Jason Clare (Blaxland, Australian Labor Party, Minister for Home Affairs ) Share this | Link to this | Hansard source

I present a supplementary explanatory memorandum to the bill and I move the government amendment:

(1) Schedule 1, item 1, page 3 (line 4) to page 5 (line 22), omit the item, substitute:

1 Section 6

Omit "$47", substitute "$55".

This amendment removes indexation of the passenger movement charge from the bill. The proposed increase of $8 will occur from 1 July 2012. The increase without indexation is expected to result in $485 million over the four years from 2012-13.

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

This is the third strike. Isn't it of great interest to everyone that when these ministers come in to give these humiliating backdowns through an amendment to their own legislation, they have the shortest speeches? It could be a 45-second speech, which is the smallest limit on a speech in this place. But here we have the minister come up and, in a low tone, say, 'Look, we are changing our legislation—the legislation that we introduced only a few days ago; the legislation that was again the cornerstone of the budget—and we are dumping the CPI increase'. I want you to hear this. You guys have gone through more wheels and turns on this than a rotor blade. How do you feel about that? Aren't you humiliated? Be it the passenger movement charge or be it withholding tax on managed investment schemes, who is running the shop over there? Who is running the shop? It is a simple question.

Minister, I ask you to come up and explain why you are dumping this proposal from your bill and why you have not said it in relation to the amendment. They will not say it because pride beats big time in their chests. No, the fact of the matter is the Labor Party was staring yet again at defeat on a budget measure that they got dead wrong.

For how long have we heard the Treasurer in this place talk about a patchwork economy? He rarely says it these days. He would get up here and he would bleed for the tourism industry. The shadow tourism minister would say it is outrageous the way they are treating the tourism industry. But the shadow tourism minister and all the people on this side of the House were saying that the tourism industry is doing it tough because of the high Australian dollar and because of what is happening overseas. The government says, yes, the tourism industry is doing it tough. But the government's logic—like its logic in so many other areas—is to increase taxes on the industry because taxes are good to you and good for you, according to the Labor Party. We want you to double the carbon tax, double the mining tax and double income tax. Double all those taxes is what the Labor Party should do because there is one thing about the Labor Party you know and I know: they know how to tax. They know how to hit you in the hip pockets.

Just today we had a bill on interest on withholding tax in managed investment trusts. The Labor Party announced in the budget they were cutting it from 30 per cent to 7½ per cent, which they did previously, then they were going to double it to 15 per cent. And today they excised it from the bill. What happened? After question time they said they were going to reintroduce a new bill in exactly the same way tomorrow. How does that work? Why are they doing that? Senator Penny Wong, the Minister for Finance and Deregulation, belled the cat when she said they could not get it through because of the opposition and the Greens. Then why are they re-introducing it tomorrow? If you were wondering about sovereign risk, if you were wondering about negativity then look no further than the Labor Party in relation to this. They say the industry is doing it tough, so then they hit it with an increase in the passenger movement charge. By the way, they will not just hit you in the coming budget for the coming year; they are going to hit you every year after that because that is what the Labor Party does.

How humiliating for a minister to come in here and amend his own budget bill. It is like that great scene at the end of TheHunt for Red October when the Russian ambassador comes in and says, 'Mr Minister, we have lost Red October.' The American official says, 'What? You've lost another one?' Here we have it, groundhog day: what, you have lost another budget measure? Where did that go? Is it in the dispatch box? Is it under the table? Is it hiding under the shoes of the member for Paterson? Where is it? Where is the budget measure?

The bottom line is that when it comes to tax you do not want to stand between the Labor Party and a new tax policy. When it comes to treating the tourism industry with contempt, the Labor Party is A1. They are the best. Look no further than this bill and look no further than their humiliation on this amendment.

Michael Keenan (Stirling, Liberal Party, Shadow Minister for Justice, Customs and Border Protection) Share this | Link to this | Hansard source

This is the second time we have seen a minister walk into the parliament today and amend their own budget bill: for the passenger movement charge that we are now discussing and, earlier today, for managed investment trusts. The latest amendment comes on top of the fact that this minister, the Minister for Home Affairs, has just announced that they have had two more illegal boat arrivals, carrying over 120 people, at Christmas Island.

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

What?

Michael Keenan (Stirling, Liberal Party, Shadow Minister for Justice, Customs and Border Protection) Share this | Link to this | Hansard source

Two more illegal boat arrivals carrying 120 people. That means that since the budget and these two backdowns on the budget, they have had 1,800 people arrive illegally in Australia in the past six weeks. That is the equivalent of 300 people coming into Australia illegally per week, and the government budgeted for 450 to come per month. So we are getting 1,200 a month, the government have budgeted for 450 a month, they have already taken $400 million out of their budget bottom line today alone, plus there is the blowout we are going to get in processing charges for all the extra illegal immigrants that are coming down. When you add all of that, their $1.5 billion surplus, which nobody believes they are going to get anyway, is completely blown away.

This passenger movement charge is really the final insult for the tourism industry. The government have slashed funding for the facilitation of passenger movements in and out of Australia and that has led to increased processing times for people coming to our country and leaving our country. At the same time they are getting more money from the people who are moving through our borders. So you can wait longer and you can pay more: this is life under Julia Gillard's Labor Party.

Unfortunately, Customs is an agency that has been systematically targeted by Labor since they came to office. The $34 million cut for passenger facilitation that I have just outlined comes on top of another $10 million cut in the most recent budget. This is occurring at a time when passenger numbers are going to move from approximately 32 million to 38 million over the next four years. So this hit to Customs means that people are going to be waiting longer but they are going to be paying extra for the privilege under the Labor Party. It means that the government's target of processing people within 30 minutes when they come into Australia is just not going to be met. Indeed, the government's own KPIs show that people are waiting longer: only 92 per cent of people are going to be processed within the time frame and, because of the budget and personnel cuts, that figure is only going to get worse.

The Australian Airports Association represents people who actually know what is going on at our airports. If you talk to them they will let you know how concerned they are about these Customs cuts. They tell us that in Australia's major gateway ports—Sydney, Brisbane, Melbourne and Perth—the processing time at peak periods for passengers has gone up by 24 minutes because of these Labor Party budget cuts.

There is absolutely no correlation between the passenger movement charge and what it costs the government to process passengers. The government's own figures tell us that they are going to be spending less on processing passengers—$240 million this year and then $230 million next year—at a time when they are going to be raising about four times that much from the passenger movement charge. The indexation was completely and utterly indefensible. It hit an industry that employs 900,000 Australians and it hit them at the worst possible time, when they are struggling from the effects of the high Australian dollar.

Don't let the minister, who came in here and gave a 10-second speech on his amendment, get away with the claim that the government are doing this willingly; that they have suddenly seen the light; that they have had a road to Damascus style conversion and realised that they cannot afford to hurt the tourism industry in this way. I have a copy of the government amendment here and we are happy to support it because it gives us the outcome we are seeking. It gives us that outcome because it is word for word, letter for letter, exactly the same as the amendment we moved yesterday.

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

Really?

Michael Keenan (Stirling, Liberal Party, Shadow Minister for Justice, Customs and Border Protection) Share this | Link to this | Hansard source

There is absolutely no difference between the government amendment and the amendment moved by the opposition yesterday. The budget is the most seminal document a government produces, outlining its priorities for the next 12 months. When you are in government and you cannot keep your budget alive for six weeks, you have forfeited the right to govern—and this is the second time today we have seen a minister scurrying in here to backtrack on their budget measures. (Time expired)

Bob Baldwin (Paterson, Liberal Party, Shadow Minister for Tourism) Share this | Link to this | Hansard source

Mr Deputy Speaker, I wonder if it is wrong for you to put a call out for somebody who is missing in action. The person charged with responsibility for the tourism industry in this country has not spoken in this debate. When I look at the speakers list for today I see he is not listed to speak, so I can understand why the government tried to guillotine debate. What is more telling about the list of speakers is that the government only had two people prepared to stand up and talk about the tourism industry.

The problem with the government is they do not connect or communicate with the tourism industry, and that is why we have this situation where they have had to have a second humiliating backdown today on their budget measures. If they had bothered to connect with the tourism industry they would understand the impact. Taxing development opportunities for foreign investment in the hotel industry is only going to drive investors away and therefore lead to less hotels being built. Taxing tourists means less tourists come. The government do not understand business because none of them, as far as I can see, has been in business. Not one has been in the tourism industry; not one has had their own money on the line making sure their business survives. So we have seen these two humiliating backdowns where the government have no control of their own budgetary measures.

Had the minister not gone to the National Tourism Alliance and said to them, not once but twice during that meeting in Cairns, 'There will be no increase to the passenger movement charge,' they might not have mounted the campaign which led to full-page advertisements condemning this government for seeing the tourism industry as an instant cash cow that offered little resistance. They stood up because the Minister for Tourism had told them there would be no increase. It is the same as with the carbon tax promise before the election. This minister, though, had also, as I said earlier, instructed his department to do modelling on a 20 per cent increase in the PMC and to work out his defences. What we have here is a minister who has not spoken on this bill, a minister who has not defended the increases. Yet last night at the Australian Federation of Travel Agents, Labor friends of tourism—and I was surprised that anyone turned up after putting these bills on—he told them that he was going to defend the CPI increase and the PMC increases. Well, Minister, we are prepared to allow the debate to go so that you can come into this House and defend your want to increase taxes on the tourism industry. What you do not understand, Minister, is that tax does not create jobs, only revenue for a very poor government.

The minister is not a bad bloke really, but he has just failed to connect. There was a movie once, called Failure to Launch, where somebody would not connect, would not make a commitment, and escaped at every possible opportunity. That was about marriage, but what you have got to do with the tourism industry is engage with them at least, and this minister has not. If this minister had engaged with the industry, he would have understood and listened to the fact that the PMC was bad news. He would have understood that amplifying it with a CPI increase was going to tip the industry over the edge. In fact not only does he not understand the industry, he also does not understand his own department and his own government. As I said earlier, this is the same minister who, the exact week before the budget took the flight up to Shanghai and launched a tourism investment policy to attract Asian investment into our hotel industry to build those much-needed 30,000 to 70,000 beds. The policy lasted about a week, because then they wanted to double the withholding tax. We have seen yet again another embarrassing backdown. Do know why you have to make backdowns? It is because you do not understand the industry and you do not connect. The minister for tourism is to stand condemned by this House, because he has already been condemned by the industry for failing to deliver. I welcome what is actually the amendment by the shadow minister for justice and customs, because that was put out in the marketplace and the minister has picked up on it and followed the coalition lead to protect our tourism industry. (Time expired)

Question agreed to.

Bill, as amended, agreed to.