Kate Lundy (ACT, Australian Labor Party, Shadow Minister for Sport and Recreation) Share this | Hansard source

It is interesting to see how the government senators resort to pretty shallow rhetoric to argue a defence of the government’s economic situation. It does not take someone with too much foresight to understand how much the Howard government has squandered the reasonable economic circumstances this country has found itself in through the last 10 long years. I would like to turn first to the issue of innovation and development of new industries and new sectors, particularly new technologies.

Over the last 10 years the Howard government has relied heavily, and more so lately, on commodity exports for Australia’s economic health and it has done the opposite when it comes to strategies to find new ways to create economic growth in Australia. It is only by the good fortune of the cycle of growth of countries such as China that our commodities exports are so strong, underpinning our economic growth. The manufacturing areas, particularly the high-technology area and the elaborately transformed manufacturing area, are shrinking at a rate of knots. So what we as a country have done over the last 10 years is decline in all of the areas that smart, clever countries have been investing in to grow their economies. Australia has been contracting precisely those areas and becoming more and more reliant on what we extract from the earth. This has left us particularly vulnerable, and in a way that, while it is healthy at the moment, is not sustainable for long-term future economic growth. It also has a series of flow-through effects in our economy, not least of which is how we try to shape our relationship with our trading partners in the future.

We have already seen how Australia can very easily become the provider of raw materials only to find our imports of elaborately transformed manufactures and high technology going through the roof. Our national foreign debt, standing at some $500 billion, I think—triple what it was 10 years ago—is testimony to that increasing vulnerability, to that reliance elsewhere and to our not being able to keep up our own part.

This has manifested itself in many ways. It has manifested itself in the loss of many of our clever people and great minds to overseas. It has resulted in a general lack of confidence in the education system in Australia, which I would argue was one of the finest and which has suffered so many damaging blows now. It is very difficult to stand proudly beside Australia’s education record when you see us sliding down the scale in expenditure on the OECD list. We are now spending less on education than most comparable OECD countries.

I mentioned earlier the decline in research and development, another area where this government has made some very tough decisions to reduce investment. This was particularly during the early years of the Howard government, when it saw that quite frankly as not a priority at all and an area where it could make some pretty rudimentary savings in the budget. This was at the expense of Australia’s long-term interest. We have also seen the damage done to our vocational system of education, the TAFE system. I will speak a little more about that.

But the overall picture is one where the long-term interests of Australia’s economic growth have not been cared for in any way, shape or form. The skills crisis is now a product of that neglect, with that investment not there in our higher education system—be it vocational or tertiary education. We are now paying the price, and it is with great frustration and disappointment that many Australians see the Howard government now over-reliant on using temporary skilled migrant labour to fill those skills gaps. I am the first person to say, ‘Yes: where there are genuine skills gaps we should be using that.’ But when the skills crisis has effectively been orchestrated by the Howard government, which then stands in defence of a skilled migrant program that is being used to fill the gap rather than actually addressing the problem that has caused that symptom, it is very hard to say that the government has any credibility at all. I think average Australians and people who are out there trying to get the skills they need for life or, indeed, update their skills for life can see the facts for what they are.

It is getting harder and harder to get an education. It is getting more expensive and it is a user-pays system; if you are not affluent in this country then in the future you will not be able to afford an education. Many people are experiencing that problem right now.

The other aspect of the skills crisis is that it is getting worse. Skilled vacancies in October 2006 were 1.5 per cent higher than for the same period last year, demonstrating that there is real damage being done to Australian businesses, their families and the national economy. These figures have been reminding the Prime Minister every month for years that he should have been taking action on this problem, instead of—as he has done—denying its existence. He just pretended it was not there. I would like to run through some of the areas with the most damning shortages. They include the science professionals, workers in the building and engineering sector, the associate professions of medical science and technical officers, and tradespeople. The biggest increases in reported skilled vacancies were in printing, automotive and wood tradespeople.

This government claims that Labor do not have any ideas; of course we do. We have got a plan to train more Australians by giving each traditional apprentice a $3,200 skills account to cover the cost of up-front TAFE fees, textbooks and materials. We have also proposed a trade completion bonus of $2,000 to encourage apprentices to complete their training, because we know that under the Howard government system a massive proportion—some 40 per cent of apprentices—were not even completing their apprenticeships. This shows that the system that is supposed to be training these people was not working under the Howard government. This, together with Labor’s skills account, would make an extra 13,000 qualified tradespeople available to Australian businesses every year. That is the sort of practical intervention that is required.

I would like to say a few words about the TAFE system as well. TAFE has copped a beating under the Howard government. It has been an unfair and ideological attack. A new report into the TAFE system shows that TAFE has a vital role in addressing Australia’s skills crisis if it is adequately resourced, and a document titled TAFE futures: working towards a principled future by Dr Peter Kell calls for increasing funding for the TAFE system to help address skills shortages by reducing the financial barriers which discourage young people from entering a training program, improving its infrastructure and equipment, and recruiting and retaining a professional teaching workforce that will meet TAFE’s future needs. But I have to say that I cannot see the Howard government listening to this advice, because over 300,000 Australians were turned away from TAFE. That is evidence that Mr Howard, the Prime Minister, is neglecting it. This must stop. I think TAFE has been a victim of bad Commonwealth policy and this is now flowing through, impacting on families and individuals at a very personal level as well as being damaging to the Australian economy.

I will turn now to the more general issues that are going on around people’s kitchen tables. The Howard government is going so completely wrong at the moment because it is so caught up in its own bubble of hyperbole about the state of the economy and its record. This is obviously a political feature of governments having been around for far too long, and it shows that there is a complete disconnect with what it is able to observe and say about the state of the economy, how people are faring and what is actually happening in the real world.

I have no doubt that this government has lost touch with what Labor calls Middle Australia—people who work on a daily basis, who are probably trying to raise kids, but not necessarily, and who are really struggling with their mortgages. My colleagues have asked several times already in this debate: how can things be so good, which is what they hear from the government all the time, and yet our situation be so tough? It is because of the way this government has not only misled Australians but allowed the costs inflicted on individual families to blow out of control, and nowhere more so than with interest rates.

It is so disgusting when you think about the campaign this government led at the last election about how interest rates would rise under Labor, with the direct claim that they would not rise under the Howard government. If you take a moment to recall those advertisements leading up to the last election, in retrospect with now eight interest rate rises in a row, you start to get a sense of the anger that is building in the community that they were so conned. Not all of them were conned, because not everyone voted for the Liberal Party, although I think this government likes to think everyone did. A proportion of people were conned by this government to vote for them on that basis.

True to form, the Howard government used fear and loathing to goad and intimidate people into voting for them. The same people that were motivated to vote in that way are now the ones that are really hurting. They are the ones that are paying $200 or more a month to pay back an average mortgage. They are the ones that are throwing their hands up in the air and saying, ‘So much for that promise!’ The bottom line is that it has been completely disproved and the Howard government has been shown to have lied to the Australian population. I think it is good that he has been exposed.

At the time, Labor made it very clear that the interest rate rises could not be controlled by any one person. We argued that at the time. However, we also argue that there is a capacity to influence interest rate rises by putting downward pressure on the causes of the rises. We have already undertaken to do exactly that, and that is why I mentioned the skills crisis and the need to invest in our economic future and in education to shore up our prospects, our crumbling infrastructure and so forth. We will address those issues. What we will not do is exacerbate the upward pressure on interest rates, as this government has done. We have seen them do that consistently with a range of issues but particularly those going to the heart of our future prospects as an economy.

I note with particular interest the Prime Minister’s cute little sidestepping, backflipping, tripping-over dance with the question of wages. He has claimed previously that under his Work Choices system wages are better and they have improved more than they have under anyone else’s system. When it suited the Prime Minister he argued how successful the Howard government had been in shoring up wages and pushing them up. But what did we see today? The minute the heat was turned on about the interest rate rises he skipped across to the other side of the street and ran back down the other way saying: ‘No, interest rates would go up much more under Labor’s industrial relations plans. Under us we’ll keep them lower.’

The bad news for the Prime Minister is that Australians are not stupid and they can see through this misleading tactic and this misleading manipulation by Mr Howard, Australia’s Prime Minister. It just does not wash any more. People are fed up. People around kitchen tables in Australia can see through the Howard government. I, of course, hope this augurs very well for the next election, but sadly for many people and many families who are paying 50 per cent more in mortgage interest repayments than they were way back in 1999—let’s understand that—there is still up to a year and maybe even more to go before the Howard government can be removed from office.

Labor believes there needs to be an ambitious program to put downward pressure on inflation and on interest rates. If you are a homeowner with a mortgage of $300,000, you are now paying almost $200 a month more than you were paying when this government promised two years ago to keep interest rates at record lows. The fact is that people are now taking on three times the level of debt that they had in 1989. So any comparison with the situation of interest rates under Labor previously is completely spurious, misleading and manipulative of the Australian population, who are burdened by these rising monthly payments. If the Liberal Party and their government, the Howard government, had any sense of even wanting to preserve their own credibility they would not persist with their blatantly misleading statements about interest rates.

In closing I would like to go back to my opening point about the big picture for Australia. For 10 years we have endured a stunted, myopic vision from this government. It has been nothing more than looking from one election to the next, with a substantial attempt to bribe and frighten Australian voters into voting for them next time. There has been no hope or grand vision. Even this week, with the drought and environmental crisis that the globe is engulfed in, we have seen such a reactionary response from the Howard government that stands as even more evidence of their short-term approach to managing this country. I think that is the greatest indictment. People out there do not feel proud of a government that has offered them so little. They do not feel proud and they do not feel a part of a world that they cannot relate to, the world that Mr John Howard, the Prime Minister, espouses. They cannot see themselves doing well, and Mr Howard cannot see what he is doing to them.