Kate Lundy (ACT, Australian Labor Party) Share this | Hansard source

It is my privilege to speak this evening on the Appropriation Bill (No. 1) 2008-2009 and the related bills. This is a historic first budget for the Rudd Labor government, the first federal Labor budget in over a decade. The budget is a very significant achievement. It is an economically responsible budget that invests in the future while meeting all of our election commitments. When I cast my mind back over the last 12 or so years, I remember the first budget of the Howard-Costello government, an infamous budget that introduced the shameful concept of core and, as we remember well, non-core promises. It was a budget that introduced deceit and trickery of a new order to Australian politics back in 1996 and set the scene for a government that would say or do anything to hold on to office.

This budget, unlike those of the past decade, is designed to meet the challenges of the future and strengthen Australia’s economic foundations. But, perhaps even more importantly, this budget keeps faith with our commitments to the Australian people. We have fulfilled our election commitments and ensured that every single dollar of new spending is more than offset by savings. Citizens need to be able to rely on governments keeping their word and honouring their promises. Over the years, under the Howard-Costello government, there has been an erosion of trust. Mr Howard’s tricky division of election promises into core and non-core promises helped fuel voter cynicism and alienation from the democratic process. It is important that this budget is keeping Labor’s election promises and, in doing so, helping to build trust and confidence in Australia’s political process and institutions.

When the Labor government came to office in November last year, Australia was facing the highest levels of domestic inflation in over 16 years. It is often said that the Howard-Costello government were asleep at the wheel, allowing the inflation bogy to creep up on them. The truth is that they were more like a drunken sailor, bingeing on shore leave, ignoring the warnings of responsible commentators and spending the taxpayers’ hard-earned dollars on election bribes as though there were no tomorrow. For over a decade, government spending was not directed to the major infrastructure challenges or to boosting the productive capacity of our economy. A surge in revenues year after year and handouts before every election was the character of that government. Over the last three years, the Reserve Bank of Australia warned on more than 20 separate occasions that skill shortages and capacity constraints were threatening growth and contributing to inflation. The Howard-Costello government ignored the inflation problem that they had created and neglected the long-term needs of this country.

Therefore, I am particularly pleased that the first Labor government budget in over 11 years has started a new era of responsible, long-term economic management. The Rudd Labor government has delivered a budget surplus of 1.8 per cent of GDP and we have offset every new spending initiative with savings measures—a discipline that the previous government neglected. As a consequence, this budget puts downward pressure on inflation and interest rates. Twelve interest rate rises in a row have hammered homebuyers and small businesses and it has to stop.

The budget has produced a record surplus, so the government is playing its part. It is an economically responsible budget that also supports working families. The education tax refund will allow parents entitled to family tax benefit A or whose children receive the youth allowance or similar payments to claim a 50 per cent tax refund of up to $750 in educational expenses for each child in primary school—that equates to a refund of $375—or a 50 per cent tax refund of up to $1,500 in expenses for each student in secondary school, a rebate that equates to $750 per child per year. These are significant amounts of money for people who have children in school and that is why the education tax refund initiative will be welcomed by people throughout Australia. For families with two school-age children this new arrangement could mean a maximum family benefit of $14,200 over their full school life. For families with three kids it could mean up to $21,000 worth of benefit for those families over the full school period. This is a significant benefit for many working families, particularly those who are doing it tough.

I am proud to say that the budget will provide $491 million for the Teen Dental Plan. Eligible families will be able to claim up to $150 per year for a preventative dental check for each of their teenage children, making it far more affordable for families to access dental services. The Medicare levy surcharge will also provide significant relief for many people. Under the budget, from 1 July this year singles with incomes of up to $100,000 and families with incomes of up to $150,000 will no longer be subject to the Medicare levy surcharge if they do not take out private health insurance. This simply restores the thresholds effectively to the position that they were in when the levy and the surcharge were initially introduced back in 1997. The opposition should be ashamed of itself for not supporting this part of the government’s budget and for playing short-term politics by referring this initiative to a committee. The opposition does not need information on this measure, nor does it need time to reflect on its impacts. That is what Senate estimates were for. The government has been fully transparent, and the opposition well understands that we are restoring the thresholds as they applied when the surcharge was introduced by the opposition when they were in government. The opposition is merely seeking to delay and frustrate the will of the democratically elected government. This shows the opposition’s wilful contempt for the Australian people and the processes of parliament.

The digital education revolution is at the heart of the Rudd government’s commitment to equip Australian students with the skills they need to live, work and succeed in an increasingly digital world. At the core of the digital education revolution is $1.2 billion of new funding to provide Australian secondary schools with world-class information and communication technology. I for one am particularly proud of this measure, having long been an advocate of the role that ICT increasingly plays in our lives. The new funding includes grants of up to $1 million per school to provide new or upgraded ICT for students in years 9 to12, through the National Secondary School Computer Fund, and a $100 million commitment to support the deployment of fibre connections to Australian schools, delivering broadband speeds of up to 100 megabits per second. Other elements of the digital education revolution include $32.6 million to supply students and teachers across Australia with online curriculum tools and resources for specialist subjects such as languages; the development of online learning and access, which will enable parents to participate in their child’s education; and $10 million to develop support mechanisms for schools in the deployment of ICT provided through the National Secondary School Computer Fund. I am very pleased that 23 secondary schools in the ACT, my constituency, will receive funding for new school computers as part of the Rudd Labor government’s $1.2 billion digital education revolution.

I congratulate those schools in the ACT that were successful in attracting funding for new computers in the first round of funding announced over the past few weeks. The allocation of the first round of funding from the National Secondary School Computer Fund delivers on yet another Rudd government election commitment. This is an economically responsible budget that builds for the future and helps working families who are in need. No more do you see that this budget delivers for the future than when you look at the initiatives relating to ICT. Those initiatives are about building capacity, strengthening our education system and making sure that our kids are learning the skills that they require for the future. All of that is good for our economy and our efforts to resolve the existing skills shortage.

The Rudd government’s first budget delivers for the people of Canberra as well. As I said, the ACT is my constituency and there are a couple of initiatives that I want to mention. One point five million dollars has been allocated to secure water for the Australian National Botanic Gardens. This funding is part of the government’s $254.8 million National Water Security Plan for Towns and Cities. The government will provide $500,000 in 2009-10 to the ACT government to assist with the restoration of the Albert Hall. Albert Hall has a significant place in Australia’s history, and indeed Canberra’s history. The first citizenship ceremony was in fact held in that wonderful building. Albert Hall sits very close to the Parliamentary Triangle. Those of you who are familiar with Canberra outside of this place will know that it is just down the road to the left of the Commonwealth Bridge on the approach. The government has also met its commitment on upgrading the King’s Highway, as part of the government’s AusLink commitment.

Universities in the ACT will receive over $34 million of capital funding from the Rudd government. This includes $24 million for ANU, $4.7 million for the University of Canberra and $5.9 million for the Australian Catholic University. This funding is part of an extra $500 million to Australian universities to help them rebuild their infrastructure—infrastructure, I might add, that degraded over the period of the Howard-Costello government. Its lack of investment in higher education is now established as part of its legacy of neglect of this country.

Canberra remains one of the most expensive places in Australia for child care. I am concerned that high childcare costs may lead to parents, particularly mothers but fathers too, having to leave the workforce because they just cannot afford child care. The Rudd government recognises the financial burdens placed on working families and will lift the child care tax rebate from 30 per cent to 50 per cent to help parents meet the costs of child care. These changes will come into effect on 1 July 2008. The government will also invest $114.5 million over four years to build more childcare centres and $22.2 million to develop new national quality standards for child care. All of these initiatives are important for working families, particularly families who are contemplating having children but are afraid of the financial burden that will place on their family. For many young people, the prospect of managing a mortgage and affording child care is very daunting indeed.

The inflation problem we inherited from the Howard-Costello government has required the Rudd government to make some hard decisions. We have had to make off-setting savings to pay for new policy and cut back on staffing in some agencies. I am happy to say that, to its credit, the government has listened to the ACT community and has been very careful to manage the effect of budget decisions on the Public Service. Budget cutbacks have been spread across many agencies that have also received funds for new measures. The budget papers show that average staffing levels are expected to decline by less than 0.5 per cent. This is a net figure that includes the effects of all the budget decisions, changes in workload and the effect of terminating programs and includes agencies that are growing as well as agencies that are declining.

The government has done everything it can to ensure that staffing reductions can be managed without forced redundancies. The government has also put in place a whole-of-government career transition program to help manage the staffing changes in a way that ensures we retain our high-quality public servants. The Public Service Commissioner issued eight principles to guide agencies in managing any staffing reductions and changes. These principles include commitments to maintaining expenditure on training and development and the employment of minority groups. This will protect the future capacity of the Public Service. In particular I commend the Special Minister of State, the Minister for Finance and Deregulation and the Public Service Commissioner and her staff for their work in putting together this program.

The Rudd government’s careful approach contrasts with the crude ideological approach to the public sector under the Howard government. The Howard government abused the Public Service and undermined its institutional integrity through a combination of fear, institutional reforms—or claimed reforms—and blatant political jobbery. The Howard cabinet developed a cynical and opportunistic approach to government, reflected in its history of boom-and-bust staff cuts and recruitment programs. In its early budgets, the Howard government terminated programs, privatised and outsourced functions and cut back on activity levels. In its first years there were substantial across-the-board job reductions throughout the Australian Public Service, with over 30,000 staff made redundant. This cost $300 million in redundancy payouts by the end of the government’s first year in office. Over the following years, many of these staff were subsequently re-employed as expensive consultants and contractors as the Howard government realised that its cuts had been too crude and that it required the skills and expertise that it had cut out of the Public Service so unthinkingly.

The Rudd government, by contrast, values the importance of a professional, impartial Public Service and will be working to restore the values of the Westminster tradition to the Australian Public Service. The Rudd government has ambitious policy goals and a determination to deliver on its commitments to the Australian people. We are looking forward to working with the Public Service in delivering better outcomes for all Australians.

This budget provides a first instalment on our commitment to govern in a responsible and forward-looking way for all Australians. The emphasis on forward thinking, the use of technologies, reducing inflation and investing in infrastructure augur well for Australia’s long-term economic future. I commend the budget to the Senate and look forward to working very hard as a member of the Rudd government in meeting the substantial challenges of the future.