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

Mr Speaker has received letters from the honourable member for Fraser and the honourable member for Casey proposing that definite matters of public importance be submitted to the House for discussion today. As required by standing order 46(d), Mr Speaker has selected the matter which, in his opinion, is the most urgent and important; that is, that proposed by the honourable member for Fraser, namely:

The urgent need to return the budget to surplus, to invest in boosting productivity, and to provide open and transparent costings to the Australian people.

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—

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

In February of this year I held a mobile office at the National Multicultural Festival in Canberra. I was standing there talking to many of my constituents when Greg, a wardsman at the Canberra Hospital, came up to me and said something to me that has stuck in my mind ever since. He said, 'You guys want to keep at it with that economic reform, because it really matters for the long-term future of Australia.' He cast his hand around, looked at the people around us and said: 'You know, in 50 years time the adults we can all see around us won't be here anymore. In 100 years time neither will the kids; none of us will be here anymore. But the reforms we put in place will endure. So keep at it. Keep looking to the future and don't get caught up in that other bloke's negativity. Don't get caught up with his short-termism. Don't get up with his point-scoring, because what you're doing matters to us and matters to our kids.'

Tonight the Treasurer will deliver a true Labor budget. It will be a budget that will return us to surplus. It will be a budget that spreads the benefits of the mining boom and looks after the most vulnerable. It will be a budget that goes in to bat for millions of low- and middle-income Australians. It will help with the cost of raising kids through the schoolkids bonus, which I was pleased to be with the Prime Minister to announce in my electorate at a Big W at Majura Park on Sunday. It will be a budget that will put in place long-term reform—aged-care reform, a National Disability Insurance Scheme and dental reform. That fiscal strategy has been given a strong endorsement by the IMF. Yesterday the IMF said:

… we welcome the authorities’ commitment to return to a budget surplus by 2012-13 to rebuild fiscal buffers, putting Commonwealth government finances in a stronger position to deal with shocks and long-term pressures from an ageing population and rising health-care costs.

The IMF said:

… tighter fiscal policy combined with an easier monetary policy stance is an appropriate policy mix.

It is often forgotten that the tax-to-GDP ratio under Labor is substantially lower than it was under those opposite. Under those opposite, on average the tax-GDP ratio was 24 per cent: 24c in every dollar of output was taken in tax. Under Labor that is now 22 per cent. We are a lower taxing government than the coalition government that preceded us. We have made real spending cuts when circumstances demanded it, something those opposite never did in 11½ years, and we have increased fiscal stimulus when circumstances demanded it, something those opposite would not have dared to do. When the global financial crisis hit, those opposite would have taken the Herbert Hoover approach: they would have cut back on government spending and sent the Australian economy into deep, deep recession.

So on Thursday night the Leader of the Opposition is going to face a serious question: is he going to give us another stand-up performance like the one he gave us last year where he runs out some sort of dog and pony show, or is he actually going to come clean with the Australian people? Is he going to support the savings that we are putting in place to return the budget to surplus and support assistance for millions of Australian families? Or will he stand in the way of a budget surplus?

Of course, the Leader of the Opposition has a few problems in order to get there. His economic team is the one that had an $11 billion black hole in its 2010 election costings. His economic team is the same one that gave us the pass the parcel budget reply: 'Oh no, I won't do the costings. Oh no, he won't do the costings. Oh no, I won't do the costings, but my media advisor will be at the back of the room shaking his head.' It is the same economic team that bungled its attempt to find savings to meet the costs of the summer floods. It is the same economic team that has a $70 billion budget crater that it knows it cannot fund without extreme cuts to basic services. Seventy billion dollars: it is like stopping the pension for two years; it is like stopping Medicare payments for four years.

And if this was not enough, the shadow Treasurer has said that he is going to hide from proper costings. When we had a bipartisan parliamentary committee to look into the Parliamentary Budget Office, it was supported by Senator Joyce and the member for Higgins. But when it came time to actually vote for the legislation, the opposition decided they could not back a Parliamentary Budget Office and they were going back to the approach that they took at the last election.

Let us remember the approach they took at the last election, which I am reminded of in a short article in today's Age. It was WHK Horwath, a Perth based accounting firm, that did a costings audit for the coalition and that was later found to have breached accounting standards. The two accountants involved, Geoff Kidd and Cyrus Patell, were fined $5,000 by the Institute of Chartered Accountants for failing to live up to professional standards. Their mistake, of course, was to say that they had audited the coalition's costings when in fact they did not.

Barrie Cassidy asked the shadow Treasurer about this on Insiders on Sunday. Here is how the exchange went:

BARRIE CASSIDY: Have you yet decided with your costings how you will have those costings audited and authenticated before the next election?

JOE HOCKEY: Yes, we have.

BARRIE CASSIDY: And how will you do it?

JOE HOCKEY: You'll see.

A government member: Don't you worry about that.

Don't you worry about that. And the exchange continued:

BARRIE CASSIDY: But the last time around the accountancy firm you used it was found they were breached professional standards, they were fined and reprimanded. This time will you guarantee it will be a genuine audit?

JOE HOCKEY: Well, an audit is obviously a broad term. In accounting senses you have audits of companies; but audit with a small 'a', which is what I was referring to, is about ensuring we can verify that our numbers are accurate.

I have some news for the member for North Sydney: there is only one definition of the word 'audit' and it has a small 'a'. This is not like 'liberal'. I understand his confusion. There are two ways of spelling 'liberal'. There is big 'l' Liberal, which is the stand in the way of everything, block everything definition, and there is small 'l' liberal, which is the market based, standing up for individual liberties. That is a clear distinction—big 'l', small 'l'—and we all get that. But, member for North Sydney, I am afraid big 'a' and small 'a' audit does not wash. There is no big 'a' and small 'a' audit. There is only an audit, and your costings were not subject to that audit last time.

If we are to believe what is coming out of the opposition at the moment, their costings will not be subjected to an audit next time around. That means the Australian people are going to be denied the right to know what the alternative government would do and how they will pay for their promises. The opposition have a magic pudding fiscal policy. They say they have an audit commission. In fact, their audit commission is not about finding the truth, it is about hiding the truth. You cannot help thinking, when you hear the opposition talking about their costings, of Jack Nicholson in A Few Good Mensaying, 'You can't handle the truth.' The opposition think the Australian people cannot handle the truth about their costings. They are going to refuse to come clean about their costings.

Meanwhile we are putting in place a Labor plan for investing in the Australian future. On 1 July we will see a substantial shift in Australian tax policy. That shift will involve increasing taxes on pollution and decreasing taxes on work. It will see Australia for the first time raise the price of a tonne of carbon pollution from zero. It is very strange that those opposite think the right price for a tonne of carbon pollution ought to be zero. They want to cut the price of pollution and they want to raise the price of work. If they have their way, the people who will get tax cuts will be the big polluters and the big miners and the people who will get the tax rises will be working Australians. It will be working Australians who will see their taxes rises because that is how we are assisting households on 1 July. That shift from taxing work to taxing pollution is economics 101. It is the right way of managing a modern economy.

We are investing in productivity. It is absolutely critical that we put in place the productivity boosting reforms like the last wave of productivity-boosting reforms under the Hawke and Keating governments, reforms such as floating the dollar—a reform that was opposed by the current Leader of the Opposition as recently as 1994. In 1994, the Leader of the Opposition described the float of the dollar as an 'exceedingly dubious outcome for Australia'. Of course, that is not the only important economic reform he stood in the way of. He said that compulsory super was one of the greatest confidence tricks of the last decade and his coalition colleagues, when backgrounding, quite happily talked about his genuine innumeracy.

We will be putting in place investments in Australia's future, recognising that productivity does not grow by itself, that governments have to invest in skills and training. We have to improve the systems that underpin Australia's productivity. That means our school reforms, teacher quality reforms and My School, and ensuring schools have the resources they need to do the important job they do. It involves investing in vital infrastructure. The National Broadband Network will drive productivity, it will strengthen our economy. It is extraordinary that, if those opposite have their way, they will cease the NBN and they will go back to their string and tin cans approach. That would be bad for delivery of services, it would be bad for Australian businesses. There are many Australian businesses, I know, in my electorate and in the electorates of all of us that are looking forward to the opportunities that the NBN will bring. I am sure that the member for Bass understands the benefits of super fast broadband for his constituents, and my constituents in Gungahlin and North Watson are looking forward to the opportunities of the National Broadband Network.

But, at the same time, those opposite are talking down the economy. We have unemployment at five per cent compared with eight per cent in the United States and 11 per cent in Europe. Our economy continues to grow. It is seven per cent larger now than it was before the global downturn. Meanwhile, the British economy has shrunk; it is three per cent smaller than it was before the downturn and has just gone back into recession.

We have a gold-plated, AAA credit rating from all three ratings agencies, and—I know those opposite hate it—the Treasurer was voted Euromoney Finance Minister of the Year. Of course, Peter Costello would have loved to have received the accolade. I am sure that if he had received that, we would have heard speeches from those opposite about how terrific the Euromoney award was. But of course, with their characteristic lack of grace, as soon as Treasurer Swan received the award, they swept into this place and began saying, 'Well, it's not an award you ever would have wanted.' But, as Treasurer Keating before him did, Treasurer Swan has been voted Euromoney Finance Minister of the Year, and that recognises that the Australian economic circumstances did not happen by accident. They happened by dint of strong investment, most of which occurred under Labor governments, because Labor governments understand the need to invest in the future. They understand, as Greg said to me at the Multicultural Festival, that we are here for a short time on this earth and our job is to invest in making the country just a little bit better than it was before. Our job is to invest in things like super fast broadband and in education. I am reminded by the member for Hindmarsh that it is more than our job—it is our duty. That is why we are here. It is our duty to be here in order to put in place a National Disability Insurance Scheme. For too long, under governments of all stripes, people with a disability have not received the deal to which they are entitled. A National Disability Insurance Scheme is going to change that.

For too long we have had an aged care system that has been patched up with bandaids here and there but has not had the root-and-branch reform that I think all sectors understand it desperately needs. We are an ageing population and we need to get aged care right. We need to think systematically about aged care. In the area of hospital reform it is vital to recognise that we have to have efficiency payments for hospitals. We have to pay hospitals and encourage them to do as good a job as they can.

Those opposite should leave off trash-talking the Australian economy. They should say in Australia what the Leader of the Opposition would say were he in London, where he said: 'Australia has serious bragging rights. Compared to most developed countries, our economic circumstances are enviable.' (Time expired)

Tony Smith (Casey, Liberal Party, Deputy Chairman , Coalition Policy Development Committee) Share this | Link to this | Hansard source

Well, here we are on budget day being lectured by the Labor Party in this matter of public importance on the need for surplus budgets and the need for openness and transparency. We are seriously being lectured by the Australian Labor Party on budget day about the need for a surplus, which they have not delivered at all in government, and about the need for openness and transparency, which they have not delivered in any regard on any day that they have been in government.

Tonight, in a few hours time, the Treasurer, the member for Lilley, will hand down his fifth budget. Four years ago, of course, his budget journey began. Whilst it is very difficult, particularly at the moment—you would appreciate, Mr Deputy Speaker Scott—to make any predictions about what those opposite may or may not do, I think we can safely say that this Treasurer's budget journey, as far as handing down budgets goes, ends tonight. I think that, in their heart of hearts, those opposite know that. In his heart, the member for Fraser, who moved this matter of public importance, knows that is the case. They know that because not only do the Australian people have no confidence in this Treasurer; some of his own colleagues have no confidence in his capacity as Treasurer. If the Australian public are going to listen to a lecture about the necessity for a budget surplus, which everyone knows is necessary, they are not going to be lectured by the Australian Labor Party.

Let us look at the journey so far. Let us go to budget night four years ago. Four years ago almost to the day, the member for Lilley stood at the dispatch box. He had inherited no net government debt; in fact he had inherited $45 billion cash in the bank and a surplus of $20 billion. And do you know what he essentially said? He said that it was not good enough, that he was going to have a bigger surplus, that the Howard and Costello government had been reckless and irresponsible and that he was going to hand down a larger budget surplus. He went to great lengths to explain why he was a more responsible economic manager. Of course this followed on from the Labor Party's pre-election campaign that they were truly fiscal conservatives, more so than Prime Minister Howard and Treasurer Peter Costello who had paid off all of Labor's net government debt, put $45 billion in the bank and handed down a surplus of $19 billion or $22 billion in 2007. But, no, for the member for Lilley, this was not good enough; he was going to do better.

And then what happened the next year, in 2009, when he gave his budget speech from the dispatch box?

I remember sitting here listening to the speech all the way through. I have worked on a few budgets before, in another capacity. I have seen a few budgets delivered and I have listened to lots of budget speeches, and almost from the first paragraph I thought: there is something missing; there is something big missing; in fact, the whole thing that matters is missing! And what was missing was any mention of a surplus or a deficit. This is Labor Party openness and transparency! It was a deficit, and page after page and line after line as the Treasurer delivered that speech there was not one mention of the projected budget deficit for that year. It was projected at about $57 billion, from memory.

In case anyone thought this was some oversight—and the Treasurer could have it either way; he could say it was an oversight, that he was so incompetent he left the budget outcome out of his speech—that was dispelled pretty quickly. We had those contorted interviews in the days after the budget from both the Treasurer and the then Prime Minister, the member for Griffith, where they would refuse to state the dollar value of the projected net government debt or the budget deficit. It was a figure they were embarrassed about and it was a figure they went to great lengths never to mention. This is the openness and transparency that is so dear to the heart of the member for Fraser, who has moved this matter of public importance.

Let me remind members of this House that tonight there will be lots of budget documents, four of five volumes, and there will be PBS statements across the board. But in the end it all comes down to one figure, doesn't it? It all comes down to the outcome. In 2009 the Treasurer did not mention his budget outcome. Such is the commitment to openness and transparency of those opposite. Then, in 2010, even the Treasurer, delivering his third budget, thought, 'I don't think I'll get away with that again,' and he did for once mention his projected deficit. Then he said the deficit would be $40.8 billion. As it turned out, the real figure was not $40.8 billion. It was not less; it was more. It was nearly $48 billion.

Then we come to this year. We have had much fanfare from those opposite about how they will deliver a surplus tonight. What they will deliver, of course, is their projection. I predict that, following the shame of 2009, the Treasurer will actually state what the outcome of the budget is, but it will be his projection for the coming year just as it was back when he projected a $40 billion deficit in 2010 that turned out to be $48 billion. With this Treasurer, the moving numbers are surely something to behold. In this financial year, which still has a little over six weeks to run, his initial projection was that the budget deficit for this year would be around $12 billion. This time a year ago at that dispatch box he said it would be about $22 billion. Then, in his MYEFO, the regular six-monthly update that updates all of the budget figures thanks to the Charter of Budget Honesty delivered by the previous government, it had grown from $22 billion to $37 billion. All predictions are that it will be in the 40s tonight, and it ain't over yet—there are still six weeks to run. We will find out, as we do with all budgets, the final outcome towards the end of September. We know where he started: at about $12 billion. We know he has gone past $37 billion. We know there has been a threefold increase in his projected budget deficit for this year.

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

So far.

Tony Smith (Casey, Liberal Party, Deputy Chairman , Coalition Policy Development Committee) Share this | Link to this | Hansard source

So far, as my friend and colleague next to me says. The Treasurer will stand up tonight, deliver a budget surplus and say: 'Believe I will hit the target. Believe me that, for once, I'll hit the target.' Maybe he will say, 'Believe me, I'll get near the target.'

As some of you know, the History Channel on Foxtel is a great source of knowledge and inspiration if you ever get home after a function. There was a great show a while ago on the precision needed for the first moon landing. The maths and all the work had to be spot on. Too fast and there would be a huge problem. The wrong calculation and the astronauts, instead of going into orbit around the moon so that they could land on it, would bounce off and fly into outer space never to be recovered. In fact, if they had got it wrong they would still be out there. I could not help thinking, 'Thank God the Treasurer wasn't working at NASA.' Can you imagine it? 'Near enough's good enough,' I was about to say, but we do not even get near enough with this Treasurer. We have seen in the days leading up to the budget, as the shadow Treasurer rightly pointed out, that he 'doesn't know whether he is Santa Claus or the Christmas Grinch'.

Years and years ago when I had a lot more time on my hands as a teenager, I used to watch most test cricket matches. There was an opening batsmen for Australia, who I am sure was a great bloke, called Graeme Wood.

Opposition members: Western Australian.

A West Australian; there you go. He went through a bad patch where he ran out most guys at the other end. He would play a shot and he would have a combination of yes, no and wait, in rapid succession, and it always ended the same way—with the opposing batsman standing next to him at the other end of the pitch. That is what we have seen with this Treasurer. He says it is going to be a tough budget; that is his script. The problem with his script is: it is the same script he uses every single year. On 1 April 2008 he said, 'It's going to be a tough budget.' Before the 2009 budget, in an interview on radio 2UE, he said, 'This is going to be a tough budget.' In 2010 the government said, through Senator Sherry, 'It's going to be a tough budget.' Again this week we have heard the Treasurer say, 'It's going to be a tough budget,' as he has handed out cash in one direction and clawed it back from another. Yes, no, wait.

The other thing we are going to see in this budget is fiddles galore. We have seen that already in some of their predictions. As the shadow minister for finance pointed out a few weeks back, in March, if you look at the spending pattern over the forward estimates there is a desperate desire to drag spending forward into this year and to push it back beyond the next financial year so that the Treasurer can stand here tonight and say, 'I am projecting a surplus.' One example is the Energy Security Fund. Here is the pattern of spending over the forward estimates: $1,000 million in 2013-14, the same in 2014-15, but apparently—for reasons that are not obvious—the purpose of the Energy Security Fund almost evaporates in the year 2012-13. It goes from $1,000 million to $1 million. Just for one year: a dip down and a dip back up. And that is only what we know to date.

What Australians can be sure of, unfortunately, is that whatever this Treasurer says tonight it will not be the outcome. Whatever he says tonight, in a little over three hours, it will not be the outcome. The unfortunate fact about the economic management of this government is that incompetence in the ministry and incompetence across the government is leading to a lack of confidence throughout the Australian economy. There is only one way to restore economic responsibility to Australia and that is with a change of government.

Julie Owens (Parramatta, Australian Labor Party) Share this | Link to this | Hansard source

Once again I follow the member for Casey. I think the last time I spoke on a matter of public importance I did the same thing, and I think I said the same thing then. The member for Casey has an extraordinary ability to ignore the fact that there was a global financial crisis.

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

You created it.

Julie Owens (Parramatta, Australian Labor Party) Share this | Link to this | Hansard source

I think the member sitting opposite said we created the global financial crisis. That is one of the most amazing statements I have heard in a long while. That deserves to go down on the list of 'silliest statements of all time'—that the Labor government created the global financial crisis. Thank you for your interjection.

This is an interesting MPI to have on budget day, because most people—particularly in the media area—who know a great deal about economics are actually off in a lockup. In this House we have Dr Emerson, the member for Rankin; he certainly knows about economics. We have a few members of the opposition who, from what I have heard so far, do not know much about economics. But I am going to take this opportunity, while all the economists are not listening—excuse me, Dr Emerson, you can give me notes later—to try to talk about the economy and the issue of surplus in non-economic language. I am going to try not to use the word 'fiscal' more than once, because I have just used it.

Governments have a major role to play in keeping our community functioning and keeping us in a place where families and individuals can live the lives that they want to live. One of the things governments have to achieve in order to do that is growth. But it is not growth for its own sake. It is not growth because growth per se is good; it is growth because growth allows us, as a community, to do certain things. It allows us to provide employment for people who are entering the workforce. That is one of the most important things that it does, and that is why this government is so focused on jobs. There are more people in the workforce now than there ever have been at any time in Australia's history. Growth allows a government—particularly a Labor government—to support the weakest and the most vulnerable. I am really pleased to see that tonight there will be some announcements on payments to families to assist with education expenses. This reflects our commitment to supporting the weakest. Our commitment is also reflected in our substantial investment in struggling schools in past budgets, in the substantial increase to pensions—the largest one in 100 years—in the increase in the childcare rebate from 30 to 50 per cent, and in the amazing work that has gone on in the development of the National Disability Insurance Scheme. We will be launching sites for that scheme next year, one year earlier than the Productivity Commission recommended. We are also giving additional assistance to parents of children with disabilities, and paid parental leave. All of those Labor reforms indicate our understanding that one of government's roles, and one of the purposes of growth, is to support people at times in their lives when they are weakest and most vulnerable.

You also want to grow because it allows a government to encourage and enable the strongest people in the community to contribute to society—the most creative, the most entrepreneurial. That is why we invested so substantially in R&D and that is why when things got tough we came to the aid of small business with instant tax write-offs during the global financial crisis, why we have announced instant tax write-offs again from 1 July and why there will be more announcements tonight that will provide tax relief to business—an extremely important role of government.

But also one of the roles of government and one of the purposes of growth is to make sure that you can do these things for future generations, that you are not just using what you have now but that you are putting in place the structures that will provide all those things for the future. That is why you will see this government commit to the MRRT—known as the mining tax—which uses some of the profits of today for the future through increases in superannuation. It is why we have put such extraordinary investment into training, why we have made reforms to health with much more focus on preventative health, and why we have invested so substantially in the NBN. All of these things are about making sure that the growth that our economy shows is invested for the things that matter—to keep people employed as they enter the workforce, to support the weakest, to encourage and enable the most creative and the strongest, and to make sure that we can keep doing these things for the future.

One of the things that governments do right around the world in order to keep economies moving in this way is to step in when there are shocks to the economy. When the global economy suffered a severe crash a couple of years ago—it is actually more years ago than you realise; it has been going on for quite some time—we did step in and we stepped in quickly and effectively. The results if you do not step in are really easy to see. When the economy turns down, when you get what I think at the time was an estimate of $250 billion over the forward estimates ripped from your tax base—and that is what we were talking about back then—what happens is individuals lose their jobs. Someone pays when the economy has a downturn of that size.

You can as a government stand back and say, 'Okay, the individuals who will lose their jobs can pay for it'—as happened in many countries of the world where the action was not fast enough. The US, for example, has 8.3 per cent unemployment and Europe has over 10 per cent now; whereas we are sitting on just over five per cent. You can stand back as a government and watch that happen or you can step in and take up the slack as business withdraws—and that is what we did as a government. What that means in times of great global financial shock is that countries actually go into deficit. They go into deficit when they need to step in and, as business recovers, they pull back again—and they pull back for very good reasons. They pull back to make space for business. As business starts to recover, it needs the employees and it needs to build things for itself. Whereas during the global financial crisis we were building things for the community, if we continued to do that in a major way as business started to build for itself, there would be a competition for investment dollars and a competition for skilled labour. So as the economy slows down government steps in to provide employment for a range of people.

In my community we built school halls, libraries and public housing, and three per cent of my workforce was employed on those projects. Three per cent of Parramatta's workforce was employed on those projects, and they were employed for up to two years. We all know that the construction industry is still quite soft. They would still be unemployed. They would have sold their trucks, they would have sold their tools, they would have lost their houses and they would have had all the mental health and other health issues that come with a shock in a person's life—and the family stress and the family break-up. And, as the economy improved, they would not have had their truck, they would not have had their tools and they would not have been in the position necessarily to move back into the workforce quickly. So we stepped in and we as a nation, by spending that stimulus money, took the weight of the global financial crisis as a community. We took it rather than allowing it to be borne by individuals—by that individual and that individual, depending which field you were in and depending where you were at the time. We did that and it was the right thing to do.

But it is equally the right thing to do as the economy recovers for us to withdraw and push the budget back into surplus. You do that for a number of reasons. You do it to get out of the way, for a start. You do it to get out of the way and to give the Reserve Bank more space on monetary policy. You do it for that reason but you also do it because, given the circumstances that this government has seen since we came to government—with global financial crises and the ebb and wane of the argument about whether it was going to get better or whether it was going to get worse—it is just sensible to put this country in a position where we have the capacity to respond to what comes in the future.

In the last two years we have lived through some of the worst natural disasters that we have seen come one after the other. Every time it happened there was a hit to our GDP, there was a loss of work opportunities and we saw the economy slow—and each time we responded. It is sensible when you have the spare capacity to move back into surplus so that if things get rocky again you have the capacity to respond. This is a sensible thing to do. It was sensible to go into deficit and it is sensible to bring the budget back to surplus as early as you can—and that is what we are doing. I am really looking forward to tonight's budget because I know it is going to be a Labor budget that continues on that commitment to growing the economy, to supporting the weakest, to enabling the strongest and to ensuring a future for future generations.

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

It is T minus three hours and counting, as Vice-Captain Wayne M Swan of the starship Laborites prepares to make a new entry in the captain's log. What this government is trying to achieve is almost a direct lift from the introduction of every episode of that great science fiction TV series, Star Trek: 'Surplus: the final frontier of these voyages of the starship Laborites, now in the sixth year of their mission to introduce strange new policies, to eek out new taxes and new regulations and to boldly go where no Labor Treasurer has gone before'—well, at least not in the member for Longman's lifetime. Rightly or wrongly, the Treasurer wants us to believe he can cross that final frontier tonight and boldly go where he has never been before—to a budget surplus.

The member for Fraser—who could be Mr Spock if he had pointy ears—talks about the need for a surplus, and not just the need for a surplus but also the need for transparency. Anyone can get up here and say they are going to deliver a surplus. You can say it as much as you like, but just saying it does not make it so. To deliver a surplus, you actually have to deliver a surplus. Sometimes there can be a difference—as we know so often with this Labor government—between what is being promised on budget day and what is proven to be delivered 16 months later. Sometimes there is a very big difference in facts and sometimes an epic difference, like the deficit that is currently in progress this financial year.

Let us not look at the wild forecasts of a desperate government. Let us look at reality, because we can actually do that. Let us go back to the captain's log from this time last year and look at what was forecast then. According to the 2010-11 MYEFO forecast there was going to be a deficit of $12 billion. At the time, that sounded like a pretty bad budget. But it actually got worse. Six months later, the budget forecast was a deficit of $23 billion. Then another six months later there was a forecast of a $37 billion deficit. And they reckon it is going to head lower. The Labor Party loves to come into this place and talk about this fictitious black hole from our side. What we have here is not a fictitious black hole; it is a very real one that is unfolding before our very eyes. At the rate that this blow-out is growing, it is not just a black hole; it is going to be a complete rip in the space-time continuum, like the one that Mr Spock sailed through in the last Star Trek movie.

If we want to talk about transparency, let us be transparent here and talk about the difference between the science fiction that the Labor Party would give you and reality. In reality this government has not got a clue about how to deliver a surplus or how to manage an economy. It is pure science fiction to think that these guys can actually deliver a surplus. This is the government that thrusts an economy-wide tax on the population, the carbon tax—and it brings in how much money exactly? How much money? Last time the government told us, it was none. It was actually going to cost more than it raised. That is because the tax will not actually achieve the goal that it sets out to do—lowering carbon dioxide emissions—so the government has to go offshore and buy some.

The Treasurer is just blindly firing out taxes like they are photon torpedoes, hoping he can bag himself a surplus. He is firing everything he has got: the carbon tax, a mining tax, 'We'll take away the rebate on your private health insurance.' But back in the engineering section, where all the productivity happens, the business sector is actually reeling. All the firepower is sapping the energy out of the ship called Australia. Manufacturers and small business exporters are all screaming at the government like Scotty: 'She cannot take it anymore, Captain. She's gonna blow.' We have the mining industry entering unchartered territory, where mines like Norwich Park in Central Queensland are closing down. We have the tourism industry on its knees, reeling from a downturn in international tourist numbers. We have manufacturing going belly up because of government neglect. And now we have a carbon tax coming in to give them all the Vulcan nerve pinch.

But the government just is not listening. They are just sailing the nation straight into oblivion, and they are doing it at warp speed. The government have driven us into debt and deficits. The Labor Party and their Klingon mates—the Greens, the so-called Independents and now the member for Dobell—led us into this mire. And now they are trying to tell us that they can lead us out. But they just keep on moving forward, telling us how to follow them. They have not turned around. They are still leading us into oblivion. That is because the Labor Party only knows one direction: a direction of reckless spending, waste, and more and more tax. And that is not how you deliver a surplus.

I want to see a surplus as much as anyone else, and I do believe it is imperative to get the budget back to surplus. But using smoke and mirrors will not do that. Pulling spending out of next year and putting it into this year does not achieve anything, except blowing out this year's budget even further. When people look at the cash for kids program that was announced this week, their first reaction might be to think of how they are going to spend that money. But when they think about it for a minute—and people will; the voters are not stupid—they will realise that they will actually need that money to pay the taxes needed to pay for the program itself. It is not just robbing Peter to pay Paul; it is robbing Peter to pay Peter. It is giving with the left hand and taking with the same left hand. For the hard-core Trekkies out there, it is like Ferengi economics. That is not creating a surplus; it is just pushing expenditure around. You cannot put this week's rent on the credit card then pay next week's rent in advance on the same credit card and tell everyone how you will not be paying rent next week. It is nonsense.

And what do you get for all of this? A flimsy $1.5 billion alleged surplus. Well, that is a surplus, Wayne, but not as we know it. That is as close to transparency as this government is going to get: forecasting a surplus that is so wafer-thin that you can see right through it. Put that figure into context. Compare it with the size of the actual blow-out in the current budget. If this Labor government turns a forecast of a $12 billion deficit into somewhere south of $40 billion, how long will the $1.5 billion surplus that is forecast stand up? I think it will be gone by the morning.

I said earlier that I would like to see a budget surplus. But we have to understand what the point of the surplus is. It is to pay off debt and put aside money for a rainy day. We have plenty of debt that needs to be paid off. But is it actually going to be paid off? Not on Labor's watch, because on their watch this parliament is going to be asked again tonight to raise the debt ceiling to record levels. And today we know that because when the Prime Minister was asked whether they would seek to raise the debt ceiling even higher we could not get an answer. If you think a surplus can be delivered by raising the debt ceiling then, again to quote from Star Trek, you are out of your Vulcan mind.

I want to see a budget surplus—a real budget surplus—because it is what a responsible government delivers for a rainy day. This Labor government inherited a $20 billion surplus and $70 billion of net worth. The coalition saved for a rainy day. We had a rainy day. We had a literal rainy day. We had the global financial crisis, but we also had the floods in Queensland and the cyclone. But the cupboard was already bare so they had to dig up more debt, and they had to dig around and put in new taxes. So what if we have another rainy day, with this wafer-thin so-called surplus? What if there is widespread flooding and cyclone damage? How is that surplus going to fare then? I have to tell you: set phasers to stun because it will be all gone. Unless that rainy day happens in the next 12 hours, it will be too late because this Treasurer's surplus will be blown out before he finishes his cornflakes in the morning.

Four times the government has come to this place and told us that we are going to have a record huge deficit. They actually came in here and said that. It turned out the reality was much worse. One thing we can be sure of is that whatever the Treasurer announces tonight it will be worse than that when it comes to the crunch. No amount of smoke and mirrors can save this incompetent government. No amount of cooking the books will stop a country from plunging into a real black hole, a worm hole you could say, that it itself has created. And when the good hard-working Australians look up from the bottom of that big black hole where Labor has put them—and it will be sometime soon—they are going to say one thing, 'Beam me up, Scotty'. We need to get this country back to reality and the budget needs to get back to a real surplus, not Labor's science fiction one.

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

I thank the member for Dawson for his contribution. I think he does well as a star trekker and perhaps that is the standard of debate those opposite want to bring to this House. With respect to something as serious as the federal budget, no wonder he wants to be beamed up.

Tonight is very serious. Tonight we are going to bring down a budget. Tonight it is very important for Australian people that this budget moves back into surplus. Madam Acting Deputy Speaker D'Ath, you know my electorate of Fowler. I have the most multicultural electorate in the whole of Australia. I also have a very disadvantaged electorate. My electorate is well and truly in the mortgage belt. The thing that matters to my constituents is putting downward pressure on interest rates, not watching Star Trek. Maybe they cannot afford to get the reruns put on their satellite systems, unlike the member for Dawson. Bringing the budget to surplus will put downward pressure on interest rates.

It is all very well to be lectured by this mob opposite who presided over eight consecutive increases in interest rates. They were there and they saw the interest rates go through the roof. They were there when people in my electorate were losing their houses. This is the mob that presided over the mortgage stress in this country. They want to lecture us on fiscal discipline. Tonight's budget will also, in addition to going back into surplus, make landmark reforms, particularly in aged care.

When we first came to power we were the first government in 12 years to increase the age pension and the disability support pension. They did not just not do it; they took a decision against their minister to not increase pensions over the 10-year period they were in government. So do not lecture us on looking after older Australians or on looking after Australians on disability pensions. We will bring the National Disability Insurance Scheme forward, which will be revolutionary. I am sure members opposite that represent people, as I do, with disabilities will know the significance of that. In electorates such as mine, people have been have been left behind with acute dental issues leading to health issues. This is very big and something those opposite had the opportunity to fix and never did.

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

They abolished it.

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

Good point. We will be bringing down the school kids bonus. That is going to be pretty significant. For parents in my electorate it will mean that twice a year they will get money when they need it most to pay for their kids' access to computer technology, school uniforms, books, pencils, papers, sports uniforms and football boots. That is something very important to any of us that represent families. Do not forget, this budget will also provide the vehicle by which the first paid maternity leave scheme will be introduced in this country.

Deborah O'Neill (Robertson, Australian Labor Party) Share this | Link to this | Hansard source

It is about time.

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

It is about time. This is not the Rolls-Royce model proposed that those opposite were going to use a discount out of the mining tax for. This will actually do something for people who need it most, families that need it now, and we are going to do it. So they can whinge and bleat as much as they like but the facts remain: we are presiding over a $1.4 trillion economy, an economy which is the envy of most of the developed world. It is also the economy that best withstood the challenges of the global financial crisis. Have you ever heard that mob opposite talk about the global financial crisis?

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

Never! They slept through it.

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

They did not actually sleep through it. That is being unjust to them. The alternate government over there, when the challenge of the global financial crisis hit, voted no to investing in our schools, they voted no to investing in social housing, and they voted no to investment in regional and local infrastructure. All those conservative councils that they represent got money from us, yet they voted no to it. This is the same mob that went to the last election with an $11-billion black hole.

We get lectured by the member for Dawson about transparency. They made an effort on transparency. Firstly, they refused to use the Parliamentary Budget Office—an independent body—to scrutinise their costings. They appointed their own auditor. I guess at a stretch you could understand it. They gave the auditor such instructions that the auditor was found to be in gross breach of professional accounting standards. This is the mob that wants to lecture us on fiscal discipline. The people they get to oversee their costings could not come out and verify their costings without breaching professional accounting standards.

The mob opposite also get on aeroplanes occasionally, fly around the world and give a few speeches. One time, not all that long back, the Leader of the Opposition was over in London. He was asked about the Australian economy. What did the Leader of the Opposition, Mr Abbott, say? He said:

On the face of this comparative performance, Australia has serious bragging rights … Compared to most developed countries, our economic circumstances are enviable.

He said that this year. These people want to jump up and down—fire and brimstone—and find holes in everything yet go overseas and speak the truth.

Another person who has some economic credibility is the member for Wentworth. He has been around for some time and had a pretty senior role in some accounting firm, they tell me. What did the member for Wentworth say? He compared 'the current success and strength of our economy against the troubles of so many others'. I think he is pretty accurate. We should give credit where credit is due. He got that call right.

When it comes to an economic debate, this mob are not in the game. They are the people who for over a decade presided over the failure to invest in Australian infrastructure. They might want to talk about the $20 billion surplus they had—and it is on the record, it is true—but they failed to invest in the economic infrastructure so necessary for this country.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

Bottlenecks everywhere!

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

They didn't vote for the roads in Queensland!

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

They presided over the establishment of bottlenecks. I am glad all those members from Queensland are here. They know how much was not put into Queensland. They failed to invest in economic, productive infrastructure. It is the same mob that when they had the chance at the Treasury benches ripped $1 billion out of public health. We are rebuilding that system. As a matter of fact, it was under the watch of the current Leader of the Opposition when he was health minister. He took $1 billion out of health.

They also managed to strip almost $1 billion out of public and vocational education. They ensured that where they could they stripped money out of that. That is what went into their surplus. They failed to spend on those things that are so necessary to put our economy on a competitive footing for the future.

We just got lectured to by the member for Dawson about the problems in Queensland after the flood. As I recall, it was this side of the House that decided it was a priority, a commitment that we should work for the restoration of flood damage in Queensland.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

Hear, hear!

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

Who voted against it?

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

The member for Forde.

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

Who voted against it? All of you.

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

All those people over there from Queensland, whose electorates were very much damaged, sat here on a party basis and voted against the efforts of the Australian Labor Party to rebuild Queensland. Those members have got to hang their heads in shame.

It was only yesterday you had the International Monetary Fund coming out and paying credit to this government for bringing the budget back to surplus as quickly as we have. You have also got Standard and Poor's coming out and congratulating the government. One simple thing that those opposite should be able to understand is that this is also the first time in Australian history that all three rating agencies have given this country AAA status. It does not matter how far they want to go back, they cannot find that at any time they have occupied the Treasury benches, because it has only happened now.

We will be working to deliver for working families. We will not be taking care of mining magnates who are seeking preselection for the Liberal Party; we will work to look after working families. (Time expired)

Bert Van Manen (Forde, Liberal Party) Share this | Link to this | Hansard source

That was the third contribution from our colleagues opposite that has been full of froth and bubble but, as usual for this government, with absolutely no substance. The member for Fowler has tried to say that we have not been able to produce a coherent economic strategy. Well, I give you 11 years of coherent economic strategy under the former Howard government that left you guys with $20 billion in the bank and $70 billion of net assets. And what have you done with it? Absolutely nothing. You have just frittered it away.

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

What about the roads in Queensland?

Bert Van Manen (Forde, Liberal Party) Share this | Link to this | Hansard source

We never voted against the repair of roads in Queensland; we voted against you introducing a new tax. Because of your economic incompetence you had to introduce a new tax to fund the fixing of the flood damage in Queensland—just one of 20-odd different taxes you have introduced.

It is important that we return our budget to surplus but it has got to be done in an orderly and sensible manner. This budget surplus is only a promise. The IMF is a bit early in its call to congratulate the government on returning the budget to surplus, because it is a promise that we will not know about until September 2013.

Labor's record of budget surpluses does not bear spending much time on, because they have not produced one in 20-odd years. We have got to a stage where we now have the highest debt in the nation's history. This Labor government has lived in the red, spending up big at the taxpayers' expense. It is building up quite a credit reference, borrowing up to $100 million every day and paying up to $100 million a week in interest. Net debt is forecast to peak at about $136 billion in 2013-14, with about $7 billion a year in interest. Last time I checked that would probably fund the NDIS. It is just one of many examples of the profligate spending of this government. Programs that could have been implemented if they had spent their money more wisely cannot be implemented, or have had to be delayed.

In all of this the average Australian is yet to see real value for money. They have not benefited at all from the $4 billion blow-out in the cost of border protection. They certainly did not benefit from the nearly $2 billion blow-out for the Building the Education Revolution.

Craig Emerson (Rankin, Australian Labor Party, Minister for Trade and Competitiveness) Share this | Link to this | Hansard source

You came to the school openings!

Bert Van Manen (Forde, Liberal Party) Share this | Link to this | Hansard source

We have not benefited from the Pink Batts program that cost four lives. I was talking about the blow-out, Craig. Just listen to what I am saying. You do not want to listen to anything else we are saying.

Australians cannot see the sense in the blow-out from the set-top box scheme. I have had seniors call my office wondering why, when they can get a cheap set-top box from Harvey Norman for $150, it cost several hundred dollars to install it under the government's program. The spending spree just continues.

The NBN is another classic example: extra funds being spent on the NBN without a proper business plan, without a cost-benefit analysis. How much money is in there that could be redirected to other programs to solve some of the problems we have in our community?

Craig Emerson (Rankin, Australian Labor Party, Minister for Trade and Competitiveness) Share this | Link to this | Hansard source

I will let the people of Forde know about that too!

Bert Van Manen (Forde, Liberal Party) Share this | Link to this | Hansard source

I am not getting any NBN in Forde, anyway, Craig. Check your facts!

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

Order! I would remind the member for Forde to refer to members by their correct titles.

Bert Van Manen (Forde, Liberal Party) Share this | Link to this | Hansard source

Business and taxpayers alike will be contributing to the blow-out in costs associated with the rollout of the NBN. Locals are also complaining about an upgrade to the M1—if funds were redirected from the NBN, maybe we could get finished some of infrastructure in Queensland the member for Oxley was talking about. Where is the value for money? How are Australians expected to believe that this government is looking out for their best interests? Bribing everyday Australians with handouts and compensation is not looking after their best interests, and the old pea and thimble trick of taking with one hand and giving with the other is not going to work either.

I sometimes wonder whether those opposite are wearing green tights under their clothes. It seems to be an inspiration gained from acting out their own roles in a new kind of Robin Hood drama where the Labor government continues to rob from the rich to give to the poor. What they do not seem to appreciate is that most of their economic policies for the past four years have actually done more damage to the people they purport to seek to assist than they have done to the rich. We saw this with the changes to the private health insurance rebate, and we saw it with the carbon tax and its evil twin, the mining tax.

The centrepiece of this year's budget in the past 12 months has been the world's biggest carbon tax. No accounting trick or bribe can hide the strength of the carbon tax and its deleterious effect on the Australian economy and confidence in our nation. The carbon tax is socialism dressed up as environmentalism. It is just one of the vehicles Labor is hoping to drive from red town to black town. But it is all based on a promise, on a wing and a prayer, in 18 months time. Given this government's track record, I am not holding my breath.

The world's biggest carbon tax is based on a lie. It will destroy jobs and do damage to household budgets and our economy in general. It is another example of this government's solution to every problem, which is to tax it, increase the cost for Australians and then give back with the other hand. The urgent need to see the budget return to surplus comes as the level of net debt soars to its highest level in our history. The guilt of Labor's spending spree is starting to set in, and now the government are desperate to get the budget back into surplus. They realise the urgency of it now, before interest on the Labor government's debt reaches the $7 billion mark. What a waste. This $7 billion could have been used to pay for a National Disability Scheme.

As I said earlier, Labor are right at home in the red. They have not delivered a surplus since 1989-90. Labor have not delivered a surplus, as the member for Dawson touched on earlier, in the member for Longman's lifetime. At this stage this surplus is a promise only—and, given Labor's interpretation of a promise, I really have to question whether we will see that surplus in September 2013. We are more likely to see the Disney blockbuster sequel to Pinocchio before then. This is a budget that will be based on cooked books, with the Treasurer being the master chef. The forecast surplus will be based on fiddled figures with spending brought forward or pushed back. For example, the bulk of the NBN expenditure is not even in the budget documents—it is mostly for standard spending like digging trenches and laying cable—just by treating it as an equity injection.

Today's MPI stresses the urgent need to return the budget to surplus, invest in boosting productivity and provide open and transparent costings to the Australian people. Improving productivity and innovation is going to come about through lower taxes and lower regulation, not increased taxes and increased regulation—both of which this government have been absolutely consummate professionals at. It was noted that, if the government were being honest with the Australian people, the real starting point would be a $8.5 billion deficit not a $1.5 billion surplus. Labor have an appalling record in forecasting budget and economic numbers. It is this that makes me rest quite comfortably that they will not produce a surplus in 18-months time.

It is the coalition that has a proven ability to manage the economy. The urgent need to return the budget to surplus, invest in boosting productivity and provide open and transparent costings to the Australian people will not be achieved by this current government but through a coalition government that will bring reward, hope and opportunity to the people of Australia.