Patrick Secker (Barker, Liberal Party) Share this | Link to this | Hansard source

When I was speaking on the Appropriation Bill (No. 1) 2010-2011 and related bills last week I noted that this budget actually projected a $40 billion deficit on top of the $53 billion deficit from the previous year. That works out to about $4½ thousand debt for every man, woman and child in Australia and contrasts quite markedly with the former Howard coalition government, where we actually left $45 billion in the kitty, which was nearly $2½ thousand dollars in favour of every man, woman and child. There is quite a strong contrast between the finances of this government compared with the previous.

It is interesting that the Labor government has not put the NBN, the National Broadband Network, on the balance sheet, instead saying that this is a commercial project. However, the government will have to take out loans for it. These will be loans that the taxpayer will have to pay back. Labor is cheating the Australian public and bending the truth about what money will be spent, so we have that on top of the other debts as well. This is a government that cuts corners and lies to sell itself as an economic conservative. This government takes the taxpayer as a fool. It is time everyone saw through the Prime Minster, Mr Rudd, and learned the truth about his plans for their money.

The Howard government in contrast had a broadband program in place, an OPEL contract that would have seen high-speed broadband delivered to homes all around Australia and certainly in a much better way for rural people. Unfortunately, the Rudd Labor government scrapped this program, took the money and offered this half-baked wasteful legislation instead.

Let us start with the promises that this government could not follow through with and that they broke very carelessly. It is up to at least 52 at this stage, so I can only detail a few of those. There was the promise to build 226 childcare centres across Australia. The reality is that only 38 were built and the rest have been scrapped. It is an incredible fallacy to make employers, employees and families believe that they would have more childcare centres but then rip them off undeniably and only give them 38.

In fact a country town called Keith in my electorate is struggling currently because the only childcare centre facility shut down a week ago. Where is the government’s promise on child care? How can a town like Keith be left with no childcare facility whatsoever when Labor stood up and promised to build more than 226 childcare centres? The Keith childcare centre was given a month’s notice, so the government has known about this for five or six weeks now and has not found a solution. It is interesting to note that, when the ABC childcare centre problem came up, there was a guarantee by the government; but, this being the seat of Barker, in the township of Keith, there is no solution.

There was also a promise to build a trades training centre in each of the 2,650 high schools in Australia. There are currently only 12 trades training centres in operation nationwide. How is this ‘investing in our students’? How is this making sure that Australia becomes a skilled workforce in the future? It is not. The government also promised that every student in years 9 to 12 would have a new computer. Of course, when they came into government they changed that and said every second student would have access to a computer. Many parents and students were sucked in by this promise. For many families, buying a computer is out of reach. So in comes the Rudd government promising that students would have computers. The prospect was exciting and there is no doubt that people voted on the basis of that promise. But it was a blatant lie. The Prime Minister pulled people in and then broke his promise. In my electorate of Barker that promise has been nowhere near fulfilled. Under the newly constituted rules there should be nearly 6,000 new computers in schools in the electorate of Barker but there are actually fewer than 600. That is a great improvement—not!

Prime Minister Rudd also promised that he would invest in our schools. Labor said that they would ‘build a revolution’. Julia Gillard, the Minister for Education, has had to do the most embarrassing thing for her credibility and call an investigation into the whole debacle. They have wasted billions in taxpayer dollars and there has been a lack of consultation. They have barged in and told the schools what the Labor government thinks they need most. I have a project in my electorate that showcases the waste and mismanagement which the government calls Building the Education Revolution. Down in the south-east of my electorate, in the town of Millicent, is St Anthony’s Catholic school, a great little Catholic school. I was there a week ago. They had a BER project built—a $2 million gymnasium. But the government did not think it necessary to consult the public as you would normally do. In fact, the government legislated so that the local and state government planning powers were not used. The problem with that gymnasium is that it towers over the front of someone’s house. When the residents open their front door they see a great big building looming over them instead of the decent view that they used to have. Who would want to buy that house now? How will the owners recoup their losses on their investment? They may not be able to sell the house because of the lack of a view. This project is under investigation as part of the task force the government has set up to investigate rorting and taxpayer funded blowouts. A government school in Naracoorte, South Australia, had to use contractors from Adelaide, some 350 kilometres away, to build their school hall because they were not allowed to use local contractors. They built their hall at 2½ times the cost per square metre of the hall at the private school down the road, which was built using local contractors and avoiding the state government bureaucracy and rip-offs.

I have listened to Labor member after Labor member talk about BER and about GP superclinics. I think we have two GP superclinics that are actually in operation in Australia. The government have promised more, but what hope do we have of that promise being fulfilled? I have heard members talk about their own electorates, as they should, and where their projects are up to. But I have also heard excuse after excuse about how great the funding is. They say they trust their project and that it will be outstanding—once it is built, once it is finished! Is it due to start soon at all? What an embarrassment for these members!

Mr Rudd made some very heroic statements regarding the budget. He claims that he will have a surplus in three years. The way he proposes to do this is with his superprofits mining tax. This tax uses Rudd logic. He honestly believes that he can introduce a cigarette tax and it will reduce smoking, but then he announces this great big new tax worth at least $9 billion a year and says that mining will increase not decrease. This is breathtaking. He says that the mining giants need to pay their way. What about the small local businesses like the one I have in my electorate, Mulgundawa Salt? This business has been around for 140 years. It employs 18 staff and has invested quite a bit of money recently in upgrading technology and machinery. It is a small and environmentally friendly operation. It does not dig holes in the ground. It uses groundwater to crystallise the salt from the water. If this operation was based in Victoria it would not be classified as a mine, but in South Australia it is and in Queensland it is and Mulgundawa Salt will be in great danger of going under if this tax is brought to fruition.

This tax is poorly thought through, rushed and there has been insufficient consultation with industry. I think it is really interesting to note that when they talked about the offshore PRT, the petroleum resources tax, they said people had an idea that the sky would fall in, but it took two years. There were two years of consultation from the time the thought was introduced to when the legislation came through and a lot of things were changed, so to have the Treasurer today in Question Time quote speeches from 1984, talking about a situation that was quite different from when the legislation came in in 1986, is stretching the truth.

I believe that Labor has had to come clean to the Australian public a number of times lately. The Home Insulation Program has failed miserably and four people have unfortunately died as a result, 146 homes have burnt down and there are possibly 100,000 houses around Australia that are electrified. Just this week the Prime Minister refused to meet with the installers that were rallying at Parliament House. He hid in his office, hid from his mistakes, hid from the damage he has done to the families and to the businesses. Is this the sort of person we want leading our country?

I was contacted by many concerned residents in Barker about the government Green Loans Program. There were blowouts in the number of assessors that were trained nationwide yet in rural areas such as Barker there are not enough assessors. There were hold-ups on the assessments and householders were waiting for their assessments, but the department ended up with a massive backlog. There are assessors that are owed money by the government and assessors that are now unemployed. It is a total mess.

We have all these failed programs, all these wasted taxpayer dollars, the reckless spending, the lack of basic consultation and the inability to roll out programs smoothly and successfully. The government’s list of failures is truly amazing. It is time that the taxpayer started to take notice of what Labor are doing with their money, held them accountable for their mistakes and demanded better answers. This budget, with its holes, hidden slush funds and figures that do not add up, is a total disgrace. What has been presented to the Australian public is a misleading budget that is built with rotting boards. It will collapse under the slightest bit of pressure. There is no way that the government will be able to achieve a surplus with a budget that is built on hopes and dreams. I was not expecting much from this budget, but I must say even I was surprised at the fib of a budget that was presented to the Australian people.

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

I rise to speak in support of the Appropriation Bill (No. 1) 2010-2011 and related legislation which supports the Rudd government’s 2010-11 federal budget, the third budget this government has now handed down. This year’s federal budget is a thorough exercise in responsible economic management. When you take a look at some of the worst-case scenarios that were being projected in the darkest days of the global financial crisis, what this budget will do for our economy is remarkable and very reassuring. With this budget it is projected that Australia will return to surplus in 2012-13, three years ahead of schedule and ahead of every major advanced economy. Many of our trading partners and international colleagues across the waters will take decades to pay back their debt. It is very sobering.

Net debt in Australia is now expected to peak earlier and lower, at just 6.1 per cent of GDP, half the level expected one year ago and less than one-tenth of the average across the major advanced economies. In fact, it is the lowest debt of all advanced economies. The budget deficit of $40.8 billion is almost $6 billion less than the forecast of the Mid-Year Economic and Fiscal Outlook, MYEFO, and more than $16 billion less than expected one year ago.

In this budget we have seen all spending offset over the forward estimates, and real payments growth has been held to below two per cent, meeting our strict fiscal rules. We have extended this fiscal strategy to continue building surpluses and achieve a rapid reduction in net debt. We will maintain the two per cent cap on real spending growth on average until the surplus reaches one per cent of GDP.

With this budget, we will also further strengthen the economy, help families and secure and sustain real future growth. We can convert the successes we have already had during the global financial crisis into a stronger, more secure economy for working families and for all Australians. Our strict spending limits help to ensure that we get back to black within three years, three years earlier than originally expected.

Our tax reforms will broaden and strengthen the economy, ensuring all sectors grow in a sustainable way which benefits all Australians, evening out the boom and bust cycles which we have seen so badly handled by governments in the past. The proceeds will be invested into superannuation savings and national savings, as well as individual savings; into new infrastructure, particularly in mining communities; and into tax cuts that will create jobs and help small business grow and thrive. This will add 0.7 per cent to long-run GDP and boost wages by 1.1 per cent.

The success of the stimulus programs and our responsible approach to the economy will also deliver a $7.3 billion boost for health and hospitals. We have hankered after health reform in this nation for far too long. One would have thought that, with the global financial crisis and the recession—which we avoided, fortunately—it would have been off the radar and off the agenda. I am delighted and very proud that we will deliver on health reform.

We will also deliver $661 million for skills and training, and do not ever underestimate that. In past recessions and downturns in the economy, the people who have borne the brunt of that have usually been our youth, the younger generations. We have seen them ill-equipped, untrained, rejected from workplaces and place on those long unemployment queues. This time, though, so much has been invested into skills, training, apprenticeship support and scholarships and funded places at universities.

I said to a group of high school students just the other day I would have hated to have had to stand in front of them ashamed and guilty that they were abandoned because of a recession. Not under this government. They have been front and centre. We have invested in them and I know that investment will be returned to Australia’s economy, into our sound social existence and contribute to the harmonious society that we all value.

This budget also invests $652 million into renewable energy. In my electorate we track that, every cent, very closely. It has been a tremendous boost to our economy and to developing opportunities for the future to have been able to take advantage of the Rudd government’s investment into renewable and clean energy. I will not go on about the Clean Energy Innovation Centre national headquarters in Newcastle or the Australian Solar Institute national headquarters in Newcastle—I have done that over and over again.

We will also in this budget deliver a $6.6 billion boost for infrastructure. It is important to note some of that will be as a result of the resources superprofits tax. My electorate is the biggest coal export port in the world by volume. We, the Rudd government, have already invested over $1½ billion into the rail track in my region. We know that the mining sector has invested $7 billion, but government cannot keep bearing that cost as well unless we find some tax reform measures to do that.

We will also deliver a third round of personal tax cuts and a standard tax deduction for work expenses, assisting people with tax returns. We will deliver those last tax cuts, as well as some tax cuts for small business and less red tape. The tax cuts will allow an investment into better superannuation, with tax breaks on interest and a boost in national savings. In the budget we have been able to devote more money to protecting our troops and our borders. Of course the tax on resources superprofits, just like in the petroleum sector, will assist us to do those things.

By securing further economic prosperity with initiatives such as the tax reform measures, everyone will benefit. In my electorate of Newcastle, there is always a little bit of a cargo cult mentality: people want to see a big item for them in the budget. Well this budget is a big item for all Australians: better health services, paid parental leave in 2011, national quality standards in child care, tax breaks on savings and small business, increased superannuation savings, a standard tax deduction and more flexibility for pension payments et cetera. All those reforms are aimed at sustaining a quality of life that I think all Australians do anticipate will continue in spite of an ageing population and in spite of a global downturn.

The Rudd government has also promised that this budget will focus on improving health services in the community, as I have said. I would like to see the implementation of those new measures that will strengthen patient access, strengthen access to records, strengthen existing training for GPs and nurses and allow GPs to invest in infrastructure improvements and to employ practice nurses in their surgeries.

This year’s budget also delivered genuine support for general practice all around the country. The diabetes plan in particular favours a GP who will manage someone with diabetes for the long term, who is going to look at their holistic health needs—not the drop-in, drop-out clinics that we often see. The money for more superclinics is also welcome, and I have already been approached by GPs in the Thornton area of my electorate—which has a very fast-growing population—who would like very much to be part of applying for a superclinic in that region. So the 2010-11 budget was a great win, particularly for health care. I know that will be welcomed by my local constituents.

It is also, though, a great win for small business across the country, which will reap the rewards of the tax cuts and incentives that are there. To be able to automatically get a tax return and write off equipment under $5,000 will be an incentive for investment for the future sustainability of small businesses. It is also a great win for the 8.4 million Australians who will benefit from increasing the super guarantee to 12 per cent.

However, to see all these benefits flow onto the people of Australia we do need something that sometimes seems unattainable here, and that is for the opposition to see sense. We need those on the other side of the House and, in particular, their leader, Tony Abbott, to see sense in the debate surrounding the resource super profit tax. All of these budget initiatives, every one of them is an investment into the sustainability of our future economy, greatly rely on the successful carriage of the RSPT through the Senate. This worries me, because we have seen in the past—with the CPRS, for instance—how ready and willing this opposition is to block the passage of such important legislation.

These big measures and big policies do deserve—and I think the public would like to see—some bipartisan support. But already we see the opposition waging a scare-mongering campaign and, unfortunately, they are backed to the hilt by the mining industry in this regard. We hear the same old arguments, ‘The sky is falling, we are all doomed’—the same arguments we saw with the CPRS, which they would not support once their leadership changed.

According to the doomsayers, the proposed tax will scare away the mining industry, and in doing so ruin our economy. Well, tell that to the people of Newcastle and the Hunter. Mr Baldwin, the member for Paterson, tried to assert that in question time the other day, only to be caught out very badly because the Newcastle Herald, which is circulated from the Central Coast right up through the Hunter Valley and throughout Newcastle, came out in support of the resource tax, understanding it as we do because we see before our very eyes the magnitude of mining investment; we see those returns. We have always been the ones, too, who experienced the busts in those cycles. We are delighted to see this time a way to sustain booms to make sure they are investment into the future economy.

Many key stakeholders feared that the profits based tax introduced in the 1980s on the petroleum industry would ruin that industry. Having had the great privilege of going to Barrow Island and seeing the Gorgon project in progress, I know that that is not the case, and the RSPT will not be any different. The tax has been specifically designed by the government to grow the mining industry and boost investment and jobs. It will see the people of Newcastle, whom I represent, and the rest of Australia get a fairer share of the resources they own—resources that are finite; once they are gone, they are gone for ever. Mining companies will still earn healthy profits net of tax. Investment in marginal but viable projects will be more likely to go ahead, as they will attract a lighter RSPT than the current uniform imposition.

When it comes down to it, Australians own our natural resources and they deserve a fair share of the superprofits mining companies make during the booms. Before the last mining boom, the Australian people were receiving about a dollar in every $3 of mining profits through royalties and charges. But, at the end of that boom, the return to the public purse had declined to just $1 out of every $7. There was also very little contribution to skills, something that saw our economy prejudiced greatly. The government wants to restore the Australian people’s share of mining profits closer to where it was in the early 2000s. The company and small business tax cuts that will be funded by the RSPT will allow more sectors of our local economy to gain a direct benefit from the boom. The mining industry itself will benefit, with the proceeds of the tax being used to set up a new $5.6 billion infrastructure fund to tackle capacity constraints.

We have watched our local coal terminals expand—and they certainly are expanding; we call the one on Kooragang Island near Newcastle ‘Legoland’—it has been an amazing spectacle to see such growth in the industry. As I have said, it has seen commercial investment of $7 billion and it is not stopping. Just as the NCIG coal terminal has been completed, the plans for another one are underway. Just as Port Waratah Coal Services have finished three terminals, T4 is also in the planning stages. The RSPT will help to keep mining exports flowing out of the Port of Newcastle and it will sustain jobs. In the long run, this tax will lead to more investment, more activity and production, and more employment. It is of vital importance that this tax goes ahead to secure our nation’s future and to sustain our economic wealth—wealth that belongs to all Australians.

There has been some suggestion that investment will depart from Australia. We know that that is not true. I have had the great privilege to visit Mongolia, and it is a country that I support in their endeavours to strengthen their independence, to prosper democracy and to prosper an economy that assists its people. But when you see that you have to travel for many hours through the Gobi Desert in four-wheel drive vehicles with no roads, no rail, no port, no infrastructure in sight, temperatures that get down to minus-50 degrees and up to plus-50 degrees, and coal and resources that are 2½ kilometres deep in the landscape, you know that this tax is not going to distract people from investing in Australian mining and its wealth of mineral resources. So I am pleased to see that many commentators have come through supporting our tax in the media and in particular supporting the growth in superannuation that it will bring about.

It has only been through the responsible economic management of the Rudd government and the Treasurer, Wayne Swan, that we have been experienced a miraculous economic performance. The primary injections of the economic stimulus plan, coupled with the targeted expenditure of the 2009-10 federal budget have guided us and will continue to guide us through the worst of the downturn. Nowhere has this responsible economic management been demonstrated more than in my own electorate of Newcastle. Just last week, the Hunter Valley Research Foundation released figures showing that the Hunter region is experiencing a record number of workers in jobs. During April, over 313,600 people went to work in the region. This broke the previous record of workforce participation, which was set only the month previously. So it is plain for everybody to see that in my community the local economy is in good shape. In fact, our official unemployment rate has dropped to just 4.3 per cent, down from five per cent the month before. It is significantly lower than the state average of 5.8 per cent. Just in case you are thinking that mining is the biggest contributor there, the biggest employment group in the electorate of Newcastle is now professionals. It is quite interesting to see the diversification of our economy and how much that has been assisted by the Rudd government’s investment particularly in innovation.

It is interesting to note that the strongest jobs growth occurred, as I said, in education and health industries, which again points to the diversification of our economy. This strong performance has been in no small part due to our government, and I am very grateful for that. Since taking office, we have seen over $1.37 billion invested in the electorate, and that does not include the benefits that will flow from the $1.6 billion Hunter Expressway. Economic stimulus spending alone accounted for around $150 million, supporting infrastructure projects that went directly back into the local economy, supporting local jobs and funding local projects.

Just last week, I visited a restaurant in my electorate, Scratchleys on the Wharf, to meet a young apprentice, Steve, who is employed under the Kickstart apprentice program. Steve was just one of the almost 500 young Novocastrians employed under the Kickstart program since it began last year to combat the global financial crisis. As I said earlier, our youth have not been betrayed by this government. The Kickstart program in particular is aimed at people aged 19 years and under. As a result of that program we did not see any dip in the take-up of apprenticeships in this group. So successful has the program been in Newcastle and across the country that we have now extended the intake period to November this year and tripled the bonus for employers taking on apprentices to almost $5,000. Across the country, tens of thousands of young Australians will continue to benefit from this amazing program.

It was lovely to be with the Deputy Prime Minister as she opened a local BER project—a school hall. We met an apprentice there, Jacob, who had previously been unemployed—a young surf-lifesaver, but unemployed—who took up an apprenticeship because of the BER. It was also lovely to meet a young woman, Alana, who was working as a community consultant with the BER program. Alana had come back from overseas because work had dried up there, and she was able to get a full-time job in the BER program in my electorate. So we have been investing in the skills of this country to sustain our economic success, and young people have been some of the beneficiaries. So that is another big tick for the Rudd government’s responsible economic management.

I would just like to repeat that this year’s federal budget is an example of responsible economic management and the timely and effective handling of the global financial crisis by the Rudd government. We are the only country to have avoided recession. We have the second-lowest unemployment of all advanced economies. We have the lowest debt of all advanced economies. We will be back in the black in three years, three years earlier than anticipated and before any other advanced economy. So this budget is a tribute to the Rudd government. It represents the investment in the future economy of this nation. It sustains growth and it sustains quality of life for all Australians. Newcastle has particularly benefited—most deservedly, I have to say. I recommend this budget to the House.

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

I rise to speak on the budget of 2010. As a matter of fact, in the days leading up to the budget, I said in my electorate of Calare that this was a wonderful opportunity for the Rudd Labor government to show not just the electorate of Calare but rural and regional Australia that it actually does care about the consequences of its actions in that region, that it actually did care about what happened regarding health, water, infrastructure and transport, outside of the big cities.

Let’s face it, the very first actions of this government was the finance minister—within weeks of taking office—slashing $649 billion, from memory, of programs from the then budget of 2007-08. It is interesting to note that, out of $649 billion that he slashed, some $420 million came out of regional Australia. That is something like three-quarters of all the money he took, and it came out of regional Australia. In their very first budget, the Rudd government reneged on the Bells Line of Road engineering study. They talked about the inland rail, but it certainly was not there the other day. They withdrew, in the last budget, a billion dollars from the Department of Agriculture, Fisheries and Forestry.

I mentioned that in our part of the world the budget was a good time for the Rudd government to make good on their hospital and health promises. The hospital problems were all, if memory serves me correctly, supposed to be sorted out and fixed up by June—not June as in next month, but June last year. I reminded them just prior to the budget that it had been announced that Bathurst was losing its private hospital, which would have a huge effect on the whole central west, and that Forbes and Parkes had been promised new hospitals. There were great opportunities for the Rudd government to show they were serious about hospitals, they were serious about health and they were serious about rural and regional Australia. Urban water is also an issue in our part of the world as well as health, but I think what I probably spat the dummy over was what has happening with regard to cancer centres of excellence. The whole area from Lithgow, just west of the Blue Mountains, all the way out to Cobar and Broken Hill was totally ignored and told they could not have a cancer centre of excellence but the town of Gosford and the region around it could.

Forgive me if I am wrong—and I am not wrong—but when the Prime Minister announced the cancer centres of excellence program and guidelines he conceded that, in certain instances of cancer detection, country people were three times more likely to die within five years of being diagnosed than the people in big cities. Yet he and the Minister for Health and Ageing saw fit to give Gosford a centre of excellence in preference to one in western New South Wales when Gosford is a big city under the Rudd government’s own guidelines. I do not suppose that had anything to do with the fact that the seat of Robertson is the third most marginal that Labor holds in Australia. Heaven forbid that that should be an issue in this program! And no-one would think it strange, I am sure, that people from Lithgow and all the way out to Cobar have got to cross the mountains or travel for up to 10 hours to get to a cancer centre of excellence, over and above the sorts of things that Orange, Bathurst and Dubbo can provide. People in Gosford are almost within a taxi ride of Newcastle and Sydney, are they not? Far be it from me to deny the people of Gosford—but prefer them in terms of need to all the people out there? Anyway, it seems obvious that that is something a Prime Minister could have fixed up, not to mention the need for a 24-hour helicopter service for emergencies. I did ask for that prior to the budget, given that areas like Wollongong, 12 minutes flying time away but with less calls than Orange, already had one. No politics there either, I am sure! So we had had expectations, for more reasons than one.

When the budget actually came out, the Labor Party, strange to say—surprise, surprise—had paid little attention to regional Australia and even less attention to these opportunities in Calare. The residents of regional Australia were not only ignored, they were punished. How were they punished? The Prime Minister came up with the great big new tax on mining. It is going to hurt regional Australia. Unfortunately for the Prime Minister, people in regional Australia realise this more than anybody else. In my electorate of Calare we happen to be lucky in not being able to be a magnificent agricultural area but we do have very serious mines. In the current or ‘old’ electorate of Calare we have Cobar and in the new electorate we will have Lithgow, as well as Cadia at Orange, Parkes and other smaller mines. Mining is the only thing that has kept us strong through the eight to 10 years of drought.

Portions of the media label the mining sector as ‘the goose that laid the golden egg’. I think this analogy is simplified and quirky, but it points in the direction of many, many more serious issues. The Minerals Council estimates that there are 4½ jobs supported by every direct employee of the mining industry. However, I think it is impossible to calculate how far that influence extends, in the same way that in regional Australia it is impossible to calculate just how far the influence of the agricultural sector extends on jobs and income. These two sectors keep our people together. One has been totally ignored, if not denigrated; the other the government intends to punish in a big way.

There are thousands of direct and indirect jobs. It does not matter whether it is a corner shop or a coffee shop—whatever it might be—the wages of mining have a huge effect on our ability not just to have a lifestyle but to have a good one; not just to have a job but to have a good one. I do not see that we have any less right to that than people in the cities. It is just that our people live with these issues. Our people know that this tax is a tax on them directly; this is not some fanciful figment of the imagination for the Prime Minister to rave on about in a theoretical way. To us, this is life—this is jobs, this is our future. I cannot believe that anybody could go into a tax like this. One can only assume they are either stupid or they simply did no research into how far it would go. This hurts small business. The number of small businesses in Cobar, in Parkes, in Orange, in Bathurst and in Lithgow attached to the mining industry are just incredible. As the leader of the coalition said the other day, if the exploration side of this was so good, why isn’t every other business in Australia putting its hand up for a similar tax?

This is a budget which can only cause grief to the best industry we have got out there in regional Australia and totally ignores the other big industry out there in regional Australia. Once again, it ignores it, and I will say more about that little later. It also ignores the need for greater investment in regional infrastructure—roads and rail. The only mention of my part of the state was that they are going to put a few sleepers under the Parkes-Broken Hill line. That is all well and good, but I would not put that as any great infrastructure; I would put that down as normal maintenance. Otherwise there is not going to be much heading across to Perth, Darwin or Adelaide. The minister for road transport and everything else he is the minister for might puff his chest out—he actually mentioned that in parliament the other day. If it did not do it, there would not be any trains running, so I do not really see that a huge win for anybody except a few people cutting sleepers. These days they are not even doing that.

Something we committed to as part of AusLink in 2007 was a $10 million bypass for the town of Orange. Currently it does not matter what it is—semitrailer or whatever it might be; a house on the back of a semitrailer—pretty much everything has to go down the main street of Orange. It is a pretty ridiculous situation. We committed $10 million to pay the majority of what the council needs to finish the northern bypass. As a result of us committing to that, the then opposition under the now Prime Minister committed to the same thing. That was a great commitment and I was very pleased to hear it, especially as they won government at that time. The only problem is that, after three budgets, they still not have put a cent up for Orange City Council to do that. That is no small thing. On the Mitchell Highway and the entrance to the Golden Highway and heading both out to Parkes, Forbes and Cowra, it is no small thing for the amount of heavy traffic that passes through a lot of people all the time.

Once again, when it comes to road funding, the federal government is as bad as the New South Wales Labor government. They are only interested in metropolitan Australia. They do not want to spend a cent towards putting a decent road across the Blue Mountains. They are not even interested in funding the engineering study we committed to in 2007. Also, despite the government’s protestations of, ‘Yes, we’re going to keep it going,’ the inland rail has been forgotten. There is no mention of it in this budget. I guess we really should not be surprised.

As I mentioned, there is a need for urban water, as well as what Senator Wong is doing to Australia’s irrigation industry. There was no mention of urban water anywhere in the budget or, if there was, there was certainly no mention of it anywhere outside of Sydney, Melbourne or Brisbane. As I started off by saying: this budget was a great big opportunity for the Rudd government to show that it is a government for all Australians. I can almost hear the words of the Prime Minister when he took office in November 2007: he was here for everybody. We are waiting for him to be here because, if there is one thing that this budget did, it did not give funding to anything west of the Blue Mountains in New South Wales.

In terms of agriculture and rural Australia, the government, in its very first budget, knocked $60 million out of CSIRO. Most of that was taken out of agriculture. The government cut $40 million from the last budget by getting rid of Land and Water Australia. That was another $40 million out of R&D. Also in the last budget they removed 130 jobs from AQIS. The Minister for Agriculture, Fisheries and Forestry talks about R&D as though he is its messiah, but he has never been known to do anything other than take money from it. Obviously, he has a real problem with anything to do with productivity. In fact, going on the terms of reference of the Productivity Commission’s inquiry that is looking into government funding towards the levy, whereby the government matches all our rural industries dollar for dollar, it is quite obvious that the minister does not like providing funding unless it is towards something to do with climate change or the common good.

Productivity gains have occurred in Australia because we are the best innovators around and because of R&D. We have a trade advantage overseas because of our biosecurity measures. Our beef can compete with American beef on their shelves because our beef has a longer shelf life, despite it having travelled from here to there. This is because our R&D is so good. We need to be aware that the Productivity Commission is currently looking at the levy. The inquiry is obviously designed to cut down the government’s commitment to match rural industries dollar for dollar. That is a disgrace and a shame. This will rebound on our industries forever if the minister for agriculture goes ahead with it. The Productivity Commission inquiry into drought basically said, ‘Get rid of drought.’ Okay, there is a little trial in Western Australia but that is not a drought program; it is just an efficiency program. That is well and good, but to call it a drought program is an insult to agriculture.

When you have a look at the facts, the government ignored water. What Senator Wong is doing to water and what the government is doing to mining and agriculture in our country mean that this is not a government with any great concern or any great moral values when it comes to anybody who lives outside the major cities. The major cities are going to be the ones who suffer when we have to once again pay back a huge debt. Last time we were in government it took us 10 years to pay back $96 billion. Heaven knows what we will have to pay back this time. I hope Australia can put a halt to this situation before we get back to debt levels which will once again take us a decade to pay back.

Maria Vamvakinou (Calwell, Australian Labor Party) Share this | Link to this | Hansard source

I am pleased to speak this evening in support of Appropriation Bill (No. 1) 2010-2011 and the cognate budget appropriation bills Appropriation Bill (No. 2) 2010-2011 and Appropriation (Parliamentary Departments) Bill (No. 1) 2010-2011, which support the 2010 federal government budget. What a contrast between the economic environment in which this budget was delivered in 2010 and that in which the previous budget of 2009 was delivered. We went from our economy being in a vulnerable position, with a budget forged in the most challenging of global economic circumstances since the Great Depression, to a budget formulated in a position of economic strength. These circumstances are the result of a fiscal policy reflective of a government directed by the highest standards of responsible economic management, a government willing to put forward tangible social and economic programs that not only helped us avoid a recession in the immediate term but delivered on-the-ground projects to prepare our nation and our community for the future.

When I spoke to the previous budget of 2009, I did so in the knowledge that it was the Rudd government that would be responsible for ensuring that the people of my electorate of Calwell would continue to play an active part in the economic life of this nation. I did so knowing that it was the federal Labor government’s economic and social policies that would serve to protect my constituents from the full brunt of what even the former Howard government Treasurer, Peter Costello, described as an ‘economic tsunami’. What allowed this economic tsunami to circumvent Australia were the measures undertaken by the Rudd Labor government’s economic stimulus plan which, through a nation-building package, delivered huge investments to communities across Australia. I am very proud to see that these huge investments, particularly in my electorate of Calwell, strengthened our local economy, helped families across the board and will serve to help us secure much-needed growth into the future.

The constituents of my seat of Calwell were amongst the highest recipients of federal government funding, with over $142 million for over 170 projects having been delivered. The amount of social and economic capital reflects the federal government’s commitment to communities across Australia, a perfect example of which is my electorate of Calwell. There is no doubt these investments have helped avoid what would have been a huge rise in unemployment and the closure of many small businesses which ultimately form the backbone of our economy in both the local and national context. Instead of a contraction in our national economy we have in fact seen economic growth of 1.4 per cent. While other advanced economies have gone backwards, Australia is moving forwards. Through measures in this budget, the government will seek to halve peak debt and get the budget back into surplus in three years time. That is three years earlier than previous projections.

With the unemployment rate on its way down, this budget is important because it delivers much-needed tax concessions for working people, for seniors and for small business owners. Following the budget announcements, many of my constituents approached me and made phone calls to my office. While they acknowledged the ongoing investment in our local community, they also wanted to know how measures in the budget translated for them on the ground, in their homes, in their neighbourhoods and in their communities.

I will go first to the tax cuts that were announced. Those tax cuts alone mean that, at the end of the day when the third round of tax cuts takes effect, people will no doubt have more money in their pockets to spend, to save, to invest or to put towards things which are important to them and to their family budgets. So, with necessary infrastructure investments needed for the sustainability of our modern economy having been provided, workers have also now been provided with added support that is much needed, particularly by lower income earners and those who will even benefit from relatively modest increases in the money they earn. There are certainly many low-income earners in my electorate of Calwell and I know that this measure, in particular, is very important to the way in which they manage their daily life and expenses.

I am also conscious of those who in the name of economic flexibility—and I refer to the former Howard government—had ignored matters for far too long. These are the underemployed in our community, which the previous government only remembered when it came to stripping away their rights at work. These are workers who are most vulnerable to economic fluctuations. Thanks to the 2010 federal budget these workers will be able to earn up to $16,000 and not have to pay income tax, which is up from $11,000 in the 2007-08 federal budget. Along with other initiatives this will have a direct impact. Who are these people that will benefit? They are the working mums who often have to work part-time. I mention working mums because the reality is that they are ultimately the ones who, in juggling home and work, often miss out. It is our role as a socially progressive government to address this reality, and this budget seeks to do just that.

In supporting workers in my electorate of Calwell, whose jobs were protected by the timely action taken by the government to avoid what would have otherwise been a crippling recession, the Rudd Labor government is also supporting the 10,290 small businesses in Calwell who will enjoy the tax breaks. That is much needed support for small business owners who form the backbone of the economy that drives growth and prosperity in my electorate of Calwell and also across Australia. When we are looking towards an economy that will be in surplus three years ahead of time, when we are looking towards providing Australians with an economic recovery that will be sustainable into the future, this government has given businesses, such as the 10,290 small businesses in my electorate, much needed tax relief in addition to a cash flow boost and a strong incentive to continue to invest in productive assets.

As the opposition, of course, likes to whip around its scare campaign against the resource super profits tax it is denying the 10,290 small businesses in my electorate as well as some 720,000 small businesses across Australia their much deserved and much needed tax breaks. The coalition fails to understand that government has a responsibility to ensure that the economic opportunities from our resources boom benefit all Australians. As mining companies and their executives take advantage of our resources we need to ensure that, through sustainable management of our resource wealth, communities across Australia receive their fair share of the economic pie.

The flow-on effects of this important government policy will give employees a stronger and fairer superannuation guarantee of 12 per cent of their salaries and wages, which will strengthen the economic environment in which 8.4 million Australians will one day retire to. In giving something back to workers in small business this budget also looks to our senior citizens who are an integral part of our community. The tax changes will increase the income threshold for eligible senior Australians both for singles and for each member of a couple. In doing so the government acknowledges the contributions that our senior Australians have made throughout their working lives to make Australia what it is today and does so while recognising their continued input into the economic life of communities across Australia.

It is important to recognise that these announcements are able to be delivered only as a result of the decisive action taken by the federal government. It is action which kept our economy strong during the global recession. We are able to deliver to working Australians precisely because the government’s fiscal policy provided the basis from which workers were able to retain their jobs and precisely because circumstances allowed small businesses to continue operating and to therefore continue employing people.

Expanding on this and in light of our productive capacity and sustainable growth I very much welcome the announcements of the new Skills for Sustainable Growth strategy. In improving the quality and accessibility of training, Calwell job seekers will receive language, literacy and numeracy support to address the barriers to sustainable employment and local workplace productivity. Under this program eligible job seekers will receive up to 800 hours of free accredited training and, in a diverse electorate such as mine, this will be of particular benefit to our young and newest Australians as well as to our Indigenous Australians, who have long been affected by the scourge of unemployment.

At a time when Australia will be cheering the Socceroos’ endeavours in the 2010 FIFA World Cup, I am pleased to say that our local junior athletes, as a result of the 2010 budget, will receive assistance in achieving their sporting dreams, as announced by the Minister for Sport, under the Australian Sports Commission’s Local Sporting Champions grant program. The up to $18,000 available for youth sports stars wanting to compete in state and national events provides our community in Calwell with 24 individual grants and two team grants. Put simply, the chance to tap into this funding program has been doubled for our junior sports stars, which I know will help provide these young athletes with much-needed support in what can often be the most exciting and challenging times of their sporting careers. It will also provide support to parents—and I know this from having spoken to young people in the program’s administration last year—because parents are often very much burdened by the costs related to running their kids around to training and so on. None of us, I am sure the chamber would agree, would want to see our budding superathletes of the future miss these opportunities because their families could not afford to sustain their training.

With regard to the continuation of the government’s strong commitment to innovation, I would like to draw on some reflections I have made in the past in this chamber. As Chair of the House Standing Committee on Industry, Science and Innovation—and of course, importantly, as the member for Calwell, which has a very large manufacturing base—I work closely with the Minister for Innovation, Industry, Science and Research, and we assist by examining, reporting and making recommendations regarding areas of policy that affect these industries. As such I would like to take this opportunity to commend the minister for his continued efforts, which are aimed at ensuring that strong and viable science, research and manufacturing industries remain an integral part of our national economy and our social framework.

The textile, clothing and footwear industry employs over 45,000 Australians across the country, generating exports that are worth $1.6 billion, as well as contributing $2.8 billion each year alone to our national economy. The employment patterns within this industry, particularly in regional economies, ensure that entire communities across Australia are strongly supported by the development of these industries. My electorate is one such community that would obviously benefit greatly from the government’s commitments. That is why the initiatives and programs introduced by the Rudd Labor government are crucial to promoting capital investment and innovation aimed at ensuring that Australian made products continue to be a driving force for our local, regional and national economy. Through an additional $5 million, which brings the total level of funding for the government’s Textile, Clothing and Footwear Strategic Capability Program to $35 million over five years, more companies will be able to access this program. Importantly, by reducing the total eligible expenditure of projects from $1 million to $500,000, it addresses the issue identified whereby companies were finding it difficult to get funding support for smaller projects.

I would also like to take this opportunity to express my full support for the budget’s inclusion of a commitment to increasing the level of our development and humanitarian assistance to the tune of half a billion dollars. This increase is important because it recognises that, as we move beyond the current global economic environment, we do so in the company of the world’s most vulnerable. In Australia in particular we are all aware that we have managed to avoid the sorts of economic pitfalls that have befallen other countries. I think we have a moral obligation to assist them and do our bit at a level that is reflective of our wealth, so I welcome that measure.

In closing, I want to say that the delivery of this budget was made possible not only because among the major advanced global economies Australia was the only country to avoid recession, not only because we were able to produce the second lowest unemployment and not only because we maintained the lowest debt and deficit but also because we did so while maintaining our AAA credit rating. Importantly, we did so while also maintaining our rights at work; the Rudd Labor government did not use the working rights of Australian people as a scapegoat for the upheavals in the global economy.

And, importantly, we do so with record investment in long-term infrastructure projects for Australia’s long-neglected roads, rail and ports. Through the Roads to Recovery program, the Hume City Council, in my electorate, will receive an extra $894,331 to assist with the maintenance and upgrading of local roads. This is in addition to the additional $89 million allocated to the ongoing Western Ring Road upgrade project, which I know will relieve a lot of the traffic congestion associated with the area immediately adjacent to my electorate.

The budget before us is good for our economy, it is good for working Australians and their families, it is certainly very good for pensioners and senior Australians, it is good for businesses and it is good for the long-term social and economic viability of communities right across Australia and, in particular, my electorate of Calwell. It is on this basis that I welcome the government’s announcements and commend the bills to the House.

Sid Sidebottom (Braddon, Australian Labor Party) Share this | Link to this | Hansard source

The message of the budget was twofold. Firstly, responsible management of the economy has seen Australia weather the global financial crisis better than most other comparable economies—a fact almost totally ignored by those opposite. The savings and policies identified in this budget are targeted to get the budget back into surplus in 2012, three years ahead of schedule. The second message is that the proceeds from the resource super profits tax will go straight back into building a stronger, broader economy by cutting business taxes, especially for small business, boosting retirement savings and investing in vital economic infrastructure.

Let us just remind ourselves about how Australia has travelled in these difficult economic times. I sometimes think that we in Australia appear somewhat isolated from the impact the world economic crisis has had, and continues to have, throughout the world, most particularly in the USA and Europe. It is not because Australia is economically isolated from the rest of the world—indeed, to the contrary. The reason Australia has performed so strongly compared to many other comparable economies is largely because the Rudd Labor government acted so decisively to stimulate our economy as private capital evaporated. The stimulus strategy sought to inject spending and investment into the economy as retail spending and private infrastructure investment began to decline significantly. The stimulus worked and kept our economy out of recession. Significantly, in partnership with Australia’s employers, employees and unions, it kept Australians in work. But do not just take my word on this, immensely proud though I am of the government’s record with the stimulus matters that we introduced.

The OECD’s latest economic forecasts are a timely reminder that our decisive action during the global recession has put our economy in a position of strength, from which we can reform the tax system and boost competition in the mortgage market for the benefit of families, workers and small business. The OECD has revised upwards its growth forecast for Australia and now expects GDP to grow by 3.2 per cent in 2010 and 3.6 per cent in 2011, one of the strongest growth outlooks of all OECD economies and well above the growth forecast for the OECD area as a whole. I know it might sound a little bland to listen to those figures, but they are comparably very impressive. I congratulate this government and our community on being able to achieve these forecasts.

On the employment front, the OECD expects Australia’s unemployment rate to fall by 4.8 per cent by the end of 2011, dramatically lower than the eight per cent unemployment rate expected for the OECD area as a whole. The OECD also welcomed the government’s disciplined budget, stating:

… in view of the stronger economy and fiscal restraint, the Government now expects to balance its budget by 2012-13, three years earlier than previously anticipated.

The national accounts for the March quarter will be out soon—on Wednesday of this week, I believe. It was this same release last year that revealed Australia had avoided a technical recession, one of only two advanced economies in the world to do so. This achievement sparked a revival in confidence which underpinned a recovery in private demand which would see Australia go on to record growth of 1.4 per cent in 2009 in year average terms and become the envy of the developed world.

So what of the resource super profits tax announced in the budget and now the source of so much shrill commentary by the big end of the mining industry? A whole host of dire scenarios is being presented by the big mining companies, ranging from allegations that they will be the most heavily taxed of all mining concerns in the world to being forced to put projects on hold, the loss of thousands of jobs, and declining returns to shareholders and superannuation recipients. Of course, any evidence that is contrary to these dire predictions is dismissed as untruths. Surely, there could not be a lot of self-interest at play here—surely not!

A local example surfaced in my own daily newspaper today when the editorial writer for the day had this to say in reaction to some negative comments from a mining company and an opposition media release about the RSPT. He said:

I must admit I was initially sold on the whole ‘they take the resources which belong to all of us’ argument, but have soured on it following the reaction from local industry players.

Well, blow me down! Because some industry players do not like the prospect of increased taxes, the government’s rationale for the tax and the Treasury modelled benefits from it do not seem to carry the same weight. Why is this? Laurie Oakes, on 29 May in the Hobart Mercury, put it incisively when he wrote:

The mining industry campaign is certainly over the top, and difficult to counter. When mining companies devalue their own shares by forecasting dire consequences from the tax, people tend to believe them.

In other words, they talked their own share prices down by this ridiculous scaremongering campaign that they have unleashed.

I think Ross Gittins’s piece in the Sydney Morning Herald of 26 May, headed ‘Let’s mine bright ideas and stop being shrinking violets’, goes some way to identifying what the real issue is with regard to the RSPT and the big mining companies’ misinformation campaign against it. Mr Gittins, no favourite or favourer of the Rudd government, argues that the traditional Australian cringe factor lies at the heart of their attack and the hope that Australians and the government will accept this. If the RSPT goes ahead, they argue, they will cancel their projects and take their money somewhere else. Mr Gittins says:

Oh dear, don’t desert us. Please!

Know what their—

that is, the big mining companies—

problem is? Australia, being one of the world’s leading mining nations, is a world leader in designing taxes that increase the public’s take without discouraging mining activity or otherwise damaging the economy.

He goes on:

The resource super-profits tax is a state-of-the-art tax, designed by our leading economists not to do all the bad things it’s being accused of. It’s a close relative of an earlier Australian invention, the resource rent tax, developed by Professor Ross Garnaut and others …

Mr Gittins further goes on:

The big international mining companies are fighting it partly because they fear that, once its success has been demonstrated, it will be copied by other countries. And they’re fighting it by trying to press our cringe button: if no one else is doing it, it must be a dumb thing to do.

As Ross Gittins goes on to show, in so many areas Australia has led the world. And that was no dumb thing to do.

Last week saw some of Australia’s foremost economic authorities endorsing the resource super profits tax and destroying key planks of the scare campaign being run against this important reform. Remember, it is a reform—a reform of the tax system that is long needed. Even the mining industry recognises this. Twenty leading economists published an open letter. They are quite happy to have their names in the newspaper publicly endorsing this scheme, this tax proposal. They described it as a more efficient and equitable system of sharing the value of exploration and mining rights.

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

Mr Katter interjecting

Sid Sidebottom (Braddon, Australian Labor Party) Share this | Link to this | Hansard source

The member for Kennedy would remember that I am assisting him in the House by speaking now. I know he will listen to what I have to say. He regards me, I hope, as a considerate person. He will consider what I have got to say and take it on its merits. The 20 economists, who include former ACCC chief Professor Alan Fels, made it clear:

There is no reason to expect a net contraction in mining over the longer term as a result of replacing royalties with the proposed resource rent tax. This is because a tax on economic rent of non-renewable resources is a more efficient way of raising revenue than taxing mining production (royalties).

It makes sense. But it does not seem that those opposite are prepared to use sense in their arguments. Last week we also saw thoroughly debunked the myth that the RSPT would push up consumer prices. When asked about that particular part of the scare campaign, another of the 20 economists, Professor John Quiggan, said:

I think that’s about the least defensible. The reason that there are super profits to be taxed is because of high world prices for these minerals that are set on world markets. So there’s no reason at all to think that the tax is going to affect the world price of these minerals, and therefore that that’s going to feed in any way into Australian consumer prices.

This was the point made by Treasury Secretary Dr Ken Henry, whom those opposite want to vilify, at Senate estimates last week, when he said that a profits based tax would not impact on consumer prices, although cutting the company tax would have a beneficial impact for consumers. Of course this has not been recognised by the big mining companies, who will benefit from the lower company tax rate.

By the way, I would like to add that those opposite, in their non-tax plan, will penalise the mining companies because they will not support a decline or a reduction in the company tax rate. Indeed, Treasury figures based on modelling from independent firm KPMG Econtech show the impact of the government’s tax plan on prices as follows—

Alby Schultz (Hume, Liberal Party) Share this | Link to this | Hansard source

Order! Is the member for Braddon willing to accept a question from the member for Kalgoorlie?

Sid Sidebottom (Braddon, Australian Labor Party) Share this | Link to this | Hansard source

No. I need the time. I do not need to be interrupted by the member for Kalgoorlie. As I was saying, the Treasury figures, based on modelling from independent firm KPMG Econtech, show the impact of the government’s tax plan on prices as follows: food, lower by 0.9 per cent; clothing and footwear, lower by 1.3 per cent; housing, lower by 1.1 per cent; transportation—member for Kalgoorlie—lower by 1.7 per cent; and communications, lower by 1.4 per cent.

Barry Haase (Kalgoorlie, Liberal Party) Share this | Link to this | Hansard source

Substantiate that.

Sid Sidebottom (Braddon, Australian Labor Party) Share this | Link to this | Hansard source

I do not need to substantiate it. That is from the modelling not just of Treasury but also of KPMG Econtech, the independent modellers. But that would not mean anything to those opposite. They just need to promote hearsay and the nay-saying of the big mining companies and that is enough. Of course it is; it always is when you have a scare campaign running.

Under the government’s tax proposals, the average worker—listen to this!—will be an extra $450 a year better off. Under the opposition’s tax plan, if that is how you can describe it, there will be no mining tax, no company tax cut and a 1.7 per cent tax increase for large companies. That would leave the same worker about $100 a year worse off. Tut-tut! Further, Labor’s tax plan will eventually boost GDP or economic output by 0.7 per cent whilst the Abbott plan would reduce GDP by 0.2 per cent. And there is more. I will throw some kitchen knives in for you as well. Investment is modelled to increase by 2.1 per cent under the government’s plan but fall by 0.55 per cent under Abbott’s. In addition, inflation will be affected. Consumer prices will be 1.1 per cent lower with the government’s taxation mix but 0.25 per cent higher with the coalition’s. Finally, average real after-tax wages are predicted to rise by 1.1 per cent under the government’s plan but would fall by 0.25 per cent under the Abbott-Hockey-Robb plan. Of course, we do not hear this in this debate from those opposite. They cannot defend their so-called tax proposal, particularly the 1.7 per cent tax on large businesses to pay for their uncosted paid parental leave scheme.

Early last week the Treasurer delivered a ministerial statement to the parliament discussing, amongst other things, the truth behind some of the myths peddled by some in the mining industry, how we will invest the proceeds of the RSPT and the posturing we have seen from some industry figures since the announcement of this vital economic reform. There has been much comment from mining companies in recent weeks about the supposed retrospectivity of the RSPT. These claims are clearly misleading, as the RSPT will apply to mining profits from 1 July 2012. It does not apply to past profits. It would help a more informed public debate if companies clearly distinguished between retrospective taxation, which this proposal is not, and taxation of existing projects, which is their actual complaint. Let’s make two points specifically related to this. The first is that complaints that the RSPT should not apply to existing projects are really an argument that governments should never change tax rates. That is not a sustainable proposition for any government any time but it is especially unsustainable when the tax share of the mining profits has fallen, regardless of what measure you use, so dramatically in recent years. As Macquarie Bank economist and interest-rate strategist Rory Robertson said last week:

… only the most naive investor could have imagined that the final prices the mining sector receives from world markets for publicly-owned resources could increase by multiples over a decade and yet governments effectively would keep selling those same resources to mining companies at the same old low prices.

Indeed, as Robertson points out, every city-based household knows that its local government rate payments will trend higher over time even if the home was bought many years earlier. Similarly, owners of rural property know that the government rates and rents are linked directly to the latest assessed value of the property and that if that value doubles then payments to the government will tend to rise in proportion.

The second point is that the report of the tax review recommended that existing projects be included, and for very good public policy reasons. To exclude existing projects would of course create significant distortion of investment, as prospective projects and existing projects would be on an uneven tax playing field. I quote from Mr Robertson:

Mining companies have also made the argument that the RSPT should be differentiated by commodity. They argue that different commodities have different revenue, cost and therefore profit profiles. Some require more investment to extract, some less.

Mining companies have used this to argue that the RSPT should apply at different rates for different commodities. But this analysis fails to grasp perhaps the most important design element of the RSPT. The fact is that, by design, an RSPT already differentiates by commodity. As a profits based tax the RSPT already takes account of the different revenue, cost and profit profiles of the different commodities. It also contains very generous treatment of investment. It therefore takes account of the different investment levels needed to develop different economies.

The government is using the proceeds of the RSPT to provide a much needed cut in the company tax rate from 30 per cent to 28 per cent for all Australian companies, with a head start for small business. This is a really important economic reform for Australia because it will help us stay competitive at a time when the company tax rates are falling in other countries, particularly in our region. It will also help boost growth and real wages over the long run. Independent modelling shows that together with the RSPT, the cut in the company rate will boost GDP by 0.7 per cent and lift investment by 2.1 per cent. By contrast, an alternative plan to lift the company tax rate by 1.7 per cent on taxable company incomes over $5 million a year will actually reduce GDP by 0.2 per cent and cut investment by 0.5 per cent according to the Treasury and that means according to the so called tax plan of the opposition.

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

With all due respect to the worthy member for Braddon, he said that the opposition are indulging in scare tactics. If I was the Labor member, I would be scared because if you think that you are going to convince the miners of Australia that you are going to hit the mining industry with a 40 per cent tax and that is not going to affect their jobs then you truly believe that the abominable snowman comes from Baduri.

I have seen some incredible thought processes convincing themselves that this is going to be good and trying to convince the Australian nation that this is going to be good. Let it be understood that the average Australian understands that the governments of Australia—of both political persuasions—completely destroyed manufacturing in this country. They went to a free trade regime when no other country on earth went to a free trade regime or even anything even remotely resembling a free trade regime. But they insisted upon going to a free trade regime as some sort of example setting for the rest of the world. We were going to be the wunderkind of the world.

The previous speaker, the member for Braddon, quoted all of these economists. I call them slithering suits out of Sydney. We see them pontificating every night on the television and in the newspapers. We have to judge them upon their merits. They have lauded the government for introducing free-trade policies. Let us have a look at manufacturing. There are three great divisions of the Australian economy, the productive side of the Australian economy: manufacturing, agriculture and mining.

Let us look at manufacturing. I emphasise that all of the economists and all of the so-called people that are in the field of money in Sydney and Melbourne said this was going to be wonderful for us. The ORANI model was produced by the Productivity Commission. I cannot remember the exact figures, but they ran something like this: if we removed motor vehicle tariffs then there would be a 20 per cent intrusion over 10 years. There was a 50 per cent intrusion over five years. Mrs Orani, the wife of one of them, should sue for defamation as a result of her name being used on such a report. There were people who stood up in this place and said how wonderful it would be for us. The whole reason for this free trade was that it was going to cut the price of a motor car. If I remember correctly the price of a motor car then was about $16,000 and within 10 years it had doubled in price. It had not gone down in price; it had doubled in price.

Mr Deputy Speaker Schultz, you were in the processing of agricultural product. In actual fact in agriculture the processing element has been historically bigger than the actual farming element in agricultural production. We pleaded with the government not to deregulate the wool industry, and one side of this parliament said, ‘We have to accept it because it is market realities,’ and the other side said, ‘It’s a good thing in the long run.’ John Maynard Keynes, the greatest economist probably of all times, said, ‘In the long run we will all be dead.’

So we sank down to the second lowest manufacturing sector of any country in the OECD with the exception of Turkey—hardly a great economic model to follow. Manufacturing was destroyed in this country. We saw motor vehicle manufacture fall from pre free trade where 72 per cent of the vehicles driven in Australia—prior to Mr Keating’s wonderful free trade initiatives—were Australian made. Now only 12 per cent of Australia’s motor vehicles are Australian made. When all of us were young people, our fridges, stoves, airconditioners and television sets were made in Australia. None of those things are now made in Australia. Manufacturing in this country effectively, as a generalisation, ceased to exist completely.

We listened to these people telling us how wonderful the brave new world will be for us and we realise now that those decisions were disastrous in the wool industry. When the industry was regulated, the price doubled over the next three years; when it was deregulated, it halved over the next three years. There cannot be a more definitive statement. In 1990 when Mr Keating, in his wisdom, deregulated that industry, 10 per cent of this nation’s income came from wool. It was bigger than coal. That is in 1990. That is not exactly ancient history. Most of the people in the parliament were here in the early 1990s.

We have wiped out manufacturing so we can move on to agriculture now. I have just mentioned the wool industry. I remind the chamber again that seven years ago Australia became a net importer of pork. I think everyone in this House would have eaten pork somewhere in the last week. Four years ago—it may have been three—we became a net importer of fruit and vegetables and last year we became a net importer of seafood. It does not matter what set of statistics you want to look at, whether it is in nine to 25 years time, this nation will be a net importer of food. Let me say to you, this nation will not be able to feed itself. That is the implication of those figures.

Manufacturing has ceased to exist, agriculture is going down the chute at 100 miles an hour. Let me again be very specific. Wool numbers are down 60 per cent. Cattle numbers are down around 20 per cent. In the sugar industry we close two mills every five years. That is three. The wheat industry is very much dependent upon seasonal climatic conditions, so I will not use that as an example and in dairying—which quite amazes me because I would not have thought that people would just stop drinking milk—but of course the manufacturing side of the industry has pulled it down about 15 per cent as well. There are your giant four agricultural industries. They are on desolation row. You have no manufacturing. Your agriculture is vanishing. What do you have left? You have mining.

I come into this place not like other people. I am one of the few who had copper dust—not coal dust, but copper dust—under my fingernails. I worked as a labourer at Mount Isa Mines and I was briefly a union rep there. I worked my own mines—I found them, I developed them myself and I produced copper from them. Prior to coming into parliament I was in the process of floating by own mining company. I know the mining industry intimately. I was Northern Development Minister and then Mines and Energy Minister in the Queensland government. Nobody in this country knows mining better than I do. Whether my kids were fed or not depended on whether I made the right decisions in mining.

In the mining industry, nine out of every 10 prospects will lose money—big money—so you have got to make enough profit on the 10th prospect. All of these great slithering suits from Melbourne and Sydney and all the very foolish people in the Labor Party are telling us how wonderful this mining tax is for us. I will give members of the Labor Party a word of advice: do not tie yourself to a sinking ship. To identify yourself with this cause is to simply chain yourself to the Titanic. Let me explain. The profits on the 10th mine have to cover the losses on the other nine. If there are not going to be any ‘super profits’ on the 10th mine then you will not have enough profits to cover the losses on the other nine prospects. So people will not mine in this country. They will go to a country where they can make super profits on that 10th mine. I should not have to tell anyone in this place that the metals market is a roller coaster. In 2006 the price for zinc was $4,000 a tonne but last year it was $1,000 a tonne. You had to be able to make enough profit in 2006 to carry you when the roller coaster goes down to $1,000 a tonne. But you would not be able to do that because the upswing of the roller coaster is truncated by the stats. If you cannot see that, there will be a terrible political price.

I actually think the government has done a very good job with the economy to date. I think the opposition are very misguided in criticising the government for spending money at the outbreak of the financial crisis. It is a great shame to see all of that good work destroyed by advice from Treasury that is simply flawed. Obviously, the man has not spoken. If you think there is no problem, why would the head of BHP—a person who has never really picked fights; he is not a confrontational person—suddenly become very confrontational? Why would Mike Davis, the head of Xstrata, take time off to talk about Australia when he is addressing the European Chamber of Commerce? Why would Mr Albanese, the head of Rio Tinto, take time off to talk about Australia when he is addressing the American Chamber of Commerce? Clearly, these people are not happy with this decision—to the point that they do not care about antagonising the government. They have nothing to lose in this country, so they might as well go for broke. The political implications of this for the ALP will be diabolical.

I wrote an article for the Financial Review some years ago—I think I was still in the National Party at that stage, but I might have just left—saying that the National Party in Queensland was going to pay a diabolical price for their failure to stand up to the powers that be in a number of areas. I said on the day before the state election that they were going to suffer a massive loss, and they suffered the worst loss in Queensland political history bar one. So I warn the current government in the same way. This is not to be nasty or threatening. They must simply understand that, in mining, nine out of 10 mines are going to lose money big. Therefore, you have to make a great profit from the 10th mine to cover the others. You have to make enough money on the upswing of the roller coaster to cover the downswing of the roller coaster.

Let me move on. Every mining company is going to bring in every one of their employees and contractors in and tell them: ‘We’ve been hit with a 40 per cent tax, fellas. If you think that is not going to affect job opportunities for yourself and for your kids, you don’t deserve to have a job in mining.’ That is what the bosses are going to say to them. When the bosses told them the IR legislation was going to be good for them, they did not believe the bosses; they believed the Labor Party. But this time they will believe the bosses, not the Labor Party. It is not like the old days, when the miners were great supporters of the Labor Party—far from it. The people working in mining today are far more sophisticated than the miners of the past. They have far more sophisticated attitudes. We saw that in electorates like Dawson, in North Queensland, when interest rate increases were threatening. With the Labor opposition under the leadership of Mark Latham, those people swung very strongly against the ALP in that election—and the member for Dawson had a very handsome majority of about 14 per cent. Just as they swung over to Labor over interest rates, when the IR legislation came in they swung violently back the other way—and Labor now holds Dawson with a four per cent majority. Anyone who thinks there will not be an effect in the mining areas is kidding themselves. Do you want me to name how many seats in New South Wales are partially mining seats and also marginal?

The other factor is that we have not had a lot of competition on the world stage. America and Europe have completely mined out their mines—the easy stuff, and even the hard stuff, has been taken away. America is mining coal at a depth of two kilometres. We would not dream of doing that in Australia. I say this to illustrate that the easy stuff in America and in Europe has gone. They are sophisticated economies that have heavily mined their land in the past. The countries that have not been mined are Brazil, the two Mongolias, all those other countries to the west of the two Mongolias, Kazakhstan and Russia. Brazil has traditionally had very unstable government. Mongolia has no infrastructure and virtually no government and is very remote. Russia, of course, was communist. Russia is no longer communist; it is a happy hunting ground. It is very much larger in area than Australia. Because it is a bigger country, there will be much more minerals there. You could almost put it in terms of tonnes of minerals per square kilometre. Brazil is a much bigger country than Australia. Even if you take out the super-wet belt of the Amazon, it is still a much bigger country than Australia—and it has not been touched. The two Mongolias and Kazakhstan are also much bigger than Australia. So we will now have dramatic competition from countries that are much bigger than us and will have much greater mineral wealth than we have. So, on top of everything else, there are alternatives to mining in Australia. Next year or the year after, BHP will mine more coal in Indonesia than it does in Australia—the leading coal exporting country on earth.

For those who are unfamiliar with mining, there is a thing called transfer pricing. I always thought Mitsubishi was the classic example of this. They sold silicon to themselves in Japan for $55 a tonne and the Queensland government bought it back as optical fibre. It does not cost a lot of money to transform the almost pure silicon, which we were exporting, into optical fibre, but we were paying $2 million a tonne for it. That is a simple example of transfer pricing. If you think that, when we bring this tax in, they ain’t gonna go to transfer pricing, you would believe in the tooth fairy!

People have the hypocrisy to say, ‘Oh, we’re standing aside and letting all this money go overseas.’ I pleaded and shouted in this place for something to be done, and I had a defamation action brought against me because of my efforts to try and stop the takeover of our mining companies by foreigners. But the governments of Australia—the ALP government and the Liberal-National Party government—sat on their hands and watched as the six giant mining companies of Australia were flogged off to overseas companies. This was to help the stock market—the great sacred God of modern society. Governments sat there and watched BHP, the great Australian, flogged off. They sat there and watched Western Mining Corporation flogged off. They sat there and watched CRA flogged off. They sat there and watched Mount Isa Mines flogged off. They sat there and watched Normandy Mining flogged off. They did nothing. In not one single case did they do a thing. Now that all the profits are flowing overseas—and very great profits, indeed—they are going to try and close the gate after the horse has bolted. Coming from the cattle industry, I know that that is a pretty useless thing to do, Mr Deputy speaker, let me tell you.

The governments of Australia, with their enlightened policies on manufacturing, have destroyed the manufacturing industries of Australia. People hate politicians, but that was not true when I was a young bloke. I felt great awe and reverence for some of the men of Australian politics—men like Sir John ‘Black Jack’ McEwen. Ask anyone in the street what they think of Mr Howard. Ask anyone in the street what they think of Mr Keating. I deeply regret to say this, because I personally like the current Prime Minister—(Time expired)

Melissa Parke (Fremantle, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to speak in support of the Appropriation Bill (No. 1) 2010-2011, Appropriation Bill (No. 2) 2010-2011 and Appropriation (Parliamentary Departments) Bill (No. 1) 2010-2011 that underpin the Labor government’s 2010-2011 budget. It is a budget that continues the Labor tradition of prudent economic management and necessary economic reform of unlocking productivity and locking in fairness, of making big-picture reform without fear or favour and of responding flexibly to prevailing economic conditions while remaining steadfast in the pursuit of our shared national interest. There is no better indication of the government’s commitment to these values and of its adherence to these qualities than in the 2010-2011 budget and in the relationship between this budget and its predecessor.

Last year the government responded to the most profound economic crisis since the Great Depression by embarking on an economic stimulus package that would both fuel and cushion the Australian economy. This action achieved its twin purposes. It underwrote the strength of the Australian economy, which grew 1.4 per cent in a period when the other advanced economies taken together contracted by 3.2 per cent. It did so by creating long-term improvements in our schools, on our roads and in our local communities through the Building the Education Revolution program, the Commonwealth-local government partnership of the community infrastructure program and black spot funding. It prevented the long and lasting damage that would have occurred without the government’s nation building stimulus, it prevented the recession that would have occurred without the government’s action and it kept hundreds of small and medium businesses alive that would have gone to the wall without the support of government stimulus.

In the last few weeks, I have visited Harmony Primary School, Spearwood Alternative School, Palmyra Primary School and Beaconsfield Primary School. In each case, I have met with staff, parents and P&C representatives who are looking forward to having the use of extensive new facilities in the next few months. In many cases, this much needed additional capacity and amenity represents the first significant capital works to have occurred at schools in my electorate in 20 years or more. For some schools, the new facilities will provide their first all-weather assembly space. I am also aware of primary schools that are having their buildings equipped to cater for their involvement in the fantastic Stephanie Alexander Kitchen Garden Program.

The Regional and Local Community Infrastructure Program has achieved a similarly successful provision of short-term emergency economic stimulus in the form of long-lasting community improvements. Under this program, the City of Fremantle installed solar panels on the roof of its community leisure centre. The City of Cockburn undertook extensive work to improve access and facilities at Bibra Lake—a beautiful and ecologically vital wetland in the heart of my electorate. The City of Melville put forward a range of projects, including waterwise improvements to the irrigation system used for the public golf course. The town of East Fremantle made improvements to disability access at community sports facilities and also undertook heritage restoration work.

Mr Deputy Speaker, when you consider the varied nature and benefits of all these projects—renewable energy, disability access, heritage conservation and improvements to environmental protection and public open-space amenity—and you then multiply this across Australia’s 700 or so local governments, you begin to see how the federal government’s action has reached into every corner of this country to support economic activity, to save jobs and to create much needed improvements to public infrastructure.

When I recently attended the opening of the refurbished Locke Park rotunda in the town of East Fremantle, the contractor who had undertaken the heritage restoration work told me that without the funding to local government projects he would have been forced to lay off five or six employees. I have heard the same thing many times in the last 12 months from workers and business owners alike.

It is crystal clear that the government’s decision to make good the collapse in private demand that followed the global financial meltdown has had a direct and dramatic effect in the Fremantle electorate, especially in the south and south-east where unemployment has been comparatively high. It is through this response, in cooperation with a go-ahead private sector and the resilience and optimism of the Australian people, that Australia now has the second lowest unemployment rate of all the major advanced economies. It is through this decisive response that unemployment, which was forecast to peak at 8.5 per cent, instead peaked at 5.8 per cent and is projected to return to less than five per cent. That is a remarkable achievement. It means that some 220,000 Australians were kept in work. It means that the personal heartache and financial trauma that would have occurred in Australian households in the absence of government stimulus was avoided.

That achievement, the maintenance of economic growth and employment strength in the Australian economy and the prevention of widespread economic harm to the Australian community, should not be overlooked or underestimated. Through the steps taken by this Labor government in partnership with state and local governments across Australia, with the goodwill and enterprise of Australian business and with the optimism and hard work of the Australian people, we have done remarkably well in remarkably difficult circumstances.

Now, a year later, the 2010-11 budget moves to address the short-term deficits that were necessary to keep the Australian economy going forward at a time when most other advanced economies were going under. It charts our passage back to surplus in three years, which is three years earlier than originally forecast. In that way, this budget builds on the achievements and meets the responsibilities of the government’s 2009-10 budget. The responsibility is to contract spending growth and to match any new spending with new savings, and we have done that. The way forward is to continue to address this government’s agenda for positive change when it comes to the 21st century challenges in health, productivity and energy policy.

Among those forward-looking changes, I am happy to highlight the following: the introduction of Australia’s first Paid Parental Leave scheme; the introduction of a resource super profits tax, which will ensure all Australians benefit fairly from the development of resources that belong to all of us, in the form of a tax scheme that will assist smaller companies and exploration projects; an unprecedented national health and hospitals reform package; a new instalment in the distinctly Labor project of providing adequate superannuation savings; and a further $650 million in renewable energy development as part of our $5.1 billion Clean Energy Initiative. These are all big picture initiatives that build from Australia’s world-leading position of economic stability and address the national and global challenges that we face in the decades to come.

The resource super profits tax is simply intended to restore balance and fairness to the arrangements that govern the use and development of commodities that belong to all of us and that we ought to manage as assets held at least partly in trust for the generations to come. The public share of resource industry profits has fallen from $1 in three to something like $1 in seven within a decade. That is simply not a fair balance between providing an incentive and a reward for resources companies on the one hand and ensuring that all Australians now and in the future benefit from our shared inheritance on the other. I note the proposed mining tax is supported by 20 leading economists and academics in a statement released on 26 May that says, inter alia:

… the current public criticism of the proposed tax has been dominated by misinformation.

Mining is different to other industries in that it uses and depletes natural resources. Some return on those resources should flow to the Australian public.

The proposed mining tax is also supported by the former head of the Minerals Council of Australia, David Buckingham, who has stated:

Given these profits are made principally from the exclusive right to exploit a non-renewable resource owned by the Australian people, such tax rates are far from unreasonable.

Mr Buckingham also pointed out the scare campaigns of the past on the petroleum resource rent tax and native title legislation. On those occasions also there were threats of lost jobs, projects, exports and national income. It was claimed that those proposals would ruin our economy. Of course, as he noted, nothing of the sort happened. Mining and petroleum industries went on to grow and prosper. It is pertinent to note that the Minerals Council itself submitted in November 2008 that there should be a shift away from state based royalty charges to a national profits based tax.

Australia’s natural resources are our common wealth and they are not inexhaustible. It is therefore entirely fair and appropriate that all Australians benefit from the exploitation of these natural resources, and that is why the government will apply the proceeds of the superprofits tax to build infrastructure in places that desperately need it, including in resource rich states like my home state of WA, and to support an increase in compulsory superannuation.

In my electorate of Fremantle the measures this budget contains in relation to health and superannuation are very welcome. The provision of $950 million to increase the capacity of emergency departments and to support the new standard requiring that patients presenting to emergency be admitted, referred, treated or discharged within four hours will improve the critical service provided by the emergency department at Fremantle Hospital. This is in addition to the $417 million to improve after-hours access to GP and primary care services and the $523 million for the training and support of Australian nurses. I also welcome the $19.2 million investment that the government is making to upskill more than 4,000 aged-care workers nationwide, and I know this already includes funds to train 23 new aged-care workers in my electorate of Fremantle.

As part of the government’s general commitment to productivity improvements and carbon emission reduction, this budget makes a further investment of $1 billion in rail freight infrastructure. Rail freight continues to be underutilised in Australia, despite the fact that it offers very significant environmental, safety and amenity benefits in comparison to road transport.

As a former community lawyer, I wholeheartedly welcome the provision of an additional $25,000 for the Fremantle Community Legal Centre. This funding is a small but important part of the largest injection of Commonwealth funding for legal assistance services in more than a decade. From 1 July additional funding in this area over four years includes: $92.3 million for legal aid, $34.9 million for Indigenous legal services and $26.8 million for community legal service programs. Having had the experience of providing assistance to people who cannot afford private representation and having had the experience of seeing the kinds of very difficult legal and personal issues that people have to confront and resolve—especially people who are disenfranchised, or newly migrated, or experiencing family breakdown or economically disadvantaged—I know that this additional capacity will make an enormous difference.

On this issue, I would also like to draw attention to the government’s new Access to Justice web portal, which is designed to enable people to find legal information and legal advice services in their local area. This forms part of the government’s Strategic Framework for Access to Justice and is an innovative 21st century component of the Commonwealth’s $1.2 billion for legal assistance services over the next four years.

I am glad that this budget with its strong emphasis on the domestic bottom line and on domestic capacity building nevertheless continues this government’s trajectory towards a higher level of international aid. The commitment in 2010-11 is for $4.3 billion, which is consistent with our path towards 0.5 per cent of gross national income by 2015-16. In the medium term I hope that Australia and other countries can reach the UN-endorsed contribution level of 0.7 per cent of GNI.

I commend the Parliamentary Secretary for International Development Assistance for his work in this area, which naturally has been in keeping with the incredibly high standard of service that he has given to this parliament and to this country for many years. I encourage all members to see the address that the parliamentary secretary, the member for Fraser, gave at the Australian National University last week on our engagement with Africa. The parliamentary secretary highlighted that Australia’s increased assistance ‘is about contributing more effectively to achieving the Millennium Development Goals and being a good international citizen in a world that is becoming ever smaller and more complex’.

Before leaving the subject of foreign aid, my attention has been drawn to a speech made by the member for Melbourne Ports during this debate on the appropriation bills in which the member was critical of the $12.7 million Australia gives to the United Nations Relief and Works Agency, UNRWA, the agency responsible for the Palestinian refugees. The member stated, inter alia, ‘We need to look more closely at the endemic waste, corruption and misappropriation of funds that has plagued UNRWA and this kind of funding over the years.’

The member made similar claims in his speech last year on the appropriation bills, to which I responded in a letter directly to the relevant minister and copied to the member. However, given that the claims have again been made from a parliamentary platform and are now being circulated on the internet, I feel it is necessary to make a brief response in kind. My own interest in this matter arises from my experience of having worked directly for UNRWA in Gaza for 2½ years and from a desire to protect the work and reputation of a respected and longstanding organisation and its staff, who are good and committed people of integrity working in exceedingly difficult and dangerous conditions.

UNRWA’s work is subject to regular independent audits and reviews. This extensive oversight includes a biennial audit by the United Nations Board of Auditors, which is an outside and independently constituted organisation. UNRWA is also subject to regular reviews and inspections by the donor community, including the European Commission, the United States General Accounting Office and the State Department and the UK Department for International Development. I note that the US, EU and the UK remain three of the largest donors to the agency and continue to provide strong support for it. As I stated in my letter last year:

Australia can have no reason to doubt UNRWA’s long-standing commitment to and ready participation in the auditing of its finances and practices in response to the legitimate desires of donors to scrutinise how their funds are being used.

The Agency is a moderating and neutral force. If UNRWA can’t pay salaries, if it has to lay off staff, or to close schools and health clinics, the alternative to the population in Gaza will be the services offered by the local authority. It is surprising that people who are concerned about Hamas don’t seem to realise that if it weren’t for UNRWA schools, all children in Gaza would be attending Hamas-run schools.

Ultimately, UNRWA is not the problem and it is not the solution. The solution lies in the political sphere. In the meantime, one of the—if not the—most effective ways of providing badly needed humanitarian assistance—food, cash, jobs—and human development assistance—education, health care, relief and social services, infrastructure and protection—is by supporting UNRWA.

Australia’s generous contributions to UNRWA are extremely important, and I am assured that the Australian government maintains its full support and commitment to UNRWA.

Labor went to the last election promising to maintain a strong Australian economy and promising to position this country for the future. At the last election, we promised to address the policy neglect of the previous government in areas like education, housing infrastructure and health. We promised to withdraw our troops from Iraq, to apologise to the stolen generations and to introduce national numeracy and literacy standards for the benefit of the schoolkids of this generation and of those that follow. But, above all, we promised that our reform agenda would be built on the foundation of a strong economy, because a strong economy is essential to jobs, is essential to opportunities for young Australians and is essential to our capacity at all levels to protect, nourish and expand our common wealth.

That is Labor’s essential credo: to maintain and improve the things we all share; to maintain and improve public education, universal health care, fair working conditions, a strong safety net, superannuation and the environment. Those things belong to all of us. They are the bedrock of Australian society, of everyday Australian life and of Australian values—fairness, opportunity, cooperation, innovation and tolerance. Managing a strong economy puts families and individuals in a position to best pursue a productive and fulfilling life according to their own interests and on their own terms and it puts government in a position to safeguard and enhance the public goods that we all share.

In recognising the balanced achievements of this government, it is nevertheless important to remember that the opposition said it could not be done. The opposition said our abolition of Work Choices would damage the economy and cause unemployment to skyrocket. The now opposition leader said paid parental leave would be implemented over his dead body. The shadow Treasurer said that returning the budget to surplus in four years would be a good effort and something this government would be incapable of achieving. The truth is that we have delivered world-leading economic performance at the same time as we have delivered a return to fairness in the workplace. Those opposite said it could not be done—and we have done it. The truth is that we have delivered one of the strongest economies in the OECD, with the first pension reform in more than a decade and while making a huge investment in renewable energy development. We have managed an economy with the lowest government debt of all the major developed economies.

In this budget, we have set the course for necessary tax reform, with 12 per cent compulsory superannuation, reduced company taxation, better treatment of small business asset write-offs and changes to support lower-income Australians with an increase in the low-income tax offset to $1,500 and a decrease in the tax that applies to interest on savings. We have delivered one of the very few OECD economies to avoid recession, with an agreed deal on national health and hospitals reform, landmark funding support for after-hour services, nurse training and the personal and systemic efficiencies inherent in a voluntary system of electronic health records.

All of these things have been achieved against a background of events that no-one predicted at the end of 2007. These achievements—the world-leading economic management and the forward-looking reforms—have occurred against the background of a global financial crisis in 2008-09 that literally wrecked a number of major developed economies. Right now, the shock waves of that crisis continue to threaten the European economies. This instability only underlines the need for the prudent economic management that is a feature of this budget.

In the tradition of Labor governments, this government has undertaken the hard task of changing things for the better, even though change is always the toughest political road. It was the Hawke-Keating Labor government that introduced compulsory superannuation, and now we have set the course for an increase in compulsory superannuation from nine per cent to 12 per cent. It was the Hawke-Keating government that introduced the family assistance package in 1987, and now we are proud to introduce Australia’s first comprehensive paid parental leave scheme. It was the Hawke-Keating government that established Medicare as the national universal health care system, building on the Whitlam government’s revolutionary Medibank initiative, and now we have put in place a national health and hospitals framework that acknowledges and tackles the demographic changes ahead. That is our story. It is a good story and I am happy to tell it. I commend the Treasurer, his staff and his department for this balanced, responsible and forward-looking budget and for the incredible achievements of the last 18 months.

Kay Hull (Riverina, National Party) Share this | Link to this | Hansard source

I will have less than five minutes to speak before 90-second statements come on—and I suggest I will have to finish my speech tomorrow—so it will not be easy for me to cover the issues in the appropriation bills that I need to cover, including mental health cuts. I will speak on budget portfolio statement 2010-11 budget related paper No. 1.11 and the issue of mental health on page 313. As we go through these pages, commencing at page 313, we find significant reason for regional Australia to be enormously concerned about the intentions of the minister and the government, particularly in relation to the cuts in mental health services and the transfer of funding out of one pot and into another. This will have a disproportionate impact on regional Australians.

I recognise that the minister has had to back down on her decision about when these health cuts will take effect. These cuts have now been deferred for nine months, so perhaps the minister can take a look at this. The minister has decided to defer the starting date for these cuts. I would like to discuss how mental health works in regional Australia and why I think the minister has erred in her attempt to assist on mental health. In fact, what she has done has made things excessively worse. I am not talking about very small regional communities that do not have access to a whole host of allied health services and social workers and psychologists. I am talking about large inland cities.

I come from a large inland city, Wagga Wagga, and I might start my explanation of my concerns by explaining just how the process works in mental health when you are in a large regional inland city. When a client presents themselves to a community health team and they are initially assessed, if they are not considered a priority—that is, they are not considered to be at risk of harm—then the client will be referred out to a social worker or to a psychologist through the division of general practice or a doctor’s surgery. The mental health team will always refer clients—

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

Order! The debate is interrupted in accordance with standing order 192. The debate is adjourned, and the resumption will be made an order of the day for the next sitting. The member will have leave to continue speaking when the debate is resumed on a future day.