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

they are not yours, Senator Bernardi; they are the Rudd Labor government’s tax reform proposals—are specifically designed to increase labour force participation. They are designed to address the inflationary pressures currently evident in the economy, which are a product of the skills shortages and labour shortages more generally. The chronic labour and skills shortages have been reported regularly, as I said, by business as the most significant constraints on their expansion. Our tax reform proposals are designed to assist in addressing that. By introducing those tax reforms, it is our aim that they will not put pressure on wages and inflation. By delivering a tax reform package, we are hoping that is one way that we can actually address some of the inflationary and wage pressures within our economy.

What we have also done to try and address some of the skilled labour shortages in our economy is announce 450,000 new skilled training places, including 25,000 which are being rolled out between now and July this year. The tax reforms themselves will increase the financial incentives for skills formation because they increase the marginal gains associated with higher wages that typically flow from higher skills attainment. When you match that with the roll-out of 450,000 new skilled training places, including 25,000 between now and July, that is a significant step towards addressing one of the key capacity constraints within our economy.

As I said, the other significant issue that we think needs to be addressed in terms of developing our modern economy and addressing some of those capacity constraints is the provision of infrastructure. There has been a debate about the need for the provision of infrastructure within the Australian economy for quite some time, but that is all it ever was under the previous Howard government: it was a debate; it was a blame game exercise. It was not actually a productive, national contribution to huge national projects. That was left to the states, particularly my home state of Western Australia. The infrastructure bottlenecks—bottlenecks that have been defined by many people—have been holding back our export performance. They have been clogging up our cities. And where was the previous government? Just playing the blame game.

The previous government was not interested in any way in the provision of the major public transport infrastructure that has now been provided by the Carpenter Labor government in Western Australia—the Perth to Mandurah train line. There was no federal support for that. There was no federal support for the need to expand our port facilities in regional Western Australia so that we can actually expand our mining industry at a time of booming resource prices. There was no support for that.

So that is another challenge. Labor’s response within the first 100 days was the announcement of the formation of Infrastructure Australia and the legislation that will establish that body and enable it to work cooperatively with the states, with local government and with business to establish a national framework for what the infrastructure priorities need to be to help develop our dynamic economy. So that is another initiative, another priority, another promise delivered on by the Rudd Labor government to actually address some of the challenges that are ahead of us.

In the meantime, where were the Howard government? Where were they? Where was their policy to fight inflation? Where was their policy to address the significant bottlenecks in terms of infrastructure provision? Where was their policy to address the skills crisis, which took 10 to 11 years of neglect to develop into what is a significant crisis? As I have said before, we have inflationary pressures largely because of the lax fiscal policy of the previous government. In the last four years, the former government had the highest increase in spending over any four-year period in the last 15 years. That is just staggering. When you are looking at the inflationary pressures within our economy, when you are looking at the interest rate rises and when you are looking at the fact that working families were struggling and many of them were having their take-home pay reduced, what was the solution of those opposite? It was to throw money all around the place and to have the highest increase in spending over any four-year period in the last 15 years.

That comes on top of the fact that the previous government ignored the 20-odd warnings from the Reserve Bank about the effect on the inflation rate of the capacity constraints and skills shortages in our economy. It is just staggering that any government could leave us with such a huge skills crisis. So our priority here is to build a modern, dynamic economy and to actually deliver on the commitments that we made to the Australian people and the election promises that we made.

Contrast that with the approach of those opposite at a time when government should have been using the fruits of the mining boom in places like my home state of Western Australia to reinvest in the future, to invest in education, to invest in skills and to provide the leadership so that we had First World infrastructure. That should have been the priority of those opposite, and it was not. Those opposite were quite happy to allow the skills crisis to continue on its merry way. As I say, my home state has an enormous challenge when it comes to the provision of skilled labour. The only contribution the Howard government made was two private technical colleges, neither of which has actually delivered one trained employee or one new skilled worker to the Western Australian labour market. That is just not good enough.

What we need is productivity growth. Productivity growth comes with an increase in the provision of skilled labour. It comes with the rollout of the infrastructure that our education system needs, that our communities need and that the business sector needs to ensure that we train people for the jobs of tomorrow, not just addressing the immediate skills crisis but anticipating where the next demand for skilled labour is going to come from and working hard to address that accordingly.

Of course, our third priority in terms of developing that modern economy and delivering on our promises is to reform the way that the Commonwealth and the states and territories interact with one another. So we end the blame game; we sit down; we talk about the combined resolve that we are going to have to address these significant capacity constraints whilst looking after hardworking Australian families who have had to bear the brunt of the mismanagement of the Australian economy—the hardworking Australian families who have had to put up with those end-on-end increases in interest rates because that was the only piece of economic response available to the Reserve Bank because of the spending approach of the previous government; the hardworking Australian families who had to put up, under Work Choices, with working longer hours for lower pay and then to pay increased prices for their goods and services.

Our resolve is to actually protect the pay and conditions of hardworking Australians and their families, to help them develop the skills they need for the jobs of the future and to ensure that their children get the education and training they need to be well placed in the future. Our resolve is also to work with the states and territories, with industry and with local government to have a comprehensive plan to deliver the infrastructure priorities that should be worked at across the board to ensure that our economy makes the most out of the mining boom that is coming from states like mine, to take the financial resources out of that and continue to develop the economy by addressing some of the infrastructure bottlenecks. They have to be the priorities. That is responsible economic management and that is what was lacking in the previous, Howard government.