Ruth Webber (WA, Australian Labor Party) Share this | Hansard source

As Senator O’Brien was saying, on the election of the Rudd Labor government we outlined three major commitments. One was to build a modern Australian economy to meet the challenges of the future that not only confront us globally but also confront our internal economy that were ignored for far too long by those opposite. One of the other major commitments was that we would honour our election commitments and that would be our priority. Our priority is to deliver on the commitments that we made to the Australian people—not the commitments that the former Prime Minister may or may not have made and may or may not have actually budgeted for but the commitments that we, the elected government, made to the Australian people. They will be our priority.

As we have seen in our first 100 days, the Labor government is well on the way towards implementing a range of the commitments that we made to the Australian people. We are seeing the rollback of Work Choices. We are seeing the implementation of a fairer, more equitable industrial relations system that protects the pay and conditions of hardworking Australians and their families. That was an important commitment that was made to the Australian people and it is a commitment that we have started to deliver. We have started to deliver the rollout of training places. We have started to deliver the provision of infrastructure to our schools. We have started to deliver on a range of the commitments we have made to ensure that we do develop a modern economy to meet the challenges of the future.

Why is it that we need to develop this modern economy? Why have we come to a point where we need to make so many changes in priority? It is because we inherited a mess. It is plain and simple: it is a mess. In the last year of the Howard government there was zero productivity growth. There was absolutely not one bit of productivity growth. This was delivered by a party that talked up productivity but did not actually deliver it. The Howard government delivered interest rate rises endlessly for three years and got inflation to a 16-year high. Those are the circumstances that we inherited when we came to power.

Why is it that interest rates have risen so high and why is it that working families are doing it so tough in Australia thanks to the Howard government? It is because of the lax fiscal policy of the previous government. It is because of the record level of expenditure over the last four years of the Howard government. When inflation was going up, all the Howard government could do was throw money around to try to buy their way back into office. It is little wonder therefore that the only position the Reserve Bank—that independent body that was given its independence by the previous Labor government—could take was to look at tackling inflation by increasing interest rates. Time and time again, organisations like the Reserve Bank, the Business Council of Australia and numerous other well-respected organisations defined some of the challenges facing the Australian economy. What did those opposite do? They just ignored every warning.

We have said that we will look at all forms of expenditure. Our priority is to deliver on our own election commitments that we made to the Australian people, not necessarily the commitments that those opposite may or may not have made and may or may not have budgeted for. We will deliver on our commitments, but we owe it to hardworking Australians and their families to contain and fight inflation and to reform our economy to make sure that it is modern and can meet the challenges of the future.

Ever since I have been in this place we have had a debate about the skills crisis. It has been a well-heralded debate, and there is no doubt the skills crisis is one of the capacity constraints facing our economy—one of the top three. A skills crisis does not suddenly pop up overnight. The skills crisis that we have in the Australian economy is something that the previous government was quite determined, obviously, to deliver to us. You cannot consistently cut spending to training places, training organisations, TAFE and other institutions and then, all of a sudden, 10 or 11 years later, say: ‘Oh dear, we do not have enough skilled labour. I know—we have to import them.’ That is not the way that you build a modern, sustainable economy. What you do is forecast where the demand for skilled labour is going to be and ensure that you fund the training places accordingly so that hardworking Australians who deserve those opportunities are trained for the jobs of the future.

As I said, the skills crisis is something that has taken quite a long time to develop. It has obviously been a determined policy of those opposite. All of a sudden, they discovered that there was a skills crisis—something that senators like Senator George Campbell have been discussing in this place for a lot longer than I have. All of a sudden, when the previous government started to listen to some of the industry bodies about the shortage of skilled labour, what was their solution? Rather than work cooperatively with the states and others, they decided to replicate a TAFE training system but made it a privately provided system.

In my home state of Western Australia, which has a massive challenge in the provision of skilled labour—there is no doubt about that, given the amount of economic growth and development that is going on there at the moment—the previous government granted us two of those private technical colleges. Neither of them have graduated a student yet—not one. We have not seen a graduate from anywhere. Two technical colleges for the whole of the Western Australian economy and not one trained person has come out of either of them, and that is the only contribution that the previous government was prepared to make to the massive need for skilled labour in Western Australia. That is one of the capacity constraints within our economy.

Another capacity constraint is the provision of infrastructure. Infrastructure is something that we have also debated long and hard in this place, but the previous government decided to just leave the big infrastructure needs to the state governments. So our major capacity constraints are the skills crisis, the infrastructure bottlenecks and the need for reform to have a more cooperative approach in the relationship between the Commonwealth and the state and territory governments. But there are other contributions that we can make in terms of addressing the needs and the development of our modern Australian economy.

One of the things that the Rudd Labor government has said that it is determined to deliver on—and it is in the process of delivering it—in order to increase the vitality of our labour market and increase the participation rate in our labour market, is of course tax reform. Our tax reform proposals—