Bob Brown (Tasmania, Australian Greens) Share this | Hansard source

The Greens also support this legislation, though I have a second reading amendment which I will speak to in a moment. In the face of the economic downturn, the package seeks to bolster growth in the Australian economy by promoting increased consumer expenditure. Our proposal for fiscal stimulus is to spend on improving the energy efficiency of all Australian homes, thereby creating employment right across the country, including in rural and regional Australia, and new training opportunities and economic stimulus while achieving important structural responses to the challenge of climate change. That would be a big step in the direction of a green economy when such a great opportunity is here.

Nonetheless, we welcome the one-off payment to many recipients of social security payments, because many of these Australians are struggling to live on very, very low incomes. The additional income for those people will make a substantial difference to their lives, even if only in the short term. We particularly welcome the payment to age pensioners—it equates to about $30 a week for single age pensioners—because that is something we have been advocating as a minimum since the last months of the previous Howard government. I look forward to pension reform that will see that increase made permanent.

I listened as Senator Scullion challenged Labor, saying that it had stood by while the coalition went in to bat for pensioners in September this year. Well, it is a pity that the coalition did not go in to bat for pensioners in the 12 years in which it was in office but instead left them languishing at the bottom of the pile and, comparatively, in a worse position than pensioners in Australia have been in for many decades. His challenge to Labor senators to apologise for making pensioners wait three months has, written into it, a very big challenge: to have the coalition apologise for making them wait 12 years.

While pensioners and others on income support need additional assistance, they need it on an ongoing basis to improve their daily quality of life, rather than as a one-off lump sum, pre-Christmas—intended to be spent in very short order—as we have in this bill. Yet over a million people on income support payments, many of them on lower rates than aged pensioners, are equally vulnerable to economic downturn and have not received a payment, or any explanation for their exclusion. These include people on Newstart allowance; there are 417,793 of them, according to last year’s figures. They also include people on the parenting payment—that is, those below the age pension age—539,922 of whom were in receipt of this payment in 2006-07.

Before dinner I was enumerating the groups excluded from this package, and I will continue. In 2006-07 there were 7,624 people on sickness allowance, 28,269 Australians on Austudy and 34,134 on Abstudy. Then there were 331,955 people receiving the youth allowance, 5,032 receiving the mature age allowance and 6,244 getting the special benefit. We Greens believe that a more equitable approach would be for the government to provide payments to all people who were in receipt of any income support payment on 14 October last. All these people are doing it tough and could use extra assistance. For example, unemployed Australians on Newstart allowance receive $224.65 each week. They would be equally likely to spend the money in the near future and provide the economic boost the government is aiming for were they to have received the increase.

Our estimation is that expanding the payment to all eligible income payment recipients would increase the size of the economic strategy that we are looking at here by approximately $1.9 billion. This additional expenditure would have had the dual advantage of increasing consumer spending in the short term, which the government has deemed the best response to the fiscal situation, and creating a fairer and more equitable package, which is our aim. The measures that the Greens are proposing in our amendment would increase the funds available for this and other measures by fiscal responses in the future. Our proposal is consistent with the Prime Minister’s concerns to end ‘extreme capitalism’ and rein in ‘excessive executive remuneration’.

I move Greens amendment on sheet 5636 in my name:

At the end of the motion add:

                          but the Senate calls on the Government to introduce a new top marginal tax rate of 50 percent for earnings over one million dollars.

The idea of a top marginal tax rate of 50c in the dollar was, of course, first flagged by the Australia Institute last month. Its report, The case for a new top marginal tax rate, argued that the current top tax rate of 45 per cent, which applies to incomes of over $180,000 per year, is inadequate in a corporate environment where some CEOs are paid excessive salaries. Well, indeed. For example, figures for 2006-07 show that Mr Alan Moss, who is a banking executive, got $33.9 million in that one year. This tax would have cost him an extra $1.645 million—a very modest contribution to the greater Australian welfare. Mr Phil Green, who is also in banking, got $17 million, and the tax would have recouped $800,000 just from him. Mr Greg Gailey, who is a mining executive, got $16.7 million. The 50c in the dollar tax would have recouped an extra $785,000 from him. Sol Trujillo, who heads up Telstra, got $11.8 million the year before last, and this tax would have recouped $540,000 from him. And so it goes on.

The Australia Institute points out that only 5,605 people in 2006-07 declared incomes in excess of $1 million and that their combined income was more than $10.7 billion, or an average of more than $1.9 million each. The chart from the Australia Institute also shows that the total tax payable by those earning over $1 million per year was just $2.15 billion, or less than 20 per cent of the money they took home. The Australia Institute’s report says:

The creation of an additional tax bracket with a tax rate of 50 per cent would enhance the equity, and progressivity—

There’s a good word!—

of the Australian tax system while, at the same time, raising a significant amount of revenue. Although in the current macroeconomic climate the contractionary effects of an increase in taxation are unwarranted, this could easily be overcome by increasing expenditure on a range of other measures, which would inject money into the communities that need it most.

I commend the Greens motion to the Senate. It would, of course, be a call to the government as the Senate cannot directly increase or impose a tax. It is a very worthwhile motion and shows how the Greens would recoup a component of the money to extend the increased benefits beyond age pensioners to all the groups that I listed after the dinner break.

The Greens support this legislation. We have put up a proposal to make it better and to provide the money to make it apply to hundreds of thousands of Australians who have missed out. We would have improved the legislation by having the payment made in the recipients’ fortnightly income packet, not in a lump sum just before Christmas, but it is certainly better than the entreaties to increase the pension we made to the last government—entreaties which fell on deaf ears. I support the legislation, I call for support for the amendment and I look forward to the rest of this debate.