Sue Boyce (Queensland, Liberal Party) Share this | Hansard source

The coalition has no objection whatsoever to a stimulus package to assist the Australian community to get through the beginnings of the global financial crisis as it affects Australia. What we do have a lot of objections to are some of the crazy aspects of this package that have been put forward. The Leader of the Opposition has told the government on numerous occasions that we are more than happy to discuss a prudent, sensible package that will assist in genuinely helping to build and continue to build the Australian economy. But this package is not the way to do it.

I would like to speak to a couple of the measures that are proposed, particularly in Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and Appropriation (Nation Building and Jobs) Bill (No. 2) 2008-2009. The first one relates to the package designed to put insulation into 2.7 million existing homes in Australia. I will talk a little bit about how foolish this package is and how distorting this package is. To do that, I would like to go back and look at what happened to the rainwater tank industry in Australia. I think everyone would remember that rainwater tank rebates were certainly the flavour of the month, at all levels of government, over the past five years in various forms. Most of these rebates have been withdrawn from residential housing because they got too expensive for the groups providing them or simply because there was nothing left to do in that area.

The rainwater tank industry, at its height, turned over $1.7 billion. We are talking about less than two years ago. It now turns over about half that amount. And perhaps we should look a little bit at the industry itself. There are many venerable, old and solid companies working in this area. They have provided tanks, primarily to the rural and semi-rural markets, for generations. But the rainwater tank rebate brought lots and lots of other players into this market. Some of them were people cashing in their superannuation and buying machines to make rainwater tanks. They were using machines they did not know how to operate and materials they did not how to mould to make products for a market they did not understand. A lot of people lost much of their superannuation through this. I am aware of three people that this happened to.

But there was another segment of this market—some rainwater tank installers who were, in anyone’s terms, ‘cowboys’. They got into the industry because they saw that it was a way to make a buck. They knew as much about rainwater tanks and rainwater tank installation as an accountant would; they knew nothing about the industry. Most of them, dozens and dozens of them, in every capital city in Australia have now failed. Of course, when they failed they did not just lose their own money; they left suppliers with debts that will never be paid and they left customers with orders for tanks that have been paid for but will never be installed. So the damage and distortion caused by concentrating your rebates into one area of the energy efficiency equation and the water efficiency equation is foolish. That is well demonstrated and it has been very recently demonstrated by the damage done to the rainwater tank manufacturers, suppliers and installers of Australia by rebates that come and go at the whim of various levels of government.

The same, of course, is going to happen with the insulation installers. One business person in Brisbane jokingly commented to me this week: ‘Oh well, we know where all the rainwater tank installers will turn up next. They’ll turn up as insulation installers.’ Of course, half of these are people who rushed out and got a training certificate under the training levy introduced by the Hawke government. So can we please began to realise that one-off approaches that target one little spot of an industry are worse than useless, they are damaging. There is no point whatsoever in concentrating on just this one little part of the energy efficiency and water efficiency equation. When you look at the proposal, we are talking about all the homes that are not currently insulated, 2.7 million homes, getting insulation over a 2½ year period. Of course this is going to cause a frenzy of activity in the market, but for what purpose? It is one small section of a market. It will attract, as I said, people who do not have a clue what they are doing, and it will attract people who are dishonest. We will have dozens and dozens of stories of pensioners who are ripped off by people who go up into their roofs, apparently fiddle around for a while and then leave. It will be months before they discover that they did not get what they paid for; they will be lucky if they get anything. So even the effect on energy efficiency could in many cases be limited.

The need to develop energy and water efficiency packages for housing is a very great need and it is also a very right way to attempt to stimulate the economy. But you do not do it by focusing on one tiny little segment of it. Let us look, for example, at the New South Wales government—which, with its current woeful performance, is not exactly the government you would think to look at. About eight years ago the New South Wales government developed a policy called BASIX. It is a list of things that home owners, home builders, can have in their house that will give them varying degrees of energy and water efficiency. It assesses each household design against energy and water reduction targets. Every new residence must meet the targets by putting together a sensible list of energy and water efficient products for that house.

BASIX does not limit itself to one industry but spreads the demand across energy and water efficiency initiatives to any industry involved in producing products that increase efficiency. The homeowner ultimately makes the decision as to which product would be installed in the new home, so it encourages the orderly development of a number of markets across the energy and water efficiency production area. It does not skew the market in one direction. It encourages competition between products that are produced for energy and water efficiency and, by doing so in an orderly fashion, where people can see that the market will be sustained, it encourages innovation and effective and efficient market pricing. The other thing about the BASIX program is that it incorporates regional variations into the rating system. It looks at things like the climate, the soil type, the rainfall and the evaporation rates in particular areas when determining what the efficiency targets for new homes in a particular region might be. It does not just concentrate on one product.

The New South Wales government states that BASIX provides greater market certainty for sustainable industries such as manufacturers of solar hot water systems, rainwater tanks, insulation, performance glass and stormwater and waste water systems. I had an email during the week from a gentleman suggesting that, if we are worried about energy efficiency for houses, better curtains would be a good starting point for many houses. You might not be surprised to hear that this gentleman actually makes and sells curtains. Nevertheless, he has a point. If you cannot afford the curtains that block sunlight to keep your house cool or the curtains that hold in heat to keep your house warm, there is very little point in having the insulation in the roof. The two go together.

What would have been a vaguely sensible way to go about this stimulus would have been to develop a list of products that householders and homeowners could have chosen from as to what they particularly saw to be the best option for improving the energy or water efficiency of their home. It could have been developed on exactly the same basis as this, with a part subsidy paid depending on which product was chosen off the list. This would have had the benefit of assisting the construction supply industry in an orderly and sensible way, not just encouraging every cowboy in town who went broke on the last fad to become an insulation installer. I should perhaps add here that in that industry there have been many, many good participants for a long time, but they and their industry will be diminished by the cowboys who have no doubt already set themselves up, ready to make a motza out of yet another poorly planned scheme.

I would also like to talk briefly in the time I have left about the proposal to put extra funding into schools. Again, from a practical perspective, there are some very bizarre things being said about this program. I think we have already covered many of the issues: what does a school that has these facilities do, and what does a school do that does not have the land to do this? We have already talked about the fact that there is not a lot of encouragement to be gained from the way the government tried to go about rolling out computers in schools for how they will manage to handle this schools program.

But I think one of the most bizarre things I have heard was evidence recently that it is the small builders who will build the school halls and libraries and the large builders who will build the houses covered by the social housing component. I am not quite sure what the department of housing thinks a small builder looks like, but certainly I am aware of thousands and thousands of small builders who run one-man businesses. They would employ perhaps one other person and an apprentice—that would be it. These are not the companies who are going to build the school halls and libraries. It is going to be the much larger builders than that who will win those contracts. For a start, those small builders do not even have the insurance cover that would be necessary to build those school halls and libraries.

So the group of builders that we are most trying to help, the people who employ one or two others but will not employ one or two others if they do not continue to have work, are apparently going to be left out of this scheme—completely, according to the department of housing’s view on it. Perhaps they would come in as employees of other builders, but once again we have this complete skewing of how an industry will work. We are going to pump over $5 billion or $6 billion into this for two years, and then what? We will build up businesses just to let them fall down again. There is no attempt whatsoever to see this as a gradual increase or a sustainable increase. It will just keep going up and down like a yoyo.

One hopes that there can be some jobs dragged into the market if this package is passed, but again the funding is all at the wrong end. We have a small amount of funding coming out quickly and we have a large amount of funding coming out that the government thinks might hit the ground within 12 months but which will be very lucky to hit the ground within two years. By that stage, the economy will need twice as much stimulating as it currently does if it is to survive. It is a bizarre package. It needs radical overhaul, and until it is overhauled and until the government is prepared to discuss the issue with the coalition we will be absolutely opposing all the very poor elements of this package.