Mathias Cormann (WA, Liberal Party, Shadow Parliamentary Secretary for Health Administration) Share this | Hansard source

Let me explain why I think the comments made by the Leader of the Government in the Senate in question time yesterday and again this morning after introducing these bills into the Senate, having a go at us for insisting on some appropriate levels of scrutiny, were hypocritical. In doing so I quote from a speech that Senator Evans gave to the Subiaco branch of the Australian Labor Party, at the Irish Club in Subiaco on 28 June 2007—less than two years ago—at 6.30 pm:

Labor recognises the role and value of an empowered Senate. Our support for the Senate has grown as it has developed into an effective political institution.

Now, listen to this:

Labor—in government or opposition—supports the Senate as a strong house of review, scrutiny and accountability. The fact is that the Australian parliament constructed better legislation when governments had to negotiate and argue their case in the Senate. We got better legislation when bills were thoroughly scrutinised by committees. The public had their input and governments were forced to listen and respond.

That is why I think that the comments that the leader of the government made in the Senate yesterday and again today are hypocritical.

We are talking about spending $42 billion of taxpayers’ money. We are talking about a package that the Australian has described as ‘Rudd goes for broke’. Let us reflect on that just for a moment. ‘Rudd goes for broke’, according to the Australian, refers to none other than the Prime Minister of the Commonwealth of Australia. When the Prime Minister goes for broke, the whole of Australia goes for broke. When the Prime Minister goes for broke, he forces Australians to go for broke. Australians have seen too many Labor prime ministers going for broke before. I put it to you that Australians do not want Australia to go for broke. Australians want a government that manages the economy carefully, skilfully and effectively. Australians want a government committed to sound and sensible economic management.

It is important to remember that governments cannot actually inject new money into the economy. Whatever the current government may believe, this is a very important reality. I do not think that this administration has quite understood it. Governments cannot inject new money into the economy. All that governments can do is redistribute money they have taken out of the economy by taxing individual Australians or businesses of today and tomorrow. They are forcing future generations of Australians to pay more in taxes to repay a significant borrowing of up to $111 billion or $200 billion, according to the package that this government is going to impose on future generations.

Would this $42 billion generate economic activity? Of course it would—$42 billion is a lot of money—but what sort of economic activity? All that the $42 billion package would do, by throwing more money at the wall, is create artificial demand—and, not only that, it will create artificial supply. You will have all those people out there with a ute in the back of their garage offering insulation. Whether they currently specialise in it or are responding to a genuine demand does not matter; the government is now creating artificial supply and artificial demand that does not correlate to genuine demand. What happens when the money runs out? Guess what—even $42 billion runs out one day. As soon as that $42 billion runs out, you will have all those people used to this government’s largesse coming through responding to a demand that is not real demand and responding to a demand that was created by government intervention.

What will happen to unemployment? The government will say, ‘All those people will be unemployed. Let’s put some more money out there, let’s create some more artificial demand and let’s create some more artificial supply,’ rather than let the market decide what it is that individual Australians want or need. Here we have a government who think: ‘We’ll take some money from these taxpayers over here and we’ll decide how you should spend it; we’ll decide how it is best allocated. Whether you need it or whether you want it, it doesn’t matter.’

Governments are not better at distributing resources in a more productive way than individuals. The arrogance of the government in the way they want to push this through the Senate is breathtaking. Labor wanted us to rubber-stamp this within 36 hours, without scrutiny, without asking too many questions. Have the government given us any reason to have confidence in their capacity to manage the economy? Have they given us any reason over the last 14 months to be prepared to sign a blank cheque?

Let us reflect on what has happened over the last 14 months. Before the last election we had the then Leader of the Opposition deceiving the Australian people into believing that he is an economic conservative, when now all he is is good old-fashioned Comrade Kevin. We had the inflation genie ‘being out of the bottle’. They were talking up inflation and talking up interest rates for political purposes, even though that was not in the best interests of the Australian people and even though that was not in the best interests of the Australian economy. What has happened to the inflation genie? Have we heard about the inflation genie in recent months? It has gone, hasn’t it? Yes, it has.

Then we have the budget. In the lead-up to the budget, all the rhetoric was we had to cut spending and it was going to be a tough budget. What happened? The government increased spending by $15 billion. They increased taxes by $20 billion. That was the only way that they were able to keep any sort of surplus at budget time: increasing taxes by $20 billion. When Labor came into government just over a year ago, they took over a $22 billion surplus. Now we are talking about temporary deficits. The reality is this: deficits under Labor are never temporary; they never are. Labor have got a plan to get us into deficit; they do not have a plan to get us out of deficit. We have the bank guarantee fiasco, and I do not even have to go into the detail of that as I am sure that the Senate well remembers the fiasco of the unlimited bank guarantee. Take the $10.4 billion cash splash. What has that done?

While all this has been going on, we have got the government telling us this is the worst economic crisis since the Great Depression. That is what has been said in this chamber again over the last couple of days and that is what I have heard Labor ministers, including the Prime Minister, say in recent weeks. If it is the greatest economic crisis since the Great Depression, why aren’t they having a more serious look at the impact of their proposed Carbon Pollution Reduction Scheme? Why don’t they even model the impact on the economy and the impact on jobs of the Carbon Pollution Reduction Scheme, an additional tax on carbon in the context of the global financial crisis? Treasury admitted that they have not done that. They have not done their job. From Paul Howse of the Australian Workers Union to Dr Brian Fisher, who has done some modelling for the Senate Select Committee on Fuel and Energy, a whole range of responsible and good people are calling on the government to do the responsible thing and conduct that modelling. But, no, they say, ‘Who cares? It’s not necessary. We’ve done modelling even though we haven’t looked at that.’ It cannot be so bad then if in the government’s view they do not think it is necessary to model the impact of the global financial crisis on their Carbon Pollution Reduction Scheme. It cannot be so bad in your mind, can it? I do not really understand where the government are coming from. While I am thinking of that, and while we are talking about the Carbon Pollution Reduction Scheme, I note that in the United States one of the things that President Obama—and Kevin Rudd is keen to be associated with the new momentum of President Obama—is doing is actually becoming more protectionist. Have you heard about this? President Obama is introducing some more protectionist policies in the United States of America to actually—