Joe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | Link to this | Hansard source

My question is to the Treasurer, and I refer him to Budget Paper No. 1, 3-23, the medium term analysis of the budget. This is the so-called plan for the government to repay debt. I ask the Treasurer: given that the projections go out to 2020, in what year will the Australian people finally pay off Rudd government debt?

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

Mr Speaker, what I can say is what is in Budget Paper No. 1. We do get it down, I think, to about three per cent net debt over that time. We will continue to pay it down from that period, because that is the responsible thing to do.

Opposition Members:

Opposition members interjecting—

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

This juvenile behaviour is just extraordinary. It is absolutely juvenile. The estimates are all there; the member has just quoted from them. What I can say is that we are engaging in temporary borrowing to meet the requirements of this economy because of the very sharp contraction that has taken place.

Those opposite want to pretend that somehow, if they were in government, they would not be borrowing and they would not be paying down debt, but they will be, and that is the particular game that they are playing today. This government’s medium-term fiscal strategy is to pay down debt as quickly as we can. That is what the budget papers say and, as the member opposite knows, it gets down to the minuscule level of three per cent in the year that he mentioned. That is what happens—the minuscule amount compared to what is going on internationally, where comparable advanced economies in countries around the world have levels of net debt at about 80 per cent. So they should stop playing their silly political game and admit that debt is necessary to support jobs and that a medium-term fiscal strategy requires some long-term structural savings. So there is a moment of truth approaching for the shadow Treasurer, because he is going to have to show how he would pay down debt, and so will the Leader of the Opposition tomorrow night.

Kelvin Thomson (Wills, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister for Infrastructure, Transport, Regional Development and Local Government, the Leader of the House. Would the minister advise the House of budget initiatives to stimulate the economy, create jobs and boost productivity through nation-building infrastructure? How can interested members of the public gain information about the budget initiatives?

Anthony Albanese (Grayndler, Australian Labor Party, Leader of the House) Share this | Link to this | Hansard source

I thank the member for Wills for his question. This year’s budget provides an additional $8.5 billion for nation-building transport infrastructure, bringing our total investment in nation-building infrastructure to $35 billion. This includes the most significant ever investment by the federal government in rail for our major cities—nine out of 15 new projects announced last night. There is support for rail in Perth, in Adelaide, in Melbourne, in Brisbane, on the Gold Coast and in Sydney—right across the nation. There is an engagement in urban rail that will provide cleaner, greener, faster public transport services to those who live in our major cities. It is good policy in dealing with urban congestion but also good policy as part of the fight to tackle dangerous climate change.

But we have also delivered for regional Australia. Of the $35 billion, some $21.2 billion, or 60 per cent, will directly benefit those living in regional communities through projects such as the Hunter Expressway in New South Wales. We will be fixing the Cooroy to Curra, section B—ignored by those opposite, even when the transport minister was the local member. There have been 13 fatalities on this section of the road since July 2002. It took a Labor government to fix it, and fix it we will. We will be dealing with ports, dealing with nation-building infrastructure, supporting jobs today but building the infrastructure that the country needs tomorrow. The centrepiece, the largest single infrastructure project, is of course our $43 billion commitment to fibre-to-the-premises broadband. We believe that this is absolutely critical. It is through information technology being available that we are communicating the message of last night’s budget to our constituents and to the population in general.

I would encourage people to log on to the website, www.economicstimulusplan.gov.au, to see the direct impact that our plan is having right around the nation. But they do not have to just log on to our website, because many members of this House are using information technology to send a message about jobs. There is one member opposite who is sending a big message about a particular job through the internet. People can log on to the new website that has just gone live in conjunction with the budget, www.petercostello.com.au. It went live today, in conjunction with the budget. We have heard about the confusion of the Leader of the Opposition and the shadow Treasurer when it comes to budget initiatives. Well, it is not just our side that agrees it is inadequate. Pete clearly thinks they are not—

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

Mr Speaker, on a point of order. The minister was asked a question about infrastructure in the budget. He was not asked a question about every member of parliament’s website, as we all have websites. It is completely irrelevant to the question. It is not Vaudeville day; it is the day after the budget and it is an important day. The minister should be called back to answer the question about the budget.

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

Order! The Manager of Opposition Business will resume his seat. The minister for infrastructure will relate his answer to the question.

Anthony Albanese (Grayndler, Australian Labor Party, Leader of the House) Share this | Link to this | Hansard source

I am, absolutely, because I was asked a question as the Leader of the House by the member for Wills about the way in which members are communicating about the budget with members of the public, and I am doing just that. I can understand why those opposite are sensitive, given the sophistication of this budget site with videos, indeed with information about Higgins. He could not turn up to the community infrastructure program launch I did in Higgins last week, but now he has a new-found interest in his electorate.

Of course, the member for Higgins could have been a bit more imaginative when he decided the title, because people might not be able to find this website. Perhaps he could have named it noticker.com.au. Perhaps he could have called it ‘Plan C.org’. Perhaps he could call it imavailable.com.au.

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

Mr Speaker, on a point of order. It is three o’clock the day after the budget and they have already given up defending this budget. This kind of trivia is not working—

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

The Deputy Leader of the Opposition will resume her seat. It is not a point of order. The minister has the call and he will bring his answer to a conclusion.

Anthony Albanese (Grayndler, Australian Labor Party, Leader of the House) Share this | Link to this | Hansard source

Thanks, Mr Speaker. The fact is that those opposite are characterised in their attitude towards this budget by opportunism. They vote against programs, then they go to the launch. They vote against nation-building broadband, but they are quite happy to use the internet to try to launch a challenge against the Leader of the Opposition.

Opposition Members:

Opposition members interjecting—

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

Order! The minister will conclude his answer.

Anthony Albanese (Grayndler, Australian Labor Party, Leader of the House) Share this | Link to this | Hansard source

Those opposite are characterised by opportunism, which is why they cannot put forward a coherent attack on this nation-building budget.

Joe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | Link to this | Hansard source

I refer the Treasurer to his own Budget Paper No. 1, 3-23, and I refer to the fact that in 2017 his budget papers are predicting above trend growth in Australia, which would be the longest above trend growth period in living memory. My question is: Treasurer, what will be the debt of the nation in 2017?

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

I thank the shadow Treasurer for his question. As I said before, we have a very clear strategy that will begin returning the budget to surplus and pay down debt as the economy recovers, and the budget delivers on that strategy. We put in place the structural saves that are absolutely essential over the long term, we have offset new spending by the final year of the forward estimates and we have held real growth in spending to under two per cent in the years the economy is projected to grow above trend, in 2011-12 and 2012-13. And, of course, this strategy is expected to see the budget return to surplus in 2015-16 and reduce the levels of debt to 3.7 per cent of GDP by 2019-20.

Mark Butler (Port Adelaide, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister for Families, Housing, Community Services and Indigenous Affairs. How will the government’s secure and sustainable pension reforms support pensioners and prepare Australia for the challenges of the future?

Jenny Macklin (Jagajaga, Australian Labor Party, Minister for Families, Housing, Community Services and Indigenous Affairs) Share this | Link to this | Hansard source

I thank the member for Port Adelaide for his question and for his long-time campaigning for the pensioners in his electorate. There are around 30,000 pensioners who will benefit from the decisions the Treasurer announced last night. Yesterday was a historic day for Australia’s pensioners. More than three million age pensioners, disability pensioners, carers, wife pensioners and veterans service pensioners will get a pension rise.

From 20 September this year, single pensioners on the full rate of the pension will receive a $32.49 increase per week. Pensioner couples will receive a $10.14 increase per week. The increase will bring the single rate of the pension to two-thirds of the rate of couples combined. There will be an increase in the base rate for single pensioners and a new pension supplement for all pensioners to simplify the complex maze of payments. All existing pensioners will receive an increase in their total pension payments.

These are the most significant reforms to our pension system for 100 years. These reforms will help to cushion pensioners from the impact of the global economic recession, but they will also deliver a stronger, fairer and now a sustainable pension system into the future. Of course, the reforms have been welcomed widely, both by pensioners and by pensioner groups. I will just quote from a few of them. Michael O’Neill, from National Seniors, says:

We think (the pension rise) is a very good outcome. It delivers relief for the most vulnerable—single age pensioners …

From the Council on the Ageing, Ian Yates says:

After years of unfair treatment for single age pensioners, they have been recognised and large steps have been taken to rectify it. The new pension system is simpler, which is most welcome.

And Val French, from Older People Speak Out, says:

Recognition and understanding as last, and cheers in lifting the age eventually to 67. Those of us on a pension have greeted the budget with relief.

She goes on to say that she congratulates the government on its decision to move towards increasing the pension age to 67. That decision on the pension age has also been welcomed by business. If I can just quote Heather Ridout from the Australian Industry Group, she says:

I think it is a very sensible decision and it really addresses those intergenerational problems that are coming down the track.

As I said, these are major reforms and they have involved very tough decisions to make sure that the pension is sustainable for the long term.

I am pleased to tell the House that we have state governments also getting behind these reforms. Just this morning the South Australian Treasurer—I am sure the member for Port Adelaide will be pleased to hear this—has confirmed that the South Australian government has agreed to the Prime Minister’s request that the pension rise flow through to pensioners in public housing so that the pension rise is not gobbled up by rent increases. These reforms are essential. They are long overdue, decisive action to prepare Australia for the future.

Joe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | Link to this | Hansard source

My question is to the Treasurer. I refer the Treasurer to the fact that the government has announced $124 billion of new additional spending since the last election. Isn’t it the case that, by spending at a rate equivalent to 29 per cent of GDP this year, the Rudd government is now the biggest spending government since World War II?

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

I thank the shadow Treasurer for his question. One of the reasons why we have been so serious about savings in this budget is precisely because we understand that we have to move, first of all, to economic stimulus to support the economy, to support jobs and, as the global economy recovers, to step down on our spending and return the economy to surplus—which is why we have put in place these long-term structural savings. That is why, in this budget, we have delivered something like $22.6 billion in savings over the forward estimates, with no new spending in the final year of the forward estimates.

We absolutely understand that, on a temporary basis, we have to spend to stimulate the economy; then we have to bring the budget back to surplus as the global growth returns. That is very important, and it has involved hard choices—hard choices the government has not been afraid to make in this budget. Of course, net spending in this budget is $13 billion over the forward estimates—so I do not know what calculations the shadow Treasurer is using—and the great bulk of that is in the first two years, when it is most needed in terms of economic stimulus. Real spending growth has been held to under two per cent in the years the economy is projected to grow above trend. That is what we have done.

So do not come in here and continue to fiddle the figures, as you have been doing. Why don’t you come in here and be honest about what you would do in these circumstances? Be honest about it and stop playing these silly political games, because we are very serious about supporting our economy, about supporting jobs in this economy and about nation building for the recovery. It is just a pity that we do not have an opposition that has a clue about it.

Kerry Rea (Bonner, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Prime Minister. Will the Prime Minister outline the importance of supporting jobs today by building the infrastructure Australia needs for tomorrow through the government’s budget?

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I thank the honourable member for Bonner for her question. It is plain to all members of the House and, I think, to all people across the nation listening to this debate today that we have faced an enormous challenge in the preparation of this budget, delivered in the worst economic crisis since the Great Depression. Therefore, the challenge which the government has been seized with is: how do we construct the building blocks, the foundation stones, upon which economic recovery can be constructed? That is why we have embarked upon nation building for recovery. I would encourage all members of the House to get behind this national effort, this national campaign, to build the economy with positive ideas, positive engagement, and take the positive lead of many out there in the business community, out there making hard decisions to support growth and employment in the most difficult of circumstances.

Our overall principle is this: to support jobs, small business and apprenticeships today by building the infrastructure our nation needs for tomorrow. That is why we are investing $22 billion through this budget in roads, rail and ports in practically every state in the Commonwealth. That is why we are investing in a national broadband network right across the nation in order to connect our regional centres and our smallest towns with a proper, modern information superhighway for the 21st century. That is why we are investing $3.6 billion in clean energy projects, including a $1.5 billion investment in what will become, we are advised, the nation’s and the world’s single largest solar power plant. On top of that, we are investing $3.7 billion in education and research, and supporting also superscience projects right cross the university infrastructure of our nation—in nanotechnology, in biotechnology, in the marine sciences and in climate change science, as well as in space science and astronomy.

On top of that, we are investing $3.2 billion in health and hospitals, including investment in some of our nation’s most important hospitals, those in particular need. Furthermore, we are investing in critical areas of research, including $1.2 billion for an integrated cancer care network across the country, led by great institutions in Sydney—what will become Lifehouse at the RPA, in honour of a person respected by both sides of politics in this place, Dr Chris O’Brien—and a project such as that at the Peter MacCallum Cancer Centre in Melbourne and right across the nation as well so we have got proper, integrated cancer care for this disease which remains the nation’s single largest killer.

We are investing in all this infrastructure to create what we need to turbocharge productivity growth in the future for the recovery but also, critically, to support jobs on the way through and to make a difference in terms of the impact of this recession.

Then, we are out there supporting small business. The temporary investment allowance, a 50 per cent deduction for small business through until the end of this year, is a positive step by the government to assist small businesses facing real problems now out there in the economy. I was surprised and disappointed this morning when I was advised that the member for North Sydney had attacked this initiative which had been put forward by the government. Furthermore, there is the extension of the first home owners boost by a further three months, until 30 September, then staged down by one step before returning to where it was as of 1 January. We know from the housing data the impact that that has had on the residential construction sector in the country and all those jobs that depend on it.

We have done this, this investment in infrastructure in the future, as well as provided jobs and support for small business in the here and now, in a fiscal strategy, a fiscal plan for the future, which is sustainable into the forward estimates and beyond. Our plan, very simply, is to halve the temporary deficit in three years and return the budget to surplus in six. It is a very clear-cut plan. That is what we have articulated in the budget papers. I again challenge the Leader of the Opposition to produce similar clarity in his budget reply tomorrow night. If he fails to do so, it will be simply white noise.

In this budget, we are delivering on this plan also through $22.6 billion in savings this year, coming on the back of $33 billion of savings which were delivered in the 2008-09 budget. If you put those figures together, the two budgets that we have presented as a government, that is $55 billion worth of savings. Contrast that with the last two years that those opposite were in office. They delivered a total max of $7.5 billion in savings across their last two budgets when the member for Higgins was sitting there awash with cash flowing in from the mining boom—the mining boom which all of them over there hoped would last forever, deriding those of us on the other side of the House when we dared ask when the mining boom would come to a close. We are therefore framing a strategy of fiscal sustainability based on hard savings—$22 billion this year and $33 billion last year, something like eight times the total amount of savings which those opposite delivered in their last two budgets.

I also draw the attention of those opposite to how, therefore, our temporary borrowing for temporary deficit strategy rests with international comparisons. Those opposite squirm when they hear the comparisons that our temporary budget deficit will be less than half that of the major advanced economies in the year ahead. They squirm about the fact that for the question of our temporary budget deficit for a temporary debt that will flow to the economy, we will have a temporary debt for Australia which will be the lowest by a country mile compared with all other major advanced economies. Furthermore, when you look at when our temporary debt will reach its height at 13.8 per cent of GDP, that will represent about one-seventh of the debt of the major advanced economies across the world. I would simply draw the attention of those opposite, as they try to score political capital out of this point and this necessary intervention in the economy at this stage, to what Standard and Poor’s have said overnight. They said:

Tonight’s Commonwealth budget is consistent with Australia’s triple A long-term rating for the country. The triple A rating is the highest rating assigned by Standard and Poor’s.

They go on to say:

We—

That is, Standard and Poor’s—

believe the deficits and associated borrowings do not alter the sound profile of the country’s public finances.

This is underpinned by the strength of the government’s balance sheet, which provides flexibility to absorb debt levels and cyclical deficits of this nature.

That is what the ratings agency Standard and Poor’s has concluded about the budget we delivered last night. It also rests on the comparisons which exist between Australia’s net debt over time as being lower by a country mile than the net debt of the other major advanced economies and, as I said, one-seventh of that when we reach the peak of our net debt at 13.8 per cent of GDP. Bearing in mind what the member for North Sydney has confirmed today, which is that his debt for this country would be $25 billion less than that which we are providing and proposing by way of the government for our plans going forward, I would suggest that the member for North Sydney reflects long and hard on the observations from Standard and Poor’s and Moody’s and the other agencies as well.

When we are out there investing in construction for infrastructure for tomorrow to support jobs and small business and apprenticeships for today, let us also reflect on this point. When a future generation of kids looks back at the time when their state-of-the-art 21st century library was built in their primary school they will point back to the actions of this Labor government which used this recession in order to invest in that library.

Peter Costello (Higgins, Liberal Party) Share this | Link to this | Hansard source

Mr Costello interjecting

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I notice that the member for Higgins regards such an investment as humorous. He regards as an object of ridicule the building of state-of-the-art science centres in secondary schools right across regional Australia, which are somewhat removed from the type of school he attended himself. Also with our investment in state-of-the-art science centres and language centres you will have a generation of kids looking back and saying, ‘These advances in our schools, these investments in modernising our schools, came off the back of a Labor government. It is prepared to get in there and have a go, investing in the infrastructure we need for the future while providing jobs, apprenticeships and support for apprentices here and now.’

This government has crafted a strategy for the future, which we believe is robust and strong. It is a nation-building plan for recovery, a nation-building plan for the future, as opposed to the cobbled-together ‘Hoover’ plan being advocated by those opposite, if ever they could possibly harness their act and get it together and coordinate a position, at least for a 30-minute stretch of time.

Joe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | Link to this | Hansard source

My question is to the Treasurer, and I refer him to his Budget Overview, appendix F: Major Savings in the 2009-10 Budget. I refer him to the Prime Minister’s last answer and his own answer, saying that they had made tough decisions. Why is it that if you are spinning tough decisions the total savings over five years represent one per cent of all your expenditure?

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

We cannot wait to see how much more he is going to cut. If he thinks we have not cut enough, he is now confirming that he is going to cut a lot more. Of course he has got to confirm tomorrow night what they are going to save in the budget to pay for the pension increase. That is a very big task that is building up for the shadow Treasurer. But as I said before, in the 2009-10 budget there are savings of $22.7 billion. In 2008-09 budget there were savings over four years of $33 billion. That is a very substantial effort.

Joe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | Link to this | Hansard source

But you say it is a tough budget!

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

Order! The member for North Sydney has asked his question.

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

In this budget what we put in place was an absolutely essential economic stimulus to support jobs, to support businesses, to support households and to support regions, because of what has been imposed on this country by the rest of the world. And what he is confirming again is that the official position of the Liberal Party is to do a lot less—not to borrow and therefore to savagely put up taxes or to savagely cut services. That is the position of the Liberal Party of Australia.

It is not a position even shared by the business community that are normally more supportive of those opposite. The common-sense proposition is that when you have such a sharp contraction of private demand the government has to move in to stimulate demand to support jobs, to support households and to support businesses. That is something that simply does not occur to them. What we have got is an opportunistic play here from the Leader of the Opposition and the shadow Treasurer—a whole heap of confusion and fuzziness—because they are not up to the job.