Robert Oakeshott (Lyne, Independent) Share this | Link to this | Hansard source

Whilst this is certainly a tight budget in a tight parliament and there will be plenty of debate, as has already taken place, around the rights and wrongs of it, in the end it will pass this parliament. So, for all the speeches one way or the other, the bottom line is it will pass. In my view, the budget is just one arm of the broader story of the moment and the question of the moment for all of us in public policy and throughout Australia. It is therefore a budget that I respond to in the broader context of what is going on in this parliament and throughout Australia right now.

I believe Australia is at a crossroads. We as a country need to conduct a budget-like audit of ourselves and ask ourselves whether we are still the brave reforming nation of our history, or have we succumbed to the risk averse, the timid and the anonymous critics of new media? Are we still the nation that spits in the eye of those who say, 'You can't, you won't, you shouldn't'? Or are we to now believe the pathetic, cult-like culture of the new radical conservatives in Australia, who want to kill this opportunity for reform within Australia right now via a campaign of vitriol and so-called death by adjectives?

We as a nation are at the crossroads. We are on the lip of the cliff of losing trust in our history, a history that has been shaped by taking chances and risks. We have a history of confidence against the odds and a history where we chose to do it our way—the Australian way and a way that so often has led the world in governance, sport, arts, science, innovation and business.

Eighteen months ago as an Independent MP in his third year of representing his community, I never thought the stakes were higher than forming government for three years, while locking in some local and national reforms through agreements reached. I was wrong. The stakes are much higher. At the crossroads as a nation, we are now in a fight for ourselves—a fight for the heart of Australia; a fight for what it means to be Australian. We are in danger of introducing something new into Australian public policy: fear. We are in danger of becoming a nation where fear wins over all else. We are in danger of creating a model of government and policy development that is risk averse and where the perception of the best government is in reality a government that does nothing at all just to avoid controversy.

In political terms, we are seeing more and more evidence of this. The Australian community is in grave danger of being 'astroturfed' into submission, where new organised, vested and issues-based interests control the chaos and the dissent for their own direct personal benefit and, as a consequence, governments cower from reform due to the new-found power of fear and dissent in Australia, leaving voters absolutely exhausted by the noise of the loudest and the richest. The crossroads we are at as a nation is whether we are a nation that still plays front-foot cricket and whether we are the great innovators who stare down opponents and prove them wrong time and time again, or whether we as a nation now play back-foot cricket and defend, whinge and complain. The question I have is: when and, more importantly, why did our Ian Chappell mentality turn into a Geoffrey Boycott mentality?

As a personal contribution on this, I accept my failure so far in these 18 months of this parliament. I sought consensus within the parliament itself, and I have found the toxic. I sought agreement on key issues across the major parties in the national interest, and I have found manufactured division. I might be too harsh on myself, as we have achieved much in this parliament: the ETS, some tax reform, the National Disability Insurance Scheme, aged care and 55 new Regional Development offices in a network. But as I seek more from the next 18 months—not for some personal reason but clearly because there is so much more to do—I feel frustrated by the moment.

I provide three examples of this right now. The first is recognition of Aboriginal and Torres Strait Islander peoples in Australia's Constitution. A full round of consultation and an extensive report were done last year, for which I was one of 22 very diverse members of a panel across party lines, working through the legal and moral complexities at stake. It delivered. It delivered a comprehensive report in January. It captured the 200 consultations throughout Australia and what was being sought by many Australians. It made the obvious and convincing point that the absolute key to success for any referendum in Australia is bipartisanship; our eight-from-44 record proves that. That is an example of this much sought-after consensus. But right now, over four months since the report was delivered, we are still stuck in the toxic muck. It is my understanding that neither Tony Abbott nor Julia Gillard has picked up the phone, walked down the corridor or leant across to the other at some joint function and said the simple words, 'Let's talk about that referendum question.' I take ownership of this failure as much as anyone, but all I can do is continue to seek more from our leadership on both sides of parliament and push and push and push where I can to seek more from both the MP for Lalor and the MP for Warringah, both of whom have extraordinary power right now and even more power together for the good of the nation. To now have good people like Tom Calma, Mark Leibler, Mick Gooda and the Liberal MP for Hasluck, Ken Wyatt, starting to say that toxic politics is now changing the strategy of policy—of when and how we promote a referendum in Australia—should cut to the absolute heart of anyone who cares about Aboriginal and Torres Strait Islander Australians and anyone who cares about Australia being the island nation of brave reformers. We are stuck in the toxic muck of our own making, and we lose nation-building opportunities unless we find a way out or a way through that muck.

A second example is electoral funding reform. In January the Australian Electoral Commission released donation records from 2010-11, and the figures should frighten everyone. The LNP revealed $110 million in political donations in the one year alone, and the ALP revealed $90 million in political donations in this same year. These are extraordinary figures that, if sustained, make a consensus on anything impossible and make the parliament itself a wholly owned subsidiary of major donors to the major parties. Again, because of the toxic, we look like heading into the 44th Parliament election season with no commitment from either side to electoral funding reform when it is so bleedingly obvious that the money now coming into the political parties is either unsustainable or dangerous for the nation. A consensus agreement is desperately needed by both major parties, as much in their own interests as in the interests of the nation. But the toxic moment is removing the opportunity for even a conversation, let alone a joint strategy. These are two governance examples, and this is before we get into the policy questions of where consensus right now would be in the national interest on policy. Take the Gonski review on education. What a difference a joint working group across party lines would make on that right now. Take comprehensive tax reform. What a difference a joint working group across party lines would make on that right now. Once again I plead and push. I plead with ordinary Australians, with commentators and with the major parties to put Australia's reform agenda first and push for consensus on policy first, because those that seek to divide do not act in Australia's interest. They act in their own interest, whether political or some other sectional interest.

I will not today nor ever support the dividers in Australia. I will always, today and in the future, support those whose focus is policy. In rugby terms, I will support those that play the ball of policy, not the man of politics. Today, in an era when we are seeing the conservative politics behave more radically than at any time since my distant cousin Michael Oakeshott wrote his conservative thoughts, I yearn for a day when these same conservative politicians and conservative cheerleaders try and win the day on policy and policy alone. Australia does suffer while we wait.

As a final point on this, I purposely single out three media leaders from the Australian newspaper, Chris Mitchell, Matthew Franklin and Dennis Shanahan—not to run some hate media argument on them and not to square up on any editorial position from them last year but because, out of a perverse mark of respect, I think these three shape the broader media position on what it is to be an opposition leader more than anyone else. I single them out as leaders who can make change for Australia. If these three continue to believe and to argue that an opposition's role is only to oppose—that their role and power as parliamentarians is to be denied right now and that there is no worth at all in the lion lying down with the lamb—then Australia suffers. I accept division makes great copy and sells newspapers, but consensus right now is what builds Australia and builds a nation. Consensus right now is what will answer the unanswered on constitutional reform, on tax reform, on productivity reform, on education reform and on electoral donation reform. If this challenge is denied, I can read the editorial now. The Australian will argue that it reflects community views only and the opposition is doing its job to oppose. If that is what it is then so be it. But, if we all want more, no three people can push for national outcomes on some key issues better than these three. Rest assured that I know the LNP, the opposition, are playing to that audience. Whilst ever they are allowed to have the position of all care and no responsibility, they will take it. I would take it. We would all take it, and reform in Australia grinds to a toxic halt.

Having said that, I think there is plenty of reform that has been achieved so far and that does deserve to be talked about. It is significant that the three major rating agencies have given a AAA rating to Australia right now. It is significant that the unemployment rate is under five per cent, inflation is in hand and the cash rate is below five per cent. Whilst there will be a debate about the debt ceiling—I am a reluctant partner in that whole process—now is not the time for a US-style debt ceiling fight. I will—and I understand the coalition will as well—allow that issue to pass this parliament right now.

The big issue next week in New South Wales is the Pacific Highway funding. I know, Mr Deputy Speaker Scott, that from the Bruce Highway's perspective you are watching closely. New South Wales can take the opportunity of finishing the project of the Pacific Highway by 2016, as promised and agreed by state and federal governments and by all political parties. The construction works were released through questions in this parliament over the past six months. There is no construction impediment to completing the final 400 kilometres of works. It is now down to nothing other than the money. I all but pushed all political chips across the table to get $3.56 billion allocated in the federal budget. As people can see in the budget papers, it is one of the standout roads items, if not the standout roads item. We can finish the job if the state commits to do its part and enter a partnership along the lines of what John Howard argued in 2007 and what Mark Vaile argued, and through all transport ministers going back to the start of this project with Laurie Brereton and Michael Knight. Everyone has argued the case for a fifty-fifty project. It is disappointing that the company line out of New South Wales in the last 12 months seems to have changed. I hope for a celebration next week, not a further cynical argument and political fight. But that is for the New South Wales budget, which we will all watch closely.

I acknowledge, as I mentioned before, the National Disability Insurance Scheme and aged-care reform. Both are significant steps forward through this budget, and I would hope that continued work sees both of those having very practical outcomes on the ground. It would be remiss not to mention the emissions trading scheme, something I took to both the 2007 and 2010 elections. We now will see that happen in Australia. It is recognising the place of both science and economics. I accept the science and the economics, and I accept my role in trying to get the policy process to deliver on both. I also would be remiss not to mention the Regional Development Australia network and the fact that we now have 55 regions identified in Australia and that all have an office working with local communities and trying to build the concept of place based and local based thinking in Australia. The budget will pass, but I do urge and encourage both Julia Gillard and Tony Abbott to lead, lead together, and lead together right now.

Alex Hawke (Mitchell, Liberal Party) Share this | Link to this | Hansard source

I rise to talk about this budget—Appropriation Bill (No. 1) 2011-2012 and related bills—in relation to what the government is doing. Each year I rise and ask the same question, and I do so again this year: what is the biggest item of expenditure in the federal budget? Of course, once again we find in this year's budget that the biggest single item is welfare. Some people would say welfare is a legitimate activity of government, but for it to be the No. 1 item of expenditure for a federal government—and this year it increased quite substantially when you look at the figures—I think is of great concern to Australia and the whole economy and how we operate our budgets. This government seems hell-bent on over-regulating and putting the government at the centre of everything in the national economy. It is correct, as the member for Lyne has identified, that Australia is at a crossroads in this regard when you consider that, in relation to small and medium enterprises, this government has brought in a whopping 20,000 new regulations for small and medium enterprises and has removed fewer than 200. There are 20,000 new regulations. When you look at this massive increase in the welfare budget and at what this government is doing to produce a smoke-and-mirrors surplus, I think you get a kind of feel for and flavour of what is really going on with this government's mismanagement of the economy.

The biggest ticket item in terms of expenditure cuts is, of course, the $5 billion worth of defence cuts, translated almost exactly into $5 billion of welfare increases. I think that $5 billion of cuts to our defence forces is one of the most short-sighted policy decisions that we will make in the coming decade. I say that because defence is the first priority of a national government. It is the most legitimate activity of a federal government. It is why we have a federal government, indeed. It is partly why we federated: to form a defence force to protect our national interests. A $5 billion cut, I think, represents a grave danger to the future operational capacity of the ADF and, indeed, will undermine its ability to upgrade many of the capital and other requirements for major projects that we all know are so necessary.

The government at the moment is lamenting in so many ways the loss of manufacturing workers, the loss of jobs in the economy and the loss of the capacity of Australia to manufacture its own things. There is no more legitimate activity of government in this space than manufacturing in defence industry. Defence industry in Australia is of vital concern for our nation's economic wellbeing. We could certainly sustain manufacturing jobs and other capacity in defence industry production, and yet we have a $5 billion cut in this regard. While we are subsidising a lazy and indolent car industry that is producing cars that consumers do not want at a price they cannot afford, and we are paying hundreds of thousands of dollars per job in that sector, we are ignoring a vital and successful component of our manufacturing that is the Australian defence industry. I am a well-known opponent of protection in industries, and I do not count defence as protection. The Prime Minister and I even had a Twitter fight about the car industry and her much vaunted policy, and I do not believe she came off best in that regard, because it is undeniable that the No. 1 reason why we need to subsidise this industry is because the top-selling car in Australia is a foreign car. Why? Because it is cheaper. People can buy a better-made car, at a cheaper price, that is smaller, more efficient and more environmentally friendly. That is the No. 1 reason that people are not choosing Australian cars. How is a subsidy going to produce a better outcome in relation to that? It flies in the face of the other policy that the government is vaunting in this budget and the economic debacle that is the so-called surplus, and that is the carbon tax.

The entire economy is now built on the carbon tax coming into operation on 1 July. As you know, Mr Deputy Speaker, the opposition is firmly committed to the removal of this toxic tax from the Australian economy, for good reason. You do not need a $5 billion increase in welfare—which the government calls 'compensation'—if you do not have a major tax going into the economy, taxing all of the productive sectors of the economy, ripping money out and increasing prices of basic goods and services. The government often says, 'You're going to rip away money from pensioners. You're going to rip away money from families.' I do not see Australian families and Australian pensioners as welfare cases. They are capable of working for themselves, earning their own living, sustaining themselves into retirement and building their own financial footing. They do not need government. Every single family in this country does not need government to be a constant drip of money for them. They can do it themselves, and that is what the role of government is—not to get involved but to get uninvolved, to leave people alone to prosper, to build the businesses they want to build, to innovate and create wealth and jobs and look after themselves and their families. Government is there to step in when people cannot do it for themselves, when they will not do it for themselves and they are unable to or they come across other issues in life. That is the legitimate role of government.

Now we have got to the point in our society today where we are, through the carbon tax, basically becoming a welfare state of epic proportions, where everybody has an entitlement to compensation for prices that are deliberately ratcheted up by this government. Why are we ratcheting up the prices of goods and services and basics like electricity? The government says that it is 'to save the climate of the planet.' Today I noticed that Tim Flannery is on the bandwagon again. I heard the member for Lyne saying once again that he is a believer in the science. Today Tim Flannery has come forward to say that we need to remove the fillings from the teeth of dead people, if they have mercury in them, because we do not want that going back into the environment. Last week he was in Western Sydney—I know the member for Chifley will be very interested in this—and he was saying that people will die in Western Sydney because of the heatwaves that are coming through climate change. This is the kind of taxpayer-funded drivel that we are hearing every day, that is justifying an economy-wide carbon tax that will punish every business and industry and will push up the cost of goods and services. It will cause us to go further down the path of becoming a welfare state, because of people like Professor Tim Flannery who propose that we need to use a wrench to pull out teeth that have mercury in them. It is in the Daily Telegraph today. That is what he is proposing. He is paid $300,000 a year by the taxpayer. This is becoming an absolute travesty. The science is hardly what is driving this policy from this government. Concern for the climate seems to be backmost of what they are doing.

This budget is of great concern in my own electorate of Mitchell, which has one of the highest proportions of families of any electorate in the country. The cost of living, of goods and services and of electricity prices in particular resonates across Western Sydney. You would not find a door to knock on in Western Sydney that would not raise electricity prices as one of their No. 1 concerns, and they are concerned about the outcome of this budget and the carbon tax. In particular, once again we see in relation to the minister for transport and the much vaunted Infrastructure Australia policy, which from this government was meant to be the saving grace of infrastructure in Australia today, another complete abandonment of the nation's biggest city, Sydney. Not only is there not a single dollar in the budget for infrastructure in Sydney; there has not been in four years. There was $100 million for a study for a metro for the last state government, which we know was probably the worst government and the most incompetent government of any single government in the nation's history. That money had to be handed back to the federal government because of the incompetence of that state government. I know the member for Chifley knows all about that, so I will not lecture him anymore on that.

The failing of this government in particular is that there is no infrastructure funding for the biggest economic generator in the country. I follow the model of infrastructure provision that it should be economical where possible. Of course there are times where government has to go out and build a rail line or a road where it may not be so economical. But primarily we must be putting money into the economic and infrastructure drivers that will build and be sustainable in our major cities, in our major ports, in our major areas of economic activity. That is the best way to fund the infrastructure so that we can continue generating jobs and prosperity and keep the economy ticking over.

This federal government says not a single road, not a single rail line, not a single driver of economic activity is needed in our nation's biggest city, with its biggest economic generator, with its massive population, with its ability to draw all of our migrants—most migrants still go to Sydney. It says, 'You don't have any infrastructure pressures or priorities.' I think it is an absolute failing of Infrastructure Australia and the policy of this government to have what it describes as non-political bodies deciding on infrastructure.

The north-west rail line in particular has been earmarked as the No. 1 priority of the New South Wales state government, funded with an additional $2.1 billion from the federal government, earmarked in the MYEFO 2010-11 year. The federal government right before the last election came forward with a promise, written on the back of a coaster, to build a Parramatta to Epping rail line to try and win the seat of Bennelong and retain the seat of Parramatta, realising how much political trouble they were in. The Prime Minister made the announcement. We all saw in Sydney what Labor had done over 16 years playing politics with rail lines in metropolitan Sydney. It was an absolute disaster. It was an absolute disaster for the state government at the last election and it was an absolute disgrace for the Prime Minister to attempt to play politics with the rail line.

This $2.1 billion in MYEFO in 2010-11 that is earmarked, allegedly, for the Epping-Parramatta rail line is not going to be brought on or brought forward. No plans are in train to build the Epping-Parramatta rail link. There is no construction timetable and no priority. Nothing will be done. No money will actually come forward until, as this government says, the state government contribute some money. The state government have made it clear that they will not be doing that. So that money could be earmarked to that state government right now in New South Wales to get infrastructure moving in Sydney, which is vital for the development of our city. It must be brought forward. But you will not see any action from this government. I would argue that until this government is removed there will be this continual political gain in relation to infrastructure funding in Sydney, which I think is to the detriment of every resident in Western Sydney, in my electorate of Mitchell.

We have heard much about this government spreading the benefits of the boom to all sectors of the economy. I think the other great betrayal of our nation's enterprise and business community in this budget was the absolute and utter shameful backflip on cutting the corporate tax rate. We know why it did that. All these small and medium enterprises around the nation who are struggling to pay their bills at the moment were looking for the cut in the company tax rate which was promised, promised and promised. We know what the promises of this government are worth. But those businesses were expecting this company tax cut. How is it right for a government to, on the one hand, outline its national policy so that businesses can make decisions and so that small and medium businesses can say, 'Look, we are under pressure but there is some prospect of us getting some relief in the next budget so we can make decisions and struggle on with our business enterprise,' and then, on the other hand, in the budget without warning pull the company tax cuts for all those small to medium enterprises around the country?

That was supposed to be spreading the benefits of the boom to every corner, as the Treasurer is fond of saying of our economy—but not the corner that is the small and medium enterprises. Not that corner. That is not where the boom will be spread to, because small and medium enterprises are one of the lowest priorities of the government.

They have no regard for the family owned or small business that is struggling under the current economic conditions and they are not spreading any part of the boom to those hardworking mums and dads and families who own businesses around the country. That is perhaps one of the greatest betrayals out of this budget that I think will have a very negative impact in confidence and in the ability of people to get ahead in their businesses.

Another problem that we have in relation to what is coming out of this budget is the constant increases of taxation and the constant uncertainty about whether something will or will not happen. We have seen it this week in relation to the enterprise migration agreements. Who is in support of it? Will it happen? Will it not happen? Is it okay by the unions? Is it not okay by the unions? Australia is becoming a sovereign risk in so many ways because of the uncertainty coming out of this government. This budget certainly reinforces the uncertainty that is coming out.

The uncertainty of this budget is: does anybody believe that we will achieve a $1.5 billion surplus next year based on, perhaps, the best increases in economic conditions in 20 years that are modelled here?

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

Read the Fin Review!

Alex Hawke (Mitchell, Liberal Party) Share this | Link to this | Hansard source

Does the member for Chifley really want to come forward and put his name to that? MYEFO is coming up at the end of this year and then of course we will have next year's budget. And in next year's budget I do not think it is too cavalier to predict that these great conditions predicted in the budget may not come forward, and we may not share that $1.5 billion surplus.

So if I have one overarching criticism it is the absolute lack of certainty that is coming out of the government. Their economic policy is just unfathomable to business and to people looking to invest in this country, and really they ought to hang their heads in shame at the way they are treating economic policy in Australia today.

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

I am very pleased to speak in support of the Appropriation Bill (No. 1) 2012-2013 and cognate bills, for the 2012-2013 budget. I am very pleased to do so because the first thing that comes to mind when we are talking about the budget and the delivery of the budget is that you need to do it on the back of a very strong economy. Without a strong economy you will not be able to implement the very good things that are currently happening.

We know that from when this government first came into government, back in 2007, until today 800,000 new jobs have been created, with another 300,000 on track by the end of 2013. We know that these jobs were not just created by the click of a finger or by sitting back and doing nothing; these jobs were created through good initiatives by this government and through the strong economy that we have built.

We bulletproofed the Australian economy and kept it out of recession, which was very important to get us to the stage where we are today. If you look around the world you see what is happening in Europe—in Greece, in Portugal, in Italy, in Spain and in Ireland—and in other parts of the world. Look at what the US has been through since 2008—its economy is just starting to pick up now. Our economy has been going strong all through that period.

It was strong because we took decisive action when the global financial crisis hit. Again, I reiterate in this place as I have done many, many times before; there was a lot of criticism about our infrastructure packages from the opposition and a lot of criticism about the BER. These were projects that kept us out of the doldrums when the rest of the world was suffering. For example, when I visit a BER project, one of the questions I always ask is: how many people did it employ? And the answer always comes back that it was anything between 50 to 200 people. When you multiply 26,000 projects, just like the BERs that I visit in my electorate, across the country and you see the number of people who were employed, you can see why we got out of that financial crisis. We did not sit back and fold our arms, as we were told to by the opposition—we actually took decisive action. That has assisted us to build this strong economy, to bulletproof the Australian economy and, as I said, to keep it out of that recession.

At the same time it has spread those good benefits of the mining boom, helping families on modest incomes and small businesses. Only last week we heard the announcement of 8,000 new jobs in WA—8,000 new jobs! What a great announcement. What a great announcement to be able to say that we are creating 8,000 new jobs and, at the same time, ensuring that the mining boom is spread evenly across the country. That is great news. Most governments around the world would fall over backwards to make an announcement like that.

There are obviously things that we have to do to get those 8,000 jobs up and running—for example, ensuring that we have the skills to be able to fulfil those positions. I am very pleased that there will be training positions along with new apprentices and of course positions for Indigenous and Aboriginal people in mining. That is a terrific story, and I think it is something that we should not fear or run away from. This is a very important announcement.

At the same time we are delivering the new schoolkids bonus: $1.3 billion—$410 a year for primary schoolchildren and $820 a year for high school children. This is on top of delivering Australia's first national paid parental leave scheme, increasing family payments for teenagers and raising the childcare rebate to 50 per cent of out-of-pocket costs. These are good things we have done because, as I have said, we have a good economy in place to be able to bring these projects to fruition and ensure that we deliver and spread the benefits of the economy across the nation.

Many good things are happening, and I support this budget because it will deliver big time for my electorate: for pensioners doing it tough; for families working long days, doing it tough and struggling to make ends meet; and for the vulnerable in our community. The measures in this budget reflect those true Labor values of our government: fairness, jobs and opportunity for all. They are the things that we see from this government. It is absolutely paramount that we deliver for those people.

I will take the opportunity to highlight some of the measures in this particular budget, the 2012-13 budget, and what it means on the ground for thousands and thousands of people in my electorate of Hindmarsh. We on this side of the House understand the pressures of families who work long days, living pay to pay and spending what little they have on themselves after paying the bills for the kids' school fees, the groceries, the electricity bill, petrol, mortgages et cetera. That is why we are easing the pressure through tax cuts and increasing payments. In the electorate of Hindmarsh, thousands of people, as I said, are now benefiting from these initiatives. We also have boosted the assistance for older people to support them in their retirement or while still working. We have introduced new initiatives to help younger people support themselves while studying or learning a trade.

Paid parental leave is a very positive initiative, and I am delighted that 906 local families in my electorate of Hindmarsh are benefiting from Australia's first paid parental leave scheme. Just this week I spoke in the chamber in favour of the Dad and Partner Pay scheme, which will see dads get two weeks paid leave to be with mum and the baby when it is born. I cannot tell you what a difference that would make on the ground. I spoke, as I said earlier, last week about what a difference it would have made to me when my boys were born if I could have spent those two weeks at home. I know there are many people today in the situation I was in back then. I actually had to change my shifts to be able to stay at home and assist my wife and do what I could to help in the first two to three weeks. At the time, as I have said before, I was driving taxis full time and I changed my shift from six at night to six in the morning so I could get home and give my wife some respite and look after the newborn babies when they came home. It was absolutely exhausting, and a bonus like the one that has just been announced would have been a godsend for my family back then. I know that there are thousands of people out there in exactly the same position that I was in 28 years ago for the first and 24 years ago with the second one.

The baby bonus is another great initiative. In my electorate, 710 local families benefited from the baby bonus last year and many of these families received $500 more of their payment upfront to help pay for the initial costs of setting up the baby's room, buying prams, clothes and all the added expenses that come up when a newborn comes home. Family tax benefit A is another initiative of this Labor government. The families of about 2,600 Hindmarsh teenagers turning 16 over the next five years will now receive up to $4,200 extra in family payments if their child stays at school. That is under our boost for teenagers as part of family tax benefit A. Another great initiative is the advance payment of the FTB A. We have 6,351 local FTB recipients who may be eligible for an advance payment of up to $1,000 to help them meet unexpected family expenses. We all know that life is not always predictable. We know that things happen—the car might break down, you might have a medical emergency and, when you are living on a low income, it can be very hard to find extra money when you need it. So this will go a long way to easing stress on families who are already overloaded trying to balance work, family, study and sport commitments, which as the dad of two boys myself I know is not an easy job and does not slow down as they get older.

We have 4,261 local families who will be receiving the childcare rebate in the electorate of Hindmarsh, and they are now benefiting from Labor increasing the childcare rebate from 30 per cent to 50 per cent of parents' out-of-pocket costs and the increase in the maximum payment to $7,500 per child per year. There are 4,261 local families in my electorate who now have the option of claiming their childcare rebate payment fortnightly rather than having to wait to the end of the year, so it is easier to make ends meet.

Twenty-nine thousand local pensioners are now benefiting from Labor's historic pension reforms, including the biggest increase to the pension in 100 years. Single pensioners on the maximum rate are receiving an extra $154 per fortnight, and couples on the maximum rate are receiving an extra $156 a fortnight combined. I have 3,275 local families in Hindmarsh who have received an annual $600 carer's supplement boost to assist with the financial pressures associated with caring for a loved one. In addition, those who care for a child with a disability now receive an extra $1,000 per year. Also, 29,000 local age pensioners in my electorate can now keep more of their pension if still working. After changes by this Labor government, pensioners can earn up to $250 a fortnight without it being taken into account as income under the pension income test. These are all good measures.

We have also realised that we need to support apprentices and the skilled labour workforce. Six hundred and sixty-three local apprentices training in skill shortage areas are being supported with $5,500 in total government support to help them complete their qualifications in my electorate.

I turn next to the household assistance package. From May, more than 8,000 local families in Hindmarsh will receive extra money through family assistance payments. A typical family in my electorate will get $529 through both tax cuts and family assistance payments. With regard to family tax benefit A and B, 7,500 FTB A recipients in Hindmarsh will receive up to $110 extra a year per child and 6,000 FTB B recipients will receive up to $69 extra a year per child as of this month. More than 1,300 families will receive an extra $289 per year in increased income support, as well as assistance through increased family payments. I mentioned pensioners earlier. I have 29,000 local pensioners in my electorate who will receive an extra $338 a year for singles and $510 for couples combined in their pensions. Payments have started to go out this week. I have more than 2,200 local self-funded retirees, and they will receive an extra $338 a year for singles and $510 for couples combined from May. More than 3,700 local job seekers will receive an extra $218 a year for singles and $390 for couples combined as of this month. I have over 2,200 students in my electorate who will get an extra $177 per year. The amount they get will depend on their rate and type of payment—for example, Austudy, Abstudy or youth allowance.

Many people will benefit from the tax cuts. Approximately 53,000 local taxpayers in my electorate will receive a tax cut on 1 July. Around 44,000 taxpayers will receive a tax cut of at least $300, and 4,000 local residents in Hindmarsh will pay no tax at all due to the tripling of the tax-free threshold. The average wage earner in Hindmarsh now pays approximately $1,200 less tax than in 2007-08 as a result of Labor's tax cuts for low- and middle-income families. From July, Labor will put up to $500 into the superannuation accounts of 22,000 local workers who are earning up to $37,000. These are low-paid workers and this will be a big benefit for them. As I said earlier, importantly, dads in my electorate will be able to apply for Labor's new dad and partner pay scheme, which begins on 1 January 2013. These are all very good benefits.

There are also nation-building programs taking place in my electorate. We have seen a rollout of the biggest road and rail program in the nation's history, with work beginning, progressing or being completed on a long list of large and smaller scale projects. For example, in my electorate, I have been proud to secure $4.5 million funding for the new King Street bridge, which opened on time and on budget at the end of last year and has been much welcomed by local residents, businesses and tourism operators.

Kelly O'Dwyer (Higgins, Liberal Party) Share this | Link to this | Hansard source

I was very pleased to be in the chamber to listen to the contribution from the member for Hindmarsh about the cash splash of taxpayer dollars. But he failed to talk about those other aspects of the budget which should be of concern to every Australian—the question, firstly, as to how this cash splash should be paid for and, secondly, why it is that the government feel the need for modest payments to people in electorates like his. It is because people know that the cost of living is going up and up and will go up even further as a result of the government's carbon tax, to be brought in on 1 July.

Never more true than they are today are the words first espoused by President Clinton two decades ago: 'It's the economy, stupid!' That is very true. It is right to consider these words when we consider the Appropriations Bill (No. 1) 2012-13 and related bills this afternoon.

Let us look at the current domestic situation. The retail sector is hurting. We have a two-speed economy, which is very different in the east and in the west. Housing approvals for new constructions are down, growth is going backwards, multifactor productivity has flatlined and is now heading in the wrong direction, and business confidence is at an all-time low. Against this backdrop we consider the international situation, which should concern us greatly. Financial turmoil in Europe shows no signs of abating. The situation in Greece and in France is not just a financial crisis but has snowballed into something even more significant—a social crisis with far-reaching consequences. We see high levels of US debt and a significant crisis of confidence in the US, and we see signs that China's growth is slowing. This is all relevant for us here in Australia.

The budget that was announced by Treasurer Wayne Swan the foundation stone on which its economic narrative is based, so it deserves very close and very careful consideration. We cannot simply rely on the glib mantra of the Treasurer that the fundamentals of the economy are strong. He seems to think that with this mantra he can somehow avert any further scrutiny. But today we scrutinise in the time available the budget bills that have been brought before us, and there are a number of elements that we should consider very carefully. The first of them is this size of government debt, the second is the size of government expenditure, the third is how this expenditure is to be funded and the fourth is the believability of the government's claims of a budget surplus.

The budget announced by Treasurer Wayne Swan is the fifth budget he has delivered. Let us go back to the budgets since the last coalition budget. The coalition had a surplus of $20 billion, we had no net debt and we had $70 billion in net government assets. Where are we today? It was announced that we have a deficit of $44 billion. This deficit was predicted by this Treasurer just over 12 months ago to be closer $12 billion. It has gone up from $12 billion to $23 billion to $37 billion and was finally announced by the Treasurer at $44 billion. If you go back and look at the four budgets that he delivered before this one, you will see that the accumulation of deficit hit in this budget a record of $174 billion. These were the four largest budget deficits in our history. I want that to sink in for the people who are listening to this speech. There has been a combined deficit of 174 thousand million dollars in just four years. We have gone from a position of no net debt to a position where our net debt will peak at $145 billion. Judging by previous forecasts, I think we can anticipate that that figure will blow out even further.

We should also consider the government's gross debt ceiling. The gross debt ceiling started at around $75 billion. The government had to increase it to $200 billion, then to $250 billion, and in this latest budget the government has sought to increase the gross debt ceiling to a record $300 billion. All Australians are rightly concerned by this. Why has the government needed to increase the net debt and the gross debt ceiling? It has needed to do so because it has increased the amount it is spending. The government has claimed that it is reducing expenditure, yet we see from this budget an increase in aggregate expenditure of more than $100 billion since the last coalition budget. That is a 40 per cent increase. How does the government propose to pay for all this? Through their 26 new or increased taxes. It will be paid for not only by this generation but also by future generations of Australian taxpayers.

On what will all this money be spent? There was, of course, $2.4 billion spent on a pink batts scheme. That $2.4 billion, if you consider the opportunity costs of the same amount of money, could have been spent on 12 much-needed grade separations on train lines throughout Victoria. The interest payments that will be made in 2015-16 of $8 billion would equate to about 32 railway crossings. Why are railway crossings significant? In my state of Victoria there are still over 172 level crossings; Sydney has just eight. Quite a number of these crossings are located on the Dandenong railway line, which currently serves over a million people and is considered a key area for future population growth. The railway line is a major east-west artery for both people and freight stretching through my electorate and Melbourne's south-eastern suburbs and its industrial parks to the significant commercial hub of Dandenong and the growing residential developments and proposed deepwater port of Hastings. The Victorian government made a submission to Infrastructure Australia. It asked for increased funding to get rid of these railway crossings, noting that the railway corridor contributed $92 billion to GDP in 2007-08, which accounted for roughly half of Melbourne's GDP or nine per cent nationally. The railway line is already operating at or above capacity, resulting in very significant closures of the level crossings.

Within my electorate of Higgins there are three crossings in close proximity to each other: Koornang Road, Carnegie; Murrumbeena Road, Murrumbeena; and Poath Road, Murrumbeena. Their frequent and lengthy closures are severely impacting on pedestrians, car traffic and road freight and having negative consequences for local business, schools, shops and community life. But these are not the only railway crossings in my electorate. Another significant railway crossing that causes concerns for so many of my constituents is the Burke Road crossing, another very significant problem.

The economic benefits of removing these traffic impediments are self-evident. That is why I am helping to promote the RACV's Redspot campaign. Critical infrastructure spending is essential to the nation's productivity growth. This is where the government should be focusing its attention, yet in this budget we see no money for Victoria for these railway crossings. Not one cent was provided of the $16 million which the Victorian government requested in its submission for railway crossing removals in Victoria. Yet in the budget we see that the government found $36 million in extra funding for carbon tax ads. This brings to a total $69.5 million that the government is spending on spinning to the Australian people the benefits of the increased cost of living that will be applied to each and every Australian as a result of their carbon tax from 1 July this year. The government has its priorities all wrong.

We also see from this budget that there has been no security of funding for the school sector. The Gonski review recommended that the government spend an extra $5.5 billion on school funding initiatives in order to revamp the way that school funding is delivered. This was being considered by the government. We see the results of that consideration in this budget. The more than $5 billion in additional funding for schools recommended in the review is not in the budget; there is not even $1 billion for it in the budget. In fact, over two years this government has apportioned an extra $5.8 million to schools funding. There is no security of funding, particularly for those schools in my electorate of Higgins which are concerned about the impact if the government does not continue with the indexation of funding for independent schools. In Higgins, $29 million will be lost to schools, and I have 39 schools in my electorate, all of which will be impacted by the loss of security of school funding if the government does not heed their call—and, of course, it has not. In this budget these schools have been completely ignored.

We can only assume from that that the government has a different plan for school funding; a different plan for the quadrennium of school funding that it will apply beyond the next election. It will involve a hit list on independent schools which, as we know, they have proposed in the past. As an opposition we will strongly oppose this.

In this budget the government has made good on its threats to cut the private health insurance rebate. Again this will increase the cost of living to so many Australian families and so many people in my electorate of Higgins. Seventy-seven per cent of people in my electorate of Higgins have private health insurance funding. This is one of the significant costs in their budget, and the government will be increasing the cost just as it has increased the cost of so many other things—including things as essential as child care. Thanks to the government's changes in regulation, childcare costs—instead of going up by 57c a week as the minister has claimed—have gone up by between $50 and $70 a week. Again, I can only reiterate the point that, on 1 July, with the carbon tax being brought into effect, this will hit not only every Australian but also every Australian business. According to the government's own modelling alone, there will be a 10 per cent increase in electricity costs, which will flow throughout the economy.

Of course, the people of Higgins expect more, and the people of Higgins deserve more. Australians deserve hope, reward and opportunity—which is the coalition's plan. We will not simply talk about delivering a surplus; we have in the past delivered surpluses. This is something that we will do; it is not something we will just talk of doing. The government's claim to deliver a $1.5 billion surplus simply does not add up, particularly when you consider that they have been pulling funding into this year and spending into this year and pushing it out into other years to try to create fictional surplus for 2012-13.

The Australian people will not be spun on this. The Australian people have clearly made a decision on this Prime Minister, on her broken promises and on her budget that was delivered only a number of weeks ago—a budget that has sunk without a trace, and for good reason. It is a budget that the Labor Party do not wish to talk about because it is a budget that highlights their failure in government. We can do better. We will do better. That is why we look forward to the opportunity of governing. We hope that the leadership issues of the government will be resolved and we look forward to the government calling an election at the earliest opportunity.

Richard Marles (Corio, Australian Labor Party, Parliamentary Secretary for Pacific Island Affairs) Share this | Link to this | Hansard source

The 2012-13 budget is a budget which has delivered a surplus on time, as promised. It is a budget which sets up our country for the future, building a stronger economy and at the same time creating a much fairer community. It is a budget which will spread the wonderful benefits that this country is getting through the mining boom to all Australians—noting that we do have a patchwork economy, where many, particularly in the south-east corner of our country, are not enjoying the benefits of the mining boom to the extent that others are. So this is a budget that will deliver for them.

It is a budget that protects low- and middle-income Australians. It does this by providing more money to families and small businesses and supporting the most vulnerable members of our community, through tax cuts, so that all taxpayers earning up to $80,000 will get a tax cut, including the tripling of the tax-free threshold and increases in the pension for more than 3.4 million pensioners. It is a budget which provides for an increase to family payments. It is a budget which provides the Schoolkids Bonus, which helps families with the costs of their children's education. It is a budget which will help support people who are living on allowances and it will also help people through the parenting payment. It is a budget which will introduce for the first time the historic National Disability Insurance Scheme, which, in the fullness of time, will represent just about the biggest advance in social policy in this country since Medicare. It is a budget which will see a blitz on public dental waiting lists.

I want to talk a little bit about how that broad picture of the budget will apply specifically in my electorate of Corio. In my electorate, 8,550 local families who have school kids will receive $410 in the case of primary school children and $820 in the case of high school children. That adds up to nearly $9 million worth of assistance for families in the electorate of Corio. More than 11,000 local families will receive an increase of up to $600 through family tax benefit A, from 1 July 2013.

Through the minerals resource rent tax we are seeing an increase in superannuation for 42,500 local workers in the Corio electorate. They will see their superannuation increase from nine per cent to 12 per cent. That is going to add almost $108,000 to the projected retirement income of an average 30-year-old worker. From July, Labor will put up to $500 into the superannuation accounts of 23,500 local workers earning up to $37,000. For 14,600 small businesses in Corio, Labor is giving an instant tax write-off for each purchase of an asset below $6,500—which, again, is one of the many benefits that flow from the minerals resource rent tax. In addition to that, the first $5,000 spent on a new motor vehicle will also be able to be written off.

In addition to those measures, there is also being rolled out as we speak the household assistance package, which will support families with any modest increases in prices which occur as a result of putting a price on carbon. More than 11,300 families in the Corio electorate will receive additional money as a result of the assistance payments. A typical family in my electorate will get $529 through both tax cuts and family assistance payments. In excess of 10,800 family tax benefit recipients in the electorate will receive up to $110 extra a year per child, and 9,200 family tax benefit B recipients will receive up to $69 a year per child.

More than 26,700 local pensioners will receive—with the rollout beginning yesterday—an increase in their pension. There will be a lump sum of $250 for singles and $380 for couples. From March next year, pensioners will receive another increase in their fortnightly payments which will see in total an increase of $338 a year for singles and $510 for couples. More than 1,000 local self-funded retirees will receive an extra $338 a year for singles and $510 for couples.

More than 5,000 local job seekers will receive an extra $218 a year for singles and $390 for couples. More than 2,500 students in Corio will get up to $177 extra per year. That amount will depend on the rate and type of payment they get at the moment in terms of supporting their studies, be it Austudy, Abstudy or Youth Allowance. About 46,000 local taxpayers will receive as a result of the household assistance package a tax cut from 1 July. Around 38,000 taxpayers will receive a tax cut of at least $300, and 4,000 local residents will pay no tax at all due to the tripling of the tax-free threshold.

All of that represents a concerted effort on the part of this government to tackle two of the great economic challenges facing our nation. The first is to make sure that the enormous benefits which flow to us through the resources boom are there for all Australians, because the essential product of that resources boom—the resources which lie underneath our ground—is owned by all Australians.

The second great challenge is placing a price on carbon so that we can develop an industrial base going forward which is much less dependent upon carbon, in a future world where dependency upon carbon is going to be penalised, and doing that in a way which does not have an impact on low- and middle-income households. They will get through this a package of assistance that will cover, and in some cases more than cover, any increase in costs associated with putting a price on carbon.

This budget and the work that has been done on that comes on the back of a very significant record of achievement on the part of Labor in power since 2007 in relation to the Corio electorate. We have seen an unprecedented level of federal government support and engagement in the electorate of Corio. I want to take a moment to describe some of those. It is a very impressive record of achievement, which is unprecedented in terms of the way federal governments have impacted upon the Corio electorate in the past.

As a result of the Labor government we will see the $3.2 billion regional rail link, which separates regional and metropolitan trains as they enter Melbourne. The City of Geelong has a vital connection with Melbourne, with a growing number of those living in Geelong working in Melbourne. This will see an infinitely more reliable and faster rail service to Melbourne, a service that does not see trains from Geelong and Ballarat caught up in the metropolitan, transit traffic jam that occurs every morning. This is a significant piece of infrastructure that will change the daily lives of working people in Geelong.

There has been $50 million spent on the rail upgrades at Geelong Port, which will make it an easier port to access from both directions and will put a focus on the significance of the port for Geelong's economic future—and that equals jobs. Deakin University's Australian Future Fibres Research and Innovation Centre has had $37 million dollars spent on it. This is a collaboration between Deakin University, CSIRO and the Victorian Centre for Advanced Materials Manufacturing.

We often talk of the old economy and the new economy, and the high-tech manufacturing jobs of the future—making carbon fibre and working with carbon fibre is the high-tech manufacturing of the future. This research centre will have a world's best research furnace for carbon fibre production, which will set up Geelong and our region to be the centre of carbon fibre research, manufacturing and production. This is an investment in future manufacturing jobs.

We have seen $26 million spent on an integrated cancer care service at Barwon Health. This acknowledges the extent to which Geelong is, in a sense, a regional capital of Victoria's south-west and a really important centre for making sure that health outcomes of those living in regional Australia are the same as those living in our capital cities. We have seen the construction of a fantastic new Australian Taxation Office building in Little Ryrie Street, which is now also the centre for the Department of Human Services in Geelong. This brings together, in one building, all the federal services that the people of Geelong rely on—in a state-of-the-art green building—and employs hundreds of local people.

We have a trade training centre, which I had the pleasure of visiting on its second day of operation, at Northern Bay College. It is a fantastic facility. It provides vocational training in the north of Geelong, where it is so badly needed. Another $4.2 million has been committed to the trade training centres at St Joseph's, Sacred Heart, Clonard and McKillop colleges, the next cluster to receive that benefit. We have seen $62 million provided in assistance to support manufacturing industries across 20 programs. Importantly, we have seen $10 million provided to Simonds Stadium, the home of the Geelong Football Club. It is part of a $46 million build on what is the southern-most stand of that stadium, setting the stadium up to be the most important piece of regional sporting infrastructure in the country.

We have seen $10 million spent on the Geelong Library and the Heritage Centre, which is a really important spend. It develops the Geelong Library and protects our city's most important and valuable records. Both were funded out of the first round of funding from the Regional Development Australia Fund. Millions of dollars have been spent on road improvements. This includes an announcement made a couple of weeks ago of $390,000 to fix four black spots in our city. Expenditure of $2.8 million has been made on five stormwater harvesting projects so that we can be much smarter in the way we use our water. A legacy of the drought is that we are now using our water in a much cleverer way. This will set us up for the next time we go through a dry patch. There has been $3.1 million spent on the renovation of the iconic Eastern Beach complex in Geelong, which is really one of the most important historical venues that we have in Geelong. It is a place which, to this day, is a gathering spot, particularly in the summer, for so many of our citizens to enjoy Corio Bay. A smaller amount of money but just as important, $391,000, has been spent on the Kardinia Park netball complex upgrade. Looking forward, there will potentially be an upgrade of the Point Wilson Waterside Infrastructure Project. Point Wilson pier is the only major ordnance pier that we have in Australia. Remediating Point Wilson is a high priority of this government. The wharf there is the sole Defence facility in the country which is capable of receiving strategic imports of explosive ordnance. This project is a long-term strategic investment that will extend the life of the wharf through to 2055.

Our government has faced the global financial crisis and steered our country through it such that we have the best economy in the developed world. Our government has faced the patchwork economy, an enormous challenge, and is spreading the benefits of the mining boom to all parts of Australia. We have a plan to do both. We have done that in the face of relentless negativity on the part of the opposition, which does nothing other than appeal to the darker angels of our nature and deny any innate optimism that exists amongst Australians to see a bright future ahead. This is not what Australians will respond to. What the Labor government is providing is a sense of hope and a sense of strategy about taking our country forward.

Russell Matheson (Macarthur, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on Appropriation Bill (No. 1) 2012-2013 representing the people of Macarthur on what can only be described as a bad budget. The people of Macarthur are honest, hardworking people who want nothing but the best for their children and future generations of our community. They have high hopes for a strong economy which will provide more jobs and opportunities for all Australians. While they are working hard to pay off their mortgages and balance the family budget, they are becoming fed up with a government that continues with its wasteful spending and incompetence.

While the people of Macarthur are trying to decrease their debt and reduce their credit limits, this government has increased the nation's credit card by $50 billion—from $250 billion to $300 billion. It has been only five short years since Labor came to office in 2007 inheriting a debt of zero. It is no wonder the people of Macarthur are fed up with a government which has continued to borrow more than $100 million a day. In 18 months, the government's estimated deficit for 2011-12 has blown out from $12 billion to $44 billion—and the year is not even over yet. This is the fourth Labor deficit in four years. Together, Labor's deficits total $174 billion. Interest payments on Labor's debt are set to reach an alarming $8 billion per year—that is $22 million a day on interest payments alone. Who do they think is going to pay off this debt? The debt will be there for our children and future generations of Australians to pay off. It is just not good enough.

The people of Macarthur can see through the spin surrounding this budget—a budget which includes the world's biggest carbon tax, cynical bribes to soften the impact of a tax, broken promises on corporate tax cuts, higher unemployment, blow-outs in the cost of border protection, an underfunded NDIS, and equity funding for the NBN which has been kept off budget. In headline cash terms, the Gillard government will spend $8.7 billion more than it earns in 2012-13. The government continues to spend on projects such as the NBN, which has been taken off budget. If this government was honest and included the NBN expenditure, the budget would show deficits over the next three years. To put it simply, there would be no surplus if the NBN was on the books.

In fact, by bringing forward just two programs—the back-to-school payment and the Commonwealth grants to local government—the government artificially saves more than $1.5 billion in 2012-13. Honest budget treatment of these two programs alone would wipe out the Treasurer's wafer-thin surplus. When will this government learn that cooking the books is no substitute for good, solid economic management? Let us face it, the Treasurer lives in 'Wayne's world'. His forecast of a $1.5 billion surplus is a mirage. The harder you look at it, the more you realise it just does not exist. Even if the Treasurer does deliver on his razor-thin surplus, Australia will need more than 93 years of the Treasurer's surpluses to repay all the waste and mismanagement created by this Treasurer. It is the families in my electorate who are feeling the pinch from this government's waste and mismanagement. The rising cost of living is a major factor affecting families, pensioners, self-funded retirees, small businesses and homeowners in Macarthur. Many have contacted my office concerned about the impacts of the carbon tax on electricity and grocery bills. Things will only get worse with the world's biggest carbon tax set to hit families, jobs and investment very soon. The budget papers confirm that, despite falling international prices, the carbon tax will go up to $29 a tonne in just three years, and an additional $36 million will be spent on taxpayer funded carbon tax advertising over the next two years. This tax will affect the entire economy. The price of everything will go up and up. Families will be hit hard. Small businesses, which are the engine room of our economy, will receive no compensation for the carbon tax.

The people of Macarthur are against this tax. They are unsure and anxious about its effect on their weekly bills, and they are angry after being misled by the Prime Minister, who said days before the last election that there would be no carbon tax under a government she led. The Treasurer did not mention the carbon tax once in his budget speech or indeed in the budget papers. He makes a glib passing reference to a carbon price but tells people not to worry about it, that it is no big deal—a tax with the single greatest impost on the family budget of every household in Macarthur. Even the Prime Minister's initial compensation package did not make a dent in the angst felt by the community.

Families in Macarthur are already paying for the highest electricity prices in the world. Now that we are heading into winter, this government will be forcing older residents on fixed incomes to spend their evenings in the dark and cold because they will not be able to afford to use their heaters or to turn on the lights. What would the Treasurer say to 60-year-old Mrs Schuit, who contacted my office last week? Mrs Schuit survives week to week by eating once a day, cooking once a week and showering every second day to keep her electricity and water bills down. Come 1 July, Mrs Schuit will be hit by the carbon tax, stretching what little finances she has even further. I would like to know: when did electricity become a luxury in this country, and when did having hot water suddenly become aspirational? People on fixed incomes, such as pensioners like Mrs Schuit, self-funded retirees, single mothers and people with a disability will be the hardest hit of all by the carbon tax. The base carbon price will continue to rise, but their compensation will not.

Now the Prime Minister and the Treasurer have resorted to desperately buying back votes from mums and dads with their schoolkids bonus sugar hit, a vain attempt to hide the true effects of the carbon tax. The Treasurer has pushed this payment into the 2011-12 financial year to protect his wafer-thin surplus. This is treating Australian families with contempt—throwing cash to them with one hand and taking away even more with the other. All seniors, students, couples and pensioners will miss out on this new cash splash, and families are not the only ones who will do it tough as a result of this budget.

This budget offers nothing more to 800 small businesses in Macarthur who will also be hit with the world's biggest carbon tax. The government has offered nothing new in this budget to provide immediate relief to struggling businesses. The sector is seeing a 48 per cent increase in insolvencies. I have met with many small-business owners in Macarthur recently who are fed up with all the broken promises, because every one of the government's broken promises will affect their livelihoods. First there was the broken promise not to introduce a carbon tax, and now there is a broken promise to cut the company tax rate.

Carbon tax related sweeteners in the form of accelerated depreciation allowances are not fooling anyone. These allowances are going to rely on small businesses having ready cash to spend on new capital items. The government's abolition of the entrepreneurs tax offset has increased tax for nearly 370,000 of our smallest businesses, including micro, home based, independent contractor and start-up businesses with incomes of less than $70,000 or $80,000 year. The local corner shop in Macarthur is not only going to have to deal with an increase in the cost of supplies and electricity but also going to have pressure from consumers looking for a bargain as the cost of living increases and unemployment rises, as forecast at in the budget.

Last year's budget promised 500,000 new jobs over two years, but the government now expects to miss its target by 300,000 jobs. Meanwhile, the unemployment rate is forecast to increase to 5.5 per cent while the government is cutting $200 million of job services programs. Even the Australian Chamber of Commerce and Industry said:

The decision to abandon the company tax cut is dripping with politics and a low blow to the business sector …

The chamber also said that this budget lacks vision for the broader economy.

I hold grave concerns for the future of small business in Macarthur. These local mums and dads will be hit the hardest because their costs will go up and up when the carbon price goes up and up. They will not receive a single cent in compensation. The coalition has a clear roadmap to restore hope, reward and opportunity for small business by scrapping the carbon tax and getting out of the way of business by slashing $1 billion worth of red tape. We believe in a hand up, not a hand out and in rewarding those who work hard to earn a living and support their families. While the much needed infrastructure projects in Macarthur do not rate a mention in this budget, the Treasurer does manage to promise preliminary economic, social and environmental studies into the sustainability of Wilton as a site for a second Sydney airport. The prospect of a second Sydney airport has been brewing in the background of Australian politics for well over 30 years, and the people of Badgerys Creek and Wilton have fought against it time and time again, and for good reason. The member for Throsby has been quoted in the Illawarra Mercury as saying:

While … there are environmental challenges—

and that is a huge understatement—

with the Wilton site, I can also see enormous economic benefits for our region.

It sounds like code for 'I support an airport at Wilton' to me. I dare say that any economic benefits would be entirely negated by the massive cost for both the federal and New South Wales governments if Sydney's water supply were contaminated. The 1985 Kinhill Stearns report clearly ruled out Wilton as a possible site for an airport because of the highly sensitive nature of the water catchment area. The development of an airport at Wilton would pose an extremely serious threat to the long-term quality and integrity of Sydney's drinking water supply. As the New South Wales state member for Wollondilly, Jai Rowell, said, what is spilt on the ground in Wilton ends up in our water supplies. The March 2012 Joint study on aviation capacity for the Sydney region identified that:

… the Wilton site … appears to have a partial overlap with a designated Mine Subsidence District and all these sites are underlain by coal measures which are actively being mined …

So questions need to be asked: why would the infrastructure minister decide to place an airport on land affected by mine subsidence, and where will Sydney get its drinking water if Warragamba Dam, Nepean Dam, Avon Dam and Cordeaux Dam are compromised?

The people of Macarthur have also been short-changed when it comes to the promised National Disability Insurance Scheme. While I understand that progress has been made with the NDIS, the government has allocated only $1 billion over four years when the Productivity Commission has said that in that time frame $3.9 billion is needed. That is $2.9 billion less than what is needed for the start-up years of the NDIS. I find it concerning and disappointing, and I think a lot of people living with a disability in Macarthur and their families will be feeling short-changed. The Productivity Commission also proposed that the NDIS would cover 400,000 Australians. The government's budget announced that it would only extend to 20,000 Australians. Based on the budget figures, full implementation of the scheme by the Productivity Commission's target date of 2018 will not happen. This budget has let down the residents of Macarthur who are living with a disability, and their families and carers. The government will be spending more each financial year—$8 billion—on debt and interest costs than it will spend in total over the next four years on the NDIS. The government has already rejected the coalition's offer to develop a joint parliamentary committee chaired by both the coalition and Labor Party spokespeople on disabilities. This would ensure that the NDIS is kept above politics so it can survive through the three election cycles it will take to be fully implemented.

I would also like to talk about the seniors in my electorate, who are forgotten in this budget. In this budget self-funded retirees will not receive a single cent of compensation to assist with the imposed damage of the carbon tax. In fact, this budget makes life much more difficult for self-funded retirees by reducing the higher tax concessions for super contributions of higher income earners. It also defers a higher concessional contributions cap for over-50s with less than $500,000 in superannuation. This government has also made it difficult for self-funded retirees to meet their medical costs by introducing means testing of the medical expenses tax offset. The incentive for mature age workers to remain in the workforce has also been removed by phasing out the $500 mature age worker tax offset. Of the $66.9 million allocated to the new Economic Potential of Senior Australians program, only $10 million is set aside to assist mature age workers to gain employment in the workforce. This program pays $1,000 to an employer who takes on a mature age worker for three months, compared to the coalition's policy, which would pay $3,250 to an employer who takes on a mature age worker from the welfare system and employs them for a minimum of six months. The remaining $56.9 million has been allocated to talking about the problem of discrimination, not fixing it, with things like an advisory panel to discuss legislation for positive ageing.

This is just another example of this government's waste and mismanagement, but the waste is nothing new to this government. A local newspaper in my electorate has labelled the National Broadband Network a 'flop' for the people of Macarthur. The NBN, which the Treasurer has left off the books this year, has become the laughing-stock of the developed world. People will be paying three times as much for their internet to use speeds that a majority of the population are not going to need, and no thought has been given to prioritising areas that either do not have broadband or have inadequate services. On top of this, the government will spend $20 million on a propaganda campaign about the NBN to paint over the waste and mismanagement of the $50 billion project—that is, if it does cost $50 billion to complete. Some are estimating that it could cost between $60 billion and $80 billion. To make matters worse, this week the Australian newspaper reported that foreign controlled companies have been awarded 82c in every dollar's worth of contracts struck for Labor's National Broadband Network, sparking warnings that local industry is being bypassed in Australia's biggest infrastructure project. Shame. The coalition will continue to hold the government to account on the NBN. We will also continue to develop our alternative broadband policy, which will improve the quality and availability of broadband for all Australians.

The coalition also has great plans for Australian school students and will revive foreign languages in schools to help unlock the potential offered by the Asian century. Within a decade, we want to see 40 per cent of all year 12 students in Macarthur and across Australia studying a foreign language. The proportion of year 12 students studying a foreign language has dropped from about 40 per cent in the 1960s to around 12 per cent today. Knowing the language of our major trading partners—China, Japan, Korea and India—is essential to unlocking the potential of the Asian century for Australia. We believe that, starting in preschool, every student should have an exposure to foreign languages. This is part of the coalition's positive plan for our economy, and I am looking forward to working with students and schools in Macarthur to ensure that this plan to revitalise foreign languages in schools becomes a reality.

I am proud to be part of a coalition that has an alternative to this Labor incompetency. We will restore hope, reward and opportunity for all Australians, we will restore good economic management and we will end the waste. We will repeal the carbon tax and stop Labor's attack on the family budget. Only in a growing economy is it possible to have lower taxes, better services and a stronger budget bottom line, as Australians discovered during the Howard era. Under a coalition government, there will be tax cuts without a carbon tax but we will find the savings to pay for them. From an economic perspective, the worst aspect of this budget is that there is no plan for economic growth, and nothing whatsoever to promote investment or employment. The coalition will ensure Australia has a vigorous five-pillar economy, strong manufacturing, vibrant agriculture, growing knowledge based industries and resilient service sectors as well as a mining industry. We will restore Australia to its rightful place in the world.

I join my colleagues here today who are disappointed in this government and its budget. Like the people of Macarthur, I am frustrated because I know there is a better way. I have seen it before—a strong economy which supports all Australians. But to achieve this we need an election so that a coalition government can put policy in place that will see our country and its peoples prosper. The coalition will reward innovation, not punish those Australians who contribute so greatly to our nation. We will restore opportunity for all Australians, young and old, and we will restore hope in our nation's future. The people of Macarthur have a bright future ahead of them under a coalition government. That is something I am very sure of. (Time expired)

Paul Fletcher (Bradfield, Liberal Party) Share this | Link to this | Hansard source

In speaking today on the Appropriation Bill (No.1) 2012-2013 and related bills, I would like to focus on the critical failure of governance associated with the influence of the union movement and union officials on Australia's $1.35 trillion superannuation sector. I want to make three points. Firstly, we have seen a governance scandal at the Health Services Union, and that has clearly spilled over into governance in the superannuation sector. Secondly, the problem is broader than just the Health Services Union. Thirdly, I want to note that the recent Cooper review into superannuation recommended substantial reforms to superannuation governance but the Minister for Financial Services and Superannuation, Bill Shorten, has done nothing about it.

Let me turn, firstly, to the governance scandal at the Health Services Union. The former national secretary of that union is the subject of an 1,100-page report by Fair Work Australia detailing multiple breaches of the union rules. Another senior Health Services union official, Michael Williamson, has been the subject of serious corruption allegations. The partner of the current Health Services Union National Secretary, Kathy Jackson, has written to police complaining about what is happening at the Health Services Union. The most obvious victims of the mismanagement and poor governance at the Health Services Union are the unfortunate members of that union.

Another group of Australians should be very concerned: those whose retirement savings are in the hands of Health Services Union officials appointed as directors of superannuation funds. Thanks to deeply flawed governance arrangements put in place by the Keating government, union officials have a privileged place in running superannuation funds. Health Services Union boss, Michael Williamson, was until recently a director of First State Super, a fund with $30 billion under management for some 70,000 current and former New South Wales public servants. He was appointed to that position by Unions New South Wales. Last month, the Chairman of First State Super complained that he had no power to remove Williamson as a trustee. Three other current Health Services Union officials are directors of superannuation funds. Peter Mylan, who is the assistant secretary of the New South Wales Health Services Union and a man recently described in the Australian as 'a long time Williamson loyalist', is also on the board of First State Super, appointed by Unions NSW. HESTA, which is a fund with $18.3 billion of superannuation savings for people working in the health industry, has two Health Services Union officials appointed by that union to the board of HESTA: Rosemary Kelly and Lloyd Williams.

Then we could look at former directors of superannuation funds appointed by the Health Services Union. Until recently there was another superannuation fund called Health Super and, before it recently merged into First State Super, Health Services Union official David Langmead served on its board. Until last year, Kathy Jackson, National Secretary of the Health Services Union, was a director of HESTA, and Craig Thomson, the former National Secretary of the Health Services Union and the current member for Dobell, is also a former director of HESTA.

Let us just remind ourselves of what the current member for Dobell had to say about Kathy Jackson's appointment as a director of HESTA. He said:

She sat on the board of HESTA, collecting board fees for many years, rarely attending meetings. But when the union decided the board fee should go to the union, she left the board.

I do not know whether or not that allegation is correct. But I do think it is instructive as an insight into the mindset of one former union official, the current member for Dobell, about the status of board appointments to superannuation funds.

It is deeply troubling that so many officials of a union whose affairs have become a byword for corruption, mismanagement and failure of governance are able to be appointed by that union to roles as directors of superannuation funds where they have the responsibility to oversee the retirement savings of tens of thousands of Australians, many of whom are not members of the Health Services Union or any other union. The Health Services Union scandal shows what happens when union officials are more interested in looking after themselves than in serving their members.

I want to come to the second proposition put before the House this afternoon: that this is a broader problem, which extends beyond the Health Services Union. There are dozens of superannuation funds that have up to half of their directors directly appointed by a union and hence there is the real risk that, if a union is infected by a 'look after your mates' culture, this in turn can infect governance in the superannuation sector.

One troubling indicator is the number of superannuation funds that do not disclose the fees they pay to their directors. Of the 16 funds which brand themselves as 'industry super', fewer than half of them disclose the fees paid to individual directors in their most recent annual reports. Another indicator that something is wrong here is the number of current or former union officials doing very nicely from serving on the boards of multiple superannuation funds. Michael Williamson of the Health Services Union, whom I mentioned before, was recently reported in the Sydney Morning Herald to earn a $330,000 a year salary, in addition to $150,000 from his various board positions, such as First State Super.

Mr Williamson is not the only follower of this particular career strategy. Consider, for example, Mr Bob Henricks, a former Queensland secretary of the Electrical Trades Union and CEO of Energy Super, a Queensland based fund with net assets of $3.8 billion. He was also Chairman of SPEC Super, until it recently merged into Energy Super, and he is also Chairperson of AUST(Q) Super. None of these funds in their annual reports disclose the fees paid to Mr Henricks as a director but, when you add up those fees across multiple funds, they are likely to be significant.

Another interesting case study is that of Mr Bernie Riordan, until recently the head of the Electrical Trades Union in New South Wales. Last year the Sunday Telegraphreported that he earns nearly $400,000 a year from a combination of his union job and directorships of three superannuation funds and businesses: Energy Industries Superannuation Scheme, FuturePlus Financial Services, and Chifley Financial Services, and one other company.

Let us look at another fund where there has been a profound governance problem. Vision Super in Victoria, formerly known as Local Government Super, was supposed to be merging with Equip Super, the fund which covers employees in the Victorian electricity and power sector. It has recently been announced that the merger is off. The difficulty seems to have been that it ran smack bang into the politics of the Australian Services Union, which dominates Vision Super. Equipsuper has elected member representatives, which is a good thing, but Vision Super has its four so-called member representatives directly appointed by the Australian Services Union. The merged entity was supposed to have elected member representatives, but it seems that ASU officials were very unhappy when a member of the Equipsuper fund—somebody who happened to be a senior manager at a power company, somebody who had formerly been an employer-appointed director of Equipsuper—chose to seek election as a board member of the merged super fund.

A letter was circulated to ASU members by ASU state secretary Brian Parkinson. Let me read from some of what he had to say. He said:

Voting has now commenced for the election of two member elected directors to serve on the Equipsuper board.

As expected, employers are seeking election to workers' positions. Indeed, one such individual, John Azaris (General Manager—Operations and Services at SP Ausnet), has exploited his senior management role to frustrate the election chances of ASU candidates.

To illustrate this point, I wish to bring this one incident to your attention. SP Ausnet management allowed Azaris, a current employer director at Equipsuper, to use it's email system to promote his candidacy as a member director. When an endorsed ASU candidate employed there (with almost 40 years of service to the company) sought to use the same service, he was refused on the most flimsy of pretexts. Management will pull out all the stops to see one of their own elected at the expense of workers.

These are the sort of unfair tricks we can expect from management. It is a disgrace. Workers such as yourself need to send a clear message to management to keep their hands off Equipsuper.

It seems that Mr Parkinson, who, as well as being ASU state secretary is also a director of Vision Super, was unhappy that the Australian Services Union was not going to have a guaranteed number of union appointed directors to the board of the merged entity. But his letter reveals that he has fundamentally misconceived his duties as a director of Vision Super. The selection of directors of a superannuation fund, to take on the vital task of stewarding the collective retirement wealth of members of the fund, has nothing to do with outdated class-war rhetoric about workers and bosses.

We could look at reported difficulties in the Meat Industry Employees Superannuation Fund. According to a recent report in the Australian this union invested some $30 million in a property company called Austcorp, before the company collapsed in May 2009 with almost all of the $30 million being lost. According to the Australian, Austcorp paid tens of thousands of dollars to a Mr Wally Curran, described as 'a legendary unionist, former long-time secretary of the Meatworkers Union and a long-serving trustee director of the Meat Industry Employees Superannuation Fund.' If you look at the most recent annual report of that fund, you will see that he was listed as a director. According to the article, Mr Curran is 80 years old and a former communist.

It is an obvious question: is Mr Curran a suitable person to be managing a superannuation fund which has $550 million of assets? Does he have the qualifications, skills and ability to separate what is in his personal interests from what is in the interests of members of the fund? But if this question can be asked about Mr Curran or Mr Parkinson—or Mr Williamson, of whom I have earlier spoken—how many other union officials on superannuation fund boards can it be asked of? If you take the 67 funds listed by the Australian Prudential Regulatory Authority as industry or public sector funds, there are 170 directors appointed directly by a union or a union peak body such as the ACTU. The majority of these people have as their day job that of being a union official. For example, the four union appointed directors on TWUSuper are the national secretary and the three state secretaries of the Transport Workers Union.

Let me turn to the third point I wish to make, which is that the Minister for Financial Services and Superannuation and the Gillard government have failed to implement the reforms recommended in the Cooper review to address the governance problems that I have spoken of. The minister, Bill Shorten, has done some window-dressing recently, announcing a package of measures that will, amongst other things, require funds to disclose the remuneration of directors. That is a good thing, but in both his reform package and in the legislation dealing with the obligations of directors of trustee companies of superannuation funds, which went through this House last week, the minister made no attempt to deal with key recommendations from the recent Cooper review dealing with the governance of superannuation funds.

Those recommendations include that disclosure of conflict of interest should be mandatory; that directors must properly disclose their remuneration in line with the provisions that apply to publicly listed companies; that the so-called equal representation model—which is code for the unions having a privileged role in the governance of superannuation funds—should no longer be mandatory; that where equal representation does apply there should be at least one third of the directors on the board who are independent; and that directors who want to sit on multiple boards must demonstrate to APRA that they do not have any foreseeable conflicts of interest.

As I have demonstrated, there is plenty of evidence that union officials regard being on the board of a superannuation fund as a nice little extra benefit that comes as part of the package of being an official. There is troubling evidence that some do not understand their fiduciary obligations to members of the superannuation fund—obligations which have nothing to do with their position as a union official and which are quite separate and which are legally binding. Unfortunately, Minister Shorten has done nothing to solve this problem. He is, I note, himself a former union official and a former director of an industry superannuation fund—one of the predecessors of AustralianSuper—as are two other Labor parliamentarians former directors of AustralianSuper, Greg Combet and Senator Doug Cameron, and as was Labor's failed candidate for Melbourne in the 2010 elections, Cath Bowtell.

The current arrangements suit the union movement and individual union officials very well. They are not, however, in the interests of the millions of Australians who are members of superannuation funds which have union officials appointed to the board, because those fund members get no say in that appointment and, in many cases, those fund members are not members of the union.

The evidence is very clear: there is a profound governance problem in superannuation. Last week the minister said that he was 'appalled' about the HSU scandal. I could not help being reminded of Captain Reynaud in Casablanca, who was 'shocked' to discover that there was gambling going on, and promised to 'round up the usual suspects'. It is time to end the window-dressing. It is time for Minister Shorten to deal with this serious problem. (Time expired)

Debate adjourned.

Sitting suspended from 13:47 to 16:00