Christopher Back (WA, Liberal Party) Share this | Hansard source

Senator Moore is a gift that just keeps giving when she comes up with these MPIs on activities of the Turnbull government. Acting Deputy President Bernardi, you, in business, and all of us with families, know very well that unless you are earning more than you are spending on a week-to-week or fortnight-to-fortnight basis, you are going down the gurgler. And that is where the last Labor government sent this country, as you know. The young people in the gallery should be taking notes because one day they will be having to run household and business budgets and having to vote for governments of the day. I say again that the only way to balance a budget is to make sure that you have more coming in than you have going out.

If we have a look at the situation in November 2007, this country had no net debt, it had no deficit and it had cash in the bank. Look where we are today? When this government came into power in September 2013, the deficit—the accumulation year to year—was already $123 billion! We were rushing to $660 billion of debt! The important point to be understood here is not the debt itself. Those of us with credit card accounts and those of us with mortgages know that it is not the actual amount on the credit card or the mortgage: it is what you are paying out each and every month in interest. What is of interest is that this country is borrowing offshore and paying $1.2 billion a month just to pay the interest on the debt.

We heard Senator Bilyk talk for one moment about negative gearing. By the Leader of the Opposition's own statement, this transformational tax reform would raise less than $600 million in four years. Do you know what that equates to in the interest that we are paying offshore at the moment? Two weeks—two weeks of lousy interest on the debt would account for the Leader of the Opposition so-called transformational tax reform on negative gearing on housing. If the Labor Party is genuinely interested in actually having a look at negative gearing—as Senator Whish-Wilson should note from his economic past—they need only go back to the efforts of the Hawke-Keating government, who did try to remove negative gearing. We all know what the impact of that was.

Of all funds associated with negative gearing, 97 per cent is on existing housing. Two-thirds of all Australians who negatively gear have a taxable income of $80,000 a year or less, 70 per cent of them have only one rental property and it makes the masterful average loss of $10,000 a year. It is largely people who can gain no other advantage. So we need to have a look at what this government is doing. Its first principle has been, is now and will be to ensure that we get to a situation in which this country is earning more than it is spending. At the moment we are spending $100 million a day, seven days a week, in excess of what we actually have and what we earn.

The comment was made by Senator Bilyk—and I am in complete agreement—that we have to make sure that all entities pay their tax. I was pleased that only this day Treasurer Morrison made the statement:

The Turnbull Government will apply new requirements on foreign investment applications to ensure multinational companies investing in Australia pay tax here on what they earn … The Government is committed to ensuring companies operating in Australia pay tax on their Australian earnings. Where companies fail to do so I will have powers to take action, including ordering divestment of Australian assets.

That is not a large area, but we all agree in this place that it is essential. It is essential that people pay their due taxation, whether they are Australian organisations, overseas organisations et cetera.

I go again to why we are where we are. The Labor Party proposed savings in government, and we know very well in the 2½ years that we have been in government that the Labor Party has opposed and blocked in this place savings measures it had itself proposed—well in excess of $3 billion. There have been further savings and revenue measures proposed by this government that the Labor opposition is blocking now—$5.5 billion. There is spending that Labor says we must restore from banked savings, this is loaned money—$30.2 billion. There are savings in this current 2015-16 budget that the opposition has said it will not support. The list goes on and on.

But I say this to the chamber: if you have a look at the situation occurring now in Europe, the United States of America, Eastern Europe and South America, the world in my view is headed for some very, very rocky times. Acting Deputy President Bernardi, as you know, I have had many years in the oil and gas industry. Look where oil and gas prices are today. I say to you: each time over history—going back to before the First World War—every time there has been a sustained drop in oil prices, the sequel has been recession and/or depression around the globe. Where are we today? Oil prices are down at the levels they are. When you have a look at what the major oil producing countries are, with the exception of the United States, they are countries that have difficulty with stability: Russia, Angola, Nigeria, Iran, Iraq, South American countries and some of the Middle Eastern countries.

This is not a time for cheap political point-scoring. This is not a time for this country to be spending well beyond its means. This is a time for us to be getting our debt under control. It is not a time for us to be losing $1.2 billion a month in interest alone on our debt. This is a time when this country needs to get back to a circumstance of strong economic stability: the sort of stability that we saw in 2007, which got this country through the global financial crisis when it eventually occurred, during the time of the Rudd government.

Just have a look at how different the circumstances are today to how they were then and whether this country is equipped to be able to sustain another global financial crisis: our terms of trade have declined; China, the great supplier of wealth to this country over the last few years, has slowed down economically; high commodity prices have now come off; and Australia has that debt of $400 to $600 billion and the monthly interest of $1.2 billion. Interest rates are at a historically low level. It is time that this country understood the challenge. (Time expired)