Tony Abbott (Warringah, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

On a day when we get the news that Australia's international economic competitiveness has declined 10 places from fifth to 15th place in the world, we have a government in denial about the further damage to our competitiveness that will be inflicted on the workers and the businesses of this country by the world's biggest carbon tax. This is a government in denial. So much is this government in denial that we had the sad and dispiriting spectacle of the Minister for Climate Change coming into this parliament at question time and singing a song. He mocked the plight of the workers of this country, who are threatened by a carbon tax, by coming into this parliament and singing a song. I wonder whether he sang that song to the workers at Kurri Kurri who are losing their jobs, in part, because of the impact of carbon tax. I wonder whether members opposite would have laughed as uproariously under those circumstances as they did in this parliament today.

This is a shameful government. It is a shameful parliament to be in denial about the impact of this carbon tax on the jobs of the people that it claims to represent. What we saw in parliament today was a shameful and embarrassing attempt by this government, including by the Prime Minister, to deny the obvious. We even had the Prime Minister today trying to claim, in the face of all the evidence to the contrary including a report by the respected Productivity Commission, that somewhere out there, somewhere in the world there was a place with a higher carbon tax than the one she is about to impose on the families, workers and businesses of Australia. She finally came up with British Columbia. I have news for the Prime Minister: British Columbia is not a country. I do not know what planet she is on but it is not a country; it is a province. I remind the Prime Minister of what the finance minister of British Columbia said earlier this year in his budget speech:

This is a good time to pause and examine how the carbon tax is affecting our economic competitiveness. To that end, we will carry out a comprehensive review, examining the tax's impact—both positive and negative—on every economic sector.

I am afraid that this Prime Minister is in total denial about the impact of the carbon tax on Australia's competitiveness and in total denial about the impact of the carbon tax on families cost of living and jobs.

But that is not all we have seen this week from this government when it comes to an assault on the economic competitiveness of our country. Last Friday there was an announcement that the Roy Hill Project should go ahead. This was unambiguous good news for our country: $10 billion worth of new investment, 50 years of production that would be exported to the benefit of our country and of the wider world, and 8,000 new jobs. But it takes a special genius unique to this government and this Prime Minister to turn a good news story like 8,000 new jobs into political disaster, but that is what this Prime Minister did. She turned 8,000 new jobs into another story about sovereign risk issues which now dog investment in this country because of this Prime Minister and this government. Yet again, it was another illustration of how this Prime Minister completely lacks judgment and another demonstration of how this is a government that is deeply ambivalent about business in general and particularly ambivalent about the role of the mining sector in this country.

What we saw in the wake of that announcement was an ugly brawl between the minister for immigration and the minister for resources on the one hand and the born-again socialists inside the caucus. And it was no surprise whose side the Prime Minister turned out to be on. What we saw last week was, first of all, the Minister for Employment and Workplace Relations, in an interesting development, tip off the unions about the enterprise migration agreement that they all knew was coming. The unions spooked the Prime Minister, the caucus rolled the cabinet, and now the issue of sovereign risk is yet again front and centre for the people who we need to invest in this country. No-one quite knows what this new caucus oversight committee is going to do. But one thing we can be certain of is that enterprise migration agreements will henceforth be harder to negotiate, they will be more onerous and they will make it much harder for investment to take place and jobs to be created in this country.

This week we have seen again and again a Prime Minister shifty and evasive with this parliament, incapable of telling the complete truth. Again and again this week we have seen a desperate government trying to claw its way back into political relevance with an advertising blitz the like of which this country has never seen. They spent $36 million on a carbon tax which they will not even name—$36 million advertising that which dare not speak its name: the carbon tax. They spent $20 million advertising the National Broadband Network and they spent $12 million advertising the education cash splash. They are even sending letters to millions of Australians: 'Extra cash for you. You have just received some extra money from the Australian government. This advance is just the start. There is more to come. From the middle of next year you will get extra cash. Don't worry, you don't need to make a new claim. This assistance will come automatically just like the cash you have just had. PS: This is just part of the extra help the government is giving.' And they never mentioned the carbon tax! The last communication most people got like that was from the Nigerian lottery scammers!

It is all borrowed money. How dare this government come into this parliament and boast about Australia's economic performance when that sort of thing is taking place, all with borrowed money. This is a government which is in full retreat from the market capitalism which has been the basis of Australia's economic prosperity. If we look at the World Competitiveness Yearbook, which has just been released, Australia's overall economic competitiveness, in just two years, has fallen from fifth to 15th. But it gets worse. Our economic performance, in just two years, has fallen from seventh to 23rd. And this is a government that wants to boast about how brilliant its economic management is! We are being beaten by Qatar. But it is okay. We are still one place ahead of the United Arab Emirates!

Is it any wonder that further investments vital to the economic health of our country and the prosperity of Australians, like the Olympic Dam investment, are now at risk. This is a government which has damaged our productivity by, amongst other things, abolishing the Australian Building and Construction Commission. It has jeopardised our fiscal strength by blowing the hard-won surplus that Peter Costello and John Howard achieved. And now it has unleashed a class war, but it cannot even get that right. This mob are so hopeless they cannot even organise a class war properly. They cannot decide whether they are against 'bad Gina Rinehart', who opposes the mining tax, or in favour of 'good Gina Rinehart', who is creating 1,000 jobs for the long-term benefit of our country. This government just never understands, it just does not get it. You cannot have wealth distribution unless you have wealth creation first. That is what this government simply does not understand.

We had the enterprise migration agreements, which everyone opposite supported until the Prime Minister was spooked by the union movement. We have got a consistent preference for government over market, for government enterprise over private enterprise, from members opposite. There is the 'green bank'—$10 billion of borrowed money that is going to go out there and pick losers, pick businesses that could not make money. We have got the National Broadband Network, $50 billion worth of spending to dig up the roads to 93 per cent of the houses in this country—whether or not people need it, want it or can afford to pay three times the price for their broadband services—even though the private sector can give us much better broadband much more quickly and much more affordably than this government telecommunications monopoly ever will.

Bizarrely, and perhaps the worst decision of all, in just the last few months they have chosen a government owned and operated freight intermodal hub at Moorebank over a private sector proposal that was vastly cheaper, vastly quicker to build and vastly more affordable. They always choose government, they always choose nationalisation, over the private businesses of this country. That is the problem with the born-again socialists of this country.

There is the mining tax, which, especially if increased, is going to kill the goose that has laid the golden egg for this country. And then of course there is the carbon tax—that wrecking ball that is about to swing right through the Australian economy from 1 July because this Prime Minister broke her solemn commitment: 'There will be no carbon tax under the government I lead.' There was the Prime Minister in question time today, shrilly demanding that I stand up and guarantee that I might do this and guarantee that I might do that. Well, I tell you what, at least my guarantees count. At least my guarantees can be trusted, unlike those of this Prime Minister, who never again can make a solemn pledge to the Australian people because of her grievous deception, the deception that will haunt her to her political grave—that 'there will be no carbon tax under the government I lead'.

It is the world's biggest carbon tax at the worst possible time. Already, a month before the tax begins, there are jobs gone in the steel industry and jobs gone in the aluminium industry. Prices are up and routes have gone in the airline industry. Rates are up in the local government sector. You just have to look at the government's own documents—its own carbon tax modelling. It says that there will be a 21 per cent decrease in steel and iron production in this country, a 61 per cent decrease in aluminium production in this country and, absent carbon capture and storage, coal generated power in this country will fall from 70 per cent to 10 per cent. That is why the carbon tax is the death of the coal industry. The whole point of a carbon tax is to make using coal and using gas more expensive—too expensive, in fact—for us to use as opposed to the alternative.

This is a country that is suffering because of an incompetent government that just cannot be trusted with the economic management of our great country. Every day this government does more damage to families' cost of living. It does more damage to job security. But there is a better way. This is a great country let down by a bad government. There is nothing wrong with Australia that a change of government would not improve.

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

It is great to be able to contribute to this matter of public importance. Talk about the hypocrisy of the Leader of the Opposition, coming forward and talking about consistency when it comes to economic policy. When it comes to consistency on economic policy, the only thing he has consistently been is confused. He has been confused on just about every front when it comes to economic policy.

Opposition Members:

Opposition members interjecting—

Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

The Assistant Treasurer will resume his seat for a moment. If there are members wanting to leave the chamber, would they do so quietly and quickly and not conduct secondary little conversations, standing out of their places.

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

Members might want to reflect upon the last time that they saw the Leader of the Opposition walk into this place and talk about the good news that exists about this economy, about one of the strongest economies in the developed world. As a member of this government, I am very proud of the record that we have. I am very proud, as a member of this country, as an Australian citizen, that we can stand tall and proud in having one of the strongest economies in the developed world.

Let us have a look at the strength of the economy, because you will not hear it from those opposite. They do not want to talk about it. Their approach is to talk the economy down. At every opportunity they want to talk it down because, to them, more important than economic success is political success, and they have equated political success with talking the Australian economy down. That is why at every opportunity they come into this place and they talk the economy down. Let us have a look at the fundamentals of this economy. Let us have a look at what every major institution has said about the Australian economy, whether it be the IMF, the OECD. They all say the same thing, and that is that we are standout performer on the world stage, that this is a strong economy. Not only is it a strong economy, but we as a government are determined to spread the benefits of that strength. That is the difference between us and them.

The Leader of the Opposition came in and he started talking about class warfare. He said, 'The problem is that the government want to conduct a class war; they are just not very good at it.' The truth of the matter is that the Leader of the Opposition wants to conduct a class war. In his budget reply speech he came forward and said that $150,000 is not a huge household income. Well, nobody is proposing to take an axe to any of the benefits or entitlements that people above that have. Nobody is proposing to do that. But the Leader of the Opposition is proposing to rip money away from people on incomes of less than $150,000. This is the class warfare that the Leader of the Opposition wants to wage—on anyone on low and middle incomes. And in fact we all know that, at the end of the day, he will sing to the tune that the piper plays. The piper, we all know, is Clive Palmer and Gina Rinehart—Clive Palmer because of his considerable contributions to the Liberal National Party. We know about those considerable contributions, and the donations that he makes are so important that they could not do without them and they have to put up with his crazy comments every now and again.

Let us look at the strength of the Australian economy. There is low unemployment, at 4.9 per cent.

Mr Frydenberg interjecting—

The member for Kooyong would not know an unemployed person if he tripped over them; that is his problem. He might have met one once. Well, I tell you what, we stand for those hardworking individuals out there that deserve the right to employment. That is why we fought hard to deliver support for the economy during the global financial crisis. Hundreds of thousands of Australian workers are only in a job or only stayed in a job because we took some decisions to invest in and support those jobs. That is what we did. Those opposite voted against it. The Leader of the Opposition actually did not vote against it because he did not come into the chamber. Just to remind members, this was not one of those occasions where he came in and then tried to scurry out of the chamber; this was one of those occasions where he just fell asleep. The biggest global event since the Great Depression, and the man who wants to come and sit on this side of the chamber, who wants to get his hands on the Treasury benches—he fell asleep through it. He slept through the whole thing. He slept through the global financial crisis and certainly was not here to stand up for the people across this country that needed our support.

We stood up and we acted. It is not only about low unemployment. Have a look at contained inflation—it is well and truly within the band that the Reserve Bank looks at. We know that is so important to families and businesses all around this country. We do not want to put pressure on interest rates. They put lots of pressure on interest rates. Remember they were the party that were always going to keep interest rates at record lows. What about the 20 warnings that they got from the Reserve Bank to cut their expenditure, to address infrastructure bottlenecks, to address capacity constraints? They never did any of those things. They did not listen to the 20 warnings they got from the Reserve Bank, and interest rates went up and up and up—10 consecutive increases in interest rates.

Working families around this country and small businesses around this country will know that interest rates are lower today than when we came to office. A family that has a mortgage of $300,000 is paying about 3½ thousand dollars a year less. They come in and they talk about the carbon price impact. Let's wait and see. If you can find me a family that ends up getting slugged by that amount, then that will be really interesting to see. We have low unemployment, contained inflation, net government debt amongst the lowest in the world—

Mr Frydenberg interjecting—

Not growing, as the member for Kooyong protests, peaking this year amongst the lowest of all of our competitor economies—9.6 per cent net debt—and we are returning that figure lower and lower as time goes by. In addition to that, we have a record pipeline of investment coming into the resources sector. Members could be forgiven for thinking that most of that money was flowing in from the pockets of Liberal members, because they have all decided to invest in the resources sector. We have seen how confident they are in the success of the resources sector. Don't listen to what they say, but when they stick their hand in their pocket—the member for Kooyong knows; he is laughing. He is laughing because he is watching his stock prices go up, he is watching the strength of the resources sector and he is going out and investing more.

There is considerable investment in the resources sector that extends beyond the pockets of the Liberal Party members. Half a trillion dollars worth of investment is coming into the resources sector. So you have to ask a question. They said the mining tax was going to kill the resources sector. They say the carbon price it is going to kill the resources sector. If all of these things are going to kill the resources sector, firstly, why would they be investing in it? But, secondly, why would half a trillion dollars worth of global capital be flowing into this sector? It is because people have confidence in the strength of the resources sector and they know that the mining tax was always what we said it was about, and that is just making sure that we get a reasonable return for the Australian people on the resources that we all own. Those opposite think that they are the preserve of the rich and the privileged, that because these people are investing the capital to extract it they should take all of the profit. They only get the opportunity to do that because the Australian people give them permission to extract the resources. In giving that permission, we think it is only fair that we secure a fair return for the Australian people. That is what we are doing.

If those people ever get the opportunity to come into this place as a government at some point in the future and they want to repeal the mining tax, that will be one of the most shameful public policy decisions this country has ever seen. To hand back a tax cut to some of the wealthiest entities in the world at a time when our economy is doing so well, but those particular sectors are doing particularly well, would be an absolute disgrace—and they know it. When they go around and talk to people in their communities, they hear the same message. There are plenty of people out there that are not experiencing the benefits of the mining boom. We want to make sure they get their fair share. That is why we are increasing family payments. That is why we have delivered a schoolkids bonus.

Mr Frydenberg interjecting—

The member for Kooyong walks right into it. He says, 'And cutting company tax.' He would be the first member for Kooyong in that seat's history to come into this place and oppose a tax cut for business. In fact, he should be disendorsed. How could any respectable member for Kooyong come into this place and oppose a business tax cut? You are a disgrace to your predecessors. Menzies would roll in his grave. Even the more dissenting members for Kooyong, those who on occasion took a more aberrant view, would have supported a tax cut for business. You are one out, and you did it because of the relentless and destructive negativity of the Leader of the Opposition. It does not matter what we propose, he will say no. This government could propose the canonisation of Mother Theresa and he would oppose it, because at the end of the day he says no to everything—except for a big fat tax cut to some of the wealthiest miners in this country.

On the question of consistency of economic policy message, we have heard from the others—they do not even know if they would deliver a surplus if they were in government. You listen to the member for North Sydney, you listen to the Leader of the Opposition, then you go and listen to the member for Goldstein or Senator Abetz, who said, 'We're not in the business of making any outlandish promises.' We are not making outlandish promises. We are delivering a surplus, and we are going to deliver increasing surpluses over the forward estimates. That is what we are going to do. The member for Kooyong points to the carbon price. If you are interested, we are delivering an emissions trading scheme with a three-year fixed price. They went to an election saying they wanted an emissions trading scheme. The member for North Sydney has come into this place and has said, 'Pricing carbon is inevitable.' Okay, so it is inevitable. So when are you going to do it? 'Not just now.' So when is the member for North Sydney proposing that we price carbon? When does he think is the best time to do that. John Howard, whose mantle they seek to try to cling to, already got there. He got over the line on this one. He decided that a carbon price, an emissions trading scheme, is what this country needed. He said very proudly at the time that if we want to maintain our competitiveness as an economy in the future, these are the hard decisions that governments have to take. I do not know anyone out there that seriously thinks that in 50 years time this country will be able to rely on fossil fuels in the way it does today or has in the past. If you believe that, then you realise that the process of beginning the transformation towards less dependence on fossil fuels and greater reliance upon a clean energy future are the hard decisions that governments have to take. We are taking them. We are taking them in difficult circumstances through a minority government. The member for Cook might be lucky enough to come back into this place at some point in the future and actually have to make a concession—to confess that he got it wrong. In fact, he got it right when he went to the election in 2007 promising an emissions trading scheme. He got it right then. But he got it wrong this time. They have got it wrong.

This government is taking some hard decisions that will make the structural changes that our economy will need for the future. That is what we have done. They all know it. Governments in the past have taken those hard decisions, quite often with some political cost, but in the end we all enjoy the bounty of that today. That is why we have one of the strongest economies in the world. It will keep going from strength to strength. It will keep growing.

The Leader of the Opposition comes into this place and says, 'We are all about wealth creation, not wealth redistribution.' I tell you what: no government in the advanced world, no developed economy, has been more about wealth creation since the global financial crisis than us. That is why our economy is seven per cent larger today than it was before the global financial crisis. No developed economy in the world has grown in that period to the extent that we have. The only reason we even get to have a debate in this country today about wealth redistribution is that we have created the wealth. Along with industry and the private sector, this government has created wealth. We helped to create that wealth by investing and supporting jobs through the global financial crisis. As for those opposite—and the Australian people will always remember this—when the tough times hit we were there to stand up and to support jobs, while they were asleep. And now we see that they just cannot wait to scurry away from the chamber at every opportunity, because they do not want to be here for the hard decisions.

Warren Truss (Wide Bay, National Party, Leader of the Nationals) Share this | Link to this | Hansard source

Now more than ever Australia needs a steady hand at the wheel, and they do not have one. Our economy, business and families alike, crave surety and a logical, consistent and predictable government that they can rely on, and they do not have one. Even this week's Labor infighting, as it gathered pace amongst the backbenchers, as they rolled the Prime Minister's control over vital resource sectors, just showed once again how this government has completely lost its way. It has no idea what kind of direction and course to set for our country. They follow the demands of the Greens. They follow the demands of the union heavies, knowing that they are already circling around the Prime Minister for the next time a leadership challenge happens.

The political intrigue that is paralysing Labor, though, not just has a cost for Labor; sadly, it has a cost for the whole of the country. It is a real cost. This instability at the top and the crisis of confidence in the Prime Minister's decision-making comes at a precarious time for all businesses, big and small across all sectors. Labor has pushed Australia to another economic crossroads, one we do not need to be facing. It has come at a time so soon after they inherited a strong and robust economy. They inherited surpluses, they inherited savings—savings that could be used for the future. All that has been squandered, all of that has been lost, and this government continues on its endless path of destruction.

This government has eroded Australia's great natural competitive advantages—the things that have made us great over the years, the reasons why companies and investors wanted to come to Australia, the reasons why Australians worked so hard to build their own country. All of these things now are being eroded by a government that has completely lost its way and lost a vision for our future. We have seen in the last couple of days practical evidence of that, as Australia has slid down the index of competitiveness, slid down the index of ease of doing business. This is an embarrassment and a humiliation to a once great country.

Let us look at some of those competitive advantages and what Labor has done to them. We once had low-cost electricity. That attracted mineral processors—smelters and refineries for aluminium, gold and copper. Energy-intensive manufacturers actually wanted to come to Australia because we had this natural advantage. But now what has Labor done to destroy this great advantage? They are buying Australia's low-cost power stations and closing them down. They are closing down our big competitive assets. What they are doing is introducing a carbon tax that is going to massively add to the cost of electricity and make it so much less attractive to come to this country.

The Business Council of Australia has identified 240 federal and state energy and climate change policies which are adding to energy costs and eroding our competitive advantage. Is it any wonder that no new low-cost power stations are being built in this country? This government does not want them and therefore it does not want the jobs and the industries that would be attracted—and it does not want the jobs in the industries and factories that are currently closing. They have indeed lost their way and squandered one of our competitive advantages.

We as a nation have abundant resources of high quality that have been relatively accessible. Under this government the ease of doing business in Australia, according to the World Bank index, has slipped from eighth to 15th. These abundant resources are no longer easy to access. This government has made it harder to get there. They have done it through endless bureaucracy—bureaucracy that guarantees now it takes years to get an approval for any project. In question time yesterday we even heard the Minister for Sustainability, Environment, Water, Population and Communities, Tony Burke trying to make a virtue out of taking years and years to make decisions about environmental approvals. He was embarrassed that the new Newman government, after only a few weeks in office, was able to give approval to projects, whereas he still has years of work to do to get through his environmental assessments. This is the kind of thing that discourages people from investing in this country. Then we have inadequate ports and railways, because the government has been unable to initiate the key projects that are necessary to service these industries.

One of the other major reasons industries came to Australia was that this was a country with low sovereign risk. The governments have traditionally been stable. They have been trustworthy, they have honoured their promises, they did not change the rules every second day. Now we have a government that does not control its own agenda. The Greens run the country and the unions run Labor. The reality is they cannot make the decisions that are necessary to deliver the kind of stable environment that would encourage investment. They cannot manage themselves, let alone manage a successful economy. They stumble from one political disaster to another. There is no stability in the investment climate either. Remember the words, 'There will be no carbon tax under the government I lead.' That was a clear statement, a clear signal to the world's business community that you could come here and not get a carbon tax, you would not get this extra cost burden. The promise lasted just a matter of days and it was dishonoured.

Then we have the mining super tax. People invest in this country in mining schemes on the basis of an economic environment that has been passed into law through the legislation of the parliament, and Labor just simply changes it as though it has no substance. Their super tax on mining has damaged industry confidence to ever make an investment because they know the rules will be changed yet again. Labor has changed the withholding tax for investors on numerous occasions. There can be no certainty for an investment when this sort of thing is happening. The promised tax cuts have been abandoned altogether. Labor never cuts taxes; Labor only puts them up. That is just the kind of environment that sends investors to other parts of the world.

Then the Prime Minister promised everybody that they could have an EMA so they could get some of the workforce that they needed. She was quite happy to tell the mining companies that she supported EMAs, but then she told the unions precisely the opposite. She wants to walk away.

An opposition member: She is furious.

Yes, she is furious about the idea that this might happen. Then there are the changes to the shipping industry. Legislation has gone through this House this morning on the transport industry, which gives control to the unions in key sectors of the industry and guarantees that the sovereign risk in coming to a country like Australia will continue to grow.

Another major advantage that we had in this country was the productive, skilled and reliable workforce. Once we were skilled with a reputation for productivity, even if our wages were a bit higher than those of other parts of the world. But that is also being lost. On the world competitive index Australia has slipped from fifth to 15th, and industrial lawlessness is one of the issues that is raising its head again and again. Jac Nasser, the head of BHP, reported just recently that the BMA consortium had experienced 3,200 industrial incidents in just one year in the Bowen Basin.

How can a company invest or make decisions for the future when it has to put up with 3,200 industrial incidents in a year? In many of these instances they use the Qantas strategy, where the unions call a strike and then call it off just at the last minute so they can keep their wages but the maximum disadvantage is done to their employer. Where are these unions coming from that believe they can actually achieve things for their members by destroying their employer? What is the sense of destroying the company, destroying the industry and destroying the competitiveness of our nation just in the name of some kind of industrial power and industrial lawlessness? Many of these unions now want to take control of the decision-making in their companies. How is anybody going to invest in those circumstances?

Labor is fond of boasting that there is $500 billion worth of projects in the pipeline. Yes, they are in the pipeline and they are stuck there. The pipeline is choked. It is blocked up by government red tape and green tape and black tape and it needs a good decent flush out. A clean-out is what is desperately needed and it is going to have to go right to the top. This government must go if we are going to restore confidence in our country and restore our competitiveness so that we can deliver a decent lifestyle for all Australians.

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

Anyone listening to the debate in here would be questioning. They would really be thinking about the grim reaper's hand of death already on the shoulder of the Australian economy and on Australian business and Australian people. This could not be further from the truth. The opposition can wish it all they want. The opposition can wish for the end of business in Australia. They can wish for a bad economy. But they are not going to get their wish from this government. This government will continue to work hard to deliver a surplus budget, to deliver a strong economy, to deliver jobs for Australians, to invest in our schools, to help families with the cost of living, to do the things that governments are meant to do to assist not only the economy but also to make sure that ordinary people—people at home listening to this, people that go to work every day, people that educate their kids—get a hand-up, assistance and support from their government, not this negative claptrap that we hear from the opposition.

It does not get any more palpable when you come into this place at question time. Every word that is uttered by the opposition is about negativity. It is about bringing down the economy; it is about ramming down confidence. At the same time that they are talking down the economy, they are wishing for Australia to become like Greece. This is their wish because, in their minds, the faster that would happen the quicker they would get government. That is their strategy and their plan. It is to bring down the economy. Let us burn the place down because by doing that we will have proved something and we will get to government quicker. This government is not going to do that. We are not going to sit by idly. We going to do the tough things and the hard things. We are going to do the things that are necessary for this economy. And you might ask why. Why would we do this? There is a very simple answer: because people deserve to keep working. They deserve to have a job, and that is what we are doing. And I think it is pretty well reflected in the unemployment figures. Look anywhere in the world, pick a country and make a comparison with Australia. You cannot wish that away. You cannot wish the numbers away, because it is the same methodology that the Australian Bureau of Statistics have used for 30 years. That same set of statistics and data say that there is now only 4.9 per cent unemployment in this country, down from 5.1 per cent. That is a record that is better than when the Howard government was in, better than the golden years when the rivers of gold used to flow to Canberra. They had more money than they could ever budget for. They used to predict a surplus and it was always big, but they did not have a clue how much money was coming in to the economy. They were good days. The whole world was peaking. Tax was a lot higher; people paid more. It did not matter which measure you used, everyone paid more tax. In fact, people paid more for their mortgages as well; interest rates were higher.

But in tough economic conditions this government has been able to do the hard yards, the hard work—nose to the grindstone. Not for us the death hand of the grim reaper trying to choke the confidence of Australians, trying to choke small business, turning up at some poor small business and telling them that they have nothing for the future, that they should just lay everybody off and give up—when the next day those same businesses announce growth, they announce new profits and good things happening. This is all that the other side look for. They look for the doom and the gloom. They wish it every day. I can see the Leader of the Opposition, Tony Abbott, kneeling down beside his bed at night and saying, 'God bless Mum, God bless dad, God bless Australia and, please God, wreck the Australian economy so I can become the Prime Minister,' because the quicker he thinks he can wreck this economy the quicker he believes that he personally will benefit and become the Prime Minister.

But nothing could be further from the truth, as you will see if you pick any report in the world—I am very confident about picking any report in the world. These guys are looking every single day and thinking, 'Can we just find one little bit of negative reporting on Australia?' They cannot turn to the rating agencies because for, the first time in our history, in over 100 years, this Australian economy under this Labor government has managed a AAA rating, the highest possible rating you can get across all three agencies. Where are the geniuses on the other side? Hang on, one of them just walked in. By the way, my offer is still on the table: if you want to run faster, I am happy to give you a few tips on how on this side we run the economy a little bit faster, how we speed things up; how we get investment into the country; how we keep people in jobs and how we make a difference to people's lives. In the end there is a measure of difference. It is called 'people having a job'. It is called 'being able to pay the mortgage', which of course is cheaper under Labor, because people, on average, are paying at least $3,000 a year less.

The shadow Treasurer shakes his head. So what? He shakes his head at everything; it would not matter what I said. If I said, 'Do you want an ice cream?' he would say no. It does not matter what I say, he would shake his head so it does not worry me too much. The reality is that the data does not lie, nor does the economy, nor does business growth, nor does the half trillion dollars of confidence—dollars, investment, confidence. So while they are saying that the coal industry is dead, energy is dead, retail is dead, manufacturing is dead—you name it, everything is dead—and that on 1 July we will all wake up with a scorched earth and nothing left, of course, we all know that that is just hollow rhetoric designed to do one thing. And this is the sad part: small business people are out there trying to create more work, keep themselves and their workers employed and do something for their families—in fact, trying to do something for the economy. But every day they hear negativity from the Leader of the Opposition. He cannot run fast enough to get out of this place. He is banging into walls to get out of this place so he can talk down the economy.

I will tell you who has got some confidence in our economy. I will give you some idea. Every other country in the world looks at us and says, 'We'd hack off our right arms to have just a little piece of your good economy.' Who else has got confidence in our economy? We have on this side. We have confidence in our economy and we will keep working hard to grow it to make sure people have got jobs. Who else has got confidence in our economy? All of those people who have poured half a trillion dollars worth of their money into our economy based on one thing: they believe we are growing, they believe we have a bright future, they believe it is good. I will tell you what, there is another interesting group of people who think we have some opportunities, some good news, some growth. While the Leader of the Opposition sits here and talks down the end of the earth as we know it, Liberal National Party members on his side are out there buying the very stocks and shares of the things he is talking—

Mike Symon (Deakin, Australian Labor Party) Share this | Link to this | Hansard source

Follow the money.

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

Absolutely—follow the money. Put your money where your mouth is. While their leader tells everybody, tells the mums and dads, 'Oh, no; it's all over. There's nothing left in the Australian economy. There's no confidence,' what do his guys do? They go and put money on the table and say, 'I'll take a wager on that because I think things are going to go up.' You do not put money on the table unless you think there is a good, bright economy ahead, and that is exactly what there is—a strong economy despite—

Opposition members interjecting—

I love hearing from that side. They talk about the politics of envy. The worst politics of envy is this: they envy the Greek economy! That is what they want. That is the real politics of envy. 'Please, please give us a Greek economy.'

An opposition member: You're on your way!

If we are on our way, I am satisfied that we are well placed to survive the worst because we have done the hard work. We actually do our homework. On this side we have actually done the right things. In one of the toughest global economies that this planet has faced for a long, long time, we did the hard work to make sure we delivered a surplus. We made sure that we invested in schools. But the book burners over there, the antiscientists, the antiresearchers, have a plan to save money. They say, 'Get rid of teachers, that'll save a lot of money. Let's not have so many schools. Science and research is overrated, why would we waste money on things like that? Computers in schools—who needs them? Computers are overrated.'

Let me tell you about the success of investing in education. If we start talking about the Asian century then we have to do something about it. I heard the other day the shadow Treasurer talk about the Asian century, but he just said, 'Let's just run faster.' Which direction? To it or away from it, because all I can see on this side—

A government member: Out the door.

Out the door—that is exactly where they ran. They are scared of it. On this side we are not scared of it, because Australia is in the right place at the right time, with the right government and the right economy. We are the right government because when it comes to facilitating jobs we help that happen. When there are big projects in this country—you can look me in the eye—we help facilitate them.

Roy Hill is a fantastic example and one of the best news stories I have heard for a very long time. It shows that on this side we are prepared to help create and facilitate jobs and projects. It is just one of up to 30 new projects, part of the half-trillion dollar investment, and 6,500 new Australian jobs will be created just in that one project. (Time expired)

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

Just before coming here I was reading an article that leads the Financial Times called 'Rush for havens as Euro fears rise'. It identifies that 'US benchmark borrowing costs have plunged to their lowest levels since 1946', and UK interest rates have fallen to '1.64 per cent, the lowest since records for benchmark borrowing costs began in 1703'. US 10-year yields are down to 1.62 per cent, which is a level last reached just after World War II, and German two-year bond yields have fallen to zero for the first time, meaning that people are prepared to lend money to Germany for two years without any interest rate, without any return, simply to get their money back.

If you believe the logic of this government when it talks about the cash rate in Australia falling, which we would encourage in a strong economy with lower funding costs, all of this is good news. But there is a rush to safe havens at the moment because there is growing uncertainty about where the Western world is heading. Europe is one great big Ponzi scheme at the moment. At every moment where there appears to be money lost or about to be lost they reach again for the debt lever. That is the challenge. Who is well placed?

Everywhere around the world people are trying to re-price sovereign risk. It is the single most significant challenge for the globe and for capital markets over the next 20 years: how to properly price sovereign risk. We are going through it again in Spain. It was Greece a few weeks ago and it continues to be Greece into the future, but it is not just Spain and Greece. It is France. It is the United States, with its near default on its loans. It is the Western world that is now being sized up for sovereign risk. Even though there is a rush to invest in places like the United States, the United Kingdom and Germany I would say it is because they are seen as safer havens than other jurisdictions.

This is an opportunity for Australia. Sure, there are significant inflows of money at the moment, and significant interest in buying Australian government bonds and state government semibonds, but there would be more interest and greater investment in Australia if we had a government that was consistent, predictable, reliable and trustworthy. CEDA has put out the World Competitiveness Yearbook results, which show us slipping from a nine ranking to 15 in the last 12 months. The government said this is all about the currency, but I see that Canada is well ahead of us and it has had a similar surge in the value of the Canadian dollar because, much like Australia, it has a vast amount of resources that are attractive. But in Australia there has been a relatively significant deterioration in labour regulation, transparency, labour relations, government decisions and the stability of those decisions, and environmental laws that made it all much harder. Those factors have played into our reduced competitiveness.

That follows on the back of other reports that identify that government decision making is having an impact. For example, even when we had solid results from the ABS about infrastructure investment, JP Morgan today put out in an Australian economic research paper that 'key project sponsors have complained about rising costs, labour and capital, of being strangled by worsening regulation and green tape, of lower commodity prices and slower growth in China'. These calamities, they argue, 'risk important projects being delayed or even scrapped'. The author recognises there may be some posturing by those companies, but the fact is the companies would not be saying it if they did not mean it because they rely on that investment. They rely on a stable, predictable investment environment, and how could it be stable and predictable in the face of initiatives like the carbon tax?

The Treasurer and Minister for Trade in Queensland, Tim Nicholls, released at nearly three o'clock today an analysis of the impact of the carbon tax. He identified: that it could see 21,000 Queenslanders lose their jobs; that real wages could be reduced by up to $2,940; and that Queensland's gross state product could take a hit of $9.6 billion as a result of this.

This is because the government is so uncommercial. It does not understand what sovereign risk is. At a time when the rest of the world is unstable we should be stable. At a time when the rest of the world is uncertain we should be certain. At a time when there is a lack of confidence in other parts of the world we should be confident. Yet listen in the words of people who actually invest, like Ian Matheson, Chief Executive Officer of the Australasian Investor Relations Association, on a survey of the top 200 ASX companies, said:

In the comments from corporates, obviously reflecting what is being told to them by international investors, there is absolutely no doubt there has been heightened concern about things such as the carbon tax, the MMRT (minerals resource rent tax), growing industrial dispute activity and sovereign risk generally. That has been going on for 12 months now.

I think that is a bit generous.

John Stanhope, former Telstra CFO, said on 17 May, 'So people looking outside of Australia think we are a sovereign risk because of the uncertainty created by policy fluctuation.' Bernie Ridgeway, managing director of Imdex was quoted in the West Australianthese are all this month—saying:

You're taking a previously blue chip jurisdiction for investment (Australia) and we're turning into something where we've got sovereign risk and uncertainty.

David Knox, chief executive of Santos and chairman of Australian Petroleum Production and Exploration Association, said:

My clear message to the Australian Government is: do not create uncertainty.

Instead provide our investors with the confidence in Australia as a stable fiscal and regulatory region—allow us to stay competitive.

The list goes on, with Christoffe de Margerie, Total chairman and chief executive. Why do people say this? This is a list of Gillard government broken promises and changes to policy since the 2010 election—none larger than: 'There will be no carbon tax under a government that I lead.'

Everyone in Australia and around the world knows that was a solemn pledge from the Prime Minister and it has been broken. That is an example of sovereign risk writ large. There are others. The Prime Minister promised community consensus on taxing carbon and broke that promise. She promised to cut company tax and was going to stick with it, but broke that promise. She promised a $500 standard deduction on tax returns, broke that promise. She promised foreign aid increases, said they were absolutely committed to meeting those goals by 2015, and broke that promise. You would remember the 50 per cent discount on interest income, another broken promise. The green buildings tax break was changed. Increased defence spending, broken. Reinvesting defence budget savings, another broken promise. Sparing the Public Service from budget cuts, broken. Private health insurance rebate changes, broken. Gambling reform and the agreement with Andrew Wilkie, broken. Consulting clubs on gambling reforms, broken. A new era of openness and transparency, broken. Onshore processing generally, broken. Processing refugees at Curtin, broken. Processing refugees at RAAF Base Scherger, broken. An onshore processing centre on East Timor, broken. A citizens assembly, broken. Cash for clunkers, mining tax royalties, BER costings—all good recommendations, as is the solar credit scheme. Delay of the national curriculum, reform of health and hospitals, a tax summit by 30 June, asylum seekers to Malaysia, the Pacific solution hypocrisy, budget neutrality of the carbon tax—it goes on and on and on. I have another 30 broken promises.

You wonder why there is sovereign risk. You wonder why there is confusion out there. It is the words and deeds of this government that are creating unnecessary sovereign risk for Australia. (Time expired)

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

It is a truism in politics that we get our own arguments but we do not get to have our own facts. Any discussion of the state of the Australian economy has to rest on basic facts. Let us start with a couple. Only rarely in the post-war era have unemployment, inflation and the cash rate all been below five per cent. We are in one of those moments right now. Fact No. 2: not once in the Howard or Fraser governments, about 20 years in office, was there one single year where government spending was cut in real terms. Yet as Stephen Koukoulis has pointed out, Labor governments have cut real spending in five years since the mid-1980s.

Cutting real spending is not easy. It requires making some pretty tough decisions, but we have done it when the times have demanded it. We have also increased government spending when the times have demanded that. That is what Keynes taught us in the teeth of the Great Depression: when there is a big drop in private demand, governments should step in to fill the gap. But those opposite think that governments should never go into debt. They have an anti-debt strategy.

We have heard already in this debate about those opposite having a different attitude when it comes to their private affairs than they do in their public affairs. Privately those opposite are buying mining shares, while publicly they are talking about the collapse of the mining industry. Privately those opposite take on debt. They do so for a perfectly good reason. They take on mortgages early in their lives and pay them off later in their lives. As Richard Dennis pointed out in a column in today's Australian Financial Review, debt is not a villain and Australia's debt is among the lowest in the developed world.

Those opposite are playing a dangerous game with confidence. Business confidence is not created by government. Business confidence is the responsibility of all. It is the responsibility of business leaders—and I have to say that some business leaders could have exercised a little more responsibility over recent months in maintaining the business confidence that benefits them as well. Business confidence is also the responsibility of those opposite. All of us have a responsibility to speak in terms of facts when it comes to the Australian economy.

We are putting in place a carbon tax because we know that is the right way of taxing non-renewable resources that can only be taken out of the ground once. These resources are not owned by any individual, but are mined thanks to the agreement of the Australian people. We are putting in place a price on carbon pollution that will see Australia's emissions cut by five per cent by 2020. That cut could have been put in place two years earlier, had those opposite stuck with their then leader or had the Greens voted with those Liberal senators who defied their new leader and voted for the CPRS legislation. Yesterday in this House the member for Melbourne took issue with some facts that I had placed on the record, that by voting against the CPRS package the Greens were responsible for an extra 10 million tonnes of carbon pollution, the equivalent of annual emissions of two million cars. The member for Melbourne said that somehow my comments 'exercised gall' and such actions would not have resulted in a better outcome for the planet. But that is not the case. We have very clear modelling that had the Greens or the Liberals supported carbon pricing legislation two years earlier we would have gotten fewer emissions.

We have a price on carbon pollution now and it is a price we had to put on. We are acting early. Those opposite would have us put our heads in the sand on every economic reform. They would have us put our heads in the sand on the minerals resource rent tax, carbon pricing and good economic investments.

Debate interrupted.