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

It is an important time in the economic history of this nation and indeed the world, and the 2012-13 budget is an important part of this nation's economic history. When federal Labor came to government at the end of 2007, our economic honeymoon period was very short. In 2008, we faced the impending global financial crisis, the greatest downturn in the world's economy for 60 years. Fortunately for the Australian people, the early awareness of the full potential of any GFC shown by then Prime Minister, Kevin Rudd, and the prescient advice of then Secretary of Treasury, Ken Henry, to 'go early, go hard, go households' combined to successfully steer Australia through the GFC. Unlike too many other developed nations, we did not go into recession, we did retain jobs and we did continue to invest in the future of the nation through significant programs in infrastructure, education, skills training and innovation. I would like to say how much I enjoyed the recent half-hour interview by Chris Uhlmann of Ken Henry on the ABC. It is always important to be reminded of what experiences we have been through.

The strategic investments that we made meant that many sectors could continue their core business and retain their workforces. It is always worth acknowledging the immense effort of many businesses and their employees to negotiate accommodations that reduced job losses for employees and losses for employers. That is the sort of cooperation this nation is capable of and is known for; it is the sort of fair go that at present seems to be somewhat under attack.

At the time of the GFC, our stimulus efforts meant deficit budgets. At that time we made a commitment to the Australian people that we would return the budget to surplus by 2013-14. In this budget, the 2012-13 budget, we have kept our promise a year earlier than we committed to. Since those deficit budgets of the past contributed to the strong economy we experience today and the circumstances that have enabled us to return to surplus, we have faced relentless claims by the opposition that we spent the hard-won surplus of Peter Costello, that we have trashed the economy and that we have maxed out the national credit card. What absolute garbage and what reckless talk that can do great harm to this nation's financial reputation.

Let's not be fooled: that supposedly hard-won Costello surplus they talk of was hardest of all on the Australian people. It was won by selling off Telstra and our major airports. It was won by failing to invest in the infrastructure and innovation that underpin successful businesses and 21st century economies. It was won by failing to invest in the skills and knowledge of the nation's people, who make up our workforce. It has been federal Labor governments that have had to do the real heavy lifting and play serious catch-up, all because of the neglect of those Howard-Costello years, all because of neglect of the Prime Minister in waiting, Tony Abbott, as he would suggest. He is an economic illiterate according to the previous Treasurer, Peter Costello.

Heaven help the Australian people if the economic midgets opposite ever get their hands on the economic levers of Treasury. The responsible economic management shown in the 2012 budget is in vast contrast and it has been good for the people of my electorate of Newcastle. Families, working people and business are the heart and soul of this nation and they are the heart and soul of the 2012 budget.

In Newcastle around 14,500 small businesses may be eligible for the new loss carry-back tax measure, as well as being able to deduct new business assets that cost under $6,500 for as many assets as they purchase. Additionally, businesses will be able to write off assets that cost more than $6,500 in a single pool and will be able to immediately deduct the first $5,000 of a new or used motor vehicle purchased from 1 July. These are measures that encourage business to invest in essential items that will continue to drive productivity and their cash flow, helping both the businesses and, ultimately, the nation.

In Newcastle almost 11,000 children and their families will receive the schoolkids bonus of $410 for each eligible child in primary school and $820 for each eligible child in high school. Of course that is paid to them each year. This critical financial support will be paid upfront at the beginning of school terms 1 and 3, when families really need it. I will not revisit the demeaning attitude of the Leader of the Opposition when he suggested families could not be trusted to manage this bonus. I am very happy to speak from my experience as a principal for over a decade and having seen firsthand the very careful financial management of many disadvantaged families to ensure their children did not miss out on a complete education.

I go back to one particular school that I was principal of. It was a very poor school—perhaps the poorest school in the city of Newcastle. It amazed me that the parents would be first into the January sales to lay-by items for next Christmas. They were very good financial planners and they never let their children miss out. But I have also seen the generosity of more financially comfortable parents who, when they received the former back to school bonus in New South Wales, donated that bonus directly to the school for specific fundraising projects. So my experience is that families in Newcastle are very capable of making very sensible decisions when it comes to such payments.

Eight thousand Newcastle families will receive an increase in family tax benefit part A from 1 July 2013, and in the Newcastle electorate alone over 10,000 young people, single parents and the unemployed will receive a supplementary allowance of $210 for singles, or $175 for a person who is a member of a couple, to help them with essential bills. Tripling the tax-free threshold from $6,000 to $18,200 means approximately 212,000 working people in Newcastle and the Hunter region will get a tax cut beginning 1 July this year. In fact, seven million Australians will get that tax cut at a time when cost-of-living pressures in a constantly changing world make it difficult for working people to plan ahead. From this month, around 90 per cent of Hunter households will receive assistance payments, a tax cut or both from the Clean Energy Future package, which was included in the budget.

We are indeed the clever country, and right now we have a strong economy to help us transition to a cleaner environment for future generations—a necessary transition, given that our carbon based resources cannot last forever and if we are to play our part in reducing the impact of climate change. The science of climate change is clear: man-made activity and carbon pollution are contributing to climate change—a change that will have a profound effect on the standard of living we currently enjoy if we do nothing. The economics of climate change is clear: the earlier a nation acts, the more benefit is derived for the economy. The business of climate change is clear: early adopters in manufacturing and business can sustain their competitiveness and stand to make the greatest economic gains. But those opposite continue to trash talk both science and our economy.

There will be modest price impacts, we know, from placing a price on carbon pollution, with Treasury estimating that overall costs will increase by 0.7 per cent, or less than 1c in the dollar. You cannot help but look back and think about that GST that was never going to happen under John Howard. It was introduced and it was 10c in every dollar that Australians spent. This is less than 1c and is an important part of making sure behaviour is changed, modifying the behaviour of the biggest polluters so they do not keep polluting at the same rate as they are.

But the carbon price will account for approximately 8c of every dollar in New South Wales household electricity bills. So, while the average bill will go up $3.30 a week because of the carbon price, an average household will receive $10.10 a week in help from the federal government. We are determined to help Australians with the rising costs of a 21st-century life, and that is the core feature of this budget and the government's modus operandi. We are prepared to take on the big economic reforms like the Clean Energy Future, the minerals resource rent tax and the National Broadband Network to keep our economy strong, but we are equally determined to do that in a way that helps average Australians manage that change in a way that spreads the prosperity and great wealth of this nation into every community in Australia. Whilst Newcastle and the Hunter region continue to benefit from infrastructure investments made in the past four budgets brought down by Treasurer Wayne Swan, there were some infrastructure measures in the 2012 budget that deserve special attention. As a government we have committed $3.6 billion to complete the much-needed duplication of the Pacific Highway between Newcastle and the Queensland border, if the New South Wales government will put in their share. The 80-20 per cent funding split that we introduced during the GFC has rightly reverted back to the 50-50 split convention, and I call on the New South Wales government to make their commitment in the forthcoming budget to get the Pacific Highway duplication completed. It is a main corridor, bringing economic benefits to my region from tourism and freight movements. With the Hunter Expressway moving ahead, thanks to our funding, regional centres such as Newcastle depend on those major arteries for their economic success.

Similarly, this budget allocates $150 million for the completion of the M2 to F3 link—that eight kilometres of road that winds through Sydney suburbs, Sydney school zones and Sydney speed cameras. Again, the F3, M2 and M7 through to the Hume Highway is a vital corridor for regional Australia to connect across regions. Getting that traffic out of the streets of Sydney makes sense for everyone. So again I call on the New South Wales government to live up to its promises, match our funding and get these main arterial highways completed.

Sitting beside this budget is the commencement of the rollout of the National Broadband Network to 110,200 households and businesses in the Hunter region within the next three years. Ninety-four per cent of households in Newcastle will be included in that three-year rollout and we cannot wait.

Looking ahead, the budget also projects that $6 billion revenue from the minerals resource rent tax will become available for urgent infrastructure needs in mining regions. It is time that the people of Newcastle finally had separation of freight and passenger rail from Fassifern through to Hexham and along the southern arm of the Hunter River to the grain and coal terminals at Carrington. Only then will we be able to reduce the coal dust and the long waits at railway crossings. This is critical to the amenity of our city, a city that has always been prepared to do the heavy lifting, the hard work, to build the economic future of this country. But any attempt by the New South Wales government to cost-shift their existing infrastructure responsibilities to the MRRT revenue should be rejected, given that royalties of over $1.5 billion from Hunter coal flowed into state coffers just last year.

Any suggestion that federal Labor's 2012-13 budget does not reflect responsible economic management needs a reality check, and that is what it got during the week the budget came down. All three major global credit rating agencies reaffirmed our gold-plated, AAA credit rating, the first achieved by any government in our history. It is, of course, a great comfort to international investors to put their money into Australia. Our economy is now seven per cent larger than before the global financial crisis. Australia's unemployment is at 4.9 per cent. This contrasts with what the OECD expects to be a 7.9 per cent unemployment rate for the OECD in 2013. The OECD Economic outlook released last week confirmed that we will significantly outperform OECD economies over this year and next. The OECD forecasts Australia's growth at 3.1 per cent in 2012 and 3.7 per cent in 2013. That is in line with our Treasury projections, but it is also in stark contrast to other global economies doing it tough.

Finally, it is important to unwind the myth that the budget raises the debt ceiling and that we have a huge national debt, maxed-out credit card problem. That is just not right. As the Australian Financial Review reported on 18 May, economists back the Gillard government's decision to lift Australia's debt ceiling by $50 billion, saying 'a financial buffer is important to preserve the status of Australia's bond market as a safe haven' during tough economic times. We all know that massive amounts of money are being invested into that bond market. An increased debt ceiling is sensible and necessary, providing liquidity to the bond market.

Senior economist at RBC Capital Markets Su-Lin Ong stated: 'This whole debate that debt is bad is not helpful.' I agree. Our net debt is expected to peak at 9.6 per cent in 2011-12. In perspective, our peak national debt is a little over one-tenth of the size of the debt of other major advanced economies. In response to the alarmist opinion piece by former Liberal senator Amanda Vanstone, she was corrected by the National Times's John Watson, who wrote: 'Get the facts and figures right—there is no debt crisis.' With an economy the envy of the world, an economy strengthened by the reforms and governance of federal Labor since 2007, our government's largest budget continues to further strengthen our economy and maintain real support for working people, families and businesses right across the nation. I take great pride in the efforts of this government over the four years we have been in power and I commend the appropriations bills to the House.

Josh Frydenberg (Kooyong, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on Appropriation Bill (No.1) 2012-2013 and related bills following the passing down of Labor's fifth budget, a budget defined by its rubbery figures, higher taxes and broken promises; a budget which is the culmination of five years of misguided policy priorities and bungled policy implementation; and a budget which does not place Australia well for the economic challenges ahead as the international environment deteriorates.

First to the bottom line: the government's prediction of a $1.5 billion surplus in 2012-13 is hard to believe. This time last year, the government predicted a deficit of $22 billion. MYEFO saw it revised to $37 billion. Now we know it has come in at $44 billion, an unforgivable blow-out which brings the accumulated deficits for the last four years to $174 billion. Not only are these the four largest deficits in Australia's history but they see our net debt peaking at over $136 billion, requiring new borrowings of $100 million a day.

The government seeks to explain itself by saying it had lower taxation receipts and was subject to external shocks such as the flooding in Queensland. But what this Gillard government fails to appreciate is that its policy prescription of increased taxes, more red tape for small business and a heightened role for unions in the workplace is a disincentive to investment and a brake on job creation. What is more, the predicted surplus was only achieved by bringing forward as much spending as possible into the 2011-12 year and pushing out as much spending as possible into the 2013-14 year and beyond—just as long as it does not fall within the magical 2012-13 year.

For example, payments of $1.1 billion to local government, $1.8 billion in infrastructure transfers to the states, $1.5 billion in carbon tax compensation for pensioners and welfare recipients, and $1.4 billion in disaster relief funding for Queensland were all brought forward to the 2011-12 year. Labor's energy security scheme, which is normally a $1 billion annual program, has only $800,000 allocated in 2012-13. The government's coal sector jobs package, which is an annual $250 million program, will only receive $10 million in 2012-13. This over-manipulation of programs also extends to the special dividends from the Australian Reinsurance Pool Corporation and the Export Finance and Insurance Corporation, which the shadow Treasurer has pointed out are only being taken in 2012-13 to 'fluff up the promise of a surplus'.

The government's accounting treatment of these programs, together with their decision to place major spending initiatives like the $50 billion NBN and the $10 billion Clean Energy Finance Corporation 'off balance sheet' in the forlorn hope that they make a return to the taxpayer, means we cannot take the government's budget numbers at face value. Nor can we allow the government to gloss over their broken promises and punishing tax hikes, the most serious of which is the carbon tax, explicitly ruled out before the election but soon to hit Australian households—in just over 30 days time. In my electorate of Kooyong I have had small business owners, self-funded retirees and captains of industry explain to me the pernicious impact the carbon tax will have on their bottom line. They are pleading for us to repeal the tax in the event we get to government. As I have said elsewhere, in my state of Victoria we will be particularly hard hit by the carbon tax. Premier Ted Baillieu released a report by Deloitte Access Economics showing that the government's carbon tax will by 2015 lead to 35,000 fewer jobs, a $6.3 billion fall in investment, a reduction in per capita income of $1,050 and a worsening in the state budget by almost $660 million—a grim picture indeed.

The next broken promise by this government was its company tax cuts, promised to small business up to the day of the budget but then brutally abandoned in this budget, saving the government $4.7 billion. In fact, Mike Symon, Labor's member for Deakin, wrote to business owners in his electorate in a letter dated 7 May, the night before the budget—

Kirsten Livermore (Capricornia, Australian Labor Party) Share this | Link to this | Hansard source

Order! The member for Kooyong will resume his seat. The member for Parramatta on a point of order.

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

No. I have a question.

Kirsten Livermore (Capricornia, Australian Labor Party) Share this | Link to this | Hansard source

Is the honourable member seeking to ask a question?

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

I am.

Kirsten Livermore (Capricornia, Australian Labor Party) Share this | Link to this | Hansard source

Will you allow the question, Member for Kooyong?

Josh Frydenberg (Kooyong, Liberal Party) Share this | Link to this | Hansard source

No. The letter was dated the night before the budget. It arrived on 10 May, two days after the budget. It said that they could celebrate a 'cut in the company tax rate from 30 to 29 per cent, benefiting 720,000 small businesses as of 1 July 2012'. A more embarrassing mistake from the member for Deakin would be hard to find. Then there are the tax concessions of 50 per cent on interest earned from bonds, annuities and bank accounts which were abandoned in this budget. The standard deduction of $500 rising to $1,000 on tax returns was also axed in this budget. The $500 mature-aged worker tax offset has also been abandoned in this budget, saving $250 million. Taxation of super for people with incomes above $300,000 has been doubled in this budget to 30 per cent, raising the government $1 billion. A higher contributions cap on super for people over 50 has been deferred in this budget to 2014, saving the government $1.5 billion. Green building tax breaks of 50 per cent on eligible assets are now gone as a result of this budget. Labor has also walked away from its solemn commitment to increase foreign aid to 0.5 per cent of GNI by 2015-16. So too, when it comes to defence spending, Labor has unforgivably ripped more than $4 billion out of defence, in the process breaking its commitment for a three per cent real increase in defence spending up to 2018 and ensuring that defence spending in Australia as a proportion of GDP is now the lowest since 1938. Planned water infrastructure upgrades for the Murray-Darling Basin have been deferred in this budget to 2015-16, saving $941 million. Finally, the passenger movement charge has been increased, meaning that the already struggling tourist industry will need to find an extra $610 million over the next four years.

When one adds to this long list of broken promises Labor's failure to generously fund the National Disability Insurance Scheme—to which it promised only $1 billion over the forward estimates, not the $3.9 billion a year recommended by the Productivity Commission—and its failure to fully commit to the Gonski review recommendation of an annual increase of $5 billion in education funding, instead allocating only a bit over $5 million for administrative follow up, it is easy to see why so many people are angry with Labor's fiscal mismanagement. The truth is that the party that gave us the pink batts, the Green Loans, the school hall fiascos, the GroceryWatch and Fuelwatch debacles, the NBN blowout and the Australia Network tender farce has turned economic incompetence into an art form. In fact, this government is so incompetent that it could not even run a hot bath. The question has to be asked in this place: if this government is so confident of turning a $44 billion deficit in 2011-12 into a surplus next year, in 2012-13, why is it trying to lift Australia's debt ceiling from $250 billion to $300 billion? The answer is that Labor does not even trust its own numbers. The truth is that in this current economic climate, both domestic and international, the government should be putting more money aside for a rainy day.

In his annual post-budget address to Australian business economists, the Treasury secretary, Dr Martin Parkinson, pointed to the difficulties in forecasting the economic outlook. In 2011-12, the budget forecast growth of four per cent in 2011-12 and 3.75 per cent in 2012-13—that was forecast down in MYEFO. While the national accounts data is still to come in, he sees growth for 2011-12 'closer to three per cent'. With exports comprising close to 20 per cent of GDP, lower than predicted export growth—particularly for education services—has had a significant impact. Export growth was forecast at 6.5 per cent in 2011-12 and now 'looks like it will be closer to four per cent'. At the same time, imports are growing faster than expected: 12.5 per cent for 2011-12 compared to forecast growth of 10.5 per cent. Terms of trade are clearly on the decline. Tax receipts, particularly company tax, capital gains tax and GST are all down. For example, company tax rates tax receipts were predicted to grow in 2011-12 by 27.5 per cent but are now down to 19.9 per cent, reflecting greater accelerated write offs and the fact that it has taken longer for company tax losses incurred during the GFC to be absorbed. Significantly, the revenue collection from indirect tax—including the GST—is revised down $3.7 billion. This data from Treasury reinforces the big question marks that coalition has over Labor's rubbery, wafer-thin surplus.

Looking abroad from Europe to Asia, the signs are not great. Japan has had its credit rating lowered two notches by Fitch from AA to A+, bringing it on par with Korea's for the first time. In April, China's shipments abroad were less than expected; and Malaysia, Thailand and the Philippines all had reductions in their exports. China's growth is estimated to be at 8.2 per cent, down a full per cent from 2011. The World Bank is expecting China's current account surplus as a percentage of GDP to decline after also falling in 2011.

As the European Union buckles under the weight of sovereign debt issues, its demand for Chinese exports will only go down. This has flow-on effects for Australia and the robustness of its export numbers both to China and beyond. It is in this climate that we must understand this year's budget.

There was from the Gillard government no economic narrative for growth and no evidence of a return to the fiscally prudent, yet effective days of the Howard and Costello years that produced two million new jobs, more than 20 per cent growth in real wages and the lowest unemployment and inflation in more than three decades, let alone the fact that they paid off Labor's $96 billion of debt and left more than $60 billion in the bank.

Alan Kohler, a former editor of the Financial Review and now a reputable economic commentator on the ABC, got it right when he described Julia Gillard and Wayne Swan's budget this way:

This is, at its core, a big taxing, big spending budget, including a big increase in welfare.

…   …   …

it is the budget of an unpopular Government approaching an election, not one that's tightening the belt.

Unfortunately, for 23 million Australians, they need and deserve better than this.

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

This is the fifth budget that I have spoken to, the fifth budget brought down by the Treasurer Wayne Swan since the election in 2007. I have to say, I am as proud of this one as I have been of any of them. We have governed in extraordinary times. I came to this parliament at the height of a boom that had lasted for 20 years. I walked in every quarter and heard the Treasurer talk about how the mining boom in China had delivered billions of dollars to the tax base—billions of dollars flowed into the tax base every quarter on the back of that boom. Then I watched a government spend it like a drunken sailor; I watched a government that said to itself, 'We've got a rich friend in China; let's have a party,' that did not build for the future, that did not invest for the future and that essentially frittered it away in the most appalling way.

We, on the other hand, have not governed in those times. In fact, we have governed through some of the worst global financial times in about 80 or 90 years—since the Great Depression. I have watched the government, with Wayne Swan as the Treasurer, handle those circumstances in quite an extraordinary way. It is no mistake that we are now in a country which—in spite of having $150 billion ripped from our revenues by the uncertainty in global markets, which made the job incredibly difficult—has a AAA credit rating from all the rating agencies for the first time in our history. It did not happen during the great boom years when money flowed in from China at a great rate; it actually happened in one of the worst times in a century.

We have more people employed now than at any time in Australia's history. Again, it did not happen through the boom years; it did not happen through 12 years of unprecedented boom that came from a boom elsewhere in the world; it happened in one of the worst times in this country. In other parts of the world the unemployment rate is twice ours. We have more people employed now than ever before in our history. We have inflation, interest rates and unemployment below five per cent for the first time in 40 years. Again, it did not happen in the boom times; it happened in the worst of times. We have the highest projected growth of any country in the developed world, and we are one of only two that managed not to go into recession in what was the worst of times.

These are things to be proud of. I would love to have been in government in better times actually, because it has been very tough for government and for many people in the country. But these are things to be proud of, as is this budget. Just as the government did the right thing when things got very difficult, when the bottom fell out of investment, in the global financial crisis, and when it looked like construction had stalled altogether, we stimulated the economy as we should. In my electorate, we kept three per cent of the workforce employed on buildings in schools and public housing. That was three per cent of the workforce that we in my area all know would not have been engaged on other construction projects. So it was a great achievement to keep those people employed for well over two years while the construction industry began its recovery. It is still recovering now.

Now it is time, as the economy recovers, to bring the budget back into surplus. We are doing that through this budget. Again, it is not the best of times—not the most easy times to do it—but it is the right time to do it. In spite of that, and in spite of the extraordinary fiscal discipline that we had to show in bringing this budget back to surplus, we have provided quite considerable assistance to those who need it most. Again, that is something that I am really proud of: we have done the right thing for the economy as a whole but we have protected and looked after those in most need.

This is not a one-off for us. If you look at the record of the government over the last four years you can see how much of a difference we have made to people who are most in need of help. In my electorate alone, there are 1,335 local families who are benefiting from Australia's first ever paid parental leave scheme. That was delivered by us, again in the worst of times. We had 1,796 local families benefit from the baby bonus last year, and many of those families also received $500 more of their payment upfront to help pay for initial costs. The families of about 5,000 local teenagers turning 16 over the next five years will receive up to $4,200 extra in family payments if their child stays at school. There are 11,800 local family tax benefit part A recipients who may be eligible for an advance payment of up to $1,000 to help them meet unexpected family expenses. There are 7,211 local families who are now benefiting from Labor increasing the childcare rebate from 30 per cent to 50 per cent of parents' out-of-pocket expenses; we also increased the maximum payment to $7,500 per child per year. That has made a significant difference to many families in my electorate. I remember those years when I first came to parliament, from 2004 to 2007. I remember families being on waiting lists for a year or a year and a half and then finally getting a job three or four weeks after their child's name made it to the front of the queue and being told they had to either pay the child care, which they could not afford, or go back to the back of the queue. I had many, many parents in my electorate who were really struggling with finding a place back then, and things for many families are much, much easier now thanks to that increasing of the rebate. Those same 7,200 families now have the option of claiming their childcare rebate payment fortnightly rather than having to wait till the end of the year, and that makes it much easier for them to make ends meet.

There are 22½ thousand local pensioners that are benefiting from our historic pension reforms, including the biggest increase to the pension in 100 years. Single pensioners on the maximum rate are receiving an extra $154 a fortnight, and couples on the maximum rate are receiving an extra $156 a fortnight combined. Four thousand one hundred and eighty-seven local families have received an annual $600 carer supplement boost to assist with the financial pressures associated with caring for a loved one. Those who care for a child with a disability now receive an extra $1,000 per child a year.

Twenty-two and a half thousand local age pensioners can now keep more of their pension if they continue to work. They can now earn up to $250 a fortnight averaged over the year without it being taken into account as income under the pension income test. This is particularly important for those pensioners who return to work at a key time of the year—maybe at Christmas because there is more work around, or maybe leading up the end of the financial year because their skills are in accounts, or maybe because they work at a school for 40 weeks of the year. Being able to average their money over the year makes a significant difference to them. There are 581 local apprentices training in skill shortage areas who are being supported with $5,500 in total government support to help them complete their qualifications.

The Household Assistance Package is rolling out now. More than 14,300 local families will receive extra money through family assistance payments in the months of May and June—we are almost finished with May now. A typical family in Parramatta will get $529 through both tax cuts and family assistance payments. Thirteen and a half thousand family tax benefit part A recipients in Parramatta will receive up to $110 extra a year per child, and 11½ thousand part B recipients will receive an extra $69 a year per child. More than 1,900 families will receive an extra $289 per year in increased income support as well as assistance through increased family payments, and more than 22½ thousand local pensioners will receive an extra $338 a year for singles and $510 for couples combined in their pensions from May. More than 1,400 local self-funded retirees will receive an extra $338 a year for singles and $510 for couples combined from May. Job seekers have not been left out either. Nearly 5,000 local job seekers will receive an extra $218 a year for singles and $390 for couples combined from May. More than 3,000 students in Parramatta will get up to $177 extra per year, and the amount they get will depend on the rate and type of their payments.

There is also assistance coming through the tax system. Around 55,000 local taxpayers—which is a substantial proportion of the working population in Parramatta—will receive a tax cut on 1 July. Around 45,000 taxpayers will receive a tax cut of at least $300, and 5,000 local residents will pay no tax at all due to the tripling of the tax-free threshold. The average wage earner in Parramatta now pays approximately $1,200 less than in 2007-08 as a result of Labor's tax cuts for low- and middle-income families, and these are being delivered not in the height of a boom but at a time when the global financial crisis and global uncertainty has ripped $160 billion from our revenue base.

From July, Labor will put up to $500 into the superannuation accounts of 26,400 local workers earning up to $37,000. The minerals resource rent tax will increase superannuation for 54,900 local workers from nine to 12 per cent. For an average 30-year-old worker this will add almost $108,000 to their projected retirement income. From October, local dads and other partners in Parramatta will be able to apply for Labor's new dad-and-partner pay scheme, which begins 1 January 2013. In spite of the opposition's unwillingness to support the cut to the company tax rate, we have still managed to provide significant assistance to small business. To 19,800 businesses we will be giving an instant tax write-off for each asset purchase below $6,500. It is one of the many benefits to be delivered by the minerals resource rent tax. On top of this, the first $5,000 spent on a new motor vehicle will also be able to be written off.

The schoolkids bonus is also great news for families. Up until this year we have had the education tax refund, where parents could claim part of the costs that they spent sending their kids to school, but about 1,700 families in Parramatta did not claim that. There are a large number of people who have not been claiming that rebate, and in many cases they are the people who need it most. So we have replaced that education tax refund with a schoolkids bonus. There will be 9,050 local families in Parramatta who are expected to receive $410 a year for each child in primary school and $820 a year for each child in high school, totalling $9 million worth of assistance for Parramatta families. Those payments will be received as they are needed: at the beginning of the year and in the middle of the year. We will see those payments rolled out to families in my electorate in June. More than 14,000 local families will also receive an increase of up to $600 in their Family Tax Benefit Part A payments, and that increase will flow from July 2013.

We will also be delivering vital assistance to 13,000 local young people, single parents and the unemployed who are currently receiving allowances by providing cash payments to help with the cost of essential services like electricity, gas and water. Singles will receive a supplementary allowance of $210 while couples will receive $350. We are also nationally investing over $225 million over four years through the jobs, education and training childcare fee assistance initiative, which helps parents on income support receive the training and skills they need to return to the workforce. It is a particularly important initiative and one that I am very proud of.

I could continue for quite awhile with the budget benefits to Parramatta, but unfortunately I have run out of time. I commend the bill to the House.

Karen Andrews (McPherson, Liberal Party) Share this | Link to this | Hansard source

I rise today to speak on Appropriation Bill (No. 1) 2012-2013 and its cognate bills. For the last year we have heard that the budget would be back in black, but the budget papers show a very different story, with an artificial surplus and the government moving to raise the debt ceiling to $300 billion. Australian families are tightening their spending so they can reduce their overheads and make ends meet, but the government is increasing its credit card limit after a spending spree of waste and bad management. What was perhaps most disappointing about this year's budget to both me and many McPherson residents was that there were no measures whatsoever that focused on addressing many of the issues being faced by residents of the Gold Coast, Australia's sixth-largest city and the second-largest in Queensland. At a time when the Gold Coast is facing an unemployment rate that remains higher than the national average there has been no vision and no plan to help the many struggling families on the Gold Coast. Residents have taken note and are not impressed by this government's lack of interest in the Gold Coast.

Today I would like to speak about some key issues that affect McPherson residents. These are education and the possibility of establishing a fly-in fly-out operation at the Gold Coast Airport, the current state of the tourism industry and the need for better transport infrastructure on the Gold Coast, particularly the southern Gold Coast. I would like to begin with education. I am on record saying that the Gold Coast has the ability to become an education city and a centre for educational excellence in Australia. I wholeheartedly believe that. Work is well underway and has been underway for some time.

You do not need to go far to find the evidence of the Gold Coast becoming a future education city. Since the late 1980s the Gold Coast has seen four universities open their doors to students; Bond University, Southern Cross University, Griffith University and Central Queensland University all now have campuses on the Gold Coast. The universities cater to thousands of students from both domestic and international markets. Consequently, they provide employment opportunities for Gold Coast residents as they hire a wide range of staff in areas such as academia, administration, groundskeeping, hospitality areas and, of course, technical support, just to name a few. Local businesses also benefit from their proximity to the universities and student accommodation, with students and staff alike spending money at these stores on a regular basis. These businesses become a hub for both students and people associated with the universities, generating more wealth within the local community. For instance, the economic benefits generated for the local community by Bond University and Griffith University amount to more than $1.6 billion annually, with over two per cent of the local workforce hired by one of these two universities.

The Gold Coast becoming an education city leads to my next point: the opportunity for the Gold Coast to host a fly-in fly-out facility. I note that the Sunshine Coast currently has chartered flights that fly out of its airport to various locations and that a new air charter company will be flying from bases in Brisbane, Cairns and the Sunshine Coast to areas in the Bowen Basin, Cloncurry, Weipa and Mount Isa. The Gold Coast can also provide fly-in fly-out services to regional areas and take advantage of the wealth that the minerals and resources sector creates.

I recently met with Brett Schimming, the CEO of Construction Skills Queensland. We spoke about a number of issues, including the skilled construction workers we have on the Gold Coast who are currently unemployed or underemployed and how these workers have skills that are easily transferrable to the mining and resources sector. We looked at opportunities and ways that we could enable construction workers to access jobs in the mining and resources sector so that the skills that these workers had could be maintained so that, when the construction industry picks up on the Gold Coast in perhaps two to three years, there would be a skilled workforce we could draw on to meet the demand for construction workers on the Gold Coast. A fly-in fly-out operation will provide an opportunity to address skill shortages in regional areas whilst reducing the unemployment and underemployment levels on the Gold Coast that have been caused by a downturn in our traditionally strong industries such as construction. Mr Schimming also explained that job applicants who did want to take advantage of a fly-in fly-out operation were unable to due to the lack of necessary qualifications, and they would then need to be able to turn to our local universities and our training providers. his would mean that universities and training providers would need to adapt and expand their courses on offer to reflect the demands within the minerals and resources sector, as well as to continue to provide their current standard of service to students. This will in turn result in more locals being hired to ensure the effective operations of those institutions, more businesses benefiting from the higher number of students in the area and more investment in the local community from the universities and training providers, who contribute back to the local area.

I would now like to address the issue of tourism on the Gold Coast. It is no secret that, because of the global financial crisis and the high Australian dollar, the Gold Coast's traditionally strong tourism industry has suffered and continues to suffer. At the end of 2011, domestic visitor numbers on the Gold Coast were shown to have fallen by six per cent from the year before, and the number of holiday visitors also fell by seven per cent. Meanwhile, our international visitor numbers fell by 12 per cent. Because of the downturn in visitors, many tourism operators have hit tough times and are trying desperately to make ends meet. It needs to be remembered that many of the businesses involved in the tourist trade are not large international or national chains but are small businesses. Accommodation providers, restaurants, cafes, specialty stores and local tourist operators are all largely run by dedicated individuals who put in the hard work to provide a quality service to visitors and at the same time to put food on the table for their families.

Major events that are held on the Gold Coast, such as the Gold Coast 500, the Quiksilver Pro surfing tournament and Cooly Rocks On, provide struggling businesses with a much-needed injection of funds. However, events are held only once a year and do not provide continuous business over a whole year, especially at times when there may be a dip in the visitor numbers. Although the Commonwealth Games will do much good for the Gold Coast by bringing in visitors and building new infrastructure for the benefit of the local community, they are still six years away. Tourism operators need help now, but instead of giving them the helping hand they need the government is making things more difficult for them at a time when that is least needed.

The expected increases to the passenger movement charge will further deter international visitors, charging them more when they depart Australia. Also, overseas passengers who travel on domestic flights within Australia will have to pay more for their domestic airfares because of the carbon tax. Coupled with the extra expenses of accommodation and living expenses such as food and activities, the government is steadily making a visit to Australia too expensive. This is also one of the reasons why there is an increase in Australians holidaying overseas. It is not because they are bored with travelling around this great nation but because it is now as cheap to have a holiday in, for example, Bali as it is to have a holiday elsewhere in Australia.

Josh Frydenberg (Kooyong, Liberal Party) Share this | Link to this | Hansard source

Cheaper!

Karen Andrews (McPherson, Liberal Party) Share this | Link to this | Hansard source

Cheaper. However, the carbon tax is expected to result in the loss of 6,400 jobs in the tourism industry—

Josh Frydenberg (Kooyong, Liberal Party) Share this | Link to this | Hansard source

Shame!

Karen Andrews (McPherson, Liberal Party) Share this | Link to this | Hansard source

Yes, shame—and we just cannot afford that. The question that I ask is: how many of these jobs will come from my hometown, the Gold Coast, where there is already a high unemployment rate? The tourism industry on the Gold Coast cannot face any more challenges in the years ahead if we are to compete with cheaper international locations. We cannot afford a government which will continue to make that task more difficult.

I would now like to speak about a continuing concern of many Gold Coast residents, and that is the upgrade of the M1. To highlight the important role the M1 occupies on the Gold Coast, you only need to consider that the Gold Coast itself is constructed along three main thoroughfares: the M1 in the west, which links the Pacific Motorway south of the Queensland-New South Wales border to Brisbane; the Gold Coast Highway, which runs up the Gold Coast coastline from the border through to Labrador; and Bermuda Street-Bundall Road, which runs through the centre of those two roads. These three roads link the north of the coast to the south, and they are key in allowing our residents, our tourists and businesses to go about their daily business. The M1 is the main route for freight vehicles and traffic heading to and from Brisbane and the surrounding areas. It plays an important role in the region's economy by ensuring that goods are received on time and by allowing residents to get to and from where they need to be in the most direct and timely fashion. In recognition of this, the Howard government in 2007 committed to providing $455 million worth of funds to upgrade the M1 between Tugun and Nerang. Yet with the ascendancy of the Rudd-Gillard government, it seems that the priority for this crucial piece of infrastructure has been downgraded.

Heavy congestion is still an issue up and down the M1, from Tugun to Nerang, with traffic stopping altogether during peak periods on the southern Gold Coast. On 21 March this year, I asked a question on notice to the Minister for Infrastructure and Transport about the M1. I asked the minister: (a) when will works commence for further upgrades to the M1 between Mudgeeraba and Tugun on the southern Gold Coast, (b) when are these upgrades schedules for completion and (c) what sum has the government allocated to upgrades between Mudgeeraba and Tugun? In his response, which I received this morning, some 69 days after the question was put, the minister referred to the Mudgeeraba Interchange, the upgrades of the Robina and Varsity Lakes interchanges and the widening of the M1 between Nerang and Mudgeeraba. He then went on to say:

The full program of works is expected to be completed by late 2013.

However, there is no mention in his response of widening the M1 further south of Mudgeeraba, which is the full completion of the works, so his answer is clearly incomplete. I call on the minister to respond fully, openly and honestly to all the residents and tourists on the southern Gold Coast, who for too long have been ignored by this Labor government.

Mr Adams interjecting—

Josh Frydenberg (Kooyong, Liberal Party) Share this | Link to this | Hansard source

They won't, Dick.

Karen Andrews (McPherson, Liberal Party) Share this | Link to this | Hansard source

They did not. Many of my constituents, as well as many Australians across the country, are hurting financially. With rising fuel prices, rising grocery prices and rising electricity prices. What is disappointing is that this government, which should be emphasising the virtues of prudent spending and wise financial management, is addicted to waste and taxation. Since Labor was elected in 2007, Australians have been forced to endure 26 new or increased taxes, which will either directly or indirectly hit their hip pockets. When Australians are struggling enough as it is, it is unimaginable that a responsible government would do such a thing.

In 2010, the Prime Minister said that the government had lost its way. This government remains lost, with no reasonable prospect of finding its way. However, the coalition has a better way to get Australia back on track and to restore hope, reward and opportunity. I look forward to continuing to work with my constituents in the months ahead to ensure that the southern Gold Coast can continue to grow as the vibrant and strong community that it is.

Dick Adams (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

This budget's prime purpose is about spreading the benefits of the boom to all corners of our country by delivering much-needed new financial relief to families and businesses under pressure. It will return to surplus to provide a buffer in uncertain global times and to give the Reserve Bank room to cut interest rates further if it needs to. It will protect low- and middle-income Australians and our community's most vulnerable with reforms like the historical first steps towards the National Disability Insurance Scheme, aged care reform and a blitz on dental waiting lists. Our interest, and my interest as the member for Lyons, is how this budget can help get better health and aged care, whilst still ensuring that there are jobs to go around to all.

Many people in rural and regional Australia have poorer access to health services than other Australians. Unfortunately, this results in poorer health outcomes. The Gillard government will seek to address this by building on our record investments in health facilities and buildings. Those living in rural and regional areas will benefit from 76 new projects under the Health and Hospitals Fund, including hospital redevelopments, community health centres, multipurpose services and dental facilities. To attract, train and retain permanent health professionals in the bush, accommodation for students and health professionals, including locums, will also be built and improved. If we are to attack the problem of ever-increasing costs in health care, then the key is to make our primary health more efficient and more accessible, giving the local communities opportunities to help themselves and their families. If we can keep all the minor problems dealt with at a local level, the hospitals will then be able to deal with the emergencies and chronic illness problems.

I have been working to ensure that my areas have benefited under these programs. I have already helped Sheffield Medical Centre set up a very efficient service, and two others are underway in the north, with Deloraine and Longford also developing expanded services. The funding of these communities will improve access to GPs and it is expected that the facilities will include general practice nurses and allied health specialists and have an emphasis on chronic disease care. Three other areas currently under negotiation are Sorell, Brighton and Bridgewater-Green Point. Greenpoint Medical Services will expand within the existing practice building, while the Sorell and Brighton councils will be working with local health service providers to deliver new health services and to attract new additional health professionals to the region. I am pleased that these later projects are shortly to be started; I have been seeking their establishment for the last few years.

I know that there will always be debate about savings measures, but we need to look at the broader perspective and how carefully targeted savings enable us to make some important, evidence based investments to improve the health system. A key example of the Gillard government's commitment to evidence based policy is the expansion of the National Bowel Cancer Screening Program. The program will extend to provide regular five-yearly screenings for people between 50 and 70 years of age. Consistent with the National Health and Medical Research Council guidelines, the program will further extend in 2017-18, when a phased implementation of biannual screening will commence. Bowel screening saves lives. Screening at regular intervals will pick up around 12,000 positive tests and save between 300 and 500 lives annually. This program does not have to take place in a main hospital; both this and the breast screening program can be delivered in a separate area using specialty trained staff—bringing it back to the local community.

Then there is dental health. It is a fact, sad but true, that around 400,000 people on public waiting lists, together with a range of people with limited means, have poorer dental health than their fellow Australians. Not only does this affect their health; poor dental health can also affect people in many other ways, including their confidence and ability to get a job or engage in many community activities the rest of us take for granted. In the budget, the Gillard government is investing $515 million in foundation measures to support reform in dental care. An estimated 400,000 adults will benefit from a blitz on public dental waiting lists. This initiative is clearly focused on Australia's most in need: lower income Australians who have waited months, possibly years, for dental treatment, unlike Mr Abbott's poorly targeted chronic disease dental scheme—a complete failure. The dental workforce will also get a boost with 50 extra voluntary dental graduate placements and 50 new oral health therapist graduate placements. A new grant program will encourage and help dentists to relocate to regional and rural and remote areas. This is very good for Tasmania.

In addition, the Gillard government has allocated $10.5 million for national oral health promotion activities—such as 'Clean your teeth' campaigns. The government will also invest $8.2 million through the Health and Hospitals Fund for projects that will support new dental chairs and mobile dental clinics in regional areas. This is another plus for regions like mine. Another innovation which I believe is vital for modernising the delivery of health care is the introduction of e-health. I have already spoken on this earlier this year and pointed out that the introduction of the Personally Controlled Electronic Health Records Bill is to enable the establishment and operation of a voluntary national system for the provision of access to health information relating to consumers of health care. It will, firstly, help to overcome the fragmentation of health information, and we know what that is like. I heard the other day that the AMA is still holding out for something, saying that they do not understand the software. I would just like them to get on board and give it full support. In hospitals in Tasmania we still see orderlies rolling files on big carts around the aisles. It is 1950s stuff, but it is still going on. The fact that we have not been able to upgrade to an electronic system is a real issue and people ought to be looking at why it has not happened earlier. Secondly, it will improve the availability and quality of health information. When something is electronic much more information is available. How much could that help health care in this country? Enormously.

Thirdly, it will reduce the occurrence of adverse medical events and the duplication of treatment. When someone goes to a doctor and has tests but then a few days later sees another doctor elsewhere, the tests may have to be done again because no record can be transferred from the first treating doctor. It is known that in any one week, one in three Australian GPs sees a patient for whom they have no current information. More than one in five GPs faces this situation every day. To allow it to get to that point today is, I believe, an indictment on some of the professionals as well. We know that about two to three per cent of all Australian hospital admissions are medication related. This represents about 190,000 hospital admissions each year—costing $660 million—of which about 15,000 are due to inadequate patient information. I heard today that 46 per cent of Australians have literacy and reading difficulties.

The practical benefits of e-health are obvious. But the e-health journey is not one that will be completed overnight. It is not just a matter of, 'Flick on a switch and away you go.' During the last two years, the government have been building the foundations for the national e-health records system. And progress has been strong. We have been working hard to build the essential digital infrastructure—the virtual poles and wires—for the national e-health records system, ensuring a common language that will allow the different parts of our health system to talk to each other, connecting up our medical records, and connecting the computers of our hospitals, GPs, specialists and allied health professionals to each other.

Over the last two years, the government has also provided more than $160 million to general practices across Australia—up to $50,000 per practice—to upgrade their computer systems for e-health. Government support has helped more than 96 per cent of Australian practices to get the IT they need for e-health—a percentage more than two times better than that of practices in the United States. That makes our GP workforce the fifth most computerised in the world. Now that many practices have most of the IT in place, we want to make sure government focuses its investment on the rollout and take up of e-health records. In the budget, the Gillard government is investing $233.7 million to continue the rollout of a national, secure e-health system.

Once the digital infrastructure is in place, patients will be able to register for their own e-health record through Medicare shopfronts and over the phone. Mums and dads will be able to register for their kids. When they are registered, patients will be able to go online to view their records and add a range of basic health information. This will include things like emergency contact details, the location of advanced care directives, allergies and medication. This will be a gradual process, carefully managed. As more patients and doctors register, more detailed features will be available as part of the record. Eventually things like immunisation records, Medicare and pharmaceutical benefits information, organ donation details, and hospital discharge papers will be able to be added. The budget should not be seen in isolation but rather as the next instalment in our investment in health reform. Health reform has been strongly focused on delivering a more evidence based, well-targeted health system. As many of you know, the Commonwealth is investing about $20 billion up until 2019-20 to improve public health services.

Significant funding will be paid to states where they have met targets for elective surgery and emergency department performance. These targets were developed with close consultation with medical experts, chaired by the Chief Medical Officer. We are also introducing activity based funding from 1 July this year, to ensure that all hospitals are paid in the same way, based on the services they actually deliver. The Minister for Health, Minister Plibersek, has been keen to increase transparency and accountability of those funding arrangements. The new arrangements will provide unprecedented transparency of Commonwealth and state contributions to our health and hospital system. All Commonwealth funds for public hospital services will flow through a new funding pool, enabling us to track where the funds go and how they are spent—more information for decision making. State and territory activity based funding for public hospital services will also flow through the funding pool. We will therefore know the relative contributions of the Commonwealth and state governments. No more shifting the buck.

Improved transparency of the performance of services at the local level is another critical element of the reforms. As you know, the National Health Performance Authority will use the measures and the standards identified in the performance and accountability framework to assess the performance of health and hospital services. This is real reform. As well as ensuring that innovative and effective practices are shared between local hospital networks and between Medicare Locals, the reports produced by the authority will help identify those that are underperforming to enable efficient performance management.

The final plank of the national reforms is safety and quality. The newly formed Australian Commission on Safety and Quality in Healthcare is already developing, implementing and monitoring national clinical safety and quality standards. These standards cover safety, quality and appropriateness of clinical care. These structural reforms will provide the opportunity for greater clinical engagement in our health and hospital system through new devolved governance structures in local hospital networks and Medicare Locals.

The main areas of funding by the Commonwealth are around health and education. This government has delivered on this front very well. I am still getting thanks from many country schools in my electorate that benefited from the BER scheme, with upgrades that they have been seeking for decades. Health is the next area that really needs to be addressed and this government has the runs on the board and I know that it will happen. This budget delivers the promises Labor has made to look after those on low incomes, working families, veterans, pensions and seniors. I congratulate the government on achieving what they have set out, still having a surplus. A lot has been achieved, especially for those on low incomes.

Scott Buchholz (Wright, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on Appropriations Bill (No. 1) 2012-13 and related bills. I would first like to bring to the House's attention the noise that the government makes with reference to the current budget surplus. I remind the House that the surplus budget before us at the moment is an indicative figure of $1.5 billion, which they intend to reach at a period of time 12 months from 1 July this year. Because of the relatively small forecasted surplus budget of $1.5 billion, in order to test the authenticity or the integrity of this government's ability to forecast out 12 months, it is prudent that we go back 12 months and see what the government forecast this budget would deliver us in the way of a deficit. I remind the House that just outside the 12-month period, in the MYEFO period before the last budget, I think we were forecasting a $10 billion deficit. That increased from $10 billion to $22.7 billion. That in itself—a $10 billion 'just got it wrong'—is unfathomable. However, that is not all. From the $22.7 billion at the last budget through to the recent MYEFO figures, that figure increased to $37 billion that they were forecasting that this deficit would be. So we have gone from $10 billion to $22 billion to $37 billion, and more than likely on 30 June the deficit that will be delivered by this government will end up in the vicinity of $44 billion. So it would go from $10 billion to $44 billion. How could Treasury—the expert advisers to this government, who rely on the waves of support that they had to get these numbers right—have got it so fundamentally wrong, from $10 billion to $44 billion? Yet we are led to believe—they are leading this nation into a false sense of security—that in 12 months from this point in time they will deliver a $1.5 billion surplus. Time will tell.

I am not one to stand up here and bash the government on every front. Mind you, there is a heap of fodder, but the economy does have some strong indicators—figures that any nation in the world would be happy with. I am paying a compliment to the government on some of the strengths in the economy, because we have to be mindful in this House that there is a wider audience. It is not just this room; it is not just this nation. There is a global audience that looks on at Australia, and being a net investor of capital we need to make sure that we send a message to those capital markets that Australia has a strong footing. But I would suggest that one of the reasons that we have some of those strengths in those financial indicators is the position that the coalition left this government in financially. We had money in the bank. What a great place to be when it comes to dealing with appropriations! We had no debt. Again, what a fantastic position when going into a global financial crisis! The government take the position that we are the envy of the world. I would suggest that the government would have been envious. We would have been the envy of the world on the figures that were handed to this government.

I would also like to bring to the attention of the House some of the comments made by some of those in the government with reference to spending as a percentage of GDP. The noises that are being made are along the lines that this government has a better track record on spending as a percentage of GDP. I thought that was quite interesting, so I went to the 2012-13 Budget Paper No. 1, and I went to the percentage of GDP payment. Surprise, surprise—in the last year of the Howard coalition government, our percentage of GDP was 23.1 per cent, and the year before that it was 23.4 per cent. When it comes to saying that this government has a better track record on spending, the papers themselves say that in 2008-09 Labor's spending was 25.2 per cent of GDP—increased payments over what we left. For the following year, 2009-10, it was 26 per cent. In 2010-11 it was 24.7 per cent, and in 2011-12 it was 25.1 per cent. None of those figures come anywhere close to our last budget on spending as a percentage of GDP. So I would just ask the House to be mindful of that when Labor colleagues of mine make the point that this is not a big-spending government.

I would also like to bring the House's attention to my concern with reference to the debt and the interest payments. You will often hear the rhetoric of the government saying that it is only 7.2 per cent of GDP or only eight per cent of GDP, or now nine per cent or whatever it is. I would use this analogy from the global financial crisis: the majority of those countries that are in trouble are now struggling to service their interest payments on that debt. I would suggest to them that following their lead of going and borrowing more money is not going to fix our problem. We are the envy of the world, and one can only imagine what they would have thought of the financial position of the Howard government when we had no debt and money in the bank. I bring the attention of the House to a recent paper by an ex-IMF senior executive who is now a Harvard law professor, Professor Ken Rogoff. He tracked Australia's spending and indicated that, per capita, after the GFC Australia had the highest rate of spending of any Western nation. One has to question whether or not we overdid our spending.

Regarding the appropriation bill, the real question for the Australian people is: can the economy and the finances of this nation, with the waste and mismanagement of the Labor Party, be managed better? Can we do a better job as a government? Can we do a better job as an opposition? Can the government do a better job managing the books? During times when we should have been prudent, has this government wasted money? I suppose you only need to look at the home insulation program. It was not the government's finest hour. In all sincerity, I pray that the residents of the 200 homes that were burnt to the ground as a result of that program have got their lives back in order. Then there was the outrageous overspending on the Building the Education Revolution program. In government, the opposition would have stimulated the economy, but we would have spent it in different sectors.

Mr Champion interjecting—

I am more than happy for you to take these ideas on board. We have a number of gridlocks in our resources sector. You can understand the two-speed economy—

Mr Champion interjecting—

Mate, you will get to have your chance in a sec. Muscle up and take this in because you are part of the problem. We would have stimulated the economy in a different way. We would have invested in ports. We would have created jobs. Jobs needed to be stimulated. The BER did that, but I do not suggest that it was a great return on our investment. We could have created jobs with a capital investment that potentially had a return on the investment that had the capacity to service its own debt. Of course, there were the $900 cheques to dead people. That was a shocker.

On the subject of waste, recently $526,000 was spent on finding 11 ABC television directors. We cannot go past the $36 million on advertising the carbon tax that just forgets to mention the carbon tax. Then there is the government's management of the asylum seekers and our border protection. The list goes on and on. The set-top box program was something that I believe the government could have handled better. We had GroceryWatch and Fuelwatch—anything that the government set up with the word 'watch' after it could have been handled better. With the Australian Network tender, Sky won the tender but did not get the contract. Only under this government could something like that have happened. We heard earlier in the House about the $314,000 study to see if birds were shrinking. We had the $140,000 investment study to monitor the sleeping habits of snails and the $210,000 study on the early history of the moon. There is more; however, you get the idea. When it comes to managing the nation's finances, I am suggesting that it can be done better. You have to be blind Freddy not to think, even putting politics aside, that it could be managed better.

Let's talk about jobs. This government said that stimulating the economy was all about jobs, jobs, jobs. You do not have to take my word for it; have a look at what the growth rate was in the calendar year 2011. It was zero. For every job that was created, a job was lost. There were uncontrollable increases in the Public Service. Since the government came to power, there has been in the increase of 13,420 full-time equivalent positions. That is from page 654 of the budget papers.

Are Labor's policies driving growth? I ask myself that question with my hand on my heart. Are the policies that the Labor government is putting in place really driving the growth of the two-speed economy?

Let us have a look at the resources sector. I struggle to find anything that is driving the resources sector from the fiscal perspective. The real growth in that sector is coming from demand from our trading partners. With a population of 1.3 billion people, China's export markets are two main ports—America is about 20 per cent and Europe is about 22 per cent. Both of those economies have softened. So we are still picking up growth here as a nation on the back of China's domestic growth as we see a more westernised development of their 1.3 billion population.

This government are in trouble with the polls. Not all of us take a lot of notice of the polls. To dig their way out of trouble they are spending money, and they are spending money they do not have. That is not a prudent way to spend money. They are spending borrowed money and spending money that will hopefully come from the mining boom. I would just like to bring to the House's attention Twiggy Forrest of Fortescue Metals' comments the other day when he gave an address to the press gallery. He said the government's handling of the mining boom was not that dissimilar to a group of guys establishing that they had a Melbourne Cup winner, that it had potential in the way of a racehorse and that it had the potential to earn them millions and millions of dollars. But after it had run its first race, instead of getting the horse ready for the second race, they celebrated by eating the horse. I thought that was an appropriate example of how external sectors of the market are commenting on Labor's handling of the resources sector.

Another interesting statistic with reference to the managing of the economy is the Essential Report survey conducted in May 2012. Asked which party they trusted to deal with another global financial crisis, most voters picked the Liberal Party at 42 per cent over Labor's—guess what?—25 per cent. Support for the government's economic management has collapsed this year because, when voters were asked the same question in 2011, Labor's support was 31 per cent compared to the Liberals' 40 per cent. Like I said, that is an open survey conducted by Essential Report.

I want to bring this back to the coalition's capacity to eliminate the waste, to eliminate mismanagement and, more importantly, in a two-speed economy to restore confidence to our manufacturing sector and tourism sector and get away from the internal Labor constant news cycle of who is going to be the leader this week. Can the economy be run better? Yes, it can. There is a heap of room for improvement.

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

I have heard a fair bit of nonsense talked in this House but the member for Wright takes the cake. That was a truly extraordinary exhibition of ignorance, really. He talks about surpluses and carries on like a pork chop. Spain had a surplus like ours, but they adopted policies of austerity, not unlike the coalition want, where you do not spend anything, and it plunged their economy into recession. That is what happens when you do not have a fiscal boost in those times when demand falls away. That is why we did it.

He talks about ports. That is all very well and good. We all want to invest in nation-building infrastructure. For instance, in my electorate the government built the Northern Expressway, which is an expressway which goes from Port Wakefield Road to Gawler. That is a project that was fast-forwarded as a result of the troubles that we found ourselves in during the global financial crisis. But you cannot simply rely on those big infrastructure projects to pull you out of a recession because they take too long to get going. That is the whole point of them. We learnt this during the recession of the 1990s. That is one of the lessons we learnt. It is one of the lessons the Treasury learnt. That is why they said, 'Don't just go with big infrastructure spending; go with middle infrastructure spending, and embolden consumers and give consumers confidence by giving them direct payments.'

The member for Wright talks about the $900 cheques and attempts to discredit important consumer confidence building injections into the economy by saying they went to dead people. Never mind the fact that it happened under John Howard and it regularly happens with all government payments. They go to people's estates. That is what happened because it is unavoidable. What are you going to do—seize money from people's estates? That is the sort of nonsense they put about in this place. Then we have the set-top boxes. So what is he doing? Advocating that grannies—little old ladies sitting in their houses—should not be able to get digital TV? There was all of the nonsense that was put about by the tabloids when Harvey Norman admitted that it could not provide them any cheaper on the scale that we were talking about than anybody else. Then we have Fuelwatch. That was rejected by the Senate, mate. This would have been government policy now. It would have been in place but for the Senate, the other place, knocking it back. It operates in WA, and that place does not seem to have fallen off a cliff. Fuelwatch was a very good policy. I stand by it. I would like to see it implemented. It is a good policy. It is in Western Australia. What would be wrong with that?

Then he starts banging on about a few scientific studies about the moon and about snails. We know what the coalition's policy is: it is to end the study of all science, because we know that they do not like scientific research, particularly on climate change. This is the thing. This is the sort of dark age that we are going to get out of the opposition—the fiscal austerity, which is now being practised in Europe and is a disaster. It has been practised in America by state governments, where they are sacking teachers and cops. They get themselves into exactly the same cycle that happened in the Great Depression, where you actually push economic growth further and further down and it exacerbates your debt position, exacerbates job losses and drives you into ever deepening recessions. This is the sort of nonsense that is put about this place. It is as if the coalition never heard of Keynesian economics. It is as if the Great Depression never existed. They say, 'Australia's just got a great economy, just for the sake of it—just for the hell of it.' They give no credit to Treasury, no credit to the country and no credit to lessons learned over 17 years, since the 1990s. It is complete nonsense. They say one thing: 'Oh, yeah, we'd support stimulus.' The reality is that, if you were faced with the same circumstances, you would have done exactly the same thing and, if you did not, you would have been throwing 200,000 people out of work. That is the reality of it.

I did not rise to correct the foolishness of the member for Wright. If I did, I would probably be here all day, so we do not want to do that. I want to talk about automotive manufacturing in my electorate. I know this is of great interest to my brother here, from Geelong. Indeed, it is of great interest to my home town, Elizabeth, as well. Holden has been a great success. Through the GFC we won the Cruze, which is a small car, and you can see the Cruze on streets all over the place. It is a great testimony to Australian manufacturing. That was done with government assistance. We won it at a time when GM in America was going into bankruptcy, sadly. They have now emerged from bankruptcy. They were supported by the government. A lot of conservatives over there were saying, 'Let GM go. Let it fail.' Now it is going gang busters. Now they have emerged from bankruptcy, a great American success story. We have the same success story going on in our own country. Basically, what the government has done through a $215 million co-investment, along with the Baillieu government and the Weatherill government in South Australia, is provide $275 million in co-investment to produce two new models and to guarantee Australian car manufacturing at Holden until 2022. That is a great good news story. It secures $1 billion in next-generation investment and $4 billion to the broader Australian economy. It is a terrific investment. I think these things should be celebrated.

Recently, we have had a lot of talk about exporting as the dollar has slightly gone down. We are starting to get a bit excited about exporting cop cars to the United States again. The dollar is the only thing that is stopping us doing that. Holden says that it has forged a new design and engineering partnership with China, of all people. Basically, Holden signed an agreement on 16 April 2012 with Shanghai General Motors and Pan-Asia Technical Automotive Centre to develop new vehicles and affiliates for the Chinese market. This is a fifty-fifty joint venture providing automotive engineering services, design, development, testing and validation for the Chinese market. Isn't that a success story in Australian manufacturing? That is the sort of thing—along with the Cruze—that we want to hear. I have to say that I was never prouder than when I saw Wheels magazine. I am happy to show it to the House. It says 'Holden's BMW', the Torana, is back. That would be exciting news. I am sure everybody in the House would agree that we would love to see the Torana, a lightweight, rear-wheel-drive, turbocharged vehicle, charging up Bathurst again. That would be a pretty exciting thing for all the petrol heads out there, and I include myself among them.

We need to have a bit of a think as to what the alternatives are to co-investment. We know what the alternative is in this House: the Liberal Party are wedded to John Howard's policy, which is not to provide any support after 2015. Sophie Mirabella has reiterated this, and the member for Warringah, the Leader of the Opposition, has reiterated this policy time and time again. What will the effect of that be on the South Australian economy? I will tell you: it will rip $1.5 billion a year out of the South Australian economy. As it is a $1.5 billion cut, that is basically an attack on South Australia, a loss of 16,000 jobs in my state. A good number of those would be in the northern suburbs, because we have the factory. People work where they live.

That is from a reputable report by the University of Adelaide Business School—not a union and not some fellow traveller but the Business School at the University of Adelaide, which is a fine university. The report finds that 2,700 people are directly employed by Holden, and the company purchases some $530 million of goods from core local suppliers, which supports another 5,600 jobs, and that prompts extra employment in retail, transport, construction and other manufacturing around the place. We simply would not have the sort of design capacity, manufacturing capacity and engineering capacity we have now if we did not have Holden in the northern suburbs. It underpins our defence manufacturing and it underpins, I think, what will be our emerging mining services industry as well, hopefully, as the mines of South Australia slowly develop. We have had an exploration boom and we look forward to having a proper fully fledged mining boom. It is something that we want the problems of, if you like.

Recently, I wrote a letter to my newly endorsed opponent, Mr Tom Zorich—and I want to be on the record here as saying that I like Tom. I think he is a worthy opponent, and we have had a longstanding acquaintanceship—friendship even—through the Central Districts footy club, which we both support. Tom was a great president of the club; no-one can take that away from him. But many of us have found Tom's intervention in politics, and particularly for the Liberal Party, somewhat curious. I wrote him an open letter, saying: 'Look, Tom. Fair enough that you've joined the Liberal Party and become their candidate, but what are you going to do to get your party to back the co-investment into Holden Elizabeth, into Holden Australia?' It seems to me that that is a pretty important question for a local candidate to be able to ask about the major factory, the major employer, in the electorate.

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

Good question!

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

It is a fair question; it is a fair letter to send. I have not got a reply yet. The Bunyip, which is the local paper of Gawler—a very good, very dynamic paper, with interesting local issues—has picked up on the story. It has a bit of a reply from Tom. He accuses me of gutter politics for having the temerity to write to him. Then he goes on to say, 'The best thing we can do with the car industry is to drop the carbon tax that will add over $400 to the cost of building an Australian car.'

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

It's a good start.

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

I will take the interjection. 'That sounds like a good start,' is what the member opposite says. But the fact is that the $400 figure is just plain wrong. It is garbage, like the member for Wright's previous speech. The fact is that it is based on a $30 carbon price and it does not factor in any of the industry assistance of the Jobs and Competitiveness Program or the $1.2 billion clean energy program.

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

How much is it?

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

I will tell you the direct impact. The direct impact is estimated to be $40 per vehicle—$40! Oh my God—$40 a vehicle! Just to give you a bit of a perspective: every time the dollar appreciates by 1c, the price of a $25,000 car goes up $250. So it just gives you a bit of an idea about where Australia's manufacturing challenges lie: they lie in the high dollar. They do not lie in carbon pricing. My bet is that the carbon-pricing system is designed to reward efficiency. So I am pretty sure that if all these factories and all these suppliers have a good look at their carbon outlays they can lower that figure even further.

A big employer in my electorate, Holden, has now got a guarantee of producing two new models, guaranteeing production to 2022, based on a co-investment by the government. That co-investment is pretty important and it is pretty important that Liberal candidate Tom Zorich actually backs the government and gets in the ear of the Leader of the Opposition and in the ear of his colleagues Mr Briggs from Mayo and others, to try to get them to back the car industry. I know it is hard for him but that is the challenge for him at this election: to get them to support the government's policy. A difficult problem, I think, for his candidacy. But it is terribly important for the local area, because we need car manufacturing. It is the heart of Elizabeth. It is why I spent a lot of time, along with my colleagues in this place, talking to ministers, lobbying ministers and making sure they understood the importance of this industry to South Australia. It is a critical industry for South Australia. We cannot get by without it. It is a critical industry for Australia. It is important that the guys who want to buy utes in Queensland have an Australian choice. It is important that New South Welshmen and those in WA can buy an Australian made car. That is an important thing—to have the Australian choice. There is not a car on the roads these days that is not taxpayer supported. It is just that some are supported by German taxpayers or by South Korean taxpayers or by Chinese taxpayers.

So let us not hear this argument that this is somehow about competitive markets. Every country that produces cars provides support, and often they provide more support than we do. This has been a good policy. It has supported employment, it has supported manufacturing, it has supported exports, it supports Australian success and it should be backed by the Liberal Party. I hope they come to their senses. There would be nothing that would please me more if this were not an issue at the next election, if this were an issue of bipartisan support for the Australian car industry. That is what I want and that is what I would ask my Liberal opponents, both those opposite and locally—Tom Zorich—to do.

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the various appropriation bills of 2012-13. Where does one start with this budget? Perhaps the best place to start is with the current financial year. Twelve months ago the Treasurer stood in this very parliament and forecast a $22 billion deficit. Last week we found out it was only out by 100 per cent. The actual deficit for this financial year has actually ballooned to $44 billion. So what went wrong?

Then we can move on to this year's budget, which is being sold under the political spin of returning the budget to surplus. We have heard that over and over from speakers on the government side. We all know this wafer-thin surplus is a mere illusion achieved through nothing other than accounting tricks by bringing expenditure forward and shifting it backwards, and the smell of cooked books is still wafting around the corridors from budget night. Even the chief of CPA Australia, Alex Malley, heaped insincere praise on the Treasurer when, on budget night, he declared that 'accounting chicanery was the winner tonight'.

Let us just assume that this government actually achieves the $1.5 billion surplus, which I note SportsBet think is a very long outsider. We have to also look at the previous four Labor budgets. Those four budgets have a cumulative deficit of an amazing $174 billion. So, even if this current budget forecast of $1.5 billion is correct, even if that is achieved, the legacy Labor will leave this country, after five budgets, is a cumulative deficit of $172.5 billion. Try to visualise $172.5 billion. It is such a massive sum. Think of a stack of $100 bills spread out across a standard sized pallet, with the bills adding to $100 million. You would need 1,720 pallets to get to $172½ billion. Those pallets, stacked high with $100 bills, would reach 2.4 kilometres into the sky. That is how much debt this government has gotten us into. Of course, then we had the change to the debt ceiling. When this government came to office our debt ceiling was at just $78 billion. But after four years that had been increased by another $172 billion. And at this budget, although the government is claiming to run a surplus, they need to borrow another $50 billion, which will push that debt ceiling to an incredible $300 billion.

What does this debt mean to the average Australian citizen? According to the figures in the budget papers, over the next four years, because of the debt that Labor has run up with their reckless spending, Australia as a nation will be forced to pay $28.9 billion in interest alone on the debt—most of it going overseas, to foreigners. That $29 billion in interest payments alone is $1,300 for every man, woman and child in the country, or an addition bill, on top of everything else consumers will have to pay over the next four years, of $5,200—courtesy of the economic management of this government. That is the bill they will get in the post.

Remember: to pay off at the current rate the combined deficits of the last four years of Labor and deliver this great surplus of $1.5 billion, we would have to repeat that for no less than 116 years. That is what we would have to do to undo the damage, to pay back the deficit that they have run up in just four years. That is the task that we face.

How have we gotten into such a mess? I know it has been well canvassed. Some of it has been because of studies funding, such as $145,000 for a study into sleeping snails. Of course, we had the $300,000 for a study to see if climate change is making Australian birds shrink. That is just the tip of the iceberg. It appears the way to get a grant from this government is to mention the magic words 'climate change'. Following are a few other studies that this government has thrown money at. A quarter of a million dollars, $250,000, has been given to a study on rethinking climate justice, whatever that is. Another $125,000 has gone to a study on the future of trade unions and how trade unions can contribute to an environmentally sustainable world. A grant of $192,000 has gone to a study for the role of emotion and reality in sending and responding to messages about climate change.

More money has been thrown away, $185,000, to produce a new autobiography on Labor opposition leader HV Evatt. Of course, such an autobiography might be very interesting, but to make sure the grant was given, the subject is to be 'how his life resonates with modern challenges … in a time of global warming'. What has Dr Evatt got to do with global warming? That seemed to be the secret to getting the grant. Another $122,000 was given for a study of rural communities in South Australia as to how they would adapt to the health challenges of climate change—and yet the hottest day ever recorded in South Australia was on 2 January 1960.

There is another great study here: $380,000 for modelling the mechanisms causing the observed increases in the rate of melting of Antarctica's ice shelves. The only problem with that is that the Antarctic ice has been growing for the last 30 years. We have a study to try and work out observed increases in the rate of melting. In fact, even in the Bering Sea, in the Arctic, we have had record sea ice. Half of the fleet that we see in Deadliest Catch have been held up in port for a record time. Then, of course, we have the Department of Climate Change and Energy Efficiency themselves. In those government departments we have 118 bureaucrats who are on a salary between $280,000 and $700,000 a year. And we wonder why we are in such debt.

But the studies go on. This government has thrown $85,000 to a study of garden statues in the Renaissance garden and $65,000 to a study to examine who actually reads Tom Keneally's books. They are very good books, but do we need to spend $65,000 of taxpayers' money to find out who reads them? This is a beauty: $60,000 for a study of Marxism, religion and the relationship between theology and political radicalism. Here is another one. This is perhaps my personal favourite. There is $180,000 for a study to rethink the history of Soviet Stalinism, to provide a sophisticated understanding of the complexity of Stalin's Russia. Surely this $180,000 will be well spent. It could show that Stalin was a good bloke, merely misunderstood! Here is another one: $164,000 has been thrown to a study of magic spells and rituals from the second century BC to the fifth century AD to achieve success in personal relations. The list goes on and on.

There is another good one here: a study of the life and times of musical artists, bands, managers, recording studios and relevant radio programs since 1945 in Western Australia. They have been thrown $120,000 of taxpayers' money. Remember, this is money that we do not have. This is borrowed money, because this government continues to borrow $100 million a day to finance these schemes. Every single hour for the last four years our nation's debt has grown at a rate of $4 million. There is another lovely little grant of $72,000 to hold 'enviro tea salons' where participants will debate climate change and the carbon price in Arabic, Mandarin, Cantonese, Dari, Hindi and Dinka. Participants will be encouraged to take part in activities including quizzes, chalking, candle making and calligraphy, all in a politically sensitive environment. This is more waste of taxpayers' money, and it goes on.

There may be some commuters out there listening to this on the radio while they are stuck in gridlock traffic. I am sure they will be very excited to find out that this government is spending $160 million of taxpayers' money to build a new bridge. The only issue is the bridge is being built across the Mekong River in Dong Thap province in the Socialist Republic of Vietnam. I am not making this up. It goes on and on and on.

One of the great things we have heard the government taking credit for is the delivery of the National Disability Insurance Scheme. I think it is worth noting what the Carers Alliance have said about the National Disability Insurance Scheme announced in the budget. If anyone knows about the difficulty of caring and what we need under a National Disability Insurance Scheme, the Carers Alliance are first and foremost. I quote from their press release:

In the cold light of day Budget Night was Fudge it Night for people with disabilities and their families … the government's proposal for implementing the National Disability Insurance Scheme is a sad, poorly executed hoax pulled on those Australians with a severe dependent disability …

The Budget provides for just over $85 million a year for individualised packages for people with significant disability, while about $164 million a year is set aside for more fatcats, technocrats …

They conclude:

It is fanciful to claim this version of the National Disability Insurance Scheme as historic when in reality the Gillard government has squibbed …

They are the words of the Carers Alliance. Then we look at issues where this government has actually cut spending. We see that our defence budget has been reduced in real terms this year by 10.5 per cent. That is the largest year-on-year reduction since the end of the Korean War. As a result, our national defence spending as a percentage of GDP will now fall to 1.56 per cent, the lowest we have had since 1938. The only thing we had missing in this announcement was the Prime Minister standing up and declaring 'peace in our time'. As Babbage Smith, the government adviser and author of the 2009 defence white paper, said about these cuts, 'We're going to be in real trouble for at least 20 years. We won't have the ability to defend ourselves.'

Many of these instances of waste should be put in a museum. Our future generations need to understand how we have ended up in such a mess and how we have gotten in such debt. But it was very nice to know in this budget that the government has handed out 1.5 million taxpayers' dollars for a new Islamic Museum of Australia. This is all very nice, but it sets a precedent. I have already had members of the Australian Coptic Church asking where their grant to build a Coptic museum of Australia is. Now we have set this precedent, in the future are we going to give every religious group taxpayer-funded money to have their own Australian museum? These are the problems that we get in.

Another issue of waste and mismanagement by this government that I would like to raise is the ACCC's pursuit of Metcash. The Metcash takeover of 80 Franklins stores, as anyone in the industry understood, would have increased competition, but still we had the ACCC trying to take this to court to block this takeover. Even Justice Arthur Emmett dismissed the ACCC's case in August, saying the deal was likely to be pro-competitive because it would help Metcash, Australia's largest independent grocery retailer, to compete more effectively against Coles and Woolworths. But we had this government spending $16 million of taxpayers' money to try to stop this competitive merger.

Finally, in the time left, in my electorate we have seen $900 million being spent on the Moorebank intermodal. This is a mega-intermodal project. The residents are actually getting the worst of both worlds. This is a mega-intermodal. We are spending $900 million merely to relocate—not actually to get it but simply to relocate—the School of Military Engineering. It is opposed by every stakeholder, except of course the infrastructure minister and his department head, Mike Mrdak. (Time expired)

Tony Windsor (New England, Independent) Share this | Link to this | Hansard source

Madam Deputy Speaker, thank you for the opportunity to speak on Appropriation Bill (No. 1) 2011-2012 and the other appropriation bills. There are a number of things that I would like to say, but I was just reflecting on the last few minutes of the former speaker's contribution. I will move on. I think one of the things that we should reflect on as a nation and as a parliament is that we do not develop this 'poor bugger me' political view of ourselves. Irrespective of who has been in government for the last decade and a half or more, we have lived in an extraordinary country and we still do. I know this message is a political message, and it is saleable out there; fear is always the most saleable commodity in politics. But I think we have to be a little bit careful that we do not market fear and down-sell our country.

Everybody can find good and bad in budgets and the appropriation bills. I can do that. I could speak for 15 minutes on bad bits, or I could speak for 15 minutes on good bits. But, if you look at how others look at this country in terms of how they judge an economy, they look at this country as being extraordinarily lucky, and this country is extraordinarily lucky. They look at our inflation rate, our interest rates and our unemployment. If you look at Europe, the US or other parts of the world and their unemployment compared to us, we say we are extraordinarily lucky. In historical terms we are extraordinarily lucky. Even today, the main debate in the House has been about guest workers. That suggests to me—and I have some issues with that policy line—that we do not have enough skills in the country. So the economy cannot be in bad shape. There are patches of it that are. They need to be identified, obviously, and where possible they should be rectified. But that does not mean we should put in place absurd policies just to placate the politics of the day.

The minerals resource rent tax package is an attempt, in my view—and others will disagree, particularly on the coalition side—to share part of the largesse across those sectors of the economy that are not benefiting from the mining boom. The mining boom is a good thing; no doubt about that. It creates a whole range of economic and other activities. But it has adverse impacts as well. The high Australian dollar is one of those impacts. The value of the dollar has a direct relationship to the mining boom. I do not think anybody actually denies that, but there are others in the economy who are wearing that burden, whether they be in the manufacturing sector, the agricultural sector or the tourism sector. They are wearing some degree of pain because of the high dollar. If the mining boom stays around—and I think most people suggest that it probably will—there will be a transition within the economy in those other areas. In my mind it is an acceptable thing to utilise some of the moneys from the minerals resource rent tax to try to impact on those who are impacted by the high dollar and other competitive aspects, some within the skills area, created by the mining boom.

Mr Deputy Speaker Oakeshott, it is a great privilege to be able to speak in front of you—and in front of this large gallery! Before you came in, Your Eminence, I was discussing what a lucky country we are and that we have to be careful that we do not develop this 'poor bugger me' attitude to our nation. We have an extraordinary nation. And to use fear and misinformation to downplay our nation is something I think we all should avoid. Regrettably, we do not all avoid it. We tend to look for the negatives more than the positives. But let us look at the debt-to-GDP ratio. A lot of people, including the previous speaker, the member for Hughes, talk about the legacy of debt—that this government has got the country into a dreadful state through this legacy of debt. Our debt-to-GDP ratio is probably—along with that of Norway and two or three other countries—among the lowest in the world. It is something the rest of the world would look on and envy. I did agree with a couple of things the previous speaker said. There is nothing wrong with debt if it is used to advantage the nation.

I look with interest at how perception works in politics. The New South Wales government has recently changed. They had 16 years of Labor government there, and it changed. It probably should have changed after 12 years, in my view, or maybe even sooner. But it did change. The perception was that New South Wales was broke. If you had gone into the street then—and probably if you did now—and asked anybody, 'How's New South Wales going?' they would say, 'Not good' or 'broke' or 'that Bob Carr fella'—and a few others: the Mafia people or whoever they were in previous New South Wales governments. They would say, 'They broke the state.' Peter Costello suffers from the same disease as Michael Egan, who was Treasurer for a large period of that time: they ran surplus budgets. If you went into the street and said, 'What's New South Wales like?' people would say, 'Oh, well, the Labor Party'—and they are still saying it. Barry O'Farrell, who is a friend of mine, is still saying that the Labor Party ran the state almost to exhaustion. In political terms it probably did, but in economic terms it did not. For 15 out of those 16 years, it ran surplus budgets. The debt accumulated in New South Wales is quite small—one budget—whereas, in Queensland, the state of opportunity et cetera, there is a debt almost half the size of the national debt. There is a different perception. Campbell Newman picked up on it a bit towards the end, and probably it became a factor in that election.

The point I am making is about perception. To his credit, the Leader of the Opposition has created a perception of chaos, mismanagement et cetera. But, in terms of our relationship with the globe, we have to be very careful that we do not down-sell our nation, particularly given the massive expansion of the resources sector and the obvious need for overseas capital.

In the appropriation bills—and I will be supporting the legislative documents that are going through the parliament—I was very pleased to see that the regional Australia components of the agreement on the formation of government with the current Prime Minister held in place. They are good agreements. There are a range of significant regional packages. Like you, Mr Deputy Speaker Oakeshott, I am very proud of the Health and Hospitals Fund ring-fencing—100 per cent for country people, $1.8 billion. Dozens and dozens of health services in the country have received assistance that they never would have in the past. Traditionally, country people would have got about 20 per cent of the Health and Hospitals Fund. There is a similar thing in the education infrastructure fund: half a billion dollars which will go towards higher education, TAFE et cetera in country areas.

As you would remember, Mr Deputy Speaker, both the current Prime Minister and the current Leader of the Opposition during that 17-day period admitted that regional Australia had been neglected by previous administrations. The agreement to put in place regional packages that would address some of those issues is part of that reconciliation, in a sense. I thank the Prime Minister particularly—and the Minister for Regional Australia, Regional Development and Local Government and other ministers as well, but particularly the Prime Minister—for adhering to that agreement. There has been much said in recent weeks over the Craig Thomson business and some other issues. It has been said that the Independent members should suddenly walk away from this particular parliament. The agreement that I struck with the current Prime Minister has held solid, and I presume it will into the future as well.

There are other issues that I think are important in this particular parliament. One, looking forward, is education and the Gonski report. I think we have an extraordinary opportunity. I congratulate again the current minister, Minister Garrett, because I think he is taking the correct approach to this. He is not trying to grandstand on it; he is trying to take people with him, and I think until recently he has been able to do that. I have been saying to the public system, the private system and the Catholic system: this is not the time to go back and look at the old divisions. There is an opportunity here to move this thing forward—to move past the old political or religious divisions. We have to grasp that. The people I have been speaking to in the three systems, particularly in country Australia, can see that opportunity. I see the infancy of politics and division starting to creep in, the little bits that I have seen mainly driven at the city level, which has traditionally controlled the politics of education.

My challenge to the three sectors is to work together to get a package that does work. To the credit of the current New South Wales minister, Adrian Piccoli—and I do not want to verbal Adrian; I was in parliament with him and know him quite well—he is one of the state ministers who is actually looking beyond the politics of old. If that is the case, I congratulate him and Barry O'Farrell, the Premier. This is a time for leadership in this issue. Education is paramount. How it works for those who are disadvantaged and those who are disabled will underpin the advantage that all our children should receive in education. In recent years, some very important assistance packages have been developed, including national partnerships arrangement assistance packages to country schools. The Gonski report in a sense would put those packages in a different, more easily explainable form, whether it be in the city or the country or to rich kids or poor kids. I make this plea: all of us should try and look beyond the politics. Do not use the Gonski report as one of the weapons to create fear in the minds of certain people. Use it as a positive to create something that we can all be remembered for. I encourage those not in this building who are involved in the private, public and religious education systems that this is an opportunity to show real leadership, get this right and back it in. There were a number of other issues that I wanted to speak about, but time does not permit.

John Alexander (Bennelong, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on these appropriation bills with a sense of dismay that can only be placated by a sense of humour. When going through the budget papers presented by the Treasurer a few weeks ago, sanity could only be retained through the exercising of the need to laugh. But budgets should not be a joke. Many years ago, Dean Martin had a hit called Welcome To My World. In this romantic piece of fiction, the words 'Miracles, I guess, still happen now and then' may have provided the source of inspiration for this year's budget from the Treasurer. This budget welcomed us to 'Wayne's world'.

There are many parts of the budget that deserve analysis, some of which have received considerable treatment already by my colleagues the members for North Sydney and Goldstein. Within the time constraints of this speech, I shall focus on a couple of others. The first thing that strikes a reader of the budget is that this is a Labor budget—a deception; an attempt to present a good story yet hidden beneath the surface is the bad news. The beauty of this budget is indeed skin deep, a very thin and transparent veneer. The fundamental deception is the movement of money from one financial year to another in order to create the perception of an artificial surplus. The Australian people are smarter than this government gives them credit for and they understand that a surplus built on the foundations of a $44 billion deficit in the preceding year is truly a surplus barely worthy of the paper it is written on. This budget is a political document, not an economic plan for our nation's future. The government focuses attention on what it is good at: vote buying. They showed in last year's budget, when the members for Lyne and New England were specifically named five times as recipients of the generosity of our money—government bought with our money. Of course, the government does not always pay the price they say they will; the member for Denison would attest to this. They take delivery of the goods but do not always pay the bill. Are these the qualities that we expect in our leadership? Are these the foundations on which we can build our future economic security?

As the shadow minister for families, housing and human services so eloquently stated, this is more of a 'fudge it' than a budget. A striking example of this deception and vote-buying is the government's proud announcement of the so-called 'schoolkids bonus'—a prime example of the type of creative accounting undertaken by this government to try to buy votes. The government's decision to dump the Education Tax Rebate, a targeted program that provided genuine assistance to relieve the costs of education for parents, was covered up by the announcement that they are generously giving away handfuls of taxpayers' money, yet again, just like under the member for Griffith, in a desperate bid to improve their electoral stocks. Yet another example of when something is working well, like our immigration policies, and yet changed for political reasons that end in an economic disaster. It seems that the government that was accused, after making their deal with the Independents, as being 'the best government money can buy' has now focused its attention towards 'the most votes money can buy'. Yes, Mr Treasurer, I agree that 'this is a Labor budget down to its boot straps': replacing a targeted program of reimbursement that provided certainty that the nation's money would be spent on our nation's schoolchildren, to a traditional Labor program that invites bad spending compounded by waste. This is the same DNA as school halls and pink batts. Now everyone in this country knows that the new scheme is a cobbled together desperate act to distract voters from the carbon tax hit to their cost of living, which will start in five weeks and then keep going up and up year after year.

Our government often promises transparency and now after a few semesters at the college of Labor it is easy now to see through their words to gain clear insight to their real policy purpose: policies solely designed to survive the moment, policies that will inevitably attract greater economic hardship. The government claim that these budget measures are about helping people who are doing it tough—a noble sentiment from our nation's Treasurer. However, I must ask the question on everyone's lips: if you really care about the cost of living, about people doing it tough, why are you introducing the world's biggest carbon tax that will have the single biggest effect on the cost of living for all Australians and bring about no improvement to the environment?

The schoolkids bonus has actually abandoned any pretence of being about offsetting education costs—it is simply a sugar hit for families to create a diversion from increased bills and costs that will rise just for going about their everyday lives. This is Kevin from Heaven's $900 gifts all over, mark 2. However, the real mark 2 was a fine Jaguar; this cash is for a clunker. Labor members are recklessly promoting this measure by saying that families will be eligible 'even if they lose their receipts'. This means every eligible family will get this cash handout, whether they have spent or even intend to spend the money on their child's education. They can spend this so-called schoolkids bonus on anything they like. Does this sound familiar? Remember the $900 handouts, commonly known as the plasma television grant? This was paid to dead people, pets and Australians living overseas and only 14 per cent of that money went to positive causes. What we are seeing here is a removal of the cash incentive for parents to invest in their children's schooling needs, instead buying parents off with the sugar hit. Ultimately this will not assist our school kids. This policy treats the parents like spoilt children: 'Darling, don't worry if you lose your receipts or if you didn't even spend the money or don't intend to spend the money, you can spend it any way you like. There, there!' This takes away the demand for responsible behaviour and replaces that demand with temptation. As Mae West famously said: 'I can resist anything but temptation.' This country needs a government who will govern in the best interests of the nation, not govern in the hope of a budget bounce in the polls. It is that short-term governing for the sake of self-interests and faceless powerbrokers that we saw in New South Wales and Queensland. Australians would have hoped by now that Labor had learned the lesson that sugar hits do not work. Just like when you give lollies to your kids, they may have a quick burst of energy, but that decision will come back to hurt you later.

This government is treating the electorate like children and then becoming confused when the voters have a tantrum. This policy rollout offers many similarities to last year's disastrous response to live cattle exports when we saw the farcical situation of a government suspending a major export activity to one of our region's most important partners, with no consultation. Why? Because of an episode of a current-affairs show. Is this really the way to implement policy? This poorly thought through knee-jerk reaction resulted in cattle being forced to suffer whilst stuck in the sun and heat of the Darwin docks and diplomatic relations with our closest neighbour being further strained.

Pages 8 to 12 of Budget Paper No. 1 commence 16 pages of the government's unquantifiable liabilities. One of these states:

The Australian Government may become liable for compensation following the decision by the Minister for Agriculture, Fisheries and Forestry to suspend the export of livestock to Indonesia for a period of 1 month in 2011. A potential class action has been received from a law firm on behalf of 21 clients.

So the government has very effectively punished a local industry, caused untold suffering to our cattle, damaged diplomatic relations, and is now likely to impact our collective back pockets as the subject of a class action from our own farmers! You can only conclude that it is not just this issue, or the other 16 pages of issues, but it is this government that is an unquantifiable liability.

As so many residents of Bennelong and voters from across the country have told us, the sooner we can get rid of this unquantifiable liability, the sooner we can get our nation back on track. This will happen through better policies, through strategies that are thought through, that are based on consultation and experience to ensure the best-quality outcome for all involved. With live exports this would be through partnership with Indonesia to provide assistance and support to implement the animal welfare standards that we aspire to, so that those standards can be applied not just to Australian cattle but to all of God's creatures that are processed in Indonesia. This is not the policy of a quick headline but the policy for a genuine and quantifiable result.

Another area where this government has chosen spin over substance is its refusal to say the words 'carbon tax'. Instead we have a price on carbon, as if that will lessen the injury caused by this tax. And I purposely use the word 'injury' as it is only for the causing of injury that one needs to pay compensation—a word this government seems very willing to promote. So I thought for a moment that I would follow the government's logic: the price on carbon will be an everyday financial impost, much like the price on goods and services, also known as the goods and services tax. You will pay for this after you have paid a price on income, commonly known as income tax. Or if you wish to help out those less fortunate you can make a donation to a price-deductible gift recipient and therefore reduce your price on income. Of course, if it all gets too much and you need to sell your house you may also need to pay a price on capital gains. Perhaps next budget the government should develop a price on spin. Now that would keep the bean counters in Treasury very, very busy.

But they are used to being busy. After all, in this budget the government announced that this year's budget deficit—or perhaps they will now call it a 'nonsurplus'—has sky-rocketed from $12 billion to over $44 billion. This is purely and simply a result of poor economic management and an attempt to cook the books to make next year's numbers look less sickly. If this kind of creative accounting occurred in the private sector, there would be some serious questions asked.

To top it off, this government is increasing the nation's credit card limit by a lazy $50 billion. I ask members of this government to sit down at any kitchen table in the country and try to explain to families that increasing your annual expenses by a factor of four and increasing your credit card limit to avoid maxing it out is quite okay as long as the next year you come out just ahead—the fact that $100 million is being paid out every single day in interest is, of course, irrelevant!

Governing our country should be carried out with the highest levels of integrity and honesty to gain for Australians the highest degree of economic security that can be achieved. Cheap tricks and hastily moving payments to this year to achieve a better result next year only achieve a deeper loss of trust in the integrity and honesty of this government. Our leader often reminds us of the need to be the adults in the room; here we need to be the adults who have become responsible parents.

Families know that increasing the credit card limit to an all-time high and piling more money onto the credit card do not make for good balancing of a budget. Australians will not be fooled by this budget. They know that the Prime Minister is not interested in helping families and is only interested in keeping her job. She is the keeper of our nation's unquantifiable liability, and one can only give her an F for fail—or, if you want to keep your sanity, just laugh.

Debate interrupted.