Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

I am very grateful to the Minister for Finance and Deregulation for agreeing to turn up and answer a few questions. I have no doubt that he will be assiduous in giving answers to the very legitimate questions that I would like to put here today. One of the prime responsibilities of a finance minister is to ensure value for money in the spending of taxpayers’ funds and to ensure that there is no waste and no mismanagement. I refer to the minister’s speech to the Press Club on 8 August 2007 where he seemed to confirm this responsibility. He said:

Every tax dollar the government takes from a family’s bank account is a dollar that can’t be spent on clothes, schoolbooks, groceries or holidays. It’s a dollar that won’t be directly creating jobs in the private sector. When the government takes that dollar, it’s got a responsibility to ensure that it provides value for money in return

I have a series of questions that I would like to ask which relate to that statement, one I agree very strongly with.

Minister, it has been reported in a new book by Lenore Taylor and David Uren, which quotes a Labor insider in relation to stimulus spending—the government taking taxpayers’ dollars and spending them:

Tanner argued vigorously against a spending package.

…            …            …

The problem for Tanner was that, while he still needed to be convinced, Rudd and Swan had already decided.

Does the minister still remain opposed to stimulus spending? Is he troubled by the fact that the government is continuing its reckless stimulus spending through until 2011-12 after one quarter of negative growth back in 2008? Furthermore, in overseeing the potential for waste and mismanagement, why is it that under the minister’s watch Labor’s promised program of computers in schools for every student in years 9 to 12 has so far delivered only 220,000 of the one million computers and a blow-out of $1 billion? Why is it that Labor promised to cut spending in consultancies but have instead awarded $1.2 billion in consultancy contracts since coming to office? Why is it that Labor promised broadband for $4.7 billion but broke that promise, replacing it with a plan for $43 billion, in the process wasting $20 million on a cancelled tender process and spending over $25 million on yet another report by consultants, all for a white elephant that will put up to $43 billion of taxpayers’ money at risk?

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Mr Tanner interjecting

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

It is a question.

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Mr Tanner interjecting

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

I will very happily do that. Why is it that under the school halls stimulus program that is to cost $16.7 billion—some of these numbers should be fairly fixed in your mind, I would have thought—independent assessment has found in at least two or three instances that these school halls cost four times the amount of similar commercial buildings? Why are we seeing billions and billions of dollars of taxpayers’ money potentially wasted? If that were repeated throughout the building phase you would probably be talking about somewhere between $5 billion and $6 billion of the $16.7 billion literally wasted when it could have been done for much less.

Also, Minister, why is it that border protection, having seen at least a $1 billion blow-out this year, has an estimate for next year based on an assumption that only 2,000 asylum seekers will arrive over the next 12 months of 2010-11 when 5,500 have arrived to date in this financial year? It is a billion-dollar blow-out in this financial year with 5,500 arrivals, so you can understand the blow-out, but why is it that an assumption of 2,000 arriving next year is then made? (Time expired)

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

I first give a generic answer to the shadow minister’s question. I will endeavour to go through them item by item. Apologies if I miss any; feel free to remind me of them. First, it is correct to say that the Minister for Finance and Deregulation has responsibility that encompasses government waste and use of taxpayers’ money, but that is a responsibility that is shared with other government ministers. As I am sure the shadow minister, as a former minister, would understand, there are things called the Financial Management and Accountability Act and the Commonwealth Authorities and Companies Act which govern the arrangements that apply here with regard to the responsibilities for managing the spending of government money with respect to both the finance minister and individual ministers. So there is, in effect, a shared responsibility with a specific role for the Minister for Finance and Deregulation, but other ministers also inevitably have responsibilities that are crucial to this overall approach.

First with respect to the question arising from the book that he refers to, obviously I do not make public comments about things I am alleged to have said or not said in cabinet or cabinet committee deliberations, and that remains my position. I can only refer him to a quote that I did provide the authors of the book, which was along the lines that I brought to these discussions, as you would expect, a traditional finance minister’s responsibility of seeking to test propositions that were put to me. I would say of any spending proposals that I see that as a central part of my responsibility, to undertake that testing or challenging of any proposals, whether inside committee decision-making processes or indeed matters that are put to me bilaterally by ministers. That is essentially my job. But otherwise I do not comment on the deliberations of cabinet or cabinet committees.

With respect to the specific matters that the shadow minister did raise, there are some matters that are more specifically within the purview of individual ministers rather than me as minister for finance. I will endeavour to go through them one by one with that caveat. First on the computers in schools program, as you would be aware, there has been a set of negotiations with state governments about the process. That did lead to some modification compared with the original election commitment. We are fulfilling the election commitment but nonetheless in order to reach agreement with the states there was an additional financial commitment involved there.

Second, with respect to consultancies, the statement in the question from the shadow minister is incorrect. In fact, spending on consultancies across the government in calendar year 2008 and again in calendar year 2009 is substantially lower than it was in calendar year 2007 under the Howard government. The fall in expenditure in calendar year 2008 was about $65 million. All these are on-the-record figures and I would suggest that the shadow minister not be misled by highly distorted material that has been published in the Australian. All these things are a matter of public record, that there has been very clear and substantial reduction in spending on consultancies under the Rudd government.

Third, on the question of the broadband proposals, the shadow minister will probably recall that the then opposition went to the election with a commitment to a fibre-to-the-node proposal for a broadband network which involved optical fibre going to nodes in individual streets rather than all the way to individual households and businesses. You will be aware that the tender process for that did not produce a successful outcome, partly because it ended up occurring very much at the peak of the global financial crisis and a number of potential bidders were undoubtedly disadvantaged by the fact that the availability of capital for things of this nature was inevitably constrained given the circumstances. The government, confronted with this situation, chose to move in effect to what was always seen as the logical next step, although no previous commitment had been made to do this. The government chose the logical next step of building a fibre-to-the-premises network. (Extension of time granted)

On the question of the Building the Education Revolution primary school buildings, I am not aware of the two or three specific instances that the shadow minister alleges that buildings that cost four times the equivalent being built in the private sector were constructed. The shadow minister would be aware that there is currently a taskforce headed by former UBS CEO Brad Orgill examining all of these questions. I am happy to rely on the report that emerges from that taskforce in terms of the issues that have been raised here. We do accept that in a situation where you have got thousands upon thousands of individual projects all around the country the nature of the construction sector is such that every now and then there will be disputes and there will be problems. We regard the prospect that there will be individual issues of this kind as something that is an unavoidable aspect of having so many individual construction projects.

We do not necessarily accept some of the assertions that have been published. In my experience, the descriptions that have been published that I have looked at in some detail, almost invariably, have been somewhat at odds with the facts or have been selective in the use of facts. There have been aspects of the picture that have been not been referred to that would clearly modify any reasonable balanced assessment of the claims being made.

Finally, I would suggest that the border protection questions are probably better directed to the Minister for Immigration and Citizenship because the basis for forward estimates and the numbers of prospective claims is something that is very much a matter for the Department of Immigration and Citizenship.

I would also draw the shadow minister’s attention to instances in the past where there have been much smaller estimates put in place that have been, shall we say, out distanced by the actual number of arrivals, instances from the time that the Howard government was in office. I refer him to the Minister for Immigration and Citizenship on the question of estimating, for forward estimates purposes, the number of arrivals.

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

I will follow a couple of those issues and then move on to some more specific questions. I have sought to follow up with the Minister for Immigration and Citizenship. He has said publicly that he has got no idea how many will come next year. I would like to know the rationale behind it. I presume you and your department take some responsibility for ensuring that the numbers make sense and that you can have reasonable confidence in the assumptions. Given that this year there were 5,500 arrivals and a billion dollar blow out, I would be interested to know what process you went through to arrive at a figure of 2,000 for next year. Given that you have had a blow out this year, I would have thought that, conservatively, you would use a higher number or as high a number as this year. If you succeed in reducing the numbers well and good, but the experience to date is there seems to be no evidence of numbers coming back so I would be interested in that process.

Secondly, the Building the Education Revolution, as you say, has thousands of different projects but, whether there is one or thousands, it still remains the responsibility of the government to act in a conscientious and prudent way to avoid waste. It seems to me you are really putting the proposition that government, with thousands of projects, cannot be expected to dot every ‘i’ and cross every ‘t’. Would that be the case?

I understand the point you were making that there are joint responsibilities between individual ministers and the Minister for Finance and Deregulation. The point of my question was what specifically have you sought to do to rein in what is clearly some of the biggest wastage perhaps in our country’s history of federal government programs including the massive wastage which will end up, no doubt, in billions of dollars with the Home Insulation Program?

There have been billions of dollars wasted, on the evidence to date, which seems to me to be a lot more than the occasional problem here and there. What specifically have you done over the last six months when it became patently obvious that there were generic problems in the management of these programs and when those ministers responsible, for whatever reason, were failing to rein in these programs? I would have thought you have a significant responsibility. How did you exercise that responsibility? I would be very interested to know.

You made a statement about the $4.7 billion that the program was in prospect and that because of the global financial crisis funds were not available for commercial interests, but you went on to say that, as a result, you went to the next logical step of fibre to the house. Was it always intended that the next logical step would be fibre to the house and that it would involve massive government involvement in the creation of that network, the funding of that network, the operation of that network and, hopefully, the financial return on that network? Was it envisaged that you would in fact renationalise a very big part of telecommunications? Was that the logical next step for the government? As you thought through this program, was that in your head when you went to the last election and promised a broadband network around the country? Is what we are not getting the thing you have always had in mind as the logical next step?

On other specific items: on page 84 in Budget Paper No. 2, nearly $1.3 billion was listed as decisions taken but not yet announced over the forward estimates with $50 million listed between 2009-10 and 2010-11. Can you rule out these funds being announced ahead of the federal election? (Time expired)

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

With respect to the supplementary question asked by the member for Goldstein on matters regarding asylum seekers, I will take that question on notice in order to give him a proper response. Secondly, I do not accept the premise on which his further question about the Building the Education Revolution program was unfolded. So I do not accept his claims with respect to waste. I am afraid that for me to answer the question he asks me about what specifically did I do, that would involve me revealing cabinet discussions and cabinet deliberations, which I am not in a position to do.

Penultimately, on the question of the move from a fibre-to-the-node proposal, as put to the election, with the fibre-to-the-home National Broadband Network proposal, when I said that that was seen as a logical next step I did not say that this was seen as a logical next step by a specific party—that is, the federal opposition. This was generally widely in public debates seen as, in effect, a stepping stone. That does not therefore mean that the opposition at the time had any specific subsequent commitment in mind. We were aware of that possibility but we had made no decision about it and had no preconceptions about it. Once the tender process for the fibre-to-the-node proposal failed, we had to give consideration to that possibility along with various other possibilities, but there was no preconceived proposal flowing in the wake of the original election proposal.

Finally, on the decisions taken but not yet announced, I am not in a position to rule anything in or out about how those matters are dealt with. Apart from anything else, it is not my responsibility. My responsibility in this regard is simply that these things are accurately recorded in the budget, but I am certainly not in a position to make any statements about when any particular thing will be announced.

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

Through you, Mr Deputy Speaker, to the minister: on the last issue that the minister responded to—decisions taken but not yet announced—I ask a supplementary question. Could you confirm, Minister, that the $400 million announced by the Prime Minister on 9 June as part of the renamed Regional Infrastructure Fund was taken from this line item in the budget? I was going to ask you more about the disbursement, but I understand from your earlier answer that you claim not to be in a position to do that. More specifically on some of the other issues: why is it that you and your department are being sidelined regarding the $16.2 billion school halls program after the Deputy Prime Minister established a $14 million task force, which will be led by Mr Brad Orgill, to assess the level of waste under this program?

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

Again, through the chair to the minister rather than ‘you’ all the time, if you do not mind. That way we can do this formally.

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

Sorry, Mr Deputy Speaker. Minister, why is it that you and your department have been sidelined in relation to the investigation into the level of waste and mismanagement under the Building the Education Revolution program? Shouldn’t this have been the job of the minister and the minister’s department? Given also that the department of finance is responsible for sustainable government finances, does the minister think that the Building the Education Revolution was value for money and good policy?

Given that Australia recorded one quarter of negative growth in 2008, why is it that $500 million of the stimulus funding under the Building the Education Revolution program will be spent in 2011-12 at a time when real GDP growth is forecast to be four per cent and CPI at 2.5 per cent, and this following six consecutive interest rate rises which have added between $4,000 to $5,000 to the average home mortgage?

Furthermore, what role did the minister perform in relation to developing the Home Insulation Program? When did the minister first become aware of the problems with this program? What is the total figure that this program will cost the budget? Has the minister costed inspecting every one of the million or so homes that have received insulation as part of this program, given the ongoing problem with fires that often occur in homes that have been ruled as not needing any particular attention? Has the minister assessed the total financial liability of the Commonwealth under this program? Minister, given that the department of finance is responsible for sustainable government finances, do you think the Home Insulation Program was value for money and good policy? Furthermore, Minister, in the 2010-11 budget papers, you claim $17 billion of new taxes as savings. Can you please clarify these statements and the metrics that the government uses in classifying new taxes as savings? Finally, do you envisage spending the remaining $700 million left in the Building Australia Fund over the coming months?

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Firstly, I stand by all of the government’s stimulus measures. While the government have acknowledged that there have been specific problems in the Home Insulation Program, we have acted to deal with those problems. I will take on notice the question about the cost to the budget of the Home Insulation Program. As to the question of Commonwealth liability, it is my responsibility with respect to any prospective legal proceedings that may be issued against the Commonwealth—be they about this or any other matter—to effectively present reporting in the budget about risks, in the statement of risk, and also to oversight those potential liabilities. I am continuing to do that in this and other areas.

The questions relating to my role in developing the program and the points at which I became aware of the problems I referred to are matters that relate to cabinet deliberations, which I am not at liberty to reveal. As to the question suggesting that my department was sidelined from the process of the examination of problems or alleged problems in the Building the Education Revolution, my answer to that is that my department was not sidelined. It is a perfectly normal and legitimate thing, where an issue emerges in a particular portfolio, for the minister of that portfolio to initiate some kind of arms-length or independent examination of that—and that is not conducted by the Department of Finance and Administration. For obvious reasons, the situation of having one arm of government investigating another arm of government would give rise to accusations that this was not a genuine independent or arms-length examination of the problems. It is a perfectly normal situation under governments of both persuasions that, if there is to be some examination of this kind, one option is to have an inquiry or a task force of the kind which has been established.

As to the question of why there would still be $500 million of stimulus budgeted for the 2011-12 financial year, I suspect the answer to that question is that, inevitably, projects occur over an extended period of time. You obviously do not pay the entire cost of a project upfront. Typically, particularly with more substantial projects, there will be milestone payments and there will be payments at the completion of the project, as well as the payments at various stages along the line. I suspect you will find that that $500 million essentially reflects that pattern. Of course, it will reflect, retrospectively, private sector activity that has occurred in the preceding period.

The question of the decision regarding $400 million of infrastructure assistance for Western Australia was an item in the category of decisions taken but not yet announced. I can confirm that. I am not in a position to make any statements about when the remaining funds in either the Building Australia Fund or any of the other funds will be disbursed. That is not a decision I take unilaterally, obviously. I am not in a position to respond to that. Apologies, I am just looking through my scribbled notes to make sure that I have covered—

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

The Home Insulation Program?

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Yes, I have responded to those questions.

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

The savings question?

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Sorry, yes. All of this is disclosed. The generic term ‘savings’ is used to describe improvements in the net bottom line to the budget. You will see this broken down into ‘revenue’ and ‘spending’ items in all of the three budgets. There is a table that aggregates all of this where it is broken down into spending and revenue items in all of the three budgets. (Time expired)

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

Just last month in his Razor’s Edge blog the minister wrote:

But I am a bit of a romantic on this, I think elections are largely determined by how well they think the Government is governing, not on how many fistfuls of cash they pump on election eve.

Minister, given your responsibility for stopping waste and mismanagement, it has been reported that a staggering $220 million of non-road, non-rail stimulus funding has been pumped into your own electorate of Melbourne, with a further $15 million in non-stimulus grants earmarked for the seat.

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

You’re even dumber than I thought you were!

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

Do we need gratuitous insults across the chamber, Madam Deputy Speaker?

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

Madam Deputy Speaker, I ask the minister to withdraw that remark.

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Madam Deputy Speaker, I am happy to withdraw.

Janelle Saffin (Page, Australian Labor Party) Share this | Link to this | Hansard source

The remark has been withdrawn. Member for Goldstein, please proceed.

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

This is a serious issue. It is not an issue to be laughed at and to abuse other people about. It is a very legitimate question. If nearly a quarter of a billion dollars is being spent in the electorate of the Minister for Finance and Deregulation, a minister who has made his reputation on the back of anti-rorting statements—

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Yes, yes, I’m going to answer your question.

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

Do I need prompting as well, Madam Deputy Speaker?

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

We are not so sensitive in here that we cannot take a bit of banter across the table. Please continue.

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

Okay—‘a bit of banter’. Thank you, Madam Deputy Speaker, that is a very good ruling! Minister, are you cynically giving the nod to the funnelling of taxpayers’ millions into your own electorate with an eye to your own electoral skin? Furthermore, following the budget the finance minister said ‘the coalition’s debt and deficit campaign is dead’. Minister, can you please justify this statement considering that the budget deficit—not that we heard much about it on the night of the budget—is $57 billion for 2009-10 and, if all of the rosy assumptions come to be, is forecast to be $40.8 billion in 2010-11? The point of my question is that $57 billion is the largest deficit in our history by a country mile and $40 billion, if it comes to pass, will be the second-biggest deficit in our country’s history. I would like the minister to explain how he can say that the debate about debt and deficit is dead when the government, with a budget approved by the minister, will have to borrow $700 million a week for the next two years to pay for the continued spending. As well, can the minister confirm that the interest on net government debt in 2010-11 will be $4.6 billion and that net government debt is forecast to peak at $93.7 billion in 2011-12? Can the minister confirm that the forecasted interest repayment on this amount is $6.5 billion? I also refer to the $10 billion super hit for small business. I refer to the proposal to lift the compulsory employer superannuation contribution from nine per cent to 12, which will cost small business $10 billion a year. Three months ago, when asked by Ross Greenwood whether future compulsory superannuation increases would come at the expense of wage increases, the minister clearly said:

… the fact that your employer is forced to put in an extra three per cent in your super means that money that otherwise could have gone into your wages, is going into your super basically.

When, subsequent to that announcement, the minister’s own words were read back to him in a radio interview on 4BC, the minister said he had been seriously misrepresented, but he finally conceded:

Yes, it will have an impact on the dollar increase for some workers.

On multiple occasions the minister has conceded that the compulsory increases in employer superannuation will come at the expense of wage increases. Why then, when pressed in different forums, has the minister claimed not to have said this? (Time expired)

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

First, with respect to matters regarding my own electorate, the amount of stimulus spending in my electorate relative to other nearby electorates varies in one respect only, and that is with respect to social housing. If you look at all of the items listed in stimulus measures in my electorate, you will see that, whether it is Building the Education Revolution or other areas of stimulus, broadly it is pretty much the same as in the equivalent electorates. There is only one difference; it is social housing. I wonder why that would be. Guess what—the answer is because that is where the social housing is. I have in my electorate the largest number of public tenants in Victoria. The number is, I understand, something like 2½ times the number in the next highest electorate.

It is unavoidable that, where you have a stimulus strategy that includes major measures to upgrade social housing, it is not going to be distributed evenly across all electorates, as, for example, the Building the Education Revolution funding is distributed evenly because the number of primary schools or primary schoolkids is going to be fairly similar across individual electorates.

The key answer to the shadow minister’s question is: were the stimulus to have been about upgrading yacht clubs then there probably would have been a disproportionate investment in his electorate, but, because the government made a decision to upgrade social housing, that meant that a disproportionate amount of that money was inevitably spent in my electorate.

Finally on this point I might indicate that the actual decisions with respect to the location of spending, the decisions about individual projects, were decisions in which I played no role. These were matters worked out with the Victorian government by the Minister for Housing, and these were decisions in which I had no role.

As someone representing an electorate that is not quite inner city but is not far therefrom, I would suggest to the shadow minister that the notion that the construction of additional housing of any kind, particularly higher density housing, in the inner city is the pathway to electoral popularity is a proposition that you will not find many serious political analysts able to support. Amongst other things, I find it amusing that people think that I regard this as a pathway to winning support in my electorate. In fact, I support it because it is the right thing to do for a large group of people who traditionally have been neglected and ignored by successive Liberal governments who have dramatically cut funding for social housing over the years and who have refused to invest in them. These are people who are on very low incomes, who are very disadvantaged and who we believe are entitled, along with everybody else, to reasonable living circumstances.

Secondly, I am asked why I made the statement that the opposition’s debt and deficit scare campaign is dead. Notwithstanding the campaign that we have had regarding tax reform from the opposition, there have been numerous questions in the last few weeks in question time about a variety of other subjects and I do not recall any questions about this particular subject. The evidence that your scare campaign is dead is actually out of your own mouths. The other evidence is that Australia’s debt level is projected to peak at around six per cent of GDP, in a world where other major countries have debt levels that are heading towards 80 per cent or 100 per cent of GDP. Any serious economist does not regard your campaign seriously and regards it as the complete joke that it is. That is why you have dropped off it completely. I have answered your question. I have answered why you have dropped your debt and deficit campaign—because even you realise it is totally idiotic. That is the answer to your question.

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

The highest ever is ‘idiotic’!

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Your campaign is idiotic. (Extension of time granted) On the questions with respect to debt interest, I refer the member for Goldstein to the budget papers.

Finally, on the question of statements I have made with respect to the impact of increases in the superannuation guarantee on wages, I will repeat the statements I made on 4BC to try to explain the difference. It is the difference between nominal wages—

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

That was very embarrassing.

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

You whinged before; how about shutting up now? I will repeat my statements, and I will make them slowly and in words of limited syllables so that, hopefully, this time the member for Goldstein might understand them. Perhaps when you get an opportunity you might stand up and see whether you can explain your version of what the difference between nominal and real wages means. That would be enlightening for all of us. On the difference between nominal and real wages, the point that I was making in the initial interview, conducted by Ross Greenwood, was about nominal wages and the perception by individual workers that an increase would involve loss of nominal wages. The question I was asked on Q&A, not on radio, referred to real wages. There will not be—

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

What?

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

That is correct. If you look at the transcript, you will see the term ‘real wages’. If you look at the government’s proposals, what you will see is that, in any given year, the increase in the superannuation guarantee is no higher than 0.5 per cent. In other words, it is expected that real wages will continue to increase, because typically the real wage increases are significantly above that and the historic trend is that and we anticipate that real wages will increase at a higher level than those rates. So real wages will not be cut; real wages will not be reduced. That is precisely why I did not accept the interpretation being put to me on Q&A about that statement, and I stand by all of that.

Yet again, the people who opposed occupational superannuation in the 1980s are going to be opposing it now and they are going to continue opposing it. Why? I say it is because it benefits ordinary working people. Why do they oppose occupational superannuation? It is because when we took office in 1983 superannuation was the privilege of the rich, the well-heeled, whom the Liberal Party are interested in supporting. What Labor did in office was extend access to superannuation to ordinary working people. What we are now proposing to do is to strengthen that access to superannuation for ordinary working people. That is why you do not like it and that is why you are opposing it, along with cutting company tax and along with improving the tax provisions for small business. You are opposing it because, ultimately, you are on about the well-off. You are on about the well-heeled in this society, not ordinary working people. Yet again you will oppose the extension of greater superannuation to the ordinary working people of this country. That is the issue here.

The government is resolutely committed to delivering this improvement in superannuation and retirement incomes for ordinary working people and strengthening the investment pool which, amongst other things, helped save Australia from the global financial crisis and helped protect Australia’s economy during that time. Any serious player in financial markets will tell you that, because there was a guaranteed automatic pool of billions of dollars coming into the markets, no matter what occurred internationally, from that occupational superannuation arrangement. That is why the government remains resolutely committed to improving occupational superannuation in this country: because it improves the retirement incomes of working people, for whom the Liberal Party has never done a jot, and because it improves the investment savings pool that will be invested in the long-term economic growth for the future of Australia. That is why we remain committed to this proposition, and that is why you oppose it—and no amount of sophistry and misrepresentation and verballing about things that I have said will change any of those things. (Time expired)

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

Madam Deputy Speaker, I raise a point of order. The time for this debate has well and truly expired and I would like to draw your attention to that.

Janelle Saffin (Page, Australian Labor Party) Share this | Link to this | Hansard source

As the time for debate on this matter has concluded, I put the question that the proposed expenditure for the Finance and Deregulation portfolio be agreed to.

Proposed expenditure agreed to.

Treasury Portfolio

Proposed expenditure, $4,330,987,000

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

The question is that the proposed expenditure be agreed to.

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

I am wondering if the minister would want me to ask questions and sit down. These are normally a fact process. I refer the minister to Budget Paper No. 1, chapter 5, page 37. It says in resource rent taxes 2013-14 the projected revenue in gross terms is $15.93 billion. I refer to note A, which says resource rent taxes include PRRT and gross receipts from the resource rent tax. Can the minister give us a breakdown of that $15.93 billion?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

I thank the honourable member for his question. It is good that he is here. I note that in the Human Services appropriations the shadow minister did not come and it broke down after five minutes. I am sure that as a former minister for human services he shares my disappointment at that. I will take that question on notice. I refer the honourable member, as he said, to the budget papers. If he is trying to break down further orders of what is in the budget papers, that is something I will get back to him on. I may get back to him on it during the course of this session or I may get back to him on it in due course.

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

I appreciate that. I note that the net impact is $9 billion and would assume that, given the royalties identified by the Australian Taxation Office in 2007-08 were nearly $4 billion and obviously would rise significantly over the next five years to fit in with that, I would also be interested in the minister providing me with the details of what the government expects to pay back to the mining industry for the 40 per cent guarantee, and also how much of the $15.930 billion is in fact going to be specifically royalties in that year. I ask the minister to explain the Treasurer’s speech of 4 May, where he said:

The fact is, the Government’s reforms will tax the mining industry better. In fact, the most significant ‘spend’ in the entire tax package is over $8 billion every year in state government royalties that will be refunded or credited to mining companies.

Given that there is a net 9 billion, and the total is 15.9 billion, the question is how did the Treasurer get the 8 billion.

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

Again, I am happy to take that question on notice. The Treasurer has clearly indicated that royalties being, as regarded by the independent tax review, the most inefficient tax in Australia, it is appropriate that the federal government refund that. If he is asking for further breakdowns to the extensive information which is in the budget papers, I am happy to provide him with that information, if it is appropriate to do so, when I have that information at hand.

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

Does the minister agree with the Minister for Finance and Deregulation that an increase in the superannuation guarantee will come out of take-home pay?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

This is a very interesting point for the shadow Treasurer to make. Again, the opposition have been at sixes and sevens on this. Of course, they have always opposed superannuation, as my colleague the Minister for Finance and Deregulation pointed out. They opposed the introduction of compulsory superannuation; they said it would have an impact on small business, they said it would drive small business out of operation and they said it would increase the cost of employing people. They said all that through the 1980s and 1990s—and, again, when the government announced the decision to increase the superannuation guarantee, they came out and said, ‘This will be a tax on small business and it will reduce take-home pay for Australians.’ I note that a couple of weeks ago Senator Abetz issued a press release asserting that it would come out of take-home pay. I fail to see how that could be at one with their constant claims over recent weeks, and indeed over recent decades, that superannuation was an impost on small business.

I make the point that the increase in the superannuation guarantee from nine per cent to 12 per cent is being phased in by this government at a more gradual rate and over a longer period than even the original nine per cent—moving from the three per cent in awards to nine per cent. We are moving from nine to 12 over a more gradual period, and we are doing so in conjunction with reductions in the corporate tax rate. There are times when the superannuation guarantee going from three to nine per cent coincided with increases in the corporate tax rate. We are doing so with reductions in the corporate tax rate and we are doing so over that long period, starting at increments of 0.25 per cent—which is half the average increment under the previous increase from three to nine per cent—to enable plenty of time for employers, employees and unions to build these into their negotiations. I have no doubt that employers will argue in those negotiations and before tribunals that these should be taken into account. I am sure that will be the case, and a number of unions have recognised it.

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

I refer to the famous pie charts in the Treasurer’s Economic Note of 9 May. In response to a question on notice in Senate estimates, Treasury provided aggregate data underlying the pie charts, and there are some unusual aspects to the data. Comparisons with ABS data show the Treasury estimates of resource rents were lower than the ABS measure of EBITDA—earnings before interest, taxes, depreciation and amortization—for the years 2001-05 through to 2007-08. Now, that is what you would expect: resource rents would be only a portion of earnings. But interestingly, in the information released by Treasury in 2008-09, Treasury’s estimate of resource rents—$91.2 billion—actually exceeds the ABS measure of earnings, which was $74.1 billion.

So Treasury’s estimate of resource rents more than doubles in 2008-09 to $91 billion from $40 billion—a massive jump. And yet the company tax only increases by 46 per cent, to $11.9 billion from $8.1 billion. My question is: why did company tax not keep pace with the increase in resource rents?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

The honourable gentlemen said that his question referred to the pie charts. I think he is referring to those in the Treasurer’s Economic Note of a few weeks ago. The Treasurer has made it clear that that information—and I think the shadow Treasurer has confirmed this—was based on Treasury modelling. If the shadow Treasurer is asking for more information around that Treasury modelling I am more than prepared to take that on notice and advise him of the further information he requires if I am able to do so.

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

Thank you. The Parliamentary Library has provided a disaggregation of the Treasury estimates of resource rents, and I seek leave to table it.

Leave granted.

I refer to the row of numbers which shows a calculated series for allowance of corporate capital. In 2008-09, the library calculates there must be a negative allowance for corporate capital—a negative $6½ billion. I wonder if the minister could explain how an allowance for corporate capital can, in fact, be negative under this assumption.

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

Given that the honourable gentleman’s question goes to Parliamentary Library analysis which I have not had the opportunity to read—he has just tabled it—I will read it and I will respond once I have had the opportunity to read it and seek Treasury advice.

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

The 2010-11 budget shows that the resource super profits tax will reach $9 billion in net proceeds in 2013-14. There has been some discussion, particularly from Dr Henry, that that may be a conservative figure and it may well be a much larger figure. Will the minister advise the House of what Dr Henry was alluding to when he referred to a higher figure?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

It is well known that, when the Treasury does its modelling and its forecasts, it takes a conservative approach. It makes assumptions which could be accused of being conservative. I know that it has made assumptions, in arriving at the $9 billion figure, based on certain profit projections and certain terms of trade projections. I think the Secretary of the Treasury was making the point that those projections are, in his mind, conservative—as is prudent and appropriate.

I know the shadow Treasurer has some interest in this. He last year accused the Treasury of not being conservative enough—of being overly optimistic. Of course those projections turned out to be too pessimistic. This year he has accused the Treasury of being too pessimistic whereas last year he accused it of being too optimistic. He now accuses it of being too pessimistic. I think he and I would agree that forecasting is, by its very nature, not always an exact science, but this is the Treasury’s best estimate based on the best information it had at hand, with conservative assumptions built into that. I would much prefer the Treasury to be conservative in its forecasts than to be overly optimistic.

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

Given that the Treasury has said—and the minister has now just confirmed—that the estimate of $9 billion in annual proceeds from the resource rent tax is conservative, will he undertake to advise the House of Treasury’s best available information on the net proceeds from the tax?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

The best information that Treasury has available is the information in the budget papers. The published budget papers represent the Treasury’s best estimate, but Treasury do not necessarily take an optimistic view on the terms of trade or on profit levels. They use their best estimate of what those parameters will be. They do that in a fashion which is not overly optimistic or, to use a different term, which is conservative. But the figures that have been published in the budget papers are the Treasury’s best estimate of what the revenue will be, as projections published in the budget papers are the Treasury’s best estimate of all economic parameters and all revenue parameters for every tax, for all sorts of revenue, for all expenditure and for the broader economic figures which apply throughout the budget.

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

I think the minister did not quite understand what I was saying. It is one thing to have the best Treasury forecasts and projections, but revenue is another thing. On this occasion, the Treasurer and the minister have confirmed that the revenue estimates of $9 billion are conservative. Given that Dr Henry said that as well—so now both the minister and Dr Henry have said the estimated revenue of $9 billion is conservative—I again ask the minister if he could tell us whether it is $12 billion, $14 billion, $7 billion, $15 billion or whatever. Obviously, if it is a conservative figure, it is more than $9 billion, but the question is just how conservative it is.

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

It is not more than $9 billion. It is $9 billion. That is what is in the budget papers. The honourable gentleman would be the first to criticise Dr Henry, the Treasury and the modellers if Dr Henry said: ‘It might be $9 billion, but actually we think that’s a bit optimistic. We think that’s on the high side. We think it could be a bit less than that.’ I think the shadow Treasurer would then be right to say: ‘The Treasury are fiddling the books. They are not putting the right numbers in.’ The Treasury’s best estimate is $9 billion. It is based on conservative, but nevertheless appropriate, assumptions about different parameters which may affect that revenue base going forward. So I have to disabuse the honourable gentleman of his notion—

Janelle Saffin (Page, Australian Labor Party) Share this | Link to this | Hansard source

Honourable member.

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

Honourable member. I also regard him as a gentleman, Madam Deputy Speaker—on most days. But I must disabuse him of this notion that somehow the forecast and the projection in the budget paper is not the Treasury’s best estimate of the amount of revenue to be raised, because it is.

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

Thank you for referring to me as a gentleman, Minister. Given we have both shared children time at the Powerhouse Museum, we both understand those pressures. Minister, I refer you to table 6, statement 3 on page 13 of Budget Paper No. 1. It shows that policy decisions since the 2009-10 budget have increased net spending by $5.9 billion. That is the sum of policy decisions for the year 2009-10 through to 2012-13. That figure includes new spending measures, new taxes and savings initiatives. It shows that all of the new taxes have been spent, all of the savings initiatives have been spent and, on top of that, $5.9 billion has been spent for good measure. New policy decisions have not contributed in net terms a single cent to reduce the budget deficit, so the question is: how are they going to reduce the budget deficit?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

This government has made its fiscal rules very clear—that is, we will limit real spending growth to two per cent. I know the honourable member says that that is easy, but I would disagree because I have had a look at the spending decisions made under the Howard government, and real spending growth exceeded two per cent for, I think, almost every year of the last 10 years of the Howard government. So I do not think it is necessarily easy to limit real spending growth to two per cent, but that is what we have committed to do and that is what we are doing in this budget. We have also committed to, if you like, banking increases in tax revenue to draw down the deficit. That is why we are able to budget for a surplus three years ahead of time and before any other major advanced economy. It is because we have those very clear fiscal rules in place, and the savings delivered under this budget are greater than the increased expenditure contained therein. For that reason, we are making a contribution to reducing the budget deficit and moving into surplus. We have made those fiscal rules very clear, and I think the honourable member is aware of that. He is also aware that we have met those fiscal rules.

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

So now that we know that God—or good fortune, terms of trade or whatever the case might be—is doing the hard work to get the budget back into surplus one day—

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

Mr Bowen interjecting

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

That is not what he thinks! I refer the minister to statement 10, page 6, which is the authoritative table of Budget Paper No. 1. The morning after the budget was presented David Koch sought to challenge me on this table, but I had read it before he saw it. I refer to the fact that, as a percentage of GDP, in the last two years of the coalition government expenditure was 23.2 per cent and then in 2007-08 it was just 23 per cent. Yet, at the most optimistic end of the chart, in the last projected year of the Rudd government’s budget to 2013-14, it is still 23.6 per cent, which is above the levels of the last coalition government. I ask the minister: when will you ever get to the same low levels of spending as that of the last year of the coalition government?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

The honourable member is correct to point out that this government needed to make some spending decisions which resulted in the figures to which he refers. We needed to make those spending decisions based on the impact of the global financial crisis on this nation, and that meant that we needed to stimulate the economy. I know the honourable member and his party opposed that stimulus but we feel that it was necessary. We feel it was necessary not just because it would have increased the unemployment rate if we had not done do so—and put a lot of people on the unemployment scrapheap, with all the intergenerational impacts that that would have had—and not just because it would have driven many businesses, including predominantly many small businesses, out of operation if we had not done so. It was necessary and desirable to do it for the long-term fiscal strategy of the government, because, if as a nation you go into recession, you have a long-term debilitating impact on government revenue and government expenditure. It has an impact on government revenue because personal income tax and corporate income tax takes are down because economic activity is less, and it has an impact on government expenditure because welfare payments, predominantly through the Newstart allowance, are greater because the unemployment rate is greater.

So it is disingenuous to say, ‘Let’s not stimulate the economy now so we can keep the budget in surplus.’ I think the shadow Treasurer himself has recognised that that was impossible. There is no way the budget could have been kept in surplus during the global financial crisis, even without any stimulus. A stimulus was necessary and desirable to reduce the deficit going forward and to maximise the chances of returning to surplus, as I think the indication is that we have done by returning to surplus three years ahead of time.

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

I take the minister back to table 5-37, about the resource rent tax. Would the minister ask the Treasury to advise why it was good enough to provide refunds with a gross figure for income tax but not good enough to provide refunds with a gross figure for the resource rent tax.

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

I am more than happy to oblige the honourable member. I will ask Treasury for that advice and will answer the question when I am able.

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

Budget Paper No. 1, at 10-8, shows that net debt will peak in 2012-13 at $93.7 billion. I refer the minister to legislation that passed through this parliament providing a guarantee for state government borrowings provided by the Commonwealth. An amendment moved by the coalition and accepted by the government was that there should be full disclosure through a register of those people who are purchasing government bonds. Given that it has been nearly a year, as I recall, since that legislation was passed and gazetted, at what point will the government comply with the law and disclose who is actually lending Australia all this money?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

In relation to that, I am happy to take advice on the timetable and report back.

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

It is one thing for us to engage in policy banter and debate, but it is actually the case that the AOFM has a requirement to comply with the law. The government itself is in breach of the law if it does not publish the register of who is actually lending us, at this stage, $100 million a day.

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

My former answer still holds. I advise the House that the Australian Office of Financial Management has published a register of the beneficial owners of Commonwealth and Commonwealth government guaranteed securities by country. The honourable gentleman is alleging that more is required under the legislation. I will take that on advice and will check the timetable for doing so, if that is in fact the case.

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

Is that on your website? Where would that be registered in published form?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

I would imagine it is on the website but I could not inform the House that that is definitely the case.

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

Could you let us know?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

I will certainly do so.

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

The shadow minister has the call.

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

I want to identify that the link between government spending and interest rates has been confirmed in the past few weeks in Senate estimates—and that is natural enough. Dr Gruen of Treasury said:

… if you were to engage in discretionary fiscal stimulus at a time of full employment then the implications of that would be that monetary policy would likely offset it with higher interest rates.

Given that in May the unemployment rate declined to 5.2 per cent and Treasury claims that full employment, as I understand it, is five per cent, at what point does the government believe it has a responsibility to heed the words of Dr Gruen and massively pull back on its stimulus spending?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

With all due respect to the honourable member, I am not sure that Dr Gruen would agree with that characterisation of his comments that he was calling for a massive winding back of the stimulus. In fact, I know that Dr Gruen would not agree with that characterisation of his comments and that, if he were able to be here, he would make that point very strongly. The fact of the matter is that the shadow Treasurer has made this case repeatedly, and he has repeatedly got it wrong. He repeatedly argues that for some reason Australian government debt, Australian government expenditure, is putting upward pressure on interest rates. Of course, there are circumstances where government spending can put upward pressure on interest rates. Indeed, the honourable member as a member of the previous government would be fully aware of that, because that is what they did. They were determined to spend their way out of the boom. They were determined, despite the terms of trade and the economic conditions at the time, to increase government expenditure very substantially.

We faced a very different set of circumstances. We faced the circumstances of a global financial crisis and a reduction in economic activity. Accordingly, we stimulated the economy but we did so in such a way that the stimulus was designed to wind down as economic growth picked up. This was a very deliberate design feature of the economic stimulus package. For example: the first home owner boost wound down at the end of last year; the improvements to depreciation, the upfront capital allowance, wound down and have now washed through the system. Indeed, if you look at the proportion of our stimulus spending, which was being spent upfront and early compared to that in many other nations, we have a very good story to tell. The honourable gentleman argues, and the opposition argued at the time, that, for example, the stimulus payments direct to households were inappropriate. We disagree. They were appropriate because they stimulated the economy quickly and early in the cycle, and that was when it was necessary to do that. It washed through the system very quickly. It stimulated the economy and it has now washed through. The stimulus is being wound down.

So I strongly disagree with the honourable gentleman’s characterisation of Dr Gruen’s statements. I strongly disagree with the central tenet of his economic argument that this government is somehow putting upward pressure on interest rates. I also strongly disagree that in any event, with Australian government bonds on issue being 0.001 per cent of bonds on issue throughout the world, the Australian government is putting upward pressure on interest rates. If I could take this opportunity to say to the member for North Sydney in further response to his previous question: I am advised that that information from the AOFM is on the website.

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

Thank you. Given that the minister is such an enthusiastic supporter of his own stimulus packages, a chart on page 2-23 and 2-24 of the 2010-11 Budget Paper No. 1 purported to show a relationship between the size of fiscal stimulus and the extent to which economic growth exceeded expectations. It concluded:

Those countries that enacted large and timely fiscal stimulus packages, including … Australia, performed much better than expected. … The relationship … is highly statistically significant ….

The chart used data from just 11 of the G20 countries. However, in Senate estimates the Treasury admitted in a statement on 2 June 2010 that ‘an error was made’—‘We screwed up’ is perhaps a better way of describing it—in the original chart. There is no statistically significant relationship between fiscal stimulus and the extent to which economic growth exceeds expectations.

It also turns out there is no significant relationship when all OECD countries are included. Given this, will the minister now agree that new Treasury information shows there is no basis to the claim that the Rudd government’s fiscal stimulus played a significant role in the economic performance of Australia? Will the minister undertake to consult with the Treasurer and ask the Treasurer to refrain from making any further unjustified claims?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

If the shadow Treasurer is realistically arguing that fiscal stimulus had no impact on economic growth in Australia over the last two years, then my answer to him is: no, we will beg to differ. We will beg to differ because I think anybody who is an objective and considered analyst of these events would acknowledge that fiscal stimulus had a clear impact on economic growth. I know that the shadow Treasurer and his opposition colleagues, who were sitting by and hoping that Australia would go into recession, because it was a good way to ride back into government, would be disappointed with the fact that Australia avoided a recession and that the stimulus actually worked.

The stimulus worked in two ways. It had an impact on economic growth directly through stimulating expenditure. It also had a very important impact on confidence. I remember that the honourable member’s colleague the former Leader of the Opposition used to rise in the chamber and lecture us about how important consumer and business confidence was and how it had collapsed, and he said that that collapse was all down to the efforts of the Rudd Labor government. Then of course we had the stimulus and consumer and business confidence rose in Australia by a greater level than in any other comparable economy. Then the former Leader of the Opposition went very quiet.

Economic stimulus has impacts in two ways: it has the direct impact and it has the indirect impact through the impact on confidence. As the Treasurer has often put it, very eloquently, it is worth more than the sum of its parts, because of that impact on confidence. So I do not share the premise of the shadow Treasurer and I am sure he will understand that I will want to check his characterisation of the Treasury’s evidence before estimates, because many of his colleagues sometimes choose to verbal bureaucrats. I want to check that he has accurately characterised their comments, because I think that would be the appropriate thing to do in fairness to those Treasury officers.

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

My question is addressed to the financial services minister. There appears to have been a surge in the Telstra share price prior to the announcement of the heads of agreement on Sunday. Whilst it may be linked to movement in the ASX 200, would the minister be good enough to ask ASIC to investigate whether the movement in the share price of Telstra has been appropriate or whether there may have been reason for concern?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

I thank the honourable member for the question, because it is a serious one. It is a very serious issue and I take all issues such as this very seriously. ASIC, as an independent statutory government authority, does not need a minister to refer issues to it for investigation, as the honourable member, a former minister for financial services, would know. I make this point: this government takes these matters very seriously. That is one of the reasons that the government made this announcement on a Sunday. Sometimes honourable members criticise us for making significant announcements on Sundays, and often the reason for that is that when the market is closed is the appropriate time to make market-sensitive announcements. A Sunday or Saturday before 10 am, or after the close of markets, is the appropriate time to do that, and often Sunday is the best day to do it.

I have not looked at the Telstra share price movements over recent days. There have of course been share price movements across the board. I will pass on the honourable member’s concern to ASIC. What they do with it is then completely a matter for them. But I am very concerned about any suggestion of—let us call a spade a spade—insider trading and, as a result, tomorrow in the House of Representatives I will be introducing a bill to significantly increase the penalties for insider trading and boost ASIC’s powers to investigate, including the power to intercept telephone calls and electronic communication to help their investigations. I would hope for opposition support for that because it is very significant.

ASIC have pointed out to me—and this was one of the reasons why I embarked on that legislative change—that it is not uncommon before major announcements for share prices to move. This leads ASIC to have very considerable concerns, and I share those concerns. If there was anything in particular to note about the Telstra share price movements over the days before this announcement, that is something that I am sure ASIC would be investigating, but I will pass on the member’s comments and ensure that ASIC are aware of them so that they can take appropriate action.

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

I thank the minister for referring that to ASIC—and the ASX if necessary, I am sure. I also make the point that there was a significant surge in the Telstra share price today on the basis of a one-page statement from Telstra that it has signed a non-binding financial heads of agreement on the NBN. I express the concern that, from a common perspective, it could reflect poorly on our reputation as a well-managed market, which we are. Our equities market is well managed, but I do express a concern that, on the basis of a non-binding agreement that Telstra itself says is subject to the passage of legislation and ACCC approval, there is a significant surge in the share price of Telstra.

I ask the minister whether it would be deemed appropriate for Telstra to provide more information to the market and, obviously, their shareholders about the terms of the financial heads of agreement so that there is actually something substantive that is the basis for the increase in the share price. I note that there was a reported statement, I think in the Australian Financial Review today, that suggested that this deal would add 90c to the value of Telstra shares, which is almost a third of the value. If this were a penny dreadful stock you would say, ‘That’s speculative.’ But, given that it is one of the largest companies in Australia, with, I am sure, the largest number of mum and dad shareholders, surely there should be more information provided by the company to the market than simply a one-page statement saying that there is a non-binding heads of agreement—and the share price surges?

Janelle Saffin (Page, Australian Labor Party) Share this | Link to this | Hansard source

Before I give the call to the minister, I draw to the attention of the parliamentary secretary and honourable members the fact that when we cross the chamber we do so by traversing the perimeter of the room and not by going directly across. I draw your attention to it tonight because it has happened a few times lately on both sides. The honourable minister has the call, and we have a few minutes left for this debate.

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

The honourable member would know that share markets and financial markets respond to all sorts of things. Often, that can be regarded by clear-eyed and rational commentators as being overly exuberant. Nevertheless, the markets do respond, and I would suggest that there have been plenty of occasions where markets have responded to a lot less than a press statement from an organisation like Telstra. As I said before, the government fully expected this information to be market sensitive. That is why we made the announcement when the market was closed—because that was the appropriate thing to do.

Again, I will refer the member for North Sydney’s comments to ASIC. There are continuous disclosure obligations, as the member knows, on all companies. I have no reason to doubt that Telstra have complied with those continuous disclosure obligations, but the appropriate organisation to consider the honourable member’s point is ASIC and I will draw his comments to their attention.

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

Just to add to this, as an example—and this is a statement from Telstra to the ASX—the transaction, if completed, would deliver a post-tax net present value of approximately $11 billion. It does not say when. This includes payment for the decommissioning of Telstra’s copper network and cable broadband services—it does not say when—the use of Telstra’s infrastructure and the value to Telstra of avoiding costs including USO costs. Payments would be made progressively to Telstra. It does not say when and on what basis. So I think there is a common interest in having more information provided in due course.

Finally, will the minister undertake on behalf of the government that, if there are any changes to the resource super profits tax, at the time of the announcement of those changes there will be full disclosure about the impact on the budget?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

In relation to the first question—

Janelle Saffin (Page, Australian Labor Party) Share this | Link to this | Hansard source

I remind the minister that it is six o’clock, so I am about to close the debate.

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

I will be very brief, Madam Deputy Speaker. I want to do the honourable member the courtesy of giving him an answer but I will be brief. I would be surprised if Telstra had not sought advice on their continuous disclosure obligations and would feel that they have filled those but, again, I will draw ASIC’s attention to his concerns and make sure ASIC looks at those concerns.

On the second matter, the government will of course act appropriately. We have said that we are in detailed discussions with mining companies. We are. They have been very serious discussions and I am sure when the government are in a position to fully update on those discussions we will do so in an appropriate manner.

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

The time for this debate has concluded.

Proposed expenditure agreed to.

Prime Minister and Cabinet Portfolio

Proposed expenditure, $413,931,000.

Anthony Byrne (Holt, Australian Labor Party, Parliamentary Secretary to the Prime Minister) Share this | Link to this | Hansard source

Madam Deputy Speaker, on indulgence—and my apologies to the member for North Sydney for walking across his path—I inform this chamber, as the Prime Minister has just informed the House, that there has been an accident today in Afghanistan where we have lost three of our soldiers and we have an indeterminate number who are injured. Obviously that has caused great concern to the House, and a statement has been made by the Prime Minister and also by the Leader of the Opposition. Our thoughts and prayers are with the families of those we have lost and those who are injured.

Janelle Saffin (Page, Australian Labor Party) Share this | Link to this | Hansard source

Thank you for bringing it to our attention. I am sure I can say on behalf all members here that our thoughts and prayers are with their families and friends and their comrades. The honourable member for Solomon now has call.

Damian Hale (Solomon, Australian Labor Party) Share this | Link to this | Hansard source

Before I ask the Parliamentary Secretary to the Prime Minister a question on the portfolio expenditure now before the committee, I would like to support his comments and add my thoughts on the loss of the three servicemen in Afghanistan. As I have a large contingent of ADF personnel living in my electorate, it certainly hits home whenever these incidents occur where there is loss of life. My thoughts are with their families at this very sad time.

Parliamentary Secretary, I know the community cabinet meetings are a great opportunity for members of the local community to engage with cabinet. The meetings provide members of the public with an opportunity to ask questions of cabinet ministers on issues that are important to them. Have there been many meetings to date and where have they been? How many people have had that opportunity to attend the meetings? In my electorate of Solomon, people regularly approach me on issues that are important to them, such as the government’s investment in our health care through the National Health and Hospitals Network, infrastructure funding and the government’s investment in infrastructure in the Territory specifically. If the PM decided to hold a community cabinet meeting in the Territory, are these the sorts of issues we would have the opportunity to discuss with the Prime Minister and the cabinet ministers?

Anthony Byrne (Holt, Australian Labor Party, Parliamentary Secretary to the Prime Minister) Share this | Link to this | Hansard source

I thank the member for Solomon for his question. I know that he is a very active local member and has rightly identified the numerous benefits that community cabinets offer to local electorates. I certainly agree with the member for Solomon that there would be a great many benefits to Territorians if a community cabinet was held in his seat. He can rest assured that I will certainly take that on board.

The Prime Minister made a commitment whilst in opposition to undertake community cabinet meetings, and it is a commitment that has been fulfilled. The meetings allow the highest level of consultation with the Australian people on issues that concern them, regardless of whether they are national or local matters. As a government we have held 24 community cabinets in every corner of the country. The cabinet has been to Western Australia on several occasions, to Tasmania, to metropolitan and regional New South Wales and, of course, to South Australia, Queensland and Yirrkala, in eastern Arnhem Land. Community cabinets are such an important initiative because, spending so much time in Canberra, the government risks losing sight of what truly matters to all Australians.

As the Prime Minister said at the community cabinet at Epping in April, the reason we take the cabinet on the road is to spend time with the men and women, boys and girls and young people who make up the great Australian family right across the place to hear directly about what the government is doing right, what the government is doing wrong and what the government can do better. So these are initiatives that, as a government, we intend to continue to pursue because they are part of the government’s commitment to keep in touch with what the community expects of us and to provide opportunities for people to bring their concerns directly to government.

There have been 11 community cabinet meetings in the year 2009-10, and there has been a very positive response from those who have attended. Since the inception of community cabinet meetings, over 10,000 people have attended public forums and over 1,300 one-on-one meetings with ministers have been held. Indeed, the reaction to these meetings normally sees more people than can be accommodated registering for each event. I notice various criticisms from the opposition, but this is done at a low cost, with the only advertising being through local papers and community cabinet sections of PM&C’s website, inviting all members of the local public to attend the meeting.

I have attended most of these meetings and have seen firsthand the wide-ranging benefits they provide to the community. There have been a number of issues that members of the public have raised that we as a government may never have known about if we had not gone and visited those various communities. So I will certainly take on board the comments of the member for Solomon and reiterate my agreement that a community cabinet in his electorate, I am sure, would be a very good thing. As far as I can recall, a community cabinet has not been held in Darwin—I am not sure if that is—

Sharryn Jackson (Hasluck, Australian Labor Party) Share this | Link to this | Hansard source

Ms Jackson interjecting

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

Mr Irons interjecting

Anthony Byrne (Holt, Australian Labor Party, Parliamentary Secretary to the Prime Minister) Share this | Link to this | Hansard source

So it would be a great opportunity for members of the community to engage with cabinet ministers and provide feedback on issues that are important to them.

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

Parliamentary Secretary, you talked about community cabinets. You recently held one in my electorate of Swan. The next day, there was a lot of speculation by people on talkback radio wanting to know exactly how the process for selection of people attending that community cabinet was done, particularly because there were constituents of mine who said, ‘We couldn’t get in, but people from Joondalup and Fremantle were able to attend, when the community cabinet was being held in Swan.’ They wanted to know why they particularly were not included when other people outside the electorate were. Could the Parliamentary Secretary to the Prime Minister answer that for me?

Anthony Byrne (Holt, Australian Labor Party, Parliamentary Secretary to the Prime Minister) Share this | Link to this | Hansard source

In answer to the good question from the member for Swan, as part of the planning process for a community cabinet meeting, shortly after the locality of a meeting is advised, PM&C’s Community Cabinet Secretariat meets with the office of the government’s local representative, local member or duty senator for the electorate to advise of the forthcoming meeting. I am sorry to ask you: I presume that you had been contacted with respect to this particular—

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

Yes.

Anthony Byrne (Holt, Australian Labor Party, Parliamentary Secretary to the Prime Minister) Share this | Link to this | Hansard source

I am sorry; I just wanted to confirm that. That is okay. Where the local member is not a government member, the Deputy Secretary, Governance, of the Department of the Prime Minister and Cabinet writes to the local member with advice about the meeting and offers a point of contact to facilitate their attendance. The letter is both faxed and posted on the day that advertising for the meeting first appears. If there is no response after a couple of days, a secretariat member will contact the member’s office to confirm that the letter has been received. The Cabinet Secretary writes to all non-government senators in the state in which a community cabinet is being held advising of the meeting and offering a point of contact to facilitate their attendance. These procedures have been in place since the Bathurst meeting in November 2009.

With respect to people trying to get through who might not have been able to, unfortunately it is like a first-come, first-served basis. The difficulty is, you have a number of people who cannot make it—I stand to be corrected by the departmental officials behind me. If it helps the member for Swan, I think there was a delegation of women looking at rural child care who were not able to make the cabinet meeting because the community cabinet meetings had been booked out. When I found out about that, I agreed to meet with them to allay their concerns. I can understand their frustration, but frequently these events are over-booked. Unfortunately, it is first come, first serve, as I understand it, but I am happy to be corrected by any of the departmental officials behind me. If there is any other issue you want to raise with respect to that, I would be happy to pursue it further for you.

Damian Hale (Solomon, Australian Labor Party) Share this | Link to this | Hansard source

My question to the Parliamentary Secretary to the Prime Minister is: as a member of the caucus National Security Committee, I am interested in knowing what the Rudd government is doing to build on its strong track record in national security. I understand the Prime Minister and cabinet has a strong policy focus on national security matters in areas such as defence policy and border security. Over the past month, there has been a lot of debate concerning a freeze on public service recruitment. So I wonder what the effect of such a freeze might have on the department’s capacity to deliver advice in this very important area.

In terms of new initiatives, I wonder what this budget includes and what the government’s focus is. Another aspect of the government’s policy on which I have been focusing closely is the National Security Legislation Monitor. I would ask whether the government is fulfilling this commitment and why the commitment has been made.

Anthony Byrne (Holt, Australian Labor Party, Parliamentary Secretary to the Prime Minister) Share this | Link to this | Hansard source

I will address the issue of the National Security Legislation Monitor, if I may. It is a fundamentally important question. I served on the Joint Committee on Intelligence and Security—it is a great honour to be selected. The selection is made by the Prime Minister of the day or the Leader of the Opposition. In a general sense, the representatives work on a very bipartisan basis. I do not know whether the member for Swan is aware of this but all the reports released by the joint intelligence committee—formerly the Joint Committee on ASIO, ASIS and DSD—have been unanimous. On one occasion, I think, there was a dissenting comment but not a dissent to the report, which says a lot about the bipartisanship of this place with respect to national security. In my term, the chair of the committee was Senator Alan Ferguson, who performed his duties with great honour and dignity and certainly was a great representative of the committee.

As I have said, national security is one of the most important aspects of public policy and I am proud of the leadership the Rudd government has shown in this area. Appointing the National Security Adviser, who is Duncan Lewis, is just one way in which the Rudd government has shown leadership in the area. Within the Prime Minister and Cabinet portfolio, there are a number of branches which do fundamentally important work in the field of national security. The National Security and International Policy Group provides advice, coordination and leadership in the development of a secure, coordinated and effective national security information and management environment.

I note in this year’s portfolio budget statements additional funding has been provided for an independent review of the intelligence community. The work of the National Security and International Policy Group is first rate and the government strongly supports their ongoing work. I would hate to think what effect the opposition’s proposed freeze on public service recruitment would have on this important work, and I do not say that lightly. I know at estimates recently the Secretary to the Department of Finance and Deregulation expressed concern that this freeze would almost rule out the capacity to take on graduates each year. Graduates are a vital asset in training our future public service leaders and this would be a huge loss. I met DFAT graduates only last week and was incredibly impressed by the standard of these particular graduates. Naturally the loss of their contribution would have a significant effect on the department’s ability to deliver services and policy. In line with the Rudd government’s commitment to national security and to government accountability, we have made a commitment to implement the National Security Legislation Monitor.

This commitment arose out of the recommendations of the Security Legislation Review Committee, in 2006, and the committee that I was on, the Parliamentary Joint Committee on Intelligence and Security and the report of the inquiry into the case of Dr Mohammed Haneef, which was compiled by the Hon. John Clarke. The purpose of the monitor is to ensure that Australia’s counterterrorism and national security legislation operates in an effective and accountable manner, is consistent with international human rights law and helps maintain public confidence in the applicable laws. The monitor will review the operation, effectiveness and implications of counterterrorism and national security legislation and report findings, comments and recommendations to the Prime Minister and, in turn, the parliament on an annual basis. The monitor will also consider whether Australia’s counterterrorism and national security legislation remains necessary and contains appropriate safeguards for protecting individual’s rights.

I understand that the Department of the Prime Minister and Cabinet is presently working with the Attorney-General’s Department to develop a strategy, drawing stakeholder agencies together to identify legislation that falls within the monitor’s purview and to suggest potential review activities that the monitor may wish to undertake in the first 12 months of operation.

I wish to reiterate what I said earlier about national security because it is so vitally important. As I have said, I was on the Parliamentary Joint Committee of Intelligence and Security in 2006, which made the recommendation regarding the national security legislation monitor. The fact that we are implementing this is testament to our commitment to national security. We are also implementing it and funding national security agencies in a manner that is responsible and that has our nation’s best interests at its core.

Incidents, both internationally and domestically—and, tragically, that includes today’s incident—have reaffirmed the need for a trustworthy government that acts in the nation’s interests. The Rudd government has a proven track record on this.

Darren Cheeseman (Corangamite, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to put on the public record my concern about the opposition’s plans to cut the Public Service and the particular impact that may have not only on my community but also across many parts of rural and regional Australia. I am talking about the opposition’s budget reply. Today I particularly want to focus on the Australian Taxation Office because I think it is a good example of an agency that provides a service nationally but which can often be delivered in many parts of regional Australia, including in my electorate of Corangamite. I am told we have some 20,000 people working for the tax office, of which about 160 of these are based in Geelong. People working in the ATO do a raft of work that focuses on the collection of around $264 billion. That is a very significant amount of income that, down the track, then goes to the provision of services, whether it be health, education or a wide range of other services, particularly in supporting some communities that may be in crisis or stress. I again think of the Victorian bushfires.

With respect to the coalition’s budget cuts, I would like to ask the parliamentary secretary some questions. What will these cuts actually mean for the provision of a strong taxation service? What will they mean in terms of having a sustainable revenue base? What impacts may occur with these proposed Public Service cuts that the coalition are proposing in the delivery of a quality service in areas such as Geelong, Darwin and in many other parts of the nation?

Anthony Byrne (Holt, Australian Labor Party, Parliamentary Secretary to the Prime Minister) Share this | Link to this | Hansard source

I thank the member for Corangamite for his question. It is obviously a good question. I certainly share the member’s concerns about what the coalition’s two-year Public Service freeze would do to the government’s ability to deliver essential services and implement crucial policy such as maritime safety campaigns and other campaigns of similar importance. The member for Corangamite is correct to point out that we have displayed strict fiscal discipline and we are returning the budget to surplus three years earlier than predicted.

The Liberal Party talks tough about cutting government spending but the party’s blocking and opposition serve to make the deficit worse. Conversely, we have displayed the courage of our convictions and delivered a budget that the nation needs. All agencies within the Prime Minister and Cabinet portfolio were able to comply with savings measures with the exception of the Office of the Inspector-General of Intelligence and Security and the Office of the Official Secretary to the Governor-General. I am sure all members will agree with the importance of the work of the Office of the Inspector-General of Intelligence and Security and respect this decision.

Across the APS, staff numbers increase and decrease in particular APS agencies depending on priorities and changes to programs. For example, this year’s budget papers show a reduction in the number of Centrelink staff on account of the number of welfare recipients also declining. All APS agencies are expected to be managed in the most efficient and effective manner possible. Since 2007, the growth and the headcount figures for the APS show that the growth in public service numbers under the Rudd government has slowed substantially. In June 2007 there were 155,416 APS employees compared with 162,000 in June 2009. This represents a modest growth in the Australian Public Service of 4.2 per cent over two years. By way of contrast, between June 2004 and June 2007 under the Howard government, the number of APS employees grew from 131,473 to 155,416—a growth of over 18 per cent.

We now have a scenario that will take us from one absurdity to another. As the member for Corangamite correctly identifies, the coalition’s proposed public service freeze will significantly undermine the Public Service capacity to deliver essential services. Graham Peachy, the head of the Australian Maritime Safety Authority, said that the plan:

… would severely curtail our ability to deliver national safety programs and to deliver an effective search and rescue effort.

This is something that concerns me. But he is not alone in his concerns. I also note that Alan Thompson, the head of the Department of Parliamentary Services, stated:

Services could be affected across parliament including in security, research, building maintenance as well as affecting the Parliamentary Library and parliamentary guides.

As the member for Corangamite has said, it will also result in a reduction of 50 staff from the Auditor-General’s office, affecting vital services.

My colleague Nick Sherry, the Assistant Treasurer, has also pointed out that the reduction in staff in the Australian Taxation Office would mean a loss of $2.1 billion in tax receipts that it would otherwise collect. I believe that the policy being put forward by the opposition is short-sighted and it is irresponsible. On the other hand, we have delivered the budget the nation needs and a budget that will return the nation to a surplus a full three years earlier than expected. We have applied strict fiscal discipline in all of the decisions we have made and the budget statements support this fully.

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

Parliamentary Secretary, during your earlier answer to the member for Solomon you spoke about the benefits to the community which would result from community cabinets being held in those electorates and the feedback that the Prime Minister and cabinet could get from holding those community cabinets within those electorates. I would have been happy to give you feedback from my electorate if you needed it. It probably would have saved the taxpayer a lot of money and airfares. If you cannot answer this question could you take it on notice: were there any direct benefits to the seat of Swan from that community cabinet? Were there any promises made for funding put forward by the local councils? If there were, could I get a copy or a list of the benefits to the seat of Swan during that community cabinet?

The other thing while I am up is on the RSPT. I know there was no consultation with the mining industry prior to the announcement of it but I would appreciate knowing between the Prime Minister and the government how much consultation there was prior to those figures being allotted into the budgets and whether the cabinet were fully aware of the impact it was going to have on the mining sector, particularly in Western Australia. In my electorate I know there are people who have had downturns in business already because of the announcement. Was the cabinet fully aware of what effect that was going to have on the people and businesses in Western Australia?

Anthony Byrne (Holt, Australian Labor Party, Parliamentary Secretary to the Prime Minister) Share this | Link to this | Hansard source

Member for Swan, I do the one on ones with the Prime Minister, so there is a discussion between the people that meet. I would be very happy to take your question on notice, and to the ability that we have we will answer those particular questions. With respect to the second question that you asked in terms of the RSPT, given that they are obviously in many cases cabinet-in-confidence conversations, I will also take that question on notice, as you have given me the capacity to do so, and we will respond to both of those questions within 30 days.

Bernie Ripoll (Oxley, Australian Labor Party) Share this | Link to this | Hansard source

I know there has been some widespread criticism of the former government, the Howard government, particularly on their track record when it comes to government accountability, something they were not known for during their long 12 years in government. My interest specifically relates to access to government information and the changes to the Electoral Act. There have been quite a number of inquiries in those areas for some time. One of the things I would like to know more about and ask the parliamentary secretary about is that the sheer number of FOI requests seems to have declined while the Howard government were in government. I know there is vital information there that really does need to be part of the public arena, so I ask the parliamentary secretary if he has a comment in terms of what government is doing about sharing government information.

Anthony Byrne (Holt, Australian Labor Party, Parliamentary Secretary to the Prime Minister) Share this | Link to this | Hansard source

I thank the member for Oxley. I know he is a very enthusiastic advocate of electoral reform. I always welcome the opportunity to speak on the government’s reform record on freedom of information policy and electoral reform. When the Rudd government won office, the privacy and FOI policy branch was moved from the Attorney-General’s portfolio into the Prime Minister and Cabinet portfolio. I know this is a little bit indulgent, but I would like to pay tribute to Senator John Faulkner, who was then Cabinet Secretary and Minister of State and a key driver of many of the reforms that have since been initiated by the Rudd government. Since then the Rudd government has introduced a number of reforms to the FOI Act as we recognised that it is in need of reform. As a government we are committed to giving better access through easier and less formal means. Anyone outside the government was subjected to a decade of secrecy under the Howard government. John Hartigan is not often referred to as a friend of mine and I notice that he and I have apparently become buddies by association by a tabloid called vexnews, a very fine, interesting blog. He referred to the previous government earlier this year as the most secretive government we have ever had, even in war time. I think that reinforces why the reforms were needed and brought about by the Rudd government. As part of our reforms we are reducing the access period to several forms of information, such as amending the Archives Act to reduce access to various records from 30 to 20 years. For cabinet notebooks the period will be reduced from 50 years to 30.

Another significant FOI related reform relates to the introduction of the Office of the Information Commissioner. The Office of the Information Commissioner will bring together the independent oversight functions for privacy protection and access to government information. We are creating two new statutory positions in the form of an Information Commissioner and Freedom of Information Commissioner. These are important reforms in promoting a culture of disclosure and meeting important election commitments.

As a government we have also introduced a number of measures that will make the Commonwealth Electoral Act fairer and more inclusive as well as implement efficiencies and make the day-to-day operations of the Australian Electoral Commission easier. The reforms we have introduced restore integrity and transparency to the electoral act after its integrity was undermined by the Howard government. One of the important reforms we have introduced comes out of the Joint Standing Committee on Electoral Matters report on the conduct of the 2007 federal election and matters related thereto. It goes to proof of identity requirements for enrolling, reduces the age at which people can provisionally enrol as well as a range of other amendments. The recommendations of the JSCEM report will bring the Commonwealth Electoral Act into the 21st century.

We are committed to implementing policies we committed to in opposition and restoring the integrity of Australia’s electoral system and FOI acts. We are committed to making information easy to access and to making government operations more transparent. I know my colleague Senator Faulkner in particular and now Senator Ludwig have been working assiduously in this regard. I am reminded again of John Hartigan’s comment—and it is very unusual these days to be on the same page as John Hartigan—that the Howard government was the most secretive government we have had, even in wartime. Having seen these reforms being put forward and executed, it is an honour to be part of a government that is so truly committed to reform and to delivering on the commitments it has made, particularly in this area.

Proposed expenditure agreed to.

Remainder of bill—by leave—taken as a whole and agreed to.

Ordered that this bill be reported to the House without amendment.