Christine Milne (Tasmania, Australian Greens) Share this | Hansard source

I rise tonight to make a few comments on the Social Security and Other Legislation Amendment (Economic Security Strategy) Bill 2008 and related bills. This legislation consists of a social security package, a $1.5 billion increase to the first home owners grant and $187 million to create 56,000 new training places in the Productivity Places Program for 2008-09. I remember not so long ago making a budget reply speech in 2006. The newspapers of the day had headlines, ‘Manna from heaven; rivers of gold’. They had huge photographs of the then Treasurer smiling—nothing could be wrong, everything was fabulous. I made the Greens’ budget reply speech and said that the Australian economy was more vulnerable than ever, much to the hoo-ha on the government benches. I said we were more vulnerable than ever because, under the Howard years, Australia had been taken back to an economy largely the same as it was in the early 19th century when we rode on the sheep’s back.

In my budget reply speech in 2006 I said that Australia had been taken back to being a quarry for the rest of the world. The manufacturing sector had been hollowed out and the jobs had gone overseas. Essentially, our budget position was entirely the result of a resource based economy, where the tax from corporate profits was actually driving the so-called wellbeing. Not only had we hollowed out the manufacturing sector, but we had also underfunded education, training and innovation, so that our skills base had been completely hollowed out as well. I indicated then that, with the twin challenges of climate change and peak oil, it would not be very long before the façade of economic wellbeing in Australia would collapse. I argued at the time that the silver lining of climate change and peak oil is that, in finding solutions to those issues, we address the vulnerabilities in the Australian economy in terms of rebuilding the manufacturing sector, investing in education and training and rolling out the renewable energy and environmental technologies that would create the jobs and solve the problems.

At the time, very few people were listening, but it is now clear that many people recognise that we are in fact in a position of overshoot. The same problem that has caused the financial meltdown has caused the ecological crisis, and that is excess debt. We have been in excess debt, which has caused the global financial crisis; and we are in excess ecological debt, which has caused the ecological meltdown which is climate change. And we are seeing it everywhere around Australia, from the collapse of the Murray-Darling system to the extreme weather events—which are not natural events; they are exacerbated by climate change. Yes, we have always had storms, floods and fires in Australia, but we are now having them more frequently and in more extreme terms. We have been told for some time that it will rain less often but, when it does rain, it will rain in a more extreme way and we should change our infrastructure so that we can cope with the changed circumstances. That has not happened, and we are seeing the consequences of that from Victoria right through to Queensland as we stand here in this Senate this evening.

It was obvious for some time that we should have been spending on mitigation, on adaptation to climate change, on rolling out energy efficiency and renewables and investing in education but, instead of this, we had both Liberal and Labor committed to $31 billion worth of tax cuts. And now we look at it and say, ‘Was that money well spent?’ I would argue that it was not. We needed to spend that money on infrastructure, to rebuild the nation in order to be able to cope with the future in terms of resource depletion and moving from a resource based to a low-carbon and eventually a net carbon zero economy.

I argued in the last budget that we should have been spending the money on retrofitting the nation’s houses. Instead of spending $31 billion on tax cuts, we could have spent $22 billion and retrofitted all of Australia’s 7.4 million houses with solar hot water and full insulation. Had we done that in the way that the Greens proposed, in which case 90 per cent of the households would have paid that money back over a further 10 years, the government would have actually got the money back. It would have been a serious investment in future infrastructure plus an investment in reduced emissions, plus an investment in socioeconomic equity. We know that when we put a price on carbon, energy bills will increase and we are going to have to see compensation to households. And there is no better way to compensate people than to permanently reduce their costs.

My concern about this legislation is that it is called an economic security strategy, but there is no strategy in a one-off payment. I agree that it is necessary to look at the payments for people in the social security system and to recognise that those payments are inadequate. But they were inadequate when both sides of this house thought it was appropriate to give away $31 billion in tax cuts and not improve the pension, not improve the payments to carers and not improve the payments to all of the people who will now be getting a one-off payment this Christmas. Yes, it will stimulate consumer spending and that may stimulate the economy to some extent, but to what end? What about next Christmas and the Christmas after that? What about when the energy bills come in in the middle of next year and people do not have the money to pay for them? What then? We use the word ‘strategy’, but a strategic response is actually spending money in a way that gets a long-term change or shift. This is actually buying time to see what happens, and I think the money could have been a lot better directed and spent.

Let me now go to the training places. We had only recently the CSIRO report Growing the green collar economy: skills and labour challenges in reducing our greenhouse emissions and national environmental footprinting. In the estimates just a few weeks ago, it was very clear that, apart from the upfront capital cost of energy efficiency and renewable energy for households, one of the main constraints to rolling out the technology is the lack of skilled tradesmen able to actually install a solar hot water system or to come in and do the kinds of work that are necessary to transform a home—whether it is installing a grey water system or installing some other energy efficient or water efficient technology. We should have been directing this series of training initiatives to looking at where the gaps are and where we need to direct the reskilling and upskilling of Australia’s population so that we meet the needs of the transition to a low-carbon economy. But it is not there. It is just a scattergun approach across the board. Hopefully some of this training package will go in the direction that I am outlining, but it will be hit and miss, rather than a strategic direction.

I introduced to this Senate a proposal for a national gross feed-in tariff. The government has said that it is not supporting that national gross feed-in tariff because it will increase the cost of energy to the extent of two or three cups of coffee a year per household. So it is not a great deal of money, but it would have created thousands of new jobs in the renewable energy sector and it would have reduced demand for coal-fired power. It would have accelerated the shift to the low-carbon economy. But, no, instead of that, we are going to stick to this occasional one-off payment. Would it not be better to have a permanent increase in the level of these payments so that people can budget? When it comes in as a one-off bonus, it is spent as a one-off bonus. I have no doubt that in many households it will be extremely well spent, but that does not alter the fact that it does not provide for a pattern of changed behaviour to enable people to save themselves money in the longer term.

I would say that the approach that we have in Australia is not a strategic approach. It is strategic only to the extent that in an economic crisis the government needs to drive a stimulus into the economy and therefore we will unload this $10.5 billion into the economy in the hope that it will stave off a worsening crisis. Wouldn’t it have been better to direct that stimulus to those things that are necessary to address the vulnerabilities of climate change, peak oil, resource dependence, lack of education and the hollowing out of the manufacturing sector? Wouldn’t it have been better to direct the stimulus in that kind of way? At the same time as this is happening in Australia, just this week in the United States president-elect Obama signed a memorandum of understanding with the Chinese to work on major investments in the clean energy revolution. He knows exactly what needs to happen in the United States, which has lost its competitiveness with the rest of the world in manufacturing. He knows that he needs to drive a stimulus package that will drive the clean energy revolution and get back some competitive advantage in the United States. At the same time, he has said quite clearly that he intends to create 2½ million jobs in the next two years in the green energy economy, and he is going to spend on roads, bridges, windmills and solar panels. What are we spending our money on, apart from driving a consumer spending package prior to Christmas? A very tiny percentage is going into training places and some money is going into housing construction. But the housing construction is not accompanied by the innovation of setting much higher standards for new buildings which would require those buildings to meet energy efficiency standards and new sustainability standards in building materials—or in retraining builders, plumbers, architects and so on in the basic principles of sustainability.

In the United States, they now have someone in the presidency who sees clearly where the future is, where the competitive advantage lies, and how working with China will deliver it for the US. In Australia we have no such strategy. I would like to ask: where was Rupert Murdoch in 2006, when the rivers of gold and the manna from heaven were falling from the Treasury based on a resource-based economy? Why wasn’t he telling us how bad the education system was in Australia and about the need for an education revolution? I do not recall Rupert Murdoch ever making a single criticism of the hollowing out of manufacturing, of the underfunding of education, or of this complete disaster of economic management and the billions and billions of dollars worth of tax cuts. When he says that the Australian education system is a disaster, let’s have him specifically tell us what it is that is so disastrous about the education system we have. It is all very well to now decide that maybe more money should have been spent on infrastructure, on education, but where was he at the time? It was not fashionable or popular then to be saying that riding on the quarry was not in the best interests of Australia. The problem is that we are still stuck in a quarry mentality. That is where we are going to be left behind, and that is where this economic stimulus package goes wrong, in my view.

With the rest of the world moving rapidly on the green new deal and recognising that with climate change and peak oil there is a need for an economic stimulus to go into the technologies that will drive a low-carbon economy—everything from electric vehicles through to renewable energy and massive investment in innovation—what have we got? Nothing except a strategy to put more holes in the ground, an unstrategic look at the education sector in terms of these training places and a consumer stimulus package that is not designed to drive any particular behavioural outcomes in the Australian population.

We have got this strategy on carbon capture and storage, and everybody else in the world is very happy for Australia to spend its money on a technology which is going nowhere while they spend their money on a technology which is going everywhere. To highlight this, just last week BP Solar announced it was closing its factory in Sydney and going offshore, and 200 skilled jobs were to be lost. Was there a peep out of anyone? Not at all. The Greens were out there, but nobody else was saying anything. If 200 jobs had been lost in a coalmine or if 200 jobs had been lost from logging in Tasmania, there would have been a scream for a rescue package to make sure that those resource based jobs stayed. But when it comes to manufacturing jobs in the new economy, it seems that we are happy to let those go offshore. Let me tell you that with the signal that Barack Obama has given in the last few days about the stimulus package in the US being designed to drive the green energy revolution, the green new deal, we will see the US becoming the hub of renewable energy, with China and with Europe, and we will see yet more skilled, educated, incredibly brilliant people leaving the country and going to the US. That is not what a clever country ought to be doing. It is not what an innovative economy ought to be doing.

Whilst the Greens are not opposing this economic stimulus package, I think it is an incredible lost opportunity. I think it is a lost opportunity in terms of a strategic response to the global financial crisis. I would have liked to have seen a much more targeted response leading to long-term investments in areas where we could build competitive advantage, rebuild manufacturing, get off our resource-based dependence, and invest in education and a more sophisticated, happier and healthier future.