece is a schools building program. It is a clear bailout for the failed Labor states’ unwillingness to meet their responsibilities for school maintenance over the years. Peeling paint and unusable equipment are evident in almost every school in the country. So now the Commonwealth is going to bail out the states. But this is supposed to be a stimulus package—something we want to spend quickly. Have you ever found a state government that can build a school building quickly? It takes them years to do the planning. They stuff around. They change the plans. They fiddle here and there. And they usually build things that the school does not want in the end anyhow. So it will take years to deliver a package of this nature.

I have also noted that the children who go to small schools are not going to be treated very generously in comparison to those who go to the large schools. If you go to a primary school with 400 students or more, the school will get $3 million out of this package, but, if your children go to a school with 50 or fewer students, you will only get $250,000. So the small country schools that have been particularly badly treated by Labor state governments over the years are going to be badly treated again by the federal Labor government. Our Investing in Our Schools Program was very successful. One of its features was that it treated all schools alike. The little battling schools that struggle so much to raise funding through their P&Cs got the same money as the rich city schools that did not need it so much. That is one of the many reasons that that program was considered to be so successful.

There is also to be money spent on competitive grants for science and language laboratories in secondary schools. How many small country secondary schools are likely to get a competitive grant for a science or language laboratory? We will be watching closely the electorates where this money is to be spent. What it will do is concentrate the expenditure even further on education in the larger and more prosperous areas.

There is also to be $1.3 billion for minor maintenance—in some kind of a pale shadow of the Investing in Our Schools Program, which even members opposite would acknowledge was very popular with P&Cs and school communities. The larger schools will get $200,000 under this program, whereas the small schools with 50 or fewer students will get only $50,000. So the P&Cs that find it hardest to raise the money will get the least help from this government. It would be better if we were to re-establish and reinvigorate the Investing in Our Schools Program, because it worked. It worked quickly and it delivered the results that schools actually want.

When one looks at the way in which the government has targeted its expenditure and its assistance to the states, one has to ask why we did not look at other areas where the states have seriously neglected their obligations. Why are we just bailing out the dilapidated school system? What about hospitals? What about the work that needs to be done on water infrastructure? Why were some of these key issues not funded? And what about, from a federal prospective, doing something more about respite care and nursing homes? That would have really delivered permanent benefits for the community. But that has been discarded and not even considered in this package.

Let us look at small business. There is a proposal in this scheme to have a short-lived investment allowance. That will be helpful to small businesses who would like to buy new equipment. The problem, of course, is that most small businesses will be so stressed under the years of Labor government that they cannot afford the debt that is associated with buying new capital equipment. You cannot invest and get a tax concession if in fact you have not got the money to buy equipment in the first place. If you are a small business and you are going to go out and buy some office equipment or some machinery, that will be good for local business. It might even boost the income of the supplier. But virtually all of that equipment is going to be imported, so it is not going to have any lasting, flow-on benefits to the economy as a whole. Very little of the equipment that is likely to be purchased under this investment allowance will be made in Australia. And, of course, it is a very small window until 30 June 2009. So you really have to be ready to go now if you are going to get any advantage from it.

Did the government consider paying the super guarantee levy of businesses to improve their cash flow or lowering income tax rates? What about delaying the emissions trading scheme, which is a new $11½ billion tax on industry that they can ill afford? Getting a tax deduction or an investment allowance for a new photocopier is very little help if you are going to have permanent, ongoing extra costs as a result of an emissions trading scheme. What about abandoning the government’s unfair dismissal laws? What about, in regional areas, abandoning the government’s scheme to abolish the en-route subsidy scheme? This is a scheme that has helped to keep regional air services in the air, and Labor is now simply going to get rid of it. There are many things that the government could have targeted this expenditure on which would have provided lasting benefits.

I will turn also to the grants of $950 to farmers and small business men and women in drought affected areas. The government says there are potentially 21,500 people who will receive this benefit. The government is wrong to say that this is something that is going to go to farmers. Only a very small proportion of farmers will be eligible to receive this $950 grant. And what guarantees are there that, when the farmer gets the money, the bank will not simply swallow it up to pay off some of his debt? How can we be assured that this money will actually be available to families to help do something that is meaningful for them? It is the equivalent of the cost of about one day’s fuel for a tractor. That is the size of this benefit. And most farmers will not even get it.

I am hearing repeated stories of scores of Australian farmers who are being told that their credit is to be withdrawn. Part of that is because they have built up extensive debt over the years of the drought and there is trouble with their equity. Their equity will plunge if the government succeeds in plunging our economy into a recession. There will be losses in the value of farm properties and therefore farm equity, and equity which previously may have been adequate to cover debts will be brought into question. Scores of farmers are also being told that their financiers—second-tier financiers, very often—will not be able to obtain the money they need to be able to support their farming customers. Because of the government’s botched bank guarantee system, there is no money to help these people. A cheque in the mail for $950 is no help to you if your bank is going to foreclose. The government seems to have done nothing in this plan to help those people who are facing such stress.

Did the government consider abandoning its plan to massively increase quarantine charges for Australian exports? Did the government consider reinstating the farm apprenticeships scheme, which it axed through its very first razor gang? Will it consider abandoning its plans to axe exceptional circumstances assistance for some of the most stressed people in agriculture? What about the dairy farmers of Australia, who are facing reductions of up to 40 per cent in their incomes, partly as a result of overseas price wars, which this government has done nothing to seek to intervene to stop?

When the Europeans and the Americans subsidise their dairy products, that affects Australian farmers too, and the government has done nothing to intervene in that regard. Can’t the government end its cruel water buybacks, which are destroying the potential for farmers to survive into the future by putting pressure on them to sell their water so that they are permanently out of agriculture? These buybacks are designed to achieve the spurious agenda that the government has on its mind.

The government has also proposed to spend some money on road maintenance—just $150 million. That will not even make up for the cuts in road maintenance that Labor has instituted since it has come into government. You could spend all of that on one road in my electorate and you still would not have caught up on the maintenance backlog just for that road. It is a paltry effort, a paltry contribution towards improving those roads and ensuring that they are available to support Australian industry.

The reality is that this package has not been well thought through. There is no evidence that the government has suggested or considered other options. There is no evidence to suggest that it has any plan or vision for the future. If you title your package ‘nation building’, you would think there was a vision or a plan, but there is not. There is no coherent strategy to drive recovery. It is a short-term package to buy popularity for a government that is floundering to find a way through the economic crisis. There is little or no leverage for business to assure their financial viability for the long-term interests of the nation. There is nothing in this package which will provide a permanent role and strengthened position for Australian business. It is just about handouts, short-term cheques in the mail, which, once they are gone, leave little or no lasting legacy. How can you build a nation when that nation is going broke? This involves billions of dollars a year for decades to come that will have to be spent on debt repayments rather than building the roads and railway lines that we need for the future. Labor talks about its infrastructure spending, but it will come to nought if future generations are unable to fund the maintenance and ongoing effectiveness of our national infrastructure network.

There is nothing in this package for pensioners and self-funded retirees. There are no tax cuts, except for the short-term investment allowance. The jobs of thousands of people are being lost in industries around the country and there is no hope for those people in this package. The government only expect to sustain 90,000 jobs as a result of an expenditure of $42 billion. Their own estimates say that there will be hundreds of thousands of Australians thrown out of work. This package offers no hope for those people. All it does is spend money for a moment’s happiness, which will be paid back through years of hardship and denial by future generations—our children and our grandchildren.

Yvette D'Ath (Petrie, Australian Labor Party) Share this | Link to this | Hansard source

I rise to support the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and cognate bills, which are before the House today. This Nation Building and Jobs Plan is not just needed; it is demanded. It is demanded by the global economic crisis. It is demanded as a consequence of the crisis facing our national economy right now.

The opposition appear to be in complete denial. We have seen this over many years and it certainly has not changed. In the past they have been climate change deniers, saying that climate change does not exist. From the comments we heard in this chamber yesterday, the Australian people need to seriously question whether those on the opposition benches actually believe that there is a global economic crisis going on right now. Certainly, from the comments that were made yesterday, you would think that this is just a stunt that has been made up by the government to initiate these sorts of packages. It is unbelievable that members, including shadow ministers, would stand up here in this chamber and make the comments that we heard not just yesterday but today. We have just heard the member for Wide Bay, the Leader of the Nationals, talk about these measures just being handouts, saying that they are not about long-term initiatives and that they are not about investment in infrastructure. Clearly the opposition have not turned on a television in the last six months or picked up a newspaper since yesterday and read what this package is about.

I should not need to do this, but I will do it anyway just so the people sitting on the other side of the chamber understand what this is about. Then they can go and tell the 13,000 students in primary schools in my electorate that this is just a cash splash! They can tell them that these are not long-term initiatives for schools. Go and tell Aspley East State School. Go and tell Aspley Special School—a school who received an award of excellence last year for their initiatives. Go and tell Bald Hills State School, Bracken Ridge State School, Clontarf Beach State School, Craigslea State School, Everton Park State School, Hercules Road State School, Humpybong State School, Kippa-Ring State School, McDowall State School, Norris Road State School, Redcliffe Special School, Scarborough State School, Somerset Hills State School, Stafford Heights State School, Queen of Apostles Primary School, Southern Cross Catholic College, St Joseph’s Catholic Primary School, Grace Lutheran Primary School, Mueller College, Northside Christian College, Prince of Peace Lutheran Primary School, St Paul’s Primary School, St Benedict’s Catholic Primary School and Woody Point Special School. Go and tell them that this is just a stunt, that this is not going to improve the education that is provided to these students in the future. They know differently, as do many other people across this country, including a lot of well-recognised organisations who have come out in support of this plan today. Heather Ridout, from the Australian Industry Group, is reported as saying:

The package targets consumer spending, which is absolutely critical to our near-term economic prospects, and boosts capital expenditure—looming as one of the real casualties of the downturn.

We heard from the member for Wide Bay that the initiatives for farmers are worthless and will provide no help, yet David Crombie, from the National Farmers Federation, released a press release only yesterday saying that the government’s $950 tax-free bonus for all drought-affected farmers will reach some 21½ thousand farmers, many needy families and regional economies. Likewise, Mr Crombie stated that the regional infrastructure package—and the member for Wide Bay seems to think that there is no investment in infrastructure by this government—will see a major revamp of country services and will shore up jobs in local communities. We have heard that this government, with this package, is being accused of not investing in important initiatives like road building, national infrastructure or health and nursing homes. I have not heard more hypocritical comments in the last 12 months than what I have heard this morning. When in government for 11 years, the opposition not only ignored health, nursing homes and national infrastructure—especially in Queensland, where, according to them, we do not have any national roads that need repairing or building—but ripped money from the state governments to ensure that they were not able to deliver on previous commitments to the local economy.

We have not heard a lot of alternative propositions put up by the opposition in the last 24 hours, but one solution we have heard is that we should delay the emissions trading scheme. What a surprise it is to hear the Leader of the Nationals suggest that we should delay the emissions trading scheme! We know the confusion in this chamber and in the other chamber about where our colleagues stand on the emissions trading scheme. The solution to the economic crisis is not to ignore climate change; that will not fix the problem. These are issues that we need to deal with and we cannot shelve one problem to deal with the other. They are both important initiatives that affect not just our environment but our economy into the long term and, as has been shown by this Nation Building and Jobs Plan, they can actually work together to grow the economy, to support the economy and to support jobs. We have seen that in some of the initiatives for households, such as providing insulation and an increased rebate for hot water systems. These initiatives are important and need to be done now and in the near future. They not only address climate change but also help to support jobs.

This national package, at the local level, will do a lot for my electorate. Just look at the social housing initiative—not just what it will provide at a social level to the community, which is so needed, but also what it will do to support jobs in the area. By building new units and new houses, you create demand for carpenters, plumbers, electricians, painters and trades assistants. If the member for Wide Bay were to say to the people in my community and in every other community around Australia that this is just about throwing money around and will not support jobs, I am sure that those people would disagree. I know that my local schools are going to welcome this initiative. There are many schools which, for many years, have done without halls or state-of-the-art libraries but need shelters and maintenance. There are so many things we can do to support our schools. It is not just up to the state governments to do that. We, as a federal government, also have a responsibility to stand up and acknowledge the worth of our young people. They are our future, and if we do not invest in their education and in the schools and the teachers who support them and their families then this country does not have a future. So that is where we must start and that is what we are doing. I welcome this initiative in relation to the schools, at many levels.

In relation to investment in local government community infrastructure, this package will not only support jobs once again in my local community but also provide necessary community infrastructure and services. The Redcliffe PCYC is one example of an organisation that I will be working closely with. I will lobby the local government to consider the complete refurbishment of the club as a worthwhile project. This is a facility that has more than 3,000 active members—young people who deserve good facilities to keep them active and to help them learn and socialise within the community. The PCYC does a fantastic job but we need to do more to assist it.

I welcome in the gallery today Alan Sparks, the Chief Executive Officer of East Coast Apprenticeships, who is absolutely committed to creating jobs and training opportunities not just locally in Queensland but nationally. Alan spoke with me and representatives of this government this morning about the importance of addressing our skills shortage, about the need for further training and about how we can make these initiatives complement each other when we are talking about building and about maintenance—because, no matter what happens in the jobs market, we still have a skills shortage and we still need to address this problem. That is the point we need to keep making to the opposition: these issues do not just go away, and you cannot put them on the shelf and think that we can come back to this at a time when the economy is looking a bit better. There has never been a more important time to deal with these initiatives. These bills before us this morning are important; they are necessary. This country not only needs the government to act but demands that this government act. I call on the opposition to support these bills.

Christopher Pyne (Sturt, Liberal Party, Shadow Minister for Education, Apprenticeships and Training) Share this | Link to this | Hansard source

While the opposition may be taking the politically unpopular course with the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and cognate bills by not immediately acquiescing to the government’s demand that we pass them without proper scrutiny—which is what they are demanding—we are prepared to take the courageous line because at least one political party in this country has to act responsibly. At least one political party in this country has to do what is right, not what is easy and politically popular. Those who are on the government benches are yet, since the election in November 2007, to make a difficult decision. They are following the advice of their senators from New South Wales who advise them to be prepared to go into deficit, and deeply, if it would help them to win the next federal election. They are doing that. They are being profligate with taxpayers’ money. They are making the easy decisions to spend, spend, spend. But the opposition, led by Malcolm Turnbull, the member for Wentworth, are prepared to stand up for what is right, and in the end, in the long term, the Australian public will see this debate for what it is: one side of the House being prepared to take out the taxpayers’ credit card and run it up to the absolute limit, and the other side of the House being prepared to stand up for what is right, to stand up for proper scrutiny and to stand up for no debt and low deficits or surpluses.

Those on this side of the House believe in fiscal rectitude. Those on the other side of the House believe in spending in order to buy their way out of difficulties—in the same way they have done since time immemorial. Labor’s way has always been to tax and spend. There is not a spending idea that most members of the Labor Party do not think is a worthy spending idea—because they are not spending their own money; they are spending taxpayers’ money. The pattern has been the same since the Whitlam government in 1972, and this government are the sons of Gough, the sons of Jim Cairns and even—in one case, literally—the sons of Frank Crean. There is a Crean in the Rudd government, and unfortunately he is allowing the government to pursue the same policies that his father, Frank, allowed his party to pursue in the Whitlam government. They are sons of Cairns, sons of Crean and sons of Gough.

To those Australians who look at this package and see an advantage for themselves today and wish that the opposition would immediately support the package, I say: consider the long-term consequences. This package will put the Australian budget into tens of billions of dollars of debt overnight. Within four years, the country’s debt will be $70 billion, and that is the conservative estimate. In the longer term, our debt will be beyond the wildest nightmares of those of us who were dismayed by the Hawke-Keating government’s $96 billion debt when we took over in 1996. We had to fix up the mess that had been left to us by the Hawke-Keating governments. And isn’t it always the way! Labor spends and the Liberals and Nationals have to fix the mess. And it will happen again. It happened after 1929-32, when we had to fix the mess created by the Depression and exacerbated by the Scullin government. It happened again after 1972-75, a period when the oil shock crisis brought unprecedented economic conditions to Australia. That situation was exacerbated again by the Whitlam-Cairns-Crean government, and we had to fix the crisis. It happened again in 1996 and it will happen again in 2010. In the longer term, the Australian public will look at this package and think, ‘Thank God that one side of the House showed some responsibility while the other side of the House, the Labor Party, were prepared to spend into debt and deficit!’

This debt will dwarf the Kim Beazley black hole of $10 billion that we inherited in 1996. We are talking about a debt that will lead to higher taxes and reduced opportunities for our children—and not only for our children but for our grandchildren. As the father of four children all under nine years of age, I am not prepared to saddle them with such an enormous debt into the future. Other members of the House, those on the Labor side of the House, seem prepared to do so. I know that many members of the government have young children. They have obviously decided that saddling them with the debt gets them out of a fix and will help them win—they hope—in 2010. They have decided that their children and grandchildren can wear the consequences of the decision they are making today, just as long as they win and get their backsides back on the government side of the House in 2010. That is all that has ever mattered to the Labor Party. That was the advice of Mark Arbib, from New South Wales, when he went to see Rudd and Swan and told them, ‘We must spend into deficit if we want to win.’ That is the New South Wales way. That is why New South Wales is now a national disgrace economically, and it is why their government is almost as bad as Hugo Chavez’s government in Venezuela.

The fine detail of these bills, which never made it into the Prime Minister’s set piece speech for the media and the spinmeisters—a speech for which he had obviously spent weeks preparing and to which he gave the Leader of the Opposition an hour and a half to prepare a detailed response—is that the government is raising the legislated limit on the government credit card from $75 billion to $200 billion. The government is essentially asking the parliament to give it a $200 billion blank cheque. But my greatest concern is in my own portfolio area of education, where the government has announced a package of $14.7 billion of spending. This will be welcomed by the schools sector. Who would not welcome it? Schools will be delighted that this money may be spent in their schools and institutions. But I say that it ‘may be spent’. They may have the estimates correct on how much this is going to cost, but we cannot, on this side of the House, give a big tick to this package, no matter how seemingly generous, given the track record of the Minister for Education in delivering the policies that were announced before the last election.

In two key areas—trade training centres and computers in schools—the minister has hopelessly failed to deliver on the promises that were made by the now Prime Minister before the last election. The part-time Minister for Education, with her eye on the ball of industrial relations rather than education, has been manifestly unsuccessful in delivering the Trade Training Centres in Schools and computers in schools programs, and everybody in the sector knows it. While many are too intimidated to say so because the government is, of course, the biggest spender on education in Australia, the truth is they all know it. Computers in schools has been a manifest failure. It is in free fall. It is costing twice as much and delivering half as much as was promised. There was supposed to be one trade training centre for every one of the 2,650 secondary schools in this country. How many have been delivered?

Bob Baldwin (Paterson, Liberal Party, Shadow Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

I haven’t seen any.

Christopher Pyne (Sturt, Liberal Party, Shadow Minister for Education, Apprenticeships and Training) Share this | Link to this | Hansard source

My honourable friend has not seen one in his electorate. Thirty-four have been delivered across the country. There is evidence that up to 10 schools in an area have to pool their resources to create a trade training centre, because principals know that a lathe in the corner of a classroom at the back of the school is not going to make the slightest difference to building skills and training and encouraging apprenticeships, vocational education and training in this country. So I think we can say with confidence that there will never be a time under the Rudd government when there is a trade training centre in every school across Australia. There will never be a time when there are 2,650 trade training centres in secondary schools, because it is out of the question that the money that has been allocated by the federal government would deliver a trade training centre in every school, and we are already seeing the need for principals to pool their resources.

Coincidentally, the kinds of resources that are being created eerily mirror the old Australian technical colleges that my venerable colleague the member for Goldstein, and before him the former member for Moreton, established under the Howard government. The Labor Party have essentially abolished them, and they refuse to visit them because they know how good they are and do not want to see the work they are destroying. They have trashed Australian technical colleges and decided to go with trade training centres which, because of the pooling of resources, bear an eerie similarity to Australian technical colleges. Isn’t that always the way with Labor? They are driven by ideology, bureaucracy and the union movement and kill things that work if they are free of regulation, involvement and control from the centre. That cannot be allowed to happen—we cannot have more freedom or the capacity for things to compete and grow! It has to be dominated by the union movement and the government, whether state or federal. It is one of the enduring embarrassments of Labor and can be traced right back to their very beginnings in the late 19th century.

In the package that has been announced there is a description of the Trade Training Centres in Schools Program as having received an outstanding response from schools across the country. The unreality of that statement struck me in its tendency towards Maoism. How absolutely ludicrous! It bears a similarity to Maoists’ descriptions of their own programs in the 1950s and 1960s, such as: ‘Consolidate and develop the grand achievements of the great proletarian cultural revolution,’ ‘Let’s go and save our money in the bank for the sake of building a happy life,’ and, ‘Warmly hail the successful happenings, warm care and great encouragement.’ These were the kinds of descriptions that Mao’s communist China used to put on its failed programs. In the package that was announced yesterday, trade training centres are described as having received an outstanding response from schools across the country. There are 34 out of 2,650 promised, hardly an outstanding response. Principals across the country are pooling their resources because of the paucity of the money that has been put forward for trade training centres. Federal President of the Australian Education Union Angelo Gavrielatos, no great friend of the coalition, described the centres as:

… a modest investment—

that—

… won’t offer a long-term solution to skills shortages.

That was post the election, after the coalition had been defeated with the AEU’s help. So how could trade training centres at the same time receive an outstanding response from schools? As I said, the suggestion has Maoist similarities in its air of unreality.

I now turn to the computers in schools program and its absolute failure. So far we have seen Trade Training Centres in Schools, essentially an unsuccessful program run by a part-time education minister who is more concerned with her future in the Labor Party than she is with delivering the policies that were announced by the then Rudd opposition. But the greatest criticism of the Labor Party’s pathetic performance in education can really be saved for computers in schools. The computers in schools program was going to cost about a billion dollars and apparently deliver a laptop computer to every child between year 9 and year 12 in schools across the country. We have now seen it blow out to at least $2 billion. It is now costing twice as much and delivering half the value. The promise now is that every second child will have access to a laptop computer—every second child at twice the cost! On any reading, computers in schools is a dramatic failure of public policy. It blew out from a billion dollars to $1.2 billion and then to $2 billion and is delivering half the value. When will the next blow-out occur? On that basis, the latest announcements in yesterday’s package will cost not $14.7 billion but more likely $29.4 billion and deliver half of what is promised. Maybe a school hall will be shared between every two schools.

This program has been a shambles from the start. And the Minister for Education, the part-time minister, bears absolute responsibility. In the first year, computers were allocated to less than 10 per cent of public schools in Australia, and many schools that were promised computers midyear had still not received them when their students left school for Christmas. Freedom of information applications and estimates hearings forced the government to reveal that the program was underfunded by several billion dollars, because it had not occurred to the minister that giving someone a computer without software, IT or ongoing maintenance or networking support was pointless. The minister tried to pass these costs on to the states and—surprisingly!—the states rebelled. The states revolted. And why wouldn’t they—because everybody knows that the uplift factor from $1 billion being spent on computers was dramatically more than the $1 billion outlay? The states simply did not have the money; they did not have the resources. Alan Carpenter, the then Western Australian Premier, said:

It’s a matter of how you implement it rather than having boxes of computers which nobody can afford to use in schools.

Independent Schools Queensland director of operations David Robertson said:

Where independent schools have additional maintenance costs they have limited choices—raising fees, stop doing something they are currently doing or appeal for parent fund raising …

Anne Gisborne, of the State School Teachers Union of Western Australia, said:

… if you’re going to be putting forward something positive and constructive, and it can’t operate, then it’s fairly useless.

I will repeat that: if you are going to be putting forward something positive and constructive and it can’t operate, then it is fairly useless. What better way to sum up all the announcements of the Labor Party in education over the last 18 months. They make a big announcement—trade training centres, computers in schools, money for numeracy and literacy—but, when the rubber hits the road in the delivery, the administration and the management of these programs, it is an abject failure. So why would the opposition tick off their latest big announcement, their latest hollow-man announcement of huge spending in the schools sector, when we have zero confidence in the capacity of the government to deliver this package on the ground in schools? We know full well that what will happen is that this will disappear into the ether, like the computers in schools program, like the trade training centres. The government will get a couple of good headlines, and the principals, the parents and the students will be left without any actual nourishment for the programs that have been announced. They will be delighted, initially. But the failure of administration, the failure of management and the failure to deliver will leave them hollowed out as individuals and schools, with the disappointment that that brings, because we know that the minister will be incapable of delivering this program.

Finally, there are huge holes in this program from the point of view of education. With its $41½ billion of taxpayers’ money to be run up on the credit card, not one dollar has been earmarked for the response to the Bradley review of higher education. With the money being blown in the way that it is—with the latest cash splash, of over $11 billion, following up on the December cash splash of $10 billion, sapping away at the resources of the taxpayers of Australia—where will the money come from for the response to the Bradley review? Where will the money come from for improvements to aged care, which is in desperate need in this country? Where will the money come from for waiting lists in hospitals—for infrastructure in hospitals? There are so many holes in this package. In education alone, I have identified a number.

The Labor Party, having pooh-poohed the Investing in Our Schools Program, is now seeking to bring it back! We support that. We believe in investing in our schools. We initiated that package. We wanted to keep that package. Labor abolished it. And now they are seeking to bring it back in this package. That is one area that we will look at in our response to this package that the leader, Malcolm Turnbull, will announce in the hours and days ahead.

So, more in sorrow than in anger, the opposition will oppose this package in the House of Representatives and the Senate.

Jim Turnour (Leichhardt, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to support these responsible bills: the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and cognate bills. I see the shadow minister for education leaving the chamber, but I would just say that I have not heard such a load of rubbish in this place for a long period of time. I do not know whether, as the shadow minister, he has actually visited any schools, but, from what I have heard about schools not receiving computers, I think he must not have. Last week hundreds of schools in my electorate received computers, and last year I was at schools where they had computers in their hands—they had them. He talked about trades training centres not being rolled out. Well, I had in my office a very tangible chair of the international marine skills training centre that is being built as a result of Labor’s investment in trade training centres in electorates like mine—a project that has been planned for five years but for which they could not get the investment they needed because the former government had an ideological bent towards these Australian technical colleges, which we know were expensive and have been a failure.

But I have come here today to debate this stimulus package and not, as the shadow education minister did, to digress into some ideological arguments, quoting Mao and others, in relation to education. We have a plan to support the Australian economy through these difficult economic times, and it is very disappointing to hear that the opposition will be blocking the Nation Building and Jobs Plan. Before I move on to that, I also need to make the point that I hope that the shadow minister for education will explain that to the 7,722 families in his electorate that will not be getting their back-to-school bonus and the 48 schools in his electorate that will not be receiving their $200,000 in additional maintenance and renewables, or the 40 schools that would have been able to apply for additional funding for infrastructure, whether libraries or other resources, and primary schools—because that is the reality of what this government is doing. At the core of this package is an investment in education, and it just shows the stark difference between this side of the House and the other side of the House when the shadow minister for education can come in here and talk such drivel.

The Rudd government, as I have said, has brought forward a nation-building package and a job protection plan which has measures to invest in schools, in defence and social housing, in community infrastructure and local roads, and in practical measures to tackle climate change, such as providing free ceiling insulation to around 2.7 million Australian homes.

We recognise that we also need to provide stimulus on the demand side. That is why we have included measures for one-off payments to eligible families, single workers, students, drought-affected farmers and others. Very importantly, we put in measures to support small business and business in general through increases in tax breaks for eligible assets. These measures are needed and have been well received in regions like that which I represent—Cairns and tropical North Queensland.

Our regional economy is heavily dependent on the tourism and construction industries, which have been battered by the global financial crisis. A well-respected regional economist has estimated that the package in these bills will pump between $400 million and $500 million into the Cairns and tropical North Queensland economy, supporting up to 1,000 jobs in the region that I come from. That is what the opposition is opposing. I know through the partnerships I have developed with local business and community leaders that this package is needed. Jobs have been lost in the tropical north because of the global financial crisis, and the Prime Minister and Treasurer have again sought to stay ahead of the game through this package as the global economy has deteriorated.

The International Monetary Fund recently revised down the growth forecasts for the world, with no nation coming out unscathed. World growth has been revised down from 3.4 per cent in 2008 to just 0.5 per cent this year. Developed economies are forecast to contract by two per cent, with the United States and Europe being in recession. Critically to Australia, China’s growth rate has also been downgraded substantially. Having grown in double-digit figures in recent years, China is forecast to grow at 6.7 per cent this year. Economic growth, particularly in countries like China, has driven the resources boom and underpinned economic growth in Australia. The boom is over and the IMF has forecast Australia’s economy will also shrink by 0.2 per cent, having only last year forecast a 2.2 per cent growth rate for Australia. The IMF is forecasting negative growth in Australia and, effectively, a technical recession. A responsible government does not stand by and let this happen. A responsible government acts decisively in the national interest and that is what the government is doing through this package of measures.

When private-sector demand and investment dries up in times like these it has been economic orthodoxy for governments to step in and stimulate the economy, and that is what we are doing. As the Prime Minister has made clear, he does not like going into deficit but it is the right thing to do given the global recession that we are facing. The government is acting in the national interest. This is the responsible course of action given that we are facing the world’s worst financial crisis since the Great Depression. This is the world’s worst economic crisis since the Great Depression, and those opposite are opposing these measures and want us to sit on our hands.

The government have also made it clear that we have a plan to bring the budget out of deficit but the opposition continues to rail against going into deficit. When growth returns we will put constraints on budget outlays and we will see the automatic stabilisers returned and bring the budget back into surplus. We have a plan to bring the budget back into surplus. We understand that it is responsible to maintain budget surpluses over the economic cycle, but we are clearly in difficult times. Arguments against a deficit by the opposition at this point in time just demonstrate how out of touch they are. I hope they are not seeking to play politics by opposing these measures, because this is not about the Labor Party or the Liberal Party—it is about the national interest. It is about the 21 million Australians out there who are facing very difficult economic times.

This package has been widely welcomed by industry and community leaders and, if the opposition are not prepared to listen to the government, I ask them to listen to calls from these leaders to support the package. If you will not listen to us, then listen to what some of the third party and independent commentators have had to say. Heather Ridout of the Australian Industry Group said yesterday:

The nation building and jobs plan announced by the federal government today is simple and substantial, and will provide a big stimulus to help keep the economy moving. Together with the interest rate cut, it has been a big day for monetary and fiscal policy—it’s a case of ‘all hands on deck’…The package targets consumer spending, which is absolutely critical to our near-term economic prospects, and boosts capital expenditure—looming as one of the real casualties of the downturn.

Mr Wal King AO of the Australian Constructors Association said:

The Rudd government’s $42 billion nation building and jobs plan announced today will play an important role in stimulating the Australian economy…This is a very thoughtful and well targeted program—

He described it as thoughtful and well-targeted, and I agree—

but this is the right time to invest in Australia to protect the future and today’s announcements are an important contribution. It is the right time to invest.

Adrian Pisarski, of the National Shelter Inc., said:

This is the biggest postwar public housing investment this country has seen, and is one that the Rudd government should be proud of … After 10 years of reduced funding from the Howard government, this is an unbelievable result for the people doing it toughest in this country … This funding was the missing element of the National Affordable Housing Agreement and will provide long term growth for the economy and the housing sector.

I know that these measures are welcome in regions like mine, where the construction industry is doing it tough. I have talked a bit about education, and I notice that the shadow minister for education quoted Angelo Gavrielatos from the Australian Education Union. Let us see what he had to say about reality in terms of our package:

In addition to providing an important economic stimulus, today’s announcement is the most important infrastructure investment the government can make. This investment will provide the opportunity for our schools to engage in urgent upgrades and to develop modern learning environments, which will improve education outcomes for our students.

That is what the Australian Education Union representative, who was quoted by the shadow education minister, had to say about this package.

Finally, the National Farmers Federation, who have not traditionally been great supporters of the Labor Party, have welcomed the package. David Crombie from the National Farmers Federation said:

The Government’s $950 tax-free bonus for all drought-affected farmers—reaching some 21,500 farmers in need—will be a much-needed fillip to families and regional economies.

Likewise, the regional infrastructure package … will see a major revamp of country services and shore-up jobs in local communities.

Further, the $2.7 billion tax break for small businesses … will be greatly appreciated by those small family-owned farms.

In light of these comments I urge the opposition to reconsider their position. If you do not want to listen to us, at least listen to those third-party independent commentators.

The opposition have not put forward any plan to deal with the job losses we are facing in communities such as Cairns and tropical North Queensland. They do not put forward any plans but they oppose ours, and they should listen to those independent commentators. Their approach is to let the market sort it out, when clearly the market has failed and continues to fail. The opposition do not see a role for government in protecting and investing in jobs during this period. They talk about jobs but do nothing to support them.

The Rudd government are not prepared to stand by and let Australian businesses and families down. We are strong supporters of free markets and economies, but we recognise that they fail and need to be properly regulated. I spoke about this in my first speech to this parliament last year. This is not the time for governments to stand idly by, as the opposition is suggesting. This is a time for the responsible action that this package of measures represents.

John Cobb (Calare, National Party, Shadow Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

I rise to speak on the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and cognate bills at a particularly serious time in our nation’s history—certainly from an economic and a futuristic point of view. Firstly, I have to talk about something I spoke about in this House last night. That is the state of the nation’s health administration and what goes with it. Last night I informed the House of the death of a man yesterday in Orange hospital. On Saturday evening he collapsed on Mount Canobolas, five minutes flying time to the hospital through the Orange helicopter service. He was three hours getting to the hospital because of the incompetence and the political bias of the New South Wales government, as they had not equipped the service, as they did the Wollongong and Sydney helicopters, with a winch. Through sheer incompetency and sheer political bias, the western New South Wales service does not have anything like the same capacity as the Wollongong helicopter, even though it has to deal with longer distances and worse terrain—the whole spectrum. Nor is it funded enough to be able to deal with issues over most of New South Wales, when the Wollongong helicopter service is—and it is only 12 minutes flying time from the Sydney base. The state of the health system, particularly in New South Wales and particularly in western New South Wales, is so bad that, when I listened to the Prime Minister speak yesterday about the $42 billion package, I kept thinking, ‘We are going to hear about health in a minute.’ I am still wondering why I have not heard a word about health.

What we heard about is pretty much a social package. I do not think it is a stimulus package. As our leader, Malcolm Turnbull, said earlier this morning, there are no certainties when you are dealing with economics and the issues around them. But when you look at this package, it very definitely is not a package that, is there for the future. It is a package that is going to have a dead end. There is no flow-on effect. There is no end result. There is no productivity. There is no long-term gain for those involved in producing or for those involved in working. It is all here and now and short term. Yes, I guess that you could say that without doubt it will keep some jobs in the building industry, but it does not go beyond that. And we are talking about $42 billion here. It does not provide any ability to repay any of that $42 billion, because there is no productivity, there are no taxes coming back from it and there is no GST coming back from it in the natural course of events. Politically, it might have been a great thing at the moment for us to say: ‘Wonderful! We will go along with $42 billion.’ There are a lot of families that will get the best part of $1,000 because they have a single worker, they have children or they are family tax benefit B taxpayers. Yes, it would have been very easy to do that. In my electorate, I am sure there are a lot of people who would benefit from that. But there are also a lot of people who have a future in this country.

In my electorate in the last four months, well over a thousand jobs have been lost in the mining industry. Most of these workers have families. It is true that some of them fly in from other parts of Australia to work, but almost every single one of those thousand workers earns over $50,000. My understanding is that a person’s tax situation as of 30 June last year determines whether or not they will receive the various payments—$950 for their children or whatever—so I do not think that one of those people will receive anything. Even if they do get a $950 one-off payment, if they have any brains at all they will put it in the bank for when things get even worse than they are now.

There is not one thing in this package that is going to encourage an employer to offer someone a job or to make it any easier to get a job. The only job assistance will be to hold jobs in the building industry. There is nothing to make it less onerous for an employer to offer a job or to keep somebody in a job—not one thing. You cannot escape the fact—given that even the government is currently talking about seven per cent unemployment in a very short space of time—that the No. 1 issue that we have to look at now and in the near future is jobs, the No. 2 issue is jobs and the No. 3 issue is jobs. I keep looking at this package, and I see a social package. I do not see anything in it that encourages people to offer more jobs or that makes it easier for employers to keep jobs. There is just nothing there to do that, and there is certainly nothing there that will do that in my part of the world.

When I look at what has happened—as I said, over 1,000 jobs have gone in the areas of Cobar, Nyngan and Parkes, just in my part of the world; that is, one job for every 90,000 people over the age of 18 who have the right to vote—it is quite incredible. I especially find it incredible that there is nothing in this package to reverse or to help that trend.

When I look at where this money is going I see that there is no long-term future in where this money is being spent. There is no flow-on, no comeback, no return of production, no return of tax and no return of GST to help pay for the $42 billion. I can see what has happened here. The government have got together and said, ‘We’re going to go into deficit. Okay; we can handle $5 billion. Oh, come on; we can handle more than that.’ Suddenly they have gone into deficit and, with Labor governments the world over, once they have taken the first step it is very easy to keep taking more. It is not so easy for those of us who have to pay it back. I remember well the pain this country went through from 1996 to 1998 while steps were taken to reverse the last trend. You cannot deny that it can be necessary to borrow money to get an outcome, but this is a one-off situation; there will be no flow-on to help it come back.

Look at where the money could be spent. If you really want to do things to help the country, to help productivity, to help jobs and to help skill levels, you should look at water infrastructure. When the now Leader of the House was shadow minister for water and infrastructure, he kept saying that the $10 million water plan was not being front-end loaded. He said that we needed to front-end load it and do all the infrastructure things in the first three years. It was a little different when Labor got into government. They wanted to front-end load it, all right, but not into spending money on water. They wanted to buy it. They just wanted to take it out of production. As I have said in this House before, they were not trying to sort out the Murray-Darling Basin; they declared war on the people in the Murray-Darling Basin and they still are. I agree with his front-end loading right now—but invest in the infrastructure. There is one project which is currently being looked at. We provided money to do a study on how to save water in the Macquarie Valley. There are enormous amounts of water that could be saved. Off the top of my head, I think there are 60,000 or 70,000 megalitres—about 10 per cent of all the water in Burrendong Dam could be saved in that region, and this is just on two irrigation schemes, and including the towns of Cobar and Nyngan, which depend upon water being pumped from the Macquarie through the Albert Priest to those towns and the mines that support them.

You could spend that money there now and you could create jobs. All the miners who are losing their jobs around Cobar, Nyngan and Parkes would be perfect people to be involved in the infrastructure work that would be needed to put in new channels, to put in pipes and to make the schemes around Trangie, Narromine and Nevertire all the way through to Nyngan much more water efficient and much more productive and give viable options for the future. I cannot think of anything that would meet the current crisis better. It is better than simply throwing money away on a one-off situation. I guess it is not popular politically to suggest investing in industry rather than in a one-off situation to people. But in the long term it all has to be paid back by the same taxpayers who are going to be getting a short-term benefit today. You can invest in returning things like water—not just for agriculture but for towns and water authorities around regional Australia and everywhere. But that seems too complicated—it is not simple enough—and apparently it does not hit the particular target group this government wants to spin doctor.

When I look at it I see the way it is intended to be spent. Malcolm Turnbull, our coalition leader, mentioned earlier this morning that the old Investing in Our Schools Program, which is being copied now, was very popular and, with the non-government school system, every cent that was allocated to them went to them. However, for New South Wales at least, because the state schools did not have a separate accounting system, because they could not actually outsource their auditing et cetera, it had to be done through the New South Wales Department of Education. Naturally, they took 15 per cent of it. Given that this is basically what they are going to do again, this means that the states will pull in about $3 billion just by saying that they are administering part of the $42 billion. I think that is quite incredible. I think that to put up this package without getting the states to agree not to do that is totally irresponsible and ridiculous.

I welcome $950 going to farmers who are receiving EC payments. However, that is very much targeting particular people. There are 21,000 farms receiving the household support payments or the money for homesteads. That would be in the order of one farm in every five in Australia. That is fine, but I think we would be far better off spending money on roads that were going to have tolls on them, not only to help production and to help the passage of people and everything else but because there would be a future in it and a long-term gain in it. It would help our taxpayers today, and their children, to repay this money, because it will have to be repaid. It took too long, and it was too hard, to pull back the $100 billion that we had to pull back. I have no doubt that we are going to end up with every bit of $200 billion being owed. The current government is trying to extend their credit limit from $75 billion to $200 billion, and I have no doubt they will spend every cent of it.

If the government wants to do something serious about investing in the community and about having a stimulus package, why would it, on one hand, pull $60 million out of CSIRO a few months ago, when now it is talking about putting $88 billion in total so far into rejuvenating the state of the nation in Australia? That is $88 billion, and yet not long ago it took $60 million out of one of the organisations which provides for the future of our country better than most. Quite a lot of that $60 million came out of research into agriculture, the money that CSIRO spends on horticulture and other things to ensure long-term sustainability, ability to deal with disease and ability to come up with new and efficient ways in horticulture and other types of agriculture. I find it incredible that the government does not want to invest in water except to buy it and take it out of production. It does not want to invest in the future of agriculture. The government wants to take away money that has been earmarked for long-term research. Especially when you consider that all the Minister for Agriculture, Fisheries and Forestry and his boss want to talk about is climate change, when the government is expecting farmers to produce more with the same or with less, why pull this money out of agriculture and then spend $88 billion on Australia one way or another?

I think we have to look at everything from the point of view of the future. We cannot for one second forget that $42 billion does not come easily and that it is very hard to pay back. Like everybody else in this House I, too, have many schools in my electorate—the biggest electorate in New South Wales—in the far outback or in places like Blayney, Sofala, in the east, or Orange. Every time I see these schools—and I have a large family myself—I think at least $2,000 of this particular package, let alone what might come in the future, is owned by every man, woman and child in Australia. Let us not forget that it has to be paid back.

I look at communications and I think that it is not long ago that this government wiped a contract that was already signed by the previous government to provide broadband to regional Australia. They would do very well to relook at that contract, talk to Optus and Elders and say, ‘Would you consider doing that again?’ because by the end of this year they would have had broadband available to almost everybody in rural and regional Australia. It is quite obvious that the Minister for Broadband, Communications and the Digital Economy in the Senate has not the faintest idea where he is going with broadband and that there is nothing in the future. Broadband is about productivity. It is about communication. It is about helping country people to do things at a time when we are going to be up against it. And we will need every means at our disposal, be it social or, more to the point, productive—be it for a farm or for anyone with a business at home—to fix the broadband up for very little money by comparison with what is currently being looked at to throw at whoever they can come up with to give them a viable tender. At the moment I think the minister has no idea where he is going. Just think about it: by the end of this year regional Australia could have had a very viable, very broad-ranging broadband network.

The $42 billion—$2,000 for every man, woman and child in Australia—is not long-term money. It is here to be spent and, even with the schools, even with the infrastructure spending, there is no gain afterwards. Whether their school needs it or not, it would be nice for kids to have a new library or hall or whatever it might be. But we have to, at the moment, take a view which is in the best, long-term interests of Australia at a time when we are going to need it. I look at this and I think it is a little bit like the Democrats in America using the current situation to pursue a social rather than a stimulus agenda. We have to have the guts to stand up and say, ‘Let us remember we are talking $42 billion, not $42.’ It does not matter how quickly you say it; it is one heck of a lot of money. It has to be paid back. Right now we have to think about our children’s future as well as our future.

Steve Gibbons (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak on the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and cognate bills. Most of the world’s major advanced economies are in recession, and emerging economies like China and India are slowing dramatically. No country will escape the falling economic growth, job losses and budget deficits that will flow from this. The recession is now bearing down on the Australian economy with growth slowing and employment weakening, but the Liberal Party stands there just like the Black Knight in Monty Python and the Holy Grail. No matter how many arms and legs they have lost, they will just not give in and accept that they are wrong. They keep on advocating the same policies that caused the global economic crisis in the first place. Just last weekend the shadow Treasurer was singing the praises of the voodoo economics of the 1970s. Across-the-board tax cuts are the opposition’s answer to everything, despite the fact that these have been one of the main causes of the economic problems in the United States, problems that have now spread to almost every country in the world. The shadow Treasurer’s claim that reducing tax rates will increase tax revenues for the government is straight out of the Ronald Reagan neoconservative policy manual, a manual that is now so discredited.

Two years ago, the architect of that tax theory, Art Laffer, said the US economy had never been in better shape. He said that there was no possibility of the US real estate bubble bursting in 2007 or 2008. In fact, he even bet someone a penny that there would be no recession by 2008—and this is someone that the shadow Treasurer is looking to for political policy guidance! In 1987, Ronald Reagan appointed Alan Greenspan as Chairman of the Federal Reserve. For almost 20 years Mr Greenspan argued for extreme free market economics and against regulation of the financial markets. Last October, Mr Greenspan admitted that the ideology that had guided his term as Federal Reserve Chairman was wrong, yet this is the same ideology that we hear from the Liberal and National Parties today.

The Liberals have no more credibility on economic policy today than Art Laffer or Alan Greenspan. Australians are indeed fortunate that they voted for a change of government before this economic crisis hit our own shores, because the Rudd Labor government is the government that is taking action to shelter Australians from the worst effects of the global economic downturn. It is taking decisive action to help all Australians, not just a wealthy few, to deal with the uncertain times ahead. This $42 billion economic stimulus package is the latest example of the government’s well-thought-out, targeted initiatives to support the Australian economy and Australian jobs. It gives support to families and individuals to ensure we keep demand and consumption flowing in the short term and it also lays the groundwork for a stronger economy when we emerge from the global recession by investing in essential community infrastructure like schools, housing and local roads projects. Of course, this means that the government will have to take the budget into a temporary deficit; with $115 billion wiped off government revenue by the global recession, there is little choice. But the government will stick to its election commitment to keep the budget in surplus over the economic cycle, with a firm plan to reduce the surpluses as growth returns and the global recession turns around.

The economic crisis is affecting my electorate of Bendigo, just as it is every other part of the Australian nation. People are doing it tough as businesses contract and jobs are lost, and this is happening after more than a decade of the worst drought in living memory. So I think it is important to highlight how this economic stimulus package will benefit many of those in my electorate. Firstly, many individuals will receive targeted bonuses that will not only help with higher living costs but also provide an immediate stimulus to the economy and support local jobs; some 11,000 families will receive back to school bonuses of around $950 to help with the cost of children returning to school; more than 260 farmers and small businesses affected by the drought will receive a hardship payment of $950; students and people looking for work will receive a training and learning bonus of $950 to help with their study costs; and everyone whose taxable income was less than $100,000 in the 2007-08 tax year will benefit from a payment of up to $950.

There is support for all of the 90 schools in my electorate, whether public, private or independent, that builds on the government’s education revolution. Every primary school will receive help to build or upgrade large-scale infrastructure such as libraries and multipurpose halls. There is funding for high schools to build new science laboratories and language learning centres. Every school will receive up to $200,000 for maintenance and renewal of school buildings and minor building works, and there is additional funding to accelerate the government’s Trade Training Centres in Schools Program, which helps to provide high-quality trade training to secondary school students. These educational initiatives will not only help schools and their students; local communities will also benefit. A key requirement of the package is that major facilities in primary schools which are built or upgraded with this funding, such as halls or indoor sporting centres, must be made available for community use. This will particularly be beneficial for the smaller townships right throughout my electorate, and local communities will also benefit from an additional $500 million to expand on the Regional and Local Community Infrastructure Program for strategic projects. This program funds local government community infrastructure projects such as town halls, libraries, community centres and sports centres.

There is a high proportion of low-income earners in my electorate, and many will benefit from the commitment to build new social housing. Most of the new houses will be completed by December next year, and this will help provide a significant boost to the local housing and construction industry. Small business is the backbone of a regional economy, and it is no different in Bendigo. The temporary business tax break announced yesterday will help many local businesses to increase productivity by investing in new plant and equipment.

Another particularly welcome set of initiatives is the $890 million to improve community infrastructure and road safety. Many lives are needlessly lost on regional roads, and these measures will be a major benefit for regional communities. An additional $30 million for the years 2008 and 2009 and $60 million in 2009 and 2010 for the Black Spot Program comes on top of the government’s announcement in December that it would more than double the black spot funding from 2008-09 from $50 million to $110 million. These are magnificent increases in a very, very valuable project. Every dollar spent on the Black Spot Program is estimated to save $14 in reduced road trauma costs. And, for the first time, a portion of additional funding will be allocated to black spots on Australia’s national highways, which until now have been excluded from the program. There have been several serious accidents on rail crossings in regional Victoria, and there is an urgent need to reduce the risks faced by road and rail users at these types of intersections. Yesterday’s announcement included $50 million in 2008-09 and $100 million in 2009-10 to speed up installation of around 200 sets of boom gates and other safety measures at high-risk rail crossings that do not already have such controls. The government will also provide a further $150 million in 2008-09 to help the states and territories fund a backlog of maintenance projects on Australia’s national highways.

Although all new homes must be insulated, many older homes, which make up about 40 per cent of Australia’s housing stock, are uninsulated. Many of these older homes are in regional areas, and insulating them will help reduce Australia’s carbon emissions, reduce energy bills and support local jobs. Installing free ceiling insulation in Australian homes will cut around $200 a year from household energy bills and will support the jobs of tradespeople and workers employed in the manufacturing, distribution and installation of ceiling insulation products. And the government has not forgotten the many vulnerable households that do not own their own home and are renters. To help these households lower their greenhouse gas emissions and save money on energy bills for the next two years, the government will double the rebate currently available to landlords to install insulation in their rental properties from $500 to $1,000.

I am proud to speak here today in support of a package of measures that are economically responsible and appropriate for the highly uncertain times in which we are living. It is a package of measures which is only possible due to the sound economic policies of previous Labor governments. Without the far-reaching economic reforms introduced by the Hawke and Keating governments, Australia would not have enjoyed the economic prosperity that it has over the last decade and would not be in such a strong position to weather the looming global recession. These measures could never have come from the Liberal and National parties had they been in power at this difficult time, as the Leader of the Opposition demonstrated by announcing that that they will not support the package in either the House or the Senate. This is just dog-in-the-manger politics. They may as well stand up in this House and punch themselves in the head a few times. Their response is driven by the same discredited, extreme capitalist ideology that made the measures necessary in the first place. Like Monty Python’s Black Knight, they just do not know when to give up. The voters kicked you out because they do not want any more of your extreme ideology. Once again, we are a lucky country: lucky to have a Labor government, a competent government and a responsible government in office at this time. I commend the government’s Nation Building and Jobs Plan to the House.

Bob Baldwin (Paterson, Liberal Party, Shadow Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

I rise to speak on the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and cognate bills. It is with a great deal of pride that I note that Australia is the 17th largest economy in the world, and it is with pride that I note that the Deputy Prime Minister, in Davos, extolled the virtues of our banking system and the regulations that have been put in place to protect the financial wellbeing of Australians. Australia does not have a Lehman Brothers bank; Australia does not have a Royal Bank of Scotland. We have secure banks. One of the things that have spiralled this country ahead of the race down the track towards a recession was the prophets of doom and gloom straight after the elections. Straight after the election the Prime Minister, the Treasurer, the Minister for Finance and Deregulation and the Deputy Prime Minister all stood up and said: ‘The economy is too hot. Inflation is a problem. We have to slow down this economy.’ So up went interest rates. Then what happened? The events that started to occur in September last year in overseas countries started to come through. They basically stalled our economy through their rhetoric. They destroyed the confidence that investors in Australia had—investors such as small businesses that are the backbone of this country and that employ many people. They started to destroy that confidence, and then came this policy of splashing cash to try to fix the issue.

There are many reporters with economic credibility who report that other than in a few select areas in retail there has been no great benefit and that 75,000 new jobs were not created because of that $10.4 billion. The cash splash was a relative failure that Australia could not afford. I read about the ‘Key Economic Forecasts’ and the ‘Budget Bottom-Line’ in the Sydney Morning Herald this morning. Why did I have to read that in the Sydney Morning Herald? Because the documents were only tabled a very short time ago. In fact, the statement and the notes that accompanied the Prime Minister’s speech yesterday were only printed in limited numbers. I am sure that every interested journalist got one, but there were none for every member of this House—and that is a disgrace. Members of this House are elected to represent the people of their electorates and to look after the financial benefits and employment prospects of individual Australians and in particular, as the Leader of the Opposition said in his speech today, to look after future generations and the children of this nation—that is, the people who are going to be saddled with this $42 billion debt.

Forty-two billion dollars in 48 hours is just under $1 billion per hour of expenditure, with no proven fact or science that it will actually work. In the Herald this morning I read that, as we all knew, the budget was to be $21.7 billion in surplus. The projection for next year was a $19.7 billion surplus, for the year after that it was a $19 billion surplus and for the year after that it was an $18.9 billion surplus. That was the track on which the coalition had taken government policy over its time in government. We went from a deficit-run government in the Hawke-Keating era to one of surpluses. We put money away for a rainy day and, true, this is that rainy day. But the new predictions are that this year we will have gone from a $21.7 billion surplus to a $22.5 billion deficit. Next year we will go from a surplus of $19.7 billion to a $35.5 billion deficit. In 2010-11 we will go from a $19 billion surplus in the forward estimates to a $34.3 billion deficit, and in the fourth year of forward estimates, in 2011-12, we will go from an $18.9 billion surplus to a $25.7 billion deficit. All of those deficits are individual, and then we look at the cumulative effect. That money will need to be paid back.

Many members of this House were not in parliament in 1996. Indeed, the Prime Minister and the Treasurer were not in this House in 1996 to see the measures that had to be put in place to address the $96 billion worth of debt that was left to the coalition to fix. We had to make some tough decisions; there were spending cutbacks. But, you know, we did not penalise the individual. We did not put taxes up. In fact, what we did was to make the tough economic reforms and address the deficit, which was paid off. There was a lot of pain, but we found that we were paying around $8 to $9 billion per year in interest rates on that deficit. As we started to reduce the deficit, that money was freed up and could be spent on other things or actually given back to the taxpayers in the form of tax cuts. Many were the times on budget night that the Treasurer got up and announced yet again another tax cut. In fact, we went to the election last year forecasting tax cuts in excess of $30 billion.

Today the Leader of the Opposition has called on the government, as part of the package, to bring forward the tax cuts from 2010 to now. That will mean that every household—including two-income households—earning around $80,000 will be around $1,700 per annum better off. It is putting the money back into the pockets of people over a period of time. Quite often, once-off payments create an initial splurge and, as we have heard, two-thirds of the $10 billion package was more than likely spent paying off debt. What is more important is that payments are regular, that people can count on them and that they can invest in their daily life. Whilst the $1,400 that was given to our pensioners was good money and well deserved, it was spent on either paying off credit cards or paying off one bill, yet here we are, after Christmas, in February, and still they are back on $273 a week. The government intends to spend $42 billion, but why aren’t the pensioners taken care of? Why isn’t there a $30-a-week increase in their pension now so that they can afford to live a little better for a longer period?

I look at this government and I compare it to when I first started work as an apprentice. My first pay packet back then—it was a few years ago!—was $11 a week. I found that, as I was working, I was able to get a thing called a bankcard. And, because I did not receive much in the way of financial training when I was at school, I thought it was free money. But then one day, when I got the bill about a month later, I worked out that it was not free money and I actually had to pay it back—and I had to pay it back with interest. This government is treating taxpayers as though this money is free money. But the reality is that it is the taxpayers, not the government, who will have to pay back this money.

It is young taxpayers, who are currently going through school, who will be burdened with this debt. Whilst some of this $42 billion of spending in one hit is very good spending on infrastructure, it has not been proven that it will fix the problem in the long term. Even the Prime Minister said, ‘This is no silver bullet.’ But the reality is that he and his leadership team were given the opportunity to sit down with the coalition and work through which packages would be financially affordable for Australia to achieve the direction in which we want to take Australia. But, no, the Prime Minister and his Labor team have gone it alone. This Prime Minister and his Labor team want to guillotine this debate for $42 billion tonight so they can ram the legislation through the Senate to ensure that the $950 expenditure for those lucky individuals who will receive it—and not all Australians will receive it—will actually start to appear in spending in the March quarter.

The Prime Minister was not averse to calling a 2020 Summit to gather Australia’s best and brightest together to bring ideas to the table. But, at a time when you have an economic crisis, why wasn’t the Prime Minister gathering together Australia’s best and brightest around the table and working out what package would work and what would benefit all Australians not only today but in the future?

After seeing one of the bills here, I fear that this is only the tip of the iceberg. One of the bills we are being asked to sign off on today will allow the government to increase borrowings to $200 billion. That is an awful lot of money—I do not know whether I could write that many zeros. If I think about my own household income, and indeed if many Australians think about their own household income, $200 billion is just a telephone number. It is something they do not easily understand. But, when they are going to be faced with increased tax payments, they will truly understand it. We as a nation grew and we were able to climb through the Asian meltdowns, the US recessions and other economic crises because we had taken hard measures, because we had created a confidence—and that is the key word in all this—in our economy, a confidence in the leadership of this government, whereby people were prepared to invest and spend. Today we are seeing people locking up their money, and none worse than the banks.

The Ruddbank will only satisfy some of the larger property developers. But can I say to you—and it is a well-known fact—that it is the small to medium-sized businesses that enable our country to survive economically. It is the small to medium enterprises which employ the broad majority of Australians. Now the banks are revaluing the assets of those people and, quite often, putting foreclosure notices on their businesses. They demand and ensure that, in this environment, they recover their money—damn what it does to the local business; damn what it does to the people who are employed there—and, in most situations, people have never defaulted on loan payments. But the banks are tightening up and, as the banks tighten up, because of the lack of confidence in this Labor government we will see more small businesses close. We will see more people hit the unemployment queues, and there will be fewer people working who are able to pay the tax to cover the debt. So it is a vicious cycle.

I hear members opposite say, ‘It will do wonderful things, and I can do this and I can do that.’ What worries me about this finance package—and I understand that all the state premiers are coming here tomorrow, and who wouldn’t with this bucket of money on the table?—is that it will just be a shift of dollars to the states.

As I look around Australia and, in particular, at New South Wales, where I come from, I see the New South Wales government is not only morally bankrupt but financially bankrupt. It has no ability to manage its economy. That is typical of Labor. This Labor government is now going to give it billions upon billions of dollars more money, without demanding one single reform by that government to ensure that it spends our money—taxpayers’ money—wisely and efficiently. So what we will see in the states is more of the same.

The Prime Minister has talked about maintenance programs and new halls. As I drive around my electorate, the biggest issue is not necessarily school halls or maintenance; the issue is the number of demountables the kids have to sit in at school. That is an issue, but that has not been addressed. No, it is all about ribbon cutting—having a new school hall to cut the ribbon of. These things do absolutely nothing, as I see it, to improve the educational standard where the kids sit in the classroom from go to whoa every day they go to school. They might visit the school hall once a week for assembly or a drama performance.

Also, this package has failed to address one of the biggest issues in Australia—that is, health care. After all, it was the Prime Minister who stood up and said, ‘I have a national plan.’ It was the Prime Minister who said, ‘If the states don’t get the health system right in 12 months, I will step in and I guarantee to fix the problem.’ He had a plan, and he also said that the buck stops with him. The reality is that the bucks—or the dollars—have stopped with him, because there is $10 billion being held up that has not flowed through. Structural reform is needed in the administration of both education and health in the states. We should be focused on outcomes, not just on political spin and on bailing out state governments for their re-election opportunities.

As I say, there are some good points. I spoke yesterday in a briefing with the Minister for Defence Science and Personnel, and he spoke to me of the Defence Housing expenditure—an additional 802 homes over and above the forward estimates, at a cost of $251 million. The program annually is around $151 million, building 500 houses per annum. Our defence people deserve to have the best accommodation that we can provide to them, and I do not deny them that. But, instead of spending $251 million on houses, perhaps the government could have reduced the burden on the bottom line by entering into more lease agreements, entering into leased properties for our servicepeople and giving them some choice.

I sit there and look at this package, and I look at the people who are presenting this argument and at the urgency with which they do it. I am reminded of Gough Whitlam in the seventies, who loved being Prime Minister so much and did not want to be bothered with all the detail; he just let his ministers spend, and spend recklessly. We incurred debt that took us 30 years to recover from. I also notice this $200 billion, and it brings back reflected memories of the Khemlani affair: ‘Get the money wherever and however you can; just make sure that we keep up with the spending.’

Spending to avert crisis is not wrong as long as it is properly managed. Spending to keep people in jobs is not wrong as long as it is properly managed. I see $42 billion, the largest single expenditure as one package ever in Australia’s budget—a billion dollars an hour is what we are asked to approve—as reckless spending, because they have not bothered to sit down with the coalition, or, indeed, even with the smartest, the brightest and the best, whom the Prime Minister brought to the 2020 summit, and to look at what can be done to make sure that we have a better Australia.

In conclusion, I was rather concerned at a media article a couple of months ago on a thing called the Pappas report. The Pappas report said not only that the government had already taken $1 billion a year, or $10 billion over the next 10 years, out of the defence budget but that Mr Pappas felt that another $3 billion in cuts could be sustained in Defence. I say to you that that is rubbish. It is rubbish because at the moment there are civilians in Defence who are losing their jobs because of these cutbacks. There are troops who are deployed to East Timor who cannot even get mosquito nets to protect themselves from the mosquitoes at night. I know the Parliamentary Secretary for Defence Support, sitting at the table here, is an ex-serviceman himself—and for that I respect and congratulate him—but I say to you, Parliamentary Secretary: your former colleagues are now deployed in Timor and do not have mosquito nets. Is it a part of your budget cutbacks that we cannot provide basic amenity to those men and women who go to serve this nation, and serve this nation well, and that you have cut back on the supply of provisions to them? Parliamentary Secretary, I ask you to take it up with your minister and ask why these people do not have basic provisions to protect them from the natural elements. They do not ask for much and they serve our nation well, but I think that we as a nation should never cut back on basic necessities which they need to do their job.

I never thought that I would stand between a bucket of money and constituents, but I have to say this: you have to have restraint and you have to show respect and responsibility. If I approve this $42 billion, as the Leader of the Opposition said this morning—and I look into the eyes of those schoolchildren and think about this—then I am going to put up to a $9½ thousand debt on every man, woman and child in Australia. I cannot responsibly do that. But I say to the government: we, the coalition, are prepared to sit down and meet you to talk through a complete package—perhaps a smaller package—that will be for the benefit of this nation in the long term. (Time expired)

Maxine McKew (Bennelong, Australian Labor Party, Parliamentary Secretary for Early Childhood Education and Child Care) Share this | Link to this | Hansard source

I rise to support the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and cognate bills, which provide a huge stimulus package which will support families and rebuild the nation. The $42 billion spend is immense—I acknowledge that; it is not in the normal order of things—but the government is faced with a bitter set of statistics. The majority of our trading partners are in recession; we have seen the halving of growth in China and a collapse in commodity prices. Australia is bracing for tough times, and the times require a comprehensive, bold package, to be delivered in a speedy manner.

While I say that this package is not in the normal order of things, it is entirely orthodox. When the private sector retreats, it is up to the public sector to fill the gap. We are seeing this around the world—in the United Kingdom, in Europe and in the United States—and this is the context, I think, in which this package needs to be considered. As the Prime Minister has been saying, across the world what started out as a financial crisis has now turned into an economic crisis and risks becoming an employment crisis.

Wherever you look—whether it is Nicolas Sarkozy in France or Gordon Brown in the United Kingdom—governments know that they have to lead their economies with targeted and timely intervention. Indeed, newly elected US President Barack Obama is working on an US$800 billion stimulus package right now but he has not yet secured agreement from all sides in the US congress. This delay is deeply regrettable not only because so much of the world still looks to the United States to take the lead but, most importantly, because of the widening human despair across America. Every day it seems we hear of more lay-offs in once great American companies. Already 2½ million Americans have lost their jobs. Just think of the despair of that. While the congress bickers, ordinary Americans are learning to cope with shattered expectations. They are still waiting for the government to step in and alleviate the pain, to do what economic orthodoxy demands during recessionary times: an opening of the public purse to resuscitate a contracting economy.

But what do we have here in the Australian parliament? It is obviously the intention of the Leader of the Opposition to emulate the Republican recalcitrants in the US congress. Isn’t that interesting? How at odds this is with what the coalition’s traditional supporters are saying! Katie Lahey, the Chief Executive of the Business Council of Australia, said:

The Rudd Government has acted quickly and responsibly to limit the impact of the global recession … The package delivers a substantial economic stimulus …

Peter Verwer, the CEO of the Property Council of Australia, has praised the initiatives and said that they will ‘inject billions of dollars of new capital directly into the community’. From my own area in the north-west of Sydney in the seat of Bennelong, Andrew Bland, the chairman of the Ryde Business Forum, said that there are excellent moves in the packages. He has particularly praised the excellent tax incentive provided for small business to invest in capital expenditure items. Interestingly, he also said:

This will hopefully flow through to increased sales and benefit the business community as a whole. We are also hopeful that the cash incentives provided to most consumers will also have a similar positive effect to that experienced late last year.

That is praise for last year’s stimulus package and a welcome for the one that we are debating today. Interestingly, those three comments came from what one could say would be the traditional coalition supporters. So much for the Leader of the Opposition being in touch with mainstream Australia and mainstream orthodoxy!

When I am talking to people in my electorate, most people say similar things. They want their government to be practical and they want a government that is compassionate. In the light of today’s debate, it is very interesting, particularly for me, to look back and reflect on why the seat of Bennelong, a traditional Liberal seat, fell at the last election, in 2007. It was not because of redrawn boundaries and it was not because of any particular antagonism towards John Howard. It was because of the deep sense of betrayal felt by so many individuals in Bennelong. Time and time again when I was out doorknocking in suburbs like Epping, Gladesville, Denistone and North Ryde—

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

Mr Briggs interjecting

Arch Bevis (Brisbane, Australian Labor Party) Share this | Link to this | Hansard source

If the member for Mayo wishes to be here to deliver a speech, he will remain silent.

Maxine McKew (Bennelong, Australian Labor Party, Parliamentary Secretary for Early Childhood Education and Child Care) Share this | Link to this | Hansard source

people continually expressed their deep disappointment that the coalition government was wasting the prosperity. As the tax revenues rolled in, as the bounty of the mining boom rolled in, people wondered why the coalition government was not building the skills of the 21st century, was not greening our households and was not providing for the homeless.

The Leader of the Opposition today has the hide to talk about the need for prudent financial management. Yet he was part of a government that time and time again put self-interest above the national interest. If anyone doubts that, they should get a copy of The Howard Years, brought to us by your ABC late last year. Have a look at the opportunism, the naked politicking and, in many cases, the sheer delight of so many key ministers in the coalition government who could not believe their good luck that they got away with it so long. I know that many people in Bennelong squirmed when they watched this, and they felt roundly vindicated that they had sent the Liberals packing. People in Bennelong work hard and they want a government that works hard in their interest. They want a government that champions their beliefs and their interests. And they particularly want that at a time when national confidence is so fragile. That is what the government’s stimulus package does and why it is so important. Australians want action. They want to see builders with fresh contracts and redesigned smart school buildings that mirror the excellence of the teaching that goes on inside those buildings. They want us to help them remake their houses so that they too can do their bit to save the planet.

I will finish by quoting from one of my constituents, Mr Peter Trickett, who lives in the north-west of my electorate, in Epping. He wrote to me only last week. He praised the government for the first stimulus package but he pointed out that, as the managing director of an engineering consultancy, he was very concerned about the impact of the downturn on the building industry. He had already seen eight projects delayed indefinitely. Being a practical man, Mr Trickett made some suggestions in his letter. First of all, he said an immediate stimulus was needed for construction. Most importantly, he stressed the need for community projects of the kind that would support local tradespeople and the other businesses that support them. He said the significant issue is to start now. Interestingly, Mr Trickett gave an example of a project that would be in the overall interests of the community and at the same time help the building industry. He said:

… an example of the type of project to consider would be to eliminate all demountable classrooms in New South Wales.

I would like to point out to the previous speaker, the member for Paterson, that this indeed is one of the options available in the schools package that is part of the overall stimulus package. I can say today to Mr Trickett: the Rudd government is listening and is acting. Like the Prime Minister, I look forward to the schools in my electorate becoming centres of economic activity where local people work to improve schools, where children learn.

Recessions are traditionally brutish things. They can empty us out. You see it in the ‘for lease’ signs, the abandoned construction sites, the deferred ambitions and the lengthening unemployment queues. But it does not have to be like this. That is why the Prime Minister has said he will move heaven and earth to support Australian jobs and shield the Australian economy from the worst effects of the global economic crisis. The dramatic reversal of our economic fortunes has reminded everyone of a key Labor principle, and that is the critical importance of balancing the public and the private. That is what this package does. I commend the bills to the House.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

I too rise to speak on the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and the cognate bills that we are debating today in this rushed manner in this House. I follow a member who, I note, although she talked about doorknocking during the 2007 federal election, failed to show her face during a by-election in a state seat, which was interesting.

Today the Leader of the Opposition has taken a principled but right stand. Today he has taken a decision which will not be popular in the eyes of the electorate and in the published opinion polls, but it is the right thing to do for our country. In my maiden speech I made the point that I come here with a set of principles to stand for. I also made the point that, no matter how big the bullies were on the other side, we would not be bullied; we would look at packages like this and make decisions based on our principles. One of those principles is that we should not leave this country in worse condition for our children than we found it in.

This package—and the whole economic management of this government—will leave this country in a worse position than we found it in. It will do so by racking up so much debt that opportunities for our children in the future will be greatly reduced. It will leave them with a higher tax burden and it will damage their opportunities for a better life.

I do not say this lightly. The decision we have taken in the party room and the very courageous decision taken by our leader will not be popular in my electorate or the electorates of many of my colleagues in the short term. But I think that in the longer term people will respect the fact that we have stood up for them and that we have not been bullied into a populist stunt by the government, based on politics. That is what these bills before the House are all about.

What does this package purport to do? It does several things. It spends money in all sorts of places—other people’s money. Let us not forget that is what we are talking about here. We are talking about our constituents’ money, not ours. The package does some things which I support—for instance, school modernisation, or a new version of the Investing in Our Schools Program, a Howard government program cut by this government which I support being reinvigorated to a certain degree. I support our leader’s position in that respect.

On Monday I was lucky enough to present a flag to the Kangarilla Primary School. It is a small school in my electorate, with 75 students. They have been completely ignored by the state Labor government in South Australia. Their air-conditioning system is blowing hot air, which, let me tell you, in 42 degrees is not a very pleasant thing for year 2 and year 3 kids to go through. Rather than replace it, which is what is required at the Kangarilla Primary School, the state government bureaucrats insist that it needs to keep being fixed, even though the air-conditioning maintenance people say it should be replaced. So I support a program like the Investing in Our Schools Program, which allows schools to make decisions which best suit their school—not necessarily to build gymnasiums or grandiose buildings that the Prime Minister or one of his ministers can open but actually to invest in infrastructure in their schools which will work for them. Air-conditioning systems are a good example.

I do support that sort of productive spending. However, what I have a problem with and what we will stand against and vote against, both here and in the Senate, is more cash splashes in the form of one-off handouts. The last package, the package announced in October last year and delivered in December, did not work. Some of that money—the very small proportion which went to pensioners—was welcomed, but I suspect that more broadly through the community people were a bit perplexed about why there was all this money being handed to them by the government. Why has a surplus which was 12 years in the making been spent in five months, so that we are now $22 billion in debt? We are going further into debt next year, further the year after and even further the year after that—to the point where we will be at least $100 billion in debt, which is more than what we found when we came to government in 1996.

But what is really concerning is a small provision which was not in the speech yesterday, the announcement from the Prime Minister. Nowhere can it be found that the government wants to increase its credit card limit from $75 billion to $200 billion. It is like when most of us in this place and a lot of our constituents get the helpful letter from the bank saying, ‘You might have a $5,000 credit card maxed out, sir’—or madam—‘but we’ll let you have $15,000.’ That is what has happened. And the Rudd government has written back and said, ‘Please, can we?’ We will have $20 billion worth of debt in this country that our kids, my kids, will have to deal with, if we let this package go through.

What is happening here is that, rather than a thought-through strategy on how to handle this crisis, we have got a panic: ‘Chuck some money at it, get some cash out the door and let’s make it political. Let’s write an 8,000-word essay, an ideological rant, and try and box the other side into supporting our big spending plans.’ Well, it will not work. We will not be bullied, as I said in my maiden speech.

Steve Gibbons (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

That’s because you’re stupid!

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

We are here to make decisions in the best interests of our country’s future. The member for Bendigo can be abusive all he likes and do the bullying, as his frontbench does every day, led by the leader of the government and others. I must say that the minister at the table, the member for Eden-Monaro, is not one of those who is involved in that sort of behaviour, but there are some on the front bench who act the goat and try and bully the other side into supporting their ill-thought-through plans. We will not do it. We will not be bullied. We will stand on our principles and do what is right for our country. That is what we plan to do and that is what I thought the Leader of the Opposition said so eloquently this morning in this place.

The interesting bit which is not in this package, although its name is the $42 billion Nation Building and Jobs Plan, is that there is no focus on jobs. There is some vague reference to supporting jobs but there is actually no focus on it. A decent writer on economic matters and certainly no friend of the coalition over time—I think he was probably one of the more critical writers about the coalition’s budget strategies and economic strategies—is Mr Tim Colebatch, in the Age, who today wrote:

And the worst is what is not there at all. There is nothing to help the real victims of the recession: the 800,000 Australians whom Treasury expects to be unemployed by June next year.

Remember that Treasury’s estimates in recent years have not been all that good, so we can expect that is probably going to be a whole lot more than 800,000. That is Tim Colebatch, not a supporter of the coalition. We had the member for Bennelong mentioning her good personal friend Katie Lahey, at the Business Council of Australia, before, claiming that she supports it and so forth. Why wouldn’t she? Of course she would. It is a segmented package. There is no surprise that Katie Lahey, the friend of the member for Bennelong, is supporting it.

Two months after the first package had been allocated to the Australian people—the massive one-off payments—why would we be going back straightaway? You would think a government with some idea would be considering the evidence, looking at what has been shown by the first spend and seeing if the results were worthy of more one-off payments. It does not appear they have done so. The only flimsy evidence those on the other side will raise is that Westfield’s profits are up, which is interesting given that they are social democrats completely opposed to capitalism these days. But that was the claim yesterday. I, like the former Treasurer on Lateline last night, do not believe the purpose of people paying tax is to boost the profits of Westfield. I genuinely do not.

Sharon Grierson (Newcastle, Australian Labor Party) Share this | Link to this | Hansard source

It has saved jobs.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

There is no evidence that it has kept jobs at all.

Andrew Southcott (Boothby, Liberal Party, Shadow Minister for Employment Participation, Training and Sport) Share this | Link to this | Hansard source

Jobs fell in December.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

Exactly. David Jones got rid of retail staff. So there is absolutely no evidence at all that that package meant Westfield kept more people. It meant their profits went up. It is pure voodoo economics from those on the other side, and it is led by their leader, who does not know what he is. Twelve months ago he was an economic conservative; today he is an unreconstructed socialist. That is what has happened here. He is bagging Margaret Thatcher, bagging Ronald Reagan and calling Milton Friedman all sorts of names. His Treasurer is abusing a well-known economist in the US, which is extraordinary for a federal Treasurer of our country to do. They have no idea about what they are actually doing on this. The Australian people understand that the only people in this parliament who know how to manage this economy are those on this side. That is why they will respect in time the decision by this side of the House to stand against parts of this package—to stand against what are excessive parts of this package.

We should not allow this government to take Australia into a situation where we are $200 billion in debt, and that is what this government is asking us to do in a 24-hour period. We did not see the bills until this morning. I note that Senator Xenophon has just been on Sky News. The threats from the other side are that you can jam it through the House—we can sit till 2 am—but you cannot jam it through the Independents in the Senate. I think it would be wise for the government to consider what the Independents have said. Twenty-four hours to spend $42 billion, not of your money but of your constituents’ money, your children’s future—24 hours. How would we explain to our children in the future when they say to us, ‘Why did you let this country get to $200 billion in debt, where most of our budget is taken up by paying interest on this debt?’ What are we going to say? ‘Oh, we considered this in great detail over a 24-hour period.’ What are we here for? Maybe we need to go to the great unreconstructed socialists and have a dictatorship so that the government can just usher through its plans. Those on the other side like quoting the new President of the United States. I note that the new President of the United States is trying to work with both sides of parliament. He is trying very hard to get the Republicans to support his ideas. He is listening to their ideas. What do you think the chances are that this Prime Minister and this Treasurer will listen to Malcolm Turnbull’s ideas?

Steve Gibbons (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

None.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

Exactly. The member for Bendigo agrees that the arrogance on the other side is beyond repute.

Steve Gibbons (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

The same courtesy you gave us.

Arch Bevis (Brisbane, Australian Labor Party) Share this | Link to this | Hansard source

Order! The member for Bendigo should not interrupt.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

The member for Bendigo highlights the point. This government is the most arrogant government and the most dangerous economic government we have had since Gough Whitlam had his hands on the levers. We know that because most of those on the other side are great disciples of Gough. There was a great celebration last week for his birthday, and I congratulate him on being the oldest former prime minister. However, he was a terrible prime minister. What we are seeing here is a bigger spend than Gough, by GDP. We have seen a situation where this government inherited a $22 billion inheritance that has been spent, with another $22 billion and another $30 billion next year, and they are asking for the bank to extend their credit card to $200 billion. There is not a shred of economic credibility left on the other side.

There is no evidence that the first package worked. There is no evidence that this package will work. There are general assertions and there is politics, and that is all it is about. How do we say it is politics? Let us look at the language in the House of the Prime Minister, the Treasurer and other ministers who have their answers drafted by the hollowmen in the PM’s office each day. It is either ‘decisive’ or ‘a temporary deficit’. Where did the ‘temporary deficit’ come from? I understand it came from a former Treasurer and then prime minister in the early 1990s who claimed that it would be a temporary deficit. It was only temporary until the coalition was elected and then it was turned around, when tough decisions were made in 1996 to bring the budget back into the black to reduce those interest payments. That is the only time it was dragged around, and the ‘temporary’ was ended. And that is what will happen here again. It cannot be temporary when the out years all predict a deficit. There is no plan to get out of deficit; there is no plan for a future surplus. This is Labor writ large.

Instead of spending his holidays writing an 8,000-word ideological rant based on some thought bubble I think he had before Christmas and trying to box the Leader of the Opposition into a corner, the Prime Minister really should have sat down and thought about a plan to keep Australia strong. Let us not forget that he has inherited one of the best economic situations in the world. I will quote from someone who is not a supporter of ours, who said on the weekend that:

Australia has a AAA foreign currency rating.

We have open and competitive markets backed up by a world class financial and prudential regulatory system—indeed given the flaws exposed by the global financial crisis in financial and prudential regulation I would say our system is even better than world class.

That was not said by a supporter of ours; it was actually the Deputy Prime Minister. She said that our system is better than world class. It is a system inherited by those on the other side. They will deny it, I am sure. They will sit there and shake their heads and say they did it all—

Steve Gibbons (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

Paul Keating—

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

Actually, APRA was introduced in 1998. When did Paul Keating lose, Member for Bendigo? I think it was in 1996. So Paul was still telling Peter Costello what to do, was he? I do not think he was, actually. I think the member for Higgins and the former Prime Minister had a fair bit to do with the establishment of the structures that have kept Australia strong.

We did not get into the business, as Bill Clinton did, of telling banks to lend to people who could not repay their debts. We did not get into the subprime business, because we had strong regulations. That has kept Australia strong.

Steve Gibbons (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

Mr Gibbons interjecting

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

The member for Bendigo can deny it all he likes; the Australian public accepts this fact. I think he is one of the only ones left who do not. The Deputy Prime Minister accepts this fact.

This government has no economic credibility whatsoever. This is exposed by our decision to oppose these measures. It is the right decision for our country’s future. We should not allow a situation where this government is allowed to rack up $200 billion of debt for our children’s future. It will not be an issue that you will have to deal with, Member for Bendigo, but the kids of the future will.

Sharon Bird (Cunningham, Australian Labor Party) Share this | Link to this | Hansard source

Order! The member will not encourage the member for Bendigo.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

My apologies, Madam Deputy Speaker. You are right to pull me up on that.

The other interesting argument we hear from those opposite is that they have actually had nothing to do with the deficit and it has just been caused by global economic circumstances and reduced taxation revenue. A small fact that they should bear in mind is that the reduction in taxation revenue has only been $9 billion out of a $22 billion surplus. The reason we are in deficit is that there has been $28 billion of extra spending. So it is not actually the global financial crisis that has caused the deficit; it has been decisions of the government. We would argue that it has been ill-thought through decisions of the government. That is what we are saying in this place today.

Ours is not a popular decision; we accept that. We will take a hit in the polls, and those on the other side will jump around with glee. But it is the right decision for our future. It is a principled decision. It is not a decision to run some ads leading up to an election of me standing in front of some big towers claiming I am an economic conservative and talking about how I have always been an economic conservative who believes in a surplus budget. This is showing through action a commitment to real economic conservatism, which is keeping this country in a situation where we will be able to pay back any debt that we rack up in the future. Giving the green light to the Labor Party and the government to rack up $200 billion of debt on the national credit card is the wrong thing to do.

In summing up, I just want to deal with one other issue that those on the other side raise, which is the rewriting of history. I do give the Labor Party great credit for that; they are very good at it, particularly on the history of stimulus packages. If you look at the history of stimulus packages, you will see it is not great. We remember Working Nation, of course, and the one in December does not look to have gone so well. Even going back to FDR’s policy, which is often rolled out as the great left-wing policy program of the 20th century, it did not work. What is forgotten is that FDR’s package did not work. There was 17 per cent unemployment in 1940. He would have lost the next presidential election but for the war. I respect what he did during the Second World War—do not get me wrong—but I think his economic credentials are far from what those on the other side would like them to be.

We agree on this side of the House that we need some stimulus. That is why our position is that we support extra money for the Investing in Our Schools Program. We support some investment in productive capacity in the economy for health issues, electricity networks and so forth. But what we will not do is allow this government to rack up $200 billion of debt for our country’s kids to face in the future. It is the wrong thing for this parliament to agree to. We will stand in the way. It is not the popular thing to do; the member for Boothby will agree with me. Those on this side of the House will agree that it will be a difficult thing for us to do in our electorates, but it is the right thing us to do. I stand opposed to these measures.

Sharon Grierson (Newcastle, Australian Labor Party) Share this | Link to this | Hansard source

I am very pleased to rise today to speak in support of the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and cognate bills. These bills actually do represent decisive and considered action on the part of this government at a time when the global economic outlook has deteriorated significantly and shows little sign of any imminent recovery. The IMF has repeatedly retargeted its forecast for global growth, cutting those predictions three times in just the past four months. But, if you listened to the speakers on the other side, you would think there is plenty of time to do something to respond. But three times the predictions for growth have been changed in four months. Finally, the IMF now anticipates a deep global recession. We cannot afford to wait until that is upon us. With projections that world growth will fall to half a per cent this year, the lowest growth rate since World War II, now is the time to act. With global output and trade figures plummeting in the final months of 2008 and the slump in global demand leading to a collapse in commodity prices, threats to our economy are very real.

I remember standing in this House last November when we were speaking on the Economic Security Strategy—the $10.4 billion stimulus package—and remarking that Alan Kohler on the business program on the ABC had commented that 42 per cent of international GDP wealth had just disappeared in one day. These are unprecedented times. Since that time, more international GDP wealth has disappeared every day. It is an economic tsunami and it certainly keeps plunging ever closer to our shores. Without a further, more significant and timely policy stimulus the Australian people—Australian businesspeople, Australian industry, Australian children and Australian students—would face the full consequences of the severe slowdown. With international economic pressures continuing, the influence of the global decline is something that none of us would want to pass on. It means job losses, business slowing and increased pressures on our welfare systems.

I listened with interest to the opposition, and I thought about how this has happened. We all think of how this has happened. Most ordinary Australians get a salary or a wage and maybe put a little in the bank or they use it for their everyday living. They may have a home that they are buying or paying off or even an investment property and they invest in their superannuation through their employment. That is it. They do not have much discretion on how to pull that out when things get tough. They have to ride this through. They will not be getting any big dividends or returns. Those with big money have pulled their money out—it is not there any more. That investment money is not there. I do not know where it is. Does it go back to Swiss banks? Does it go into gold bullion? I do not know where it is, but it is not there now. People with big money have some discretion. They have some choice. Ordinary Australians do not have any choice. What little assets they have are stuck there. They are watching their assets diminish in value and they are hoping that these packages, this government’s measures, will help them—and that is what we are trying to do. I do hope that when those opposite are pushed to a vote they consider the lack of control that most ordinary Australians have over this situation and the plea from them for help from us.

According to the IMF and Treasury, when the economic stimulus is taken into account, economic growth is expected to grow by one per cent this year. That is the growth that maintains jobs. In 2009-10, with the stimulus package, it is projected that growth would be perhaps 0.75 per cent. These measures, undertaken with the advice of Treasury and guided by the information coming through the IMF are about both supporting growth and jobs now and investing in Australia’s economic future. This package builds on the $10.4 billion Economic Security Strategy released earlier, where we saw pensioners, carers and people with disabilities certainly making good use of that money. We know how much they appreciated that, particularly in my electorate. I was absolutely touched by the number of constituents who wrote little notes and letters saying, ‘Thank you,’ or, ‘Please thank the Rudd government,’ or, ‘Please tell Kevin that this meant so much to me.’ It did mean a lot to those people because until then they saw no light on the horizon.

I welcome the $42 billion stimulation package. I know that my electorate of Newcastle is set to see many significant benefits. This morning I heard some of the Leader of the Opposition’s grand economic rhetoric—his grand thesis on democracy and economic theory—and I have heard the member for Mayo talk about this ‘great inheritance’. What did we inherit? Let us be honest now. Let us not rewrite the history again. We did not hear anyone say anything about the lack of investment in skills, in innovation, in education and in training. We did not hear anyone talk about the failure of the previous government to rein in low-doc loans. I heard the former Treasurer, Mr Costello, on Lateline the other night speaking about how we did not have the subprime situation. No, we did not have the subprime situation, but I have been on the House of Representatives Standing Committee on Economics and have heard two Reserve Bank governors urge the previous government to do something about low-doc loans. Mortgage repossessions are running at one a week in my electorate. That has been the case for several years. It did not start now; it started because of that neglect of the economic fundamentals. I would say to the Leader of the Opposition: ‘Watch out!’ I thought Mr Costello was certainly looking forward to an opportunity presenting itself for him and his ambitions.

These are difficult economic times. This package is designed to maintain and stimulate growth, protect jobs and provide a responsible and decisive response to this unprecedented global and national economic circumstance. I recall someone saying something about a big-spending election promise. The opposition are saying that we are the big spenders. Well, hey, big spender, come on down! If we had had to fund the election promises from the Howard government, if the public had been foolish enough to re-elect those people into government, we would certainly be in a much more parlous situation.

In this package we have also taken the opportunity to invest in the green economy—something very important to my electorate. We have a dreadful carbon footprint in the Hunter and Newcastle. We export coal, but we are doing something about transitioning our economy towards a more energy efficient situation. There are measures in this package that respond to climate change and deliver to people the opportunity to take on some energy efficient measures in their homes—for example, house insulation or a solar hot water tank. Some people with a bit of discretionary money would love to invest in measures to combat climate change and invest in the environment for our future. This summer we are all greatly feeling the effects of the situation and we all feel some guilt and some desire to make a difference and contribute. So it will be very pleasing to see people take up those opportunities to contribute to improving the climate change situation and building a green economy in this nation.

I know that for the people of Newcastle this package will be extremely important. The average salary is less than $50,000 per annum in an electorate like mine, so most people will benefit from that $950 taxpayer one-off bonus. There are over 20,000 school-age children in my electorate. At this time of the year, when they are going back to school, the $950 back-to-school bonus will be used very well and will certainly be appreciated. It is very much an investment in the education of our children and it is an understanding that families always have additional costs that they try to balance as best they can. Every one of the 10,000 recipients of family tax benefit B in my electorate will receive a bonus of $950 per family to help with those costs.

As a former school principal I am delighted to see so much going into maintenance of schools and into infrastructure in schools. It is a good decision. It is something that I know can be rolled out straightaway. For a local economy like mine, with 52 primary schools and 70 schools overall, this measure will mean that tens of millions of dollars will be injected into our regional economy. Building the education revolution alone equals a swift injection of up to $50 million into the Newcastle economy.

Many new homes will be built through the investment in defence housing. I am really looking forward to the benefit that will flow to my electorate from that. Activity in the construction industry is known to create more jobs, flowing through to the transport industry, subcontractors and suppliers. It is a great way of spreading some of our wealth. The 50,000 private home owners in my electorate will be particularly pleased that they can now consider putting in some insulation to keep their homes cool on hot summer nights.

I am also pleased to see that there have been many public endorsements of this package in Newcastle—unlike what we have heard from the opposition. Local endorsements have been strong from the business chamber, the trade union movement, the manufacturing cluster group and the collective Hunternet. They are all predicting that these measures will be of great assistance to our local economy.

In Newcastle we have a strong tradition of stepping up when things are tough, and we are doing so already. We make a valuable contribution to the national economy. I would encourage people benefiting from this economic stimulus package to support local farmers markets and local produce manufacturers. There are manufacturers of insulation in my electorate. I hope that they score very well out of this. For local regions that have a history of the booms and the busts, this will be a wonderful opportunity for everyone to benefit and to contribute to the great challenge of keeping our economy strong, protecting the jobs of the people we care about and making sure that the future of this nation is a bright and great one.

Darren Chester (Gippsland, National Party) Share this | Link to this | Hansard source

It is a pleasure to speak on the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and cognate bills, which are before the House. It would be the easiest thing in the world to stand here and join in the government cheer squad and pass the $42 billion program without any murmurs of dissent. But, in all good faith to the people of Gippsland and to my own children, I cannot support these bills, which mortgage our future. I think the Prime Minister has simply not yet made the case to justify the scale and the targets of this package.

I doubt that there is a single person in this parliament who does not appreciate the magnitude of the economic challenges which confront our nation and the world at the moment. But to suggest that we should just sit back and give the Prime Minister and the Treasurer a blank cheque, no matter how misguided or ill-conceived the plan may be, is I believe the height of arrogance from those in government. We would not be doing our job if we did not at least scrutinise this legislation on behalf of the people of Australia. It is easy to shovel the money out the door and give everyone a bonus but it is damn hard to pay the bills in the future. I fear the Prime Minister has panicked. In his desperation to be decisive, to do something, to just do anything, he has panicked and come out with a package about which even he admits—he admitted it here yesterday in the chamber—he does not know if it will work. In this mad rush, the government is attempting to ram this legislation through parliament without allowing reasonable time for due consideration of the details of a spending program which we all acknowledge is of historic proportions.

Do not get me wrong, Madam Deputy Speaker: I do not believe the package is completely flawed. There are several elements that I fully support, particularly if they were downsized to more reasonable proportions. But this government is not interested in negotiating with the opposition. It is not interested in hearing the views of people on this side of the chamber, many of whom have held high office in the past and have been successful in guiding this nation through troubled times over the past decade. I am reminded of a quote from a good friend of mine, a member of the upper house in the state parliament in Victoria, Mr Damian Drum. He says: ‘To think either side has a mortgage on what is right or what is wrong is absolute folly.’ I believe that there are some very reasonable people on both sides of this House and that we could go a lot further in our deliberations on this package if we listened to the good ideas from both sides of the chamber. If the Prime Minister and the Treasurer could perhaps put aside their own egos for five minutes and sit down and listen to others, I think Australians would benefit in the longer term. I am sure we would end up with a much better stimulus package if we all just took a cold shower and brought this legislation back before the House, perhaps even in a week, rather than trying to ram it through today without any level of negotiation. There should be more discussion and negotiation between senior members on both sides of the House.

I turn to the specific details of the package. The bonus payments are probably the area where I have my greatest concerns. There is almost $13 billion to be given out in one-off payments over the next few weeks. These will be popular. I have no doubt they will be popular in my electorate of Gippsland, where I have a lot of family tax benefit A recipients and a significant number of low-income earners. But even the Prime Minister admitted the data from the $10.4 billion package which was initiated prior to Christmas is not yet complete. I was one of the members on this side of the House who actively supported the $10.4 billion package before Christmas, because one of the primary targets of that package was pensioners, carers and people with disabilities. They were the less fortunate people in my community who I had been actively campaigning for for longer term support through government support payments. So I openly supported the $10.4 billion package and encouraged people, if they had the opportunity to spend some of that money, to spend it locally and support local jobs.

It is strange—and I have commented on this in the past—that the government could never justify increasing pensions on the basis of social justice, on the basis of the need to help those less fortunate. They had to wait until there was an economic crisis to finally do something to help pensioners, carers and people with disabilities. So I was surprised that the Labor government—supposedly the great defender of low-income earners and those less fortunate—was not prepared to assist our pensioners at a time of need but waited for this economic crisis to justify its decision. Even if you accept the argument that the government’s $13 billion in bonus payments is affordable for the Australian nation, why are we taking a punt like this at this time? We do not know if it will work. There has been no modelling whatsoever released to tell us whether $950 per individual is enough or whether it is too much. I fear that once that money has gone we will have nothing to show for it as a nation.

Gippslanders will get a significant share of this money. If you worked it out based on really rough figures of $13 billion spread over 150 electorates, you would find that about $87 million was coming to Gippsland. I can tell you now that the people of my electorate are not as short-sighted as the Prime Minister in this regard. They would rather see that $87 million spent on safer roads, better hospitals, improved aged-care facilities, sporting grounds, swimming pools and nursing homes—some real infrastructure improvements that are going to be there for the longer term, not a here today, gone tomorrow cash splash, which is all we are going to see over the next months with this $13 billion program. There is a very long list in my own electorate of areas in which we could spend this money more constructively and which I believe would deliver the long-term productivity improvements we are looking for as a nation as we move forward into the 21st century. The Shire of Wellington itself has regularly lobbied the government and me in relation to a $5 million plan to help develop an indoor sports centre—again, a much better use of the money than just a $950 one-off payment.

The Macalister Irrigation District around the Maffra area has an urgent need to upgrade the irrigation channels. We are talking about one of the most productive export industries in my region, and there is no funding available for it under the national water plan at this stage. We also see this $950 one-off payment being made to farmers. I can tell you now that they would rather see some real commitment to upgrade the irrigation infrastructure in Gippsland for the longer term so that their children have a future on the farm rather than just one $950 payment, which is all they are going to see in this particular package.

Gippsland Rotary Centenary House is another project that I have been speaking to the government about. It has been a very successful program. The state government in Victoria and the previous government, in a bipartisan way, supported the development of the Gippsland Rotary Centenary House, where local Rotary clubs have created a home away from home for people receiving cancer treatment. Tragically, the program is so successful and is in such demand in the Latrobe Valley that we need more units. A plan has now been put before the government to build a further nine units. Again, the people of Gippsland would rather see some of this $13 billion spent on projects like that for longer term benefits to the cancer care treatment of people in Gippsland than a one-off payment of $950.

There is an ongoing program, which has received support from both sides of the House, from the Minister for Infrastructure, Transport, Regional Development and Local Government and also from the Prime Minister and the former Prime Minister. That program is to upgrade the Princes Highway from Traralgon to the New South Wales border. Every report that comes back from the AusRAP studies shows that the Princes Highway in Gippsland is of a lower standard than would be accepted of a national highway. A $140 million program to duplicate the highway from Traralgon to Sale has been put before and accepted by the government. Again, all we have seen committed to that program is $2 million. It is another project that Gippsland would rather see get underway than a $950 one-off cash payment that will be gone before Easter.

I accept that investment in natural gas reticulation is actually more of a state government responsibility, but, judging by the program we have before us, the state and federal boundaries have been blurred somewhat in this current package. Investing in natural gas reticulation is primarily a state responsibility but it would create jobs in my community and help our small businesses prosper and compete with the metropolitan areas. I think a lot of metropolitan businesses take for granted that the gas from Gippsland is available for their use, but many small businesses in my community have no access to natural gas at the moment. That is something that I have approached both the state and the federal ministers about. Once again, the people of Gippsland would rather see something constructive than the $950 in their pocket which will be gone tomorrow. The Prime Minister and the Treasurer are selling Gippsland and all Australians short by suggesting they would rather have just this one-off payment than some longer term investment in infrastructure.

One of the key areas of the package that lets down the people of Australia relates to small business support. Any package that we put together for the Australian public now should have a focus on jobs. Again, this package misses the mark. I acknowledge that there are some tax breaks for small business, and that is a positive start, but, if we are going to be splashing around a sum of $42 billion in just one package, we need a real focus on jobs and—from the viewpoint of a country-based member of parliament particularly—jobs in rural industries and the small business sector. For example, again there is nothing in this package to help secure the export markets for the dairy industry, which is faced with an uncertain future due to the price cuts and the protectionism of the European Union. There is nothing in this package for rural industries whatsoever. There is nothing here to support the regional tourism industry, and this staggers me. The member for Eden-Monaro is with me in the chamber today, and I suggest that he would love to see some more funding for regional tourism to promote the great attractions of the Sapphire Coast. The Sapphire Coast is a nice place but the Gippsland coastal area is just a little better. I know the member for Eden-Monaro disagrees. There is nothing here to support the regional tourism industry. I would support a massive boost in marketing of regional attractions to encourage Australians, perhaps this year, to put the local economy first and to take a holiday here in Australia. I am disappointed that the package, which could have focused on small business jobs and on tourism industry jobs, has missed the mark in that regard.

The government could have reinstated the farmer apprenticeship scheme and also the Small Business Assistance Program, which were both cut in the previous budget. It is very hard to believe that you are for jobs in small business when you have a government that was prepared to cut such schemes in the last budget. There really could have been more investment in regional infrastructure and programs like the Regional Partnerships initiative, which has been sadly missed in a lot of regional communities since its disbandment by this government. We have had the inquiry; now I think it is time to start rolling out funding for genuine projects which meet the tests and will certainly be strongly supported by members who represent regional electorates.

This package should have been all about jobs. Given my bias for regional communities, it should have been all about regional jobs. What the government said last year compared to what they are saying now is something that is really beyond belief. Last year we were talking about creating 250,000 jobs from these stimulus packages, but now they are only talking about supporting jobs—supporting 90,000 jobs. I fear that we are really just making this up as we go along. They do not know if this package is going to help jobs at all, and I am not prepared to mortgage Australia’s future on a bit of guesswork by the Treasurer and the Prime Minister. Gippslanders would rather have a job in the future than have a $950 bonus in their pocket in the next month or so. Gippslanders are telling me already that they would support a major investment infrastructure boost rather than just $950 in one bonus payment that will be gone before Easter.

Even with a $42 billion package, even with a package of historic proportions, there are those who have managed to miss out. It is hard to believe that, when you are throwing taxpayers’ money around like confetti, some people can still miss out. Among them are the most vulnerable and those heavily impacted by the economic crisis, such as our self-funded retirees. There is not a cracker in this for them—not a cracker for the pensioners, the carers, the people with disabilities. We should be locking in a permanent increase in their support payments now and giving some certainty to the economy rather than the whim of one-off payments. What if this money is not enough? When is the next payment going to come? When is the next stimulus package? It is very easy for anyone to make a hero of themselves, going around spending like a drunken sailor, shouting the bar, when they are spending someone else’s money.

I said at the outset that the package is not without merit and I believe there are some good ideas in there, just as I do believe that there are good ideas on both sides of the House to contribute to this debate. That is why I am most concerned that we have attempted to ram this package through with such a short amount of time for debate. The schools and education package is one area where I think there is probably unanimous support across the chamber. It is one of the most sensible components of this package. I will ignore the rhetoric of members from the opposite side which suggests that the previous government was not interested in schools. I would suggest that the Investing in Our Schools Program was an outstanding initiative and members on this side of the House would certainly support such a package going forward into the future. Members on both sides of the House understand the importance of investing in the future of our children, and the very essence, I believe, of this debate is what that future is that we are going to provide for our young children. What concerns me most with this package is that it discriminates against the smallest schools in regional areas by allocating them a smaller amount. I fear that the federal government, in this regard, is actually bailing out our state governments and that we will only end up hiding their failure to invest in the future of our public schools. Although there is no-one who is going to debate the point about whether we need to be investing more in our schools, I think this is one of those times when a bit more discussion and negotiation between both sides of the House would have come up with a better package than just simply throwing massive amounts—$14.7 billion—at the problem and effectively bailing out the state governments’ failure to invest.

The sheer magnitude of this program and the involvement of the state governments bring doubts to my mind as to whether it can actually be delivered. There is no-one on this side of the House who has much confidence in the capacity—

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! It being 2 pm, the debate is interrupted in accordance with standing order 97. The debate may be resumed at a later hour and the member will have leave to continue speaking when the debate is resumed.