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

I have received a letter from the honourable member for North Sydney proposing that a definite matter of public importance be submitted to the House for discussion, namely:

The Government’s failure to responsibly manage the economy

I call upon those members who approve of the proposed discussion to rise in their places.

More than the number of members required by the standing orders having risen in their places—

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

I noticed in the newspapers this morning a report that the Treasurer will resign from parliament should the member for Griffith be elected Leader of the Labor Party—and I suspect that after that question time the member doubled his numbers in the caucus. The Treasurer made a very feeble attempt to recover some level of economic integrity after yet again being exposed in his failure to address the details of all of his announcements—quite ably, I might say, by my colleague the member for Mackellar, who had picked up quite appropriately that the announcement in the government's second reading speech that there was no age limit on the Superannuation Guarantee contribution in fact totally contradicted what was in the law they were introducing, which put up a 75-year age limit.

This is a classic example of this government's performance and the fact that they are incompetent and pay no attention to detail. Even this morning they were still updating on the internet the explanatory memoranda for the 11 mining tax bills they introduced yesterday—and they expect this parliament to have a properly informed debate about the matter!

You would have thought that this week Australian households and small businesses would have been relieved at a decision by the Reserve Bank of Australia to cut the cash rate by 25 basis points. Three of the four major banks passed on that rate cut in full to the standard variable home loan. Of course, the National Australia Bank did not. I say it should have been good news because it will be some measure of relief for Australian households from some of the challenges they face with higher utility prices, higher food prices and so on. But the reduction in interest rates came about because the Reserve Bank is concerned about international movements—and rightly so—but also concerned about the moderation in economic growth. Economic growth is not travelling at the speed that the Reserve Bank expected. That means the economy is not performing as well as the Reserve Bank originally expected.

Consumers are also more cautious than the Reserve Bank expected. Why are consumers cautious? Every time this government sees a problem or challenge in the community it taxes it—'If there's a problem with teenage binge drinking, introduce an alcopops tax,' 'If there's a problem with people smoking too many cigarettes, introduce a cigarette tax,' 'If there's a problem with carbon dioxide in the atmosphere, introduce a carbon tax,' and, 'If there's a challenge for the Australian car industry facing cheaper imports, introduce laws that increase the taxation rate on foreign made cars and more expensive motor vehicles.'

Of course, if you do well in Australia this government always wants to target you, no matter who you are. It was not that long ago, perhaps 14 years, that the mining industry in Australia was, relatively speaking, on its knees. But this government now says: 'Well, if you're doing well in Australia, we'll tax you. If you're not doing well in Australia, we'll still tax you. And if anyone is left, we'll regulate them.' That is what the Labor Party does.

I nearly fell off the green leather chair here today when the Treasurer said they had a great fiscal strategy and it is delivering a surplus. Unfortunately, it is not delivering a surplus; that is why it is a bad fiscal strategy. The budget deficit this year will be $22.6 billion, and it will be the fourth consecutive year of deficit. I said before, and I have said consistently, I do not expect Labor to ever deliver a surplus budget. Originally I said it about the member for Griffith, and I was absolutely right—he never did deliver a surplus budget. I say it emphatically about the Labor Party: they will not deliver a surplus budget. Bear this in mind, Mr Speaker: you will need to deliver surplus after surplus after surplus to start paying down the $110 billion of net debt. Bear in mind that, over the last four years, Labor have accrued a deficit of $154 billion. The only reason net debt is less than that is that we left money in the bank. We actually left the country with no net debt; in fact, there was a net surplus of assets. So they have spent the surplus of assets that we left them with four years ago and then they accrued $110 billion extra in net debt. The government are borrowing $62 million a day, at the moment, simply to meet day-to-day expenditure. It is no wonder that the Australian people reacted when the Prime Minister announced in the papers today that she wants to lend money to the IMF to lend money to the Eurozone to lend money to the Greeks. Under this proposal, Australia would be borrowing money to lend it to people who would lend it to people who would lend it to people who have a debt problem.

Of course, the Treasurer himself was tricking in question time. He knew exactly what we were getting at. First of all, he started the bluff and bluster about the coalition no longer supporting the IMF. We do support the IMF; we have always supported the IMF. We have done so on a number of occasions and we will continue to do so. But the IMF should not accept some of the suggestions from the Eurozone that it should form a partnership with the Eurozone for the European bailout fund. It is not part of the current mandate of the IMF. That is a very important point.

I quoted the Chancellor of the Exchequer in Great Britain, and I repeat it. He knows that the people of Britain will not cop British taxpayers' money being used to bail out the Greeks and the European currency. It is one thing to bail out an individual country. The IMF does that on regular occasions and it is appropriate that it does so. The strict rules that the IMF applies—and they are often criticised, as they were during the Asian financial crisis—are appropriate as a way of repaying those loans. The concern of the Chancellor of the Exchequer, and our concern, is that this is about shoring up a currency. This is about shoring up the European Union.

The Prime Minister has gone into this issue like a wild bull in a china shop. Firstly, the Prime Minister arrives overseas and says, 'We stand ready to give more money to the IMF for this purpose,' yet the IMF has no deal with the Eurozone. Secondly, the concerns for everyday Australians are: what is the amount of money that is going to be put into this program and why is Australia leading the charge when the nearest neighbours to the Europeans—that is, the British—are not prepared to do the same? The third key factor is that the Europeans are trying to get the Greeks to agree to the current package on the table. They are trying desperately to get the Greeks across the line on the current package, saying, 'It is this package. You should accept it.' But along comes Julia Gillard and says, 'Hang on, there could be another pot of money.' So all the dissenters in Greece can turn to the words of the Prime Minister of Australia and say, 'Here's an alternative to accepting the existing European package.'

When the Prime Minister said she does not understand foreign affairs, she was damn right. The British know this, and other countries know this, but unfortunately we have a Prime Minister who is more interested in big-noting herself and going to the G20, when she is one of the weakest voices and trying to pretend to Australians that she is the strongest voice.

The challenge for Australia out of this is that, firstly, we should fix our own house. Our strength in our words comes from our actions. When Australia speaks, people listen, provided that we have the cash in our pocket, that we are not penalising our people, that we do not have to have austerity measures and that we as a nation are enhanced and empowered by having no debt, by having cash in our pocket. In a world where there is financial turmoil there is one truth: the person who has cash, the person who has no debt, and the person who can influence politics and influence outcomes is the one who has the most money in their pocket. That is the rule.

There is the emergence of China and the fact that the Europeans are now seeking out China for funding. The Chinese are not openly offering funding to the Eurozone like our Prime Minister. No, no, no. The Chinese are standing back and saying, 'You must prove that you are prepared to fix your house, and you come to me.' That is because they are the powerful ones, they have the money. But our Prime Minister feels the need to be generous at taxpayers' expense, after she has just delivered a $50 billion deficit, with a more than $22 billion deficit this year and with her incompetent Treasurer umming and ahhing about whether he actually can deliver a surplus.

You know what, the bottom line is this: the Prime Minister is promising what she cannot deliver. She is 'writing cheques her body cannot cash'—to quote from a great movie. The bottom line out of that is: Australians end up paying the price. Why do they end up paying the price? Because this is a government addicted to tax. On the same day that the Prime Minister offers money to help the Eurozone—the richest and largest economy in the world—when they did not even ask for it, Australians are having new taxes imposed on them by the government. A flood tax, a mining tax, a carbon tax, an alcopops tax, a cigarettes tax and new taxes on cars are all happening at the same time that our Prime Minister is beating her chest over in Europe, saying, 'We're going to lend you money.' My goodness! That is like a member of the gallery up there going along to the National Australia Bank and saying, 'Look, I can lend you 100 bucks'—

Andrew Laming (Bowman, Liberal Party, Shadow Parliamentary Secretary for Regional Health Services and Indigenous Health) Share this | Link to this | Hansard source

'And I've got a home loan with you!'

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

That is right: 'I'll offer you a home loan!'

The challenge in the Australian economy at the moment is that this government is not concerned about the fundamentals, which include improving productivity. This government has not lifted a finger on productivity. This week we have seen the government, the Labor Party, as the acting Prime Minister said, return to true form. They always look at the opportunity to engage in class war. They were so focused on the interests of the unions this week that they forgot the people out there that get on the planes. They were so focused on the unions this week that they forgot the interests of the miners that take the risk—invest the money to deliver the minerals to the marketplace that pay our bills.

The government was so focused on its own internal politics this week—the battle between the member for Griffith and the Prime Minister—that they did not recognise the signals from the Reserve Bank that the economy is not performing as well as was expected. Of course, the acting Prime Minister would say that this is the fault of the Europeans. Falling consumer confidence is not the fault of the Europeans. Falling consumer confidence comes when everyday Australians face higher bills—higher utility bills in electricity and water—higher transportation costs, higher health costs, higher rents, higher housing costs and construction costs. The falling building construction numbers and falling consumer confidence are alarming because they represent the fact that the Australian consumer has not got the confidence to go through. As far as I and the coalition are concerned, you do not build consumer confidence by introducing new taxes. You do not build Australian business confidence by taxing those that are most successful. You do not help the Australian economy by offering money, which Australia does not have, to a cause that Australia should not be involved in at this point of time. The fundamental point is that this is a directionless government that is focused on its own achievements of power and preservation of power rather than on the interests of the Australian people. And long may it continue until the day when we throw them out of government. (Time expired)

Bill Shorten (Maribyrnong, Australian Labor Party, Assistant Treasurer) Share this | Link to this | Hansard source

On the matter of public importance, I waited with my usual optimism to hear something constructive from the shadow Treasurer, but yet again nothing came out. If we are going to have a debate about the reasonable management of the economy, we need to set up the tests for that management. I would submit to the House that there is a number of reasonable tests: getting the big calls right; balancing the books; identifying existing problems in our economy and our society and fixing them; making sure that our economy grows fairly and inclusively; looking at the alternative management strategy, that is, of the opposition; and, most importantly, having innovative ideas and an optimistic vision for the future. These are the criteria. These, I submit, are the things Australians are interested in: getting the big calls right; balancing the books; identifying the major problems; seeing that the economy grows fairly and inclusively; examining if there are better alternative options; and making sure that we have an optimistic long-term view—not just for today or tomorrow, next week or next month or next year but for the next decade or the next two decades.

Returning to the submissions on the efficient and effective management of the economy, let us have a look at the big calls; let us look at the scoreboard for the government. On the global financial crisis: unlike most of the rest of the OECD, this nation managed to escape recession. Let us look at the big calls in the workplace: we reformed and abolished the unfair Work Choices laws of our predecessors which were leading us in a race to the bottom in wages and conditions. We abolished the minimum standards which would see our children and our grandchildren being paid inferior and unfair wages.

Let us look at another big call that we have got right: the information superhighway, the National Broadband Network, the innovation for the 21st century, which allows Australians to compete with the rest of the world. Let us look at another call we got right: flood reconstruction. No-one could have predicted these floods, but what options were available? Using the national economy, we set a levy and found the funds to help rebuild the terribly damaged infrastructure, mainly in Queensland but in other places too. We are also getting the big call right about finally acting on creating a sustainable economy by putting a price on carbon pollution. Indeed, have a look at the most immediate big call we had: dealing with the precipitous and over-the-top lockout at Qantas, stranding tens of thousands of passengers and travellers and grounding hundreds of aeroplanes. So there we go, we got the big calls right—the GFC, Work Choices, NBN, flood reconstruction, the carbon price and the most recent imbroglio and confusion created by Qantas shutting down its airline.

There is another submission which shows that we are managing the economy reasonably—that is, the need to balance the books. When you look at our net public sector debt in the Commonwealth to GDP, you see we are doing better than most of the rest of the world. It is going to peak at seven per cent; our interest payments are 0.4 per cent. Let us be very clear what the GFC did: the GFC absolutely slammed government revenue, but we have managed to engage in the fastest fiscal contraction since records began. That is $100 billion across four budgets. We have been winding back the Howard government's welfare creep. Indeed, when we came to power at the end of 2007, nearly 75 per cent of Australian families were receiving some family payment from the government. This was not sustainable and we have been winding that back. Look at the departmental efficiency dividend we have been applying to get our numbers back into the black—1.5 per cent. This I believe contrasts very favourably to the ill-thought-out opposition policies, which I will come to in a moment.

Having said that we get the big calls right and having said that we balance the books, we have also identified existing problems and we are in the process of fixing them. We do have a multispeed economy. You would have to live on another planet not to recognise that the mining boom, whilst it is good for some sections of the Australian economy, is causing dislocation in other parts of the economy. We have a very high dollar, which makes it hard for domestic tourism, domestic education services and local manufacturers to compete. So what are we doing? We have introduced the minerals resource rent tax so that we will share the prosperity that the richest companies in the world are enjoying from non-renewable resources—Australians' birthright—throughout the whole of the Australian Commonwealth; we are going to provide the 29 per cent corporate tax break; we are going to provide $1 billion in tax breaks for small business; we are going to build national infrastructure; and we are certainly going to lift compulsory superannuation from nine per cent to 12 per cent.

Never let it be forgotten that those opposite get 15 per cent super but would vote against 8½ million Australians getting 12 per cent. I look up the dictionary and that is coalition hypocrisy of the worst order. I note there are no interjections from them on that point because they know I am right. We also look at the unfair fees in superannuation—

Opposition Members:

Opposition members interjecting—

Bill Shorten (Maribyrnong, Australian Labor Party, Assistant Treasurer) Share this | Link to this | Hansard source

Now they come up with interjections when they guiltily realise they have been caught out with their hand in the cookie jar of superannuation.

George Christensen (Dawson, National Party) Share this | Link to this | Hansard source

Play a different tune!

Bill Shorten (Maribyrnong, Australian Labor Party, Assistant Treasurer) Share this | Link to this | Hansard source

If the member for Dawson is bored, why doesn't he go and find something else to do? Dial a friend! Fees in superannuation are unfair, so we are going to have SuperStream and MySuper and make sure that we put downward pressure on fees and charges in superannuation. We are going to improve and reform the provision of financial advice in Australia.

Mr Briggs interjecting—

I can hear the member for Mayo, the mini-me of Peter Reith, interjecting. We are the only people who will even listen to him—his own side keep gagging him. We have the Future of Financial Advice reforms, and we are going to reform financial planning. We are going to reduce the confusion around flood insurance and sort out a common definition so that never again will Australians have to go through fruitless and frustrating arguments with their insurer as to whether or not they are covered for flood. We are also making many more reforms in many other areas.

Having said that we are identifying existing problems and fixing them, that we are balancing the books and that we are getting the big calls right, I would submit in support of the proposition that we are managing the economy efficiently the fact that we are making sure that the economy grows fairly and inclusively. We understand that change is an inevitable part of Australian life, but we are determined to make sure that no-one gets left behind, as opposed to a coalition society where, if you cannot survive for yourself—

Mr Fletcher interjecting—

Peter Slipper (Fisher, Liberal Party) Share this | Link to this | Hansard source

It is Thursday afternoon and, while I admire the exuberance of the member for Bradfield, he should restrain himself at this point in time. The Assistant Treasurer has the call.

Bill Shorten (Maribyrnong, Australian Labor Party, Assistant Treasurer) Share this | Link to this | Hansard source

Thank you, Mr Deputy Speaker, for pulling up the member for Bradfield. We are making sure that we do not forget social justice. Australia as a nation is in a process of change, but we can never forget people in that process of change. We have increased the pension. We have engaged in income tax cuts. Fortuitously, I have to hand some of the statistics on the personal income tax cuts that this government has delivered.

Someone earning $20,000 is paying $750 less this financial year than they were in 2007-08. Someone earning $30,000 is paying $750 less than they would have been in the last year of the Howard government. Someone earning $50,000 is paying $1,750 less this financial year than they would have been in the last year the Howard government.

Mr Briggs interjecting—

Mr Fletcher interjecting—

Peter Slipper (Fisher, Liberal Party) Share this | Link to this | Hansard source

The members for Mayo and Bradfield will desist from continual interjections.

Bill Shorten (Maribyrnong, Australian Labor Party, Assistant Treasurer) Share this | Link to this | Hansard source

I get more sense off a bunch of crows on a power line than those two! The person earning $80,000 is paying $1,400 less this year, even including the flood levy, than they would have paid under the Howard government. So we have been delivering real change. For instance, a single person without children earning $39,000 in 2007-08 and $44,500 in 2010-11 has seen their tax wedge fall by 1.7 percentage points to 14.9 per cent in 2010-11. These are real numbers, and the real numbers are confronting to the opposition.

We are doing other things in the field of social justice which should not be overlooked. The most important thing you can do for social justice is create a job. If an Australian has a job they have a chance of engaging in the housing market and of educating their kids: they have a stake in society. Since Labor has been elected, 752,000 jobs have been created. When you look at what has been happening around the world in the global financial crisis, 30 million jobs have gone; yet in Australia under a Labor government 752,000 jobs have been created. We have increased the family payments for families with teenagers between 16 and 19. As any parent with a teenager between 16 and 19 knows, they do not get any cheaper the older they get.

The government is also proposing a particularly equitable piece of law, and we put the bill into the parliament yesterday, but the coalition is regrettably opposing it. There are 3½ million Australians who earn less than $37,000 a year, which means that they either pay no tax or 15 per cent in income tax. But what happens with their superannuation, since superannuation is taxed concessionally at 15 per cent? That 15 per cent concessional tax is all right if you pay a higher rate in income tax, because there is then an advantage to put your money in super at the lower tax rate. The problem is that, if you are one of the 3½ million lower income Australians, you do not get the benefit of that tax concession. So what are we going to do? We are going to abolish it. What will happen is that, if you earn less than $37,000 a year, you will no longer pay tax on your superannuation—it will all go into your superannuation.

It does not just stop there, though. We have now extended and developed the education tax refund, providing more help for families with the cost of educating their kids. the education tax refund has been extended to include school uniforms and a range of other incidental costs. These are the costs parents have, and they are DNA-hardwired to pay them for their kids because they want their kids to get the best start in life. What we are doing is helping them in that process of educating the kids.

Having said that we get the big calls right, that we balance the books, that we identify the existing problems and are fixing them, that we are into social justice and that we are making sure Australians have an opportunity to cope in an ever-changing world, we must look at some of the coalition myths. Getting criticism from the opposition about economic management seems a little rich when I look at their costing errors. In the election period last year they had a $10.6 billion costing black hole. The opposition need to know that taxpayers' money is not monopoly money; it is real money, and you should not have black hole. Some of their costing errors—

Mr Briggs interjecting—

Perhaps if the member for Mayo spoke less and listened more there would be a chance that he would learn more. I apologise—I did not mean to imply he was learning! Their costing errors included spending $3.3 billion from the nation-building funds on local roads and not accounting for it in their numbers. They did not account for $356 million in their employment participation policy. They did not allow for $2.5 billion. They reduced what is known as the conservative bias allowance, which Treasury says does not realise any actual budgetary savings. Treasury and finance have identified literally hundreds of millions of dollars.

Mr Robb interjecting—

I understand why the member for Goldstein attempts to interrupt me: he is embarrassed because he is in charge of this economic smash-up—this economic road crash.

Let us have a look at the final thing which, I would submit, shows that we are the party capable of economic management. We are the only party with an innovative and positive view of the future. If you have not been convinced already—by our balancing the books, by our working at fixing the problems, by our propositions of social justice and by the litany of opposition costing errors which are more like something done by Homer Simpson than by a serious opposition—then I submit to you three points among the collection of propositions that we are advancing for the future of Australia.

Firstly, we want to lift compulsory superannuation to 12 per cent. The opposition know it is a good idea—they get 15 per cent or defined benefit. The first rule of leadership is: don't just say it; practice what you preach. If they are willing to take 15 per cent for themselves, why can't the rest of Australia get 12 per cent?

It does not stop there. Secondly, we are now spending, as a down payment on the future, $3 billion on productivity through training apprentices and training trainees. Nearly half a million Australian people are on the path of apprenticeships and training.

There is a third idea which, I submit to you, demonstrates our capacity to manage the economy on behalf of the society as a whole. I think a lot of people on the Labor side know what that is: the proposition of a national disability insurance scheme.

Mr Robb interjecting—

The opposition interjects on such a good idea—very heartless. A national disability insurance scheme is a long overdue proposition for this nation. Why should someone, because they are born with an impairment or acquire it in a blink of an eye, live a second-class life in Australia? Why should their carers live a second-class life? This party of government, this Labor Party, understand that it is now time to set right the wrong that has been occurring for a very long time in Australia. We are establishing the foundations for a national disability insurance scheme. We are working on a national injury insurance scheme. We are determined to make sure that two million Australians with profound or severe disability and their carers finally get included in Australian society on an equal basis. (Time expired)

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

We have recently heard a litany of confusion and make-up. In recent weeks we have had to suffer the embarrassment of our Prime Minister and our Treasurer lecturing Europe about their economic woes. As we have just heard from the member for Maribyrnong, the lecturing of Europe has only served to highlight the incompetence of those opposite in managing our economy.

Overnight we heard more platitudes from our Prime Minister, who, speaking in Europe, admonished the Europeans for muddling through and urged them to get a plan. Can you believe it? It is the pot calling the kettle black. It comes from a Prime Minister and a Treasurer who have muddled from one train wreck to another. It is cringe worthy. They are lecturing the Europeans, yet it is looking increasingly likely that this government will once again have to raise the debt ceiling above the quarter of a trillion dollars that they raised it to only months ago from $70 billion when they took office. They have raised it now to a quarter of a trillion dollars, and it is looking likely that they will come back again into this place within 12 months and look for a further rise in that debt ceiling.

Their self-esteem is such that our Prime Minister and Treasurer are now offering to borrow more money to bail out Europe. This is a Europe which this year will again, after many years of doing the same thing, spend tens of billions of dollars subsidising their farmers so that our own farmers are locked out of their markets. They are going to spend tens of billions of dollars in Europe to lock our farmers out of their markets and disadvantage our farmers, yet we are going to help bail out Europe with tens of millions of dollars in aid. This is a nonsense, this is cringe worthy, this is embarrassing and, more importantly, this is sheer incompetence.

What do you think people who are struggling in small business out there—

Mr Bradbury interjecting—

So you are going to give them a carbon tax, and you are going to give business a mining tax. This is the sort of thinking we have to deal with. This is the absurd thinking and the economic illiteracy that is running our country. They are going to help the Europeans to lock our farmers out of their markets. They are going to help the Europeans spend our borrowed money—every cent of that money they give to the Europeans will be borrowed money—and that will be used to help subsidise their farmers to lock our own farmers out of Europe. This is just unbelievable.

But the biggest criticism that we have with this government—and we have had it for a long time—is their refusal to acknowledge the vulnerability of our economy. All of that vulnerability is not their fault, but they will not even acknowledge the vulnerability that is not even their own fault.

This is why there is a crisis of confidence. People know that there is something afoot—that there are dark clouds out there. People know that we are totally reliant on the pollyanna assumptions that this government made in their budget estimations. People know that, if resource prices come off just 15 or 20 per cent, we will have more and more deficits and higher and higher interest rates. People know this. They know that jobs will go backwards. People are concerned about losing their jobs. The trend is there, yet this government will not acknowledge the vulnerability of our economy. They refuse to act to restore the economic resilience that they inherited. Despite the mining boom, we have seen growth of debt—the third fastest in the developed world. There are only the economic powerhouses of Iceland and—

David Bradbury (Lindsay, Australian Labor Party, Parliamentary Secretary to the Treasurer) Share this | Link to this | Hansard source

Back it up.

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

Here he is! He looks confused. He does not even know the OECD figures that show that the Australian economy went from zero debt to, now, $210 billion of gross debt. We have gone to that level, and it is the third fastest in growth of any developed country in the world, apart from the powerhouses of Iceland and Ireland!

A government member interjecting—

What an embarrassment! What a statement! 'We got the big calls right,' said the member for Maribyrnong, and now we have confusion coming across the table—total confusion. Despite the mining boom we have had three record deficits. Not only that; we have had a structural deficit in this year's budget, which is twice Germany's structural deficit. We have, on a per capita basis compared with Italy—one of the big economies in the world and one of the shaky ones—a structural deficit which is 30 per cent greater.

So on a per capita basis we are twice as risky—twice as bad and twice as big—as Germany, and compared to Italy our structural deficit is 30 per cent greater on a per capita basis. This is the vulnerability that we have. This means that if there is any downturn in commodity prices we will be facing a $50 billion, $60 billion or $70 billion deficits for years and years. That means much higher debt, and all of the prosperity—all of the great blessings that we have had from this mining boom—will be squandered. This is irresponsibility. This is a government that will not acknowledge what is going on in our own country, much less the rest of the world.

The other thing about this vulnerability is the growth in government that we have seen in our lives over the last four years. It is the biggest growth in government in my life—and that includes the Whitlam era. This is the only government in the world that reregulated its labour market in the face of a global financial crisis. Those changes are now coming home to roost. We are now seeing the vulnerability and the repercussions.

Not only that; this is the only country in the world—the only government in the world—that is renationalising its telecommunications sector. What does the Economist magazine think of that? We heard about it earlier on. This is the only country in the world that is bringing in a nationwide carbon tax. What about that tax? It is crawling with thousands of bureaucrats. It is crawling with six new organisations. It is the most interventionist way you could ever try to deal with a price on carbon. It is the most socialist way you could deal with the price of carbon. No-one else has one; we are ahead of the rest of the world. That is a vulnerability. We are putting this carbon tax on everybody in this economy despite the fact that we are facing very vulnerable, very doubtful times.

We had the member for Maribyrnong up here a few minutes ago gloating that this government had created an efficient public service. If you go back to the first budget of the Treasurer of this Labor government you find that the budget predicted that, in 2011-12, the Public Service would grow to a cost of $16 billion. Have a look at the budget papers this year and you will see that the cost for 2011-12 is expected to be $19 billion. So there we had the member for Maribyrnong, who is supposed to be the Assistant Treasurer—what a goose!—who thinks his party has improved, refined and maintained a public service which is efficient. Yet it has grown $3 billion more in cost than they anticipated just three years ago—and that is in the face of a global financial crisis, for goodness sake!

This is a government that has failed Australians. We can give hope, growth and development, and we can open up the north; but this government has failed and will not deliver on those things. We offer hope, reward and opportunity.

David Bradbury (Lindsay, Australian Labor Party, Parliamentary Secretary to the Treasurer) Share this | Link to this | Hansard source

I am very pleased to be able to contribute to this debate about the management of the economy. The matter that has been raised by the member for North Sydney suggests that this government has not been capable in managing the economy; the facts tell a very different story. In fact, if we have a look at what has occurred over the last couple of years across the global economy we see that Australia stands out as one of the most outstanding success stories when it comes to economic management. I regularly host visits of individuals from all around the world, and when they come here they comment, almost universally, on how successful the economic management has been here in Australia through the troubled times of the global financial crisis.

To underline this point I will make a simple comparison of some figures. At the height of the global financial crisis, 30 million jobs were shed across the global economy; yet here in Australia we created over 700,000 jobs. We created over 700,000 jobs at a time when every other country was facing job losses. The initiatives that we put in place by acting decisively to stimulate the economy have been the difference. Those initiatives ensured that Australians were able to stay in employment through these difficult times.

We all know that the government has a very strong focus on jobs. When we talk about managing the economy, we talk about managing it for the many and not for the few. We talk about managing it so that working Australians continue to be in work. Had we adopted the so-called policy prescriptions of the opposition during the global financial crisis then lots of Australians—tens if not hundreds of thousands of Australians—would not have stayed in employment. The consequences of that would have been extremely detrimental to the national economy.

We all know that, when the debate in this place was occurring around the government's response to the global financial crisis, the Leader of the Opposition was not even in this chamber. Unlike most of his colleagues, he actually did not vote against the stimulus measures, because he failed to turn up to the chamber. We all recall the article in the Daily Telegraph that at great length identified the fact that the member for Warringah, before he was the Leader of the Opposition, did not even come into this chamber to vote; he slept through the vote. Is that the sort of person we want with their hands on the levers and the steering wheel of the national economy as we move into the next phase of economic development? Is that the person we want at the helm? He was asleep at the wheel when this government intervened to save all of those jobs.

Those on the other side seek to diminish the contribution of the government to the economy through the global financial crisis. They often say: 'It was not the government; it was the resources boom. That is all it was—the resources boom.' I am reminded of the comments that the then Secretary of the Treasury, Ken Henry, made to Senate estimates in May last year. He made the very valid point that if every sector across the Australian economy the Australian economy had shed jobs at that same rate as did the resources sector through the global financial crisis—and to recap for those who cannot recall, during the global financial crisis the mining industry shed 15 per cent of its jobs—the unemployment rate in Australia would have been 19 per cent. I would like to hear those who say the mining sector saved the Australian economy through the global financial crisis respond to that.

There are those who say that it was not just the mining sector; it was China. They say this as if to suggest that China was not around before this government came to power and that any of the revenue gains over the years which governments before us were able to achieve had nothing to do with China. All of a sudden China decided to industrialise when Labor came to power! They say that we only survived the global financial crisis as the economic success story we are because of China.

In the Leader of the Opposition's most recent pronouncements he said he has grave concerns about dealing with China. He thinks we need to be very cautious about a free trade agreement with China. In fact, I am sure his former leader, the former member for Bennelong, would be most concerned and disturbed to know that the very free trade negotiations he initiated back in 2005 have now become the source of such great concern to his old party. I think it is a further example of the complete lack of sensible economic thinking within the coalition at the moment.

You often hear those on the other side talk about taxation. We heard another bout of it from the member for North Sydney today. They say this government has introduced this tax and that tax: 'All they ever do is introduce new taxes.' Why would a government want to introduce taxes? Governments introduce taxes for various reasons. I would hazard a guess that some of the reasons we have introduced some of these initiatives might be the same reasons that the former government introduced all of the new taxes they chose to introduce, whether it be the sugar levy, the dairy levy, the tax on airfares after the Ansett collapse, the East Timor levy or the mother of all taxes they introduced: the goods and services tax. They come into this place and talk as though they are the only ones who ever cut taxes and we are the only ones who ever introduced them. They fail to acknowledge the fact that in our first three budgets we cut personal income tax by $47 billion. We have reduced personal income tax by $47 billion.

This is all a smokescreen to hide the real motives behind their decision to block and then repeal the mining tax. They are going to have to argue this in their communities. The Australian community is onboard with the mining tax. When I talk to people in the community, I find there is almost universal acceptance that this is what our nation requires. When BHP was announcing its record profits and when BlueScope Steel was laying off over 1,000 working Australians, most Australians could see that the nature of this patchwork economy meant that we needed to spread the benefits of the resources boom.

We need to ensure that all Australians get the benefit of the exploitation of our mineral resources. These are the resources we as Australian people own. As companies seek to exploit them to generate their own income and—as a result—national income, we need to ensure that the benefits are evenly spread. We are determined to do that. We are determined to do that to deliver a tax cut to small business, to reduce the company rate and to increase the ability of small businesses to instantly write off asset purchases of up to $5,000 and $6,000 to ensure that those purchasing motor vehicles are able to take an upfront deduction up to that amount.

We are also ensuring that working people are able to aspire to the retirement savings we all know they deserve. After toiling away for 40 years in the workforce, Australians expect that in retirement they will have a decent standard of living. We know that the compulsory superannuation levy at nine per cent will not deliver sufficient retirement savings; we want to make sure that all Australians are able to retire with a degree of comfort. These are measures that those on the other side oppose and will seek to repeal in government. They will increase taxes on small business. They will rip away superannuation for working Australians. They will give a massive windfall tax cut to the resource companies. That is their vision for the future. We are determined to build an economy that is resilient for the future, to tackle the challenge of an ageing population and to build the infrastructure that we need through a national broadband network. We are determined to ensure that our economy is a prosperous one and that the benefits of it are spread right across the economy. Most importantly, we want to make sure that working Australians get their fair share. It is all good and well for the big end of town to benefit; we want to make sure that working families and working Australians share in the fruits and the bounty of the prosperity that we will enjoy. (Time expired)

George Christensen (Dawson, National Party) Share this | Link to this | Hansard source

We are here to speak on the government's failure to responsibly manage the economy, and we have heard from Admiral Bradbury that everything is shipshape—the economy is well anchored. But it is very difficult for me to know where to start to criticise the government on this front. How do you choose from the vast array of economic vandalism that this government has listed on its resume? It would be a laughable proposition if only it were not so serious.

The government's economic failure is extremely serious for those on the receiving end—for this country's forgotten families: the hardworking mums and dads out there who had to sit back and watch this government dive into the pool of money earned by the good people of this country and responsibly banked by the previous government. The families in my electorate of Dawson had to sit back and watch them splash it around, spilling billions of dollars here and billions of dollars there. They are a Labor government, so they are not so concerned about a bit of spillage or a bit of waste, because waste is their middle name. When the pool of money ran out, they borrowed more, and then they borrowed more, and then they borrowed even more money. They splash, they spill, they waste. They just keep borrowing and they just keep wasting. It is painful to watch for the families that have worked hard for that money and even more painful for the families who will spend the rest of their working lives without seeing an end to Labor's debt, if this lot stay in.

This economic mismanagement continues to destroy the economy. They are a bit like a kid in the lolly store—spoilt for choice—but I will choose just three things to focus on. They are big things that the government are responsible for. They have continued and will continue to waste money. They have cost and will cost families money. They have cost and will cost businesses money. They have cost and will cost jobs.

There can be no greater example of a government determined to destroy its own economy than the Labor-Greens government, who are imposing the biggest, the ugliest and the most destructive carbon tax in the world. The problem with this government is their complete isolation from the people they are supposed to represent. The Prime Minister and the Labor members in this place sought and got a mandate from the people not to impose a carbon tax. They did not listen then and they are certainly not listening now. They are not listening to businesspeople, who quite justifiably have very serious concerns about the impact that this carbon tax will have on their livelihood. This Labor government denies the legitimate anxiety that these businesses have, knowing this tax is about to come in and hit them very, very hard. This is what business and industry are saying out in the real world. The National Generators Forum, the peak body of Australia's power industry, said the carbon tax will:

… produce virtually no change in emissions from the generation sector while imposing huge costs on the community, trade-exposed industries and electricity generators.

After looking at the legislation that this government introduced and passed, the National Generators Forum said it would almost double the wholesale price of electricity to $100 per megawatt hour by 2020. The Labor government either does not listen or does not care—probably both—about what this will do to businesses and the families that are employed by them.

Businesses in my electorate of Dawson have already made decisions to halt investment. Take, for example, Werner Engineering, a business that has been around for three decades in the Mackay region servicing the agricultural and resource sectors. I spoke to their manager, Chris Geach, about his planned multimillion dollar relocation and expansion. They have had to put it on hold. The increased cost that his local, Australian based business will have to pay under the carbon tax will not be paid by his international competitors. You cannot blame business for being against this carbon tax. But it is not just business; it is the families and workers employed, or soon to be not employed, by businesses who hate it as well. It is no wonder that more than 94 per cent of people who returned a survey that I put out in my electorate say they are opposed to the carbon tax.

Michael McCormack (Riverina, National Party) Share this | Link to this | Hansard source

Ninety four per cent?

George Christensen (Dawson, National Party) Share this | Link to this | Hansard source

Six thousand people responded; 94 per cent were against. But, as big and as ugly and as economically destructive as the carbon tax is, it is just one method this government is using to bring the economy to its knees. Everything this government touches it stuffs up. As the Leader of the Opposition says, it is like the Midas touch in reverse; in fact, it is actually worse than the Midas touch in reverse because the government even manages to stuff up the economy with what it does not touch.

The one time they should have done something—the one time they should have stepped in—they did not. Qantas and the flying public needed the government to act and they did not act. They sat on their hands and did nothing. They were probably too scared to do anything because they know what happens when they do act. But doing nothing just punched another big, fat hole in the economy. It punched another big hole in business. In the Whitsundays, in the electorate of Dawson, times are already tough—as tough as they were during the pilots strike of 1989. They are suffering from the high Aussie dollar and the legacy of the summer of natural disasters. The Whitsundays relies on tourism and, by allowing the situation with the Qantas industrial dispute to get so out of control that the national carrier's entire fleet was grounded, this government knocked the stuffing out of even more Whitsunday businesses. QantasLink flights, thankfully, continued into the Whitsundays, but I have to tell you that there were a lot of empty seats. No connections means no passengers, and no passengers means no business, and that means someone is out of pocket—a family is out of pocket. How much more damage does the government want to do to the economy in the Whitsundays? They cannot wait for the carbon tax up there, I can tell you. They cannot wait!

Then there is the damage that has been caused to job-creating investment proposals in North Queensland by the rigid regulations of the environmental protection and biodiversity conservation approvals process. I point to one very big example of the damage: the multibillion dollar Abbot Point multicargo facility project. This project, which has the capacity to generate thousands of jobs and see an increase in population and services into the town of Bowen, has been held up by the federal environment department, awaiting EPBC approval, since December last year. Literally nothing has happened to what will be one of the biggest projects of all in Northern Australia. Each month the project proponents are told, 'Next month you will get the approval,' or 'The approval is coming; it is coming.' Well, so is Christmas—for a second time round for this proposal. Next month the project will have sat there stagnant for a year because of the federal government's delays.

Here is a little update that has been given by the Department of Sustainability, Environment, Water, Population and Communities; it came out during the Senate estimates. A bureaucrat from there, Barbara Jones, Assistant Secretary of the Environment Assessment Branch, said:

The proponent, North Queensland Bulk Ports, provided a final EIS document to the department on 6 December last year. The department is still considering the content of that document and assessing it.

The department has been assessing it for nearly a year. The proponents were advised that the application would be finalised in February—nine months ago—and it has been held up because of the onerous demands to offset perceived environmental damage. I have to tell you that that has Bob Brown's fingerprints all over it. The state government has already addressed the issue, and the proponents have agreed to a 100 per cent offset to all perceived environmental damage—100 per cent agreed. That was the original issue, and the agreement—you would think—would be the end of the issue.

But industry sources have told me that the department has now got UNESCO involved—UNESCO; would you believe it?—because the project is off the coast of the Great Barrier Reef. Now we have some bureaucrat in some United Nations office sitting over there in Paris with his little red pen, probably daydreaming about a holiday in the Bahamas or somewhere, and he is more concerned about that or what he is going to have for lunch than he is about creating jobs in North Queensland. The department basically confirmed this at Senate estimates. While they would not use the word 'referral' because of the connotations it has, they said that they were basically notifying UNESCO bureaucrats in Paris about job-creating projects in North Queensland.

Who is running this country? Is it the Labor Party, who quite clearly could not care less about business, investment or the economy? Is it the Greens, who want to completely shut it all down? If a Labor government is taking its economic policy from the Greens, it is just a matter of time before there is no economy in North Queensland—and the rest of the country will not be far behind.

Andrew Leigh (Fraser, Australian Labor Party) Share this | Link to this | Hansard source

Deputy Speaker Slipper, may I congratulate you on your sartorial splendour this afternoon?

Peter Slipper (Fisher, Liberal Party) Share this | Link to this | Hansard source

I thank the honourable member.

Andrew Leigh (Fraser, Australian Labor Party) Share this | Link to this | Hansard source

The member for Dawson has been dancing around the matter of public importance today, which is that of the economy. It is surprising, therefore, that he does not raise the issue that he raised in his maiden speech. In his first speech to this place, the member for Dawson called for the scrapping of income tax—a bold proposal, to be sure, which I am sure that the member for Dawson is still committed to. Why is he not putting that forward? It might be something to do with the fact that the coalition are in a deep, deep black hole.

We know, of course, that in the last federal election they were a cool $11 billion down in their costings. But it has only got worse, and the hole is now $70 billion. It is kind of odd that at this point that the member for Dawson does not just say, 'Let's keep on digging and see what we find; let's scrap the income tax as well.' Why doesn't he say it? Maybe he is like his leader—maybe he is willing to say anything to any audience that will keep them happy.

In contrast, we on this side of the House have an economic record which includes keeping 200,000 people in employment in the global financial crisis and saving tens of thousands of small businesses from going to the wall. We have got rid of inefficient taxes like the dependant spouse tax offset, the entrepreneurs' tax offset and the fringe benefits tax arrangement for cars—which, perversely, was bad economics and bad environmental policy. We have done that so that we can put money where it is needed most—into the National Broadband Network, which will boost productivity, and into schools and hospital reforms that will lay the productivity agenda for the next generation.

We listened to economists when we put in place a minerals resource rent tax that taxes an immobile source of production in minerals and allows us to cut taxes on a mobile source of production—that is, corporate tax investment. When economists throughout the world told us, as the scientists do, that climate change is happening and that a price on carbon pollution is the right thing to do, we on this side of the House listened and put a price on carbon pollution; those on that side of the House just abuse economists when they do not like what they say.

We are putting in place a national disability insurance scheme—another pillar in Australia's social safety net—and we are boosting superannuation. Meanwhile, those opposite are opposing the boost to 12 per cent super. Fifteen per cent is good enough for them, and nine per cent is good enough for their constituents. They are like a duke living in a castle complaining about public housing investment.

We on this side of the House held a tax forum to look at new ideas; those on that side of the House were missing in action. Occasionally we get the odd idea from them. The members for Wentworth and Kooyong support a sovereign wealth fund. A sovereign wealth fund is like a piggybank in overseas currency, so it is useful if you have something to put in it. Do they want to put anything in it? No; they oppose the minerals resource rent tax. The members for Wentworth and Kooyong have a policy of an empty piggybank. That is their economic idea.

The member for Mayo wants a broad-based goods and services tax. He says he wants to broaden the goods and services tax but, in the next breath, he is says that he wants a narrow carbon price and attacks the notion of a broad based carbon price. Ours is not the broadest-based carbon price, but the principle is there. The member for Mayo wants to broaden the GST but to narrow the carbon price. What would the former Treasurer Peter Costello say if he could see these people now? We know what he would say, because they are opposing his own reforms. They are opposing the fuel tax reforms he brought into parliament in 2003. They are taking a position on the petroleum resource rent tax that is the opposite of what the Howard-Costello government pursued throughout the 1990s and 2000s in their litigation with Esso.

Peter Slipper (Fisher, Liberal Party) Share this | Link to this | Hansard source

Order! The discussion is now concluded.