Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Hansard source

'They might buy a house and put a mortgage on it'! Well guess what? That is not the situation that Labor has put us in. Labor has not exposed the country to good debt; Labor has exposed the country to bad debt. Not even your borrowing for the NBN was a good investment. You made a complete mess of— I was going to say something unparliamentary but I stopped myself in time. You were wasting money left, right and centre on something which, quite frankly, was not value for taxpayers' money. But the real problem we have in Australia as a result of the decisions that were made by the previous Labor government, combined with the structural pressures we are facing in any event in the context of the ageing of the population and our exposure to global markets, means we are in a situation where we are borrowing to fund a large proportion of our recurrent expenditure year in, year out. The longer we do this, the longer we add to our debt in an expectation that our kids will pay tomorrow to fund other living standards today—the Labor Party can yell and scream as much as they like but that is the situation that Labor put the country in. They are wanting to force our children and grandchildren to pay higher taxes or accept deeper spending cuts down the track in order to pay for our expenditure today.

There is never an easy way to reduce government spending because the truth is, once you lock in government spending decisions, there is somebody at the other end of that spending who enjoys a benefit they do not readily want to give up. If you are able to get something for free and then somebody says, 'We want you to make a small contribution in order to help us ensure that the service you are accessing is going to be available for everyone over the medium to long term', that is not necessarily spontaneously going to be popular.

Let us talk about health for a moment. Expenditure in health has continued to grow faster than the economy for some time and will continue to grow faster than the economy for the foreseeable future, in particular and on the back of the growing demand as a result of the ageing of the population. So what do we do? Our responsibility as members of parliament, our responsibility as representatives of the people of Australia is to ensure that we put our health care system on a sustainable foundation for the future. When you have growing and potentially unlimited demand and unlimited resources, however high they are, you need to ensure that those resources are deployed in the most efficient and effective way. You need to ensure that the resources you have available are spread as far and wide as possible.

And what is our policy challenge in health? Our policy challenge in health is to ensure that all Australians can have affordable and timely access to high-quality health care in a way that is also affordable for the taxpayer. So the question becomes: when I access a medical service, should the taxpayer cover 100 per cent of the cost of that service or should I be asked to make a small contribution to accessing that service? Labor thought that it was appropriate for the patient accessing a service to pay a small co-payment when it came to accessing pharmaceuticals. So why is it not appropriate when accessing a GP service? The principle is exactly the same. We know, of course, that in tempore non suspecto, as the Romans would say, before this whole issue became political the shadow Assistant Treasurer, Mr Leigh, held that exact same view. The shadow Assistant Treasurer, Mr Leigh, who does know a bit about economics, actually made the point that a small co-payment is the absolutely appropriate way to go when it comes to ensuring we maximise the efficient allocation of limited resources to a growing demand for healthcare services and that a price signal is a proven way to achieve that.

There are, of course, a whole series of structural reforms that we have put forward in the budget—not because we enjoy hurting people or imposing pain on people but because we want to ensure that the important services of government—social services, healthcare services and all the things that governments do—continue to be affordable over the medium to long term. To those Australians who ask why the government is doing this, I would say consider what is happening to our revenue now. In December last year, the Labor Party would say, the Treasurer and I were overly pessimistic in our revenue assumptions—that the assumptions underpinning our revenue forecasts were supposedly deliberately pessimistic in order to make the budget numbers in Labor's last budget look worse than what they were. That is not what we did. We were committed to being realistic. As it turns out, we were being too optimistic. And today Labor is saying that we exaggerated the revenue that we were expecting to collect. So you cannot have it every which way. The truth is that nobody expected commodity prices to fall as much as they did. But we are responsible and we are continuing to work to fix the mess that Labor left behind.

On a final point, Mr Shorten says he is not only going to deliver a surplus but deliver it sooner than the coalition. Given that he is opposing most of our savings measures, given that he is not able to convince Labor to support their own saving measures and given that he is starting from way behind, I want to hear from Mr Shorten where he is going to cut and where he is going to cut deeper. Where is he going to increase taxes in order to not only deliver a surplus but deliver it sooner? Right now, the Leader of the Opposition, Mr Shorten, not only wants to have his cake and eat it too; he wants to sell the cake that he wants to have and eat. That is something that is just not practically possible. He will have to put his money where his mouth is, sooner or later. In the lead-up to the next election, if he does not support the savings measures that we have put forward in order to get our budget situation back under control, if he does not want to add to the deficit and if he wants to get back to surplus more quickly, he will have to say where he is going to cut and where he is going to increase taxes—in particular, because he is starting from way behind.

The coalition, of course, looks forward to more constructive suggestions in the spirit of the motion put forward by Senators Leyonhjelm and Day. We look forward to productive and positive suggestions by the Labor Party, because, in the end, we are all in this together. We cannot expose future generations of Australians to the lowering of opportunity that would follow from the continuous level of debt and deficit that are the direct result of the spending and debt growth trajectory that Labor has put Australia on. I encourage all Australians to reflect very carefully about the trajectory that we are on at present. We should all be committed to stronger growth and repairing the budget.