Alex Gallacher (SA, Australian Labor Party) Share this | Hansard source

I too rise to make a contribution in this very important debate on the government's tax plans, which are fiscally reckless, less progressive and fail in the area of Australian jobs. You can't be in this chamber for any length of time without asking yourself a little, 'What is going on here?' Here we have a government that's lost 34 consecutive Newspolls. They had a disastrous double-D election which delivered a crossbench which means that they negotiate with Senator Hanson and other people on every bit of contentious legislation, all created by the Hon. Malcolm Turnbull's leadership.

If we go back to Senator Mathias Cormann's contribution with the Hon. Tony Abbott and the Hon. Joe Hockey with the glass of wine and the cigar and The Best Days of Our Lives playing, they slashed and burned almost every Australian who was receiving some sort of income protection or benefit. We now have a situation which is described this way by our spokesman:

The government's tax plan achieves a rare trifecta. It's fiscally reckless, will lock in a less progressive tax system and will leave Australia less able to support Australian jobs in the event of a downturn.

I must confess that on Saturday I often do have a trifecta, but I do that with a vision of winning and enjoying those winnings. Here we have a government that wants to deliver a trifecta, including a less progressive tax system and being less able to protect Australian jobs in the event of a downturn.

We in the 45th Parliament are being asked to pass legislation which will bind the 46th Parliament and the 47th Parliament. This is quite extraordinary! Stage 1 from 1 July 2018 is fair enough—it's the 45th Parliament's work. Stage 2 is from 1 July 2022. It's quite conceivable that'll be outside the 46th Parliament. Then Stage 3 is from 1 July 2024. It's extraordinary! This government is acting as if it has just won 34 consecutive Newspolls with a 10 per cent margin and has resounding community support and—dare I say it—it's acting as if it has bipartisan support in this chamber. It can't get its legislation through without dealing with a fractious crossbench. Senator Cormann is lauded as this master of patience and for his negotiation ability, but the reality is he has to deal daily with the crossbench in passing any of this legislation.

And this proposal comes on top of the proposal to cut corporate taxes. It's gigantic. Senator Cormann always says, in an overabundance of goodwill and good humour, that he'll display all the relevant information to all the parties so we can all get on board with his grand plan. But the depth charge here is extraordinary. We've had 27 years of uninterrupted economic growth. This plan assumes that we're going to have 37 years. It assumes that we're going to continue to grow exponentially, without any hiccups at all. And the depth charge is simple. All of the stuff they couldn't achieve in the Abbott-Hockey-Mathias Cormann budget—the Hon. Tony Abbott, the Hon. Joe Hockey and the Hon. Mathias Cormann, with that glass of wine and cigar and The Best Days of Our Lives playing in the background—because the community revolted and they nearly lost the next election and the Hon. Tony Abbott lost his prime ministership over it, they're seeking to do with this depth charge into the future: a reduction of national income way beyond this parliament and into two future parliaments. But they figure that if they can get this through and the national income is reduced to that extent, one downturn and we will not be able to sustain the Australia that we currently have. We will not be able to sustain increases to the aged pension. We will not even be able to sustain the pitiful amount we pay to people on Newstart allowances, which is 20 years without an increase.

So, this is the game: 'We're going to give workers and aspirants a tax cut.' But what they're really doing is trying to constrain the income of future Australian governments—of which they have no idea what the composition will be—in terms of delivering service to all the respective participants in this economy. The last words in Senator Fawcett's contribution were about defence, a matter really dear to his heart. But there's no way that the provision of Medicare, defence, human services and the NDIS—any of these valuable and important services—to this country can be guaranteed if we're prospectively handing future income out the window. There will be no future income. If we get the corporate tax cuts through and we then compete with Singapore and Ireland, I don't know where it stops. Ireland is, I think, at 12 per cent, and Singapore at the moment is at 20 per cent. Do we have to go to 12 per cent? Is the $50 billion worth of corporate tax cuts going to be enough in that competitive arena? Then you add this halving, if you like, of future income. How is it possible that we can actually be debating this matter for two parliaments hence? We have no idea what the composition of the Senate will be. We have no idea who will be the successful government. Yet we've been asked to consider this with all seriousness.

The government have been a disaster since they got in. They tried to slash and burn. It didn't work. And now they've come up with this very innovative plan, and we on this side of the chamber are expected to say, 'Okay, yeah: let's do that.' Well, I'm sorry: I just don't think Australians will buy this. And when you dig down into who's actually getting what, there are modest benefits for hardworking Australians on low incomes. Labor will double that benefit. As for the tax-free threshold moving to 32 per cent, or thereabouts, for everybody earning under $200,000—a 32.5 per cent personal tax bracket from $120,000 to $200,000—if we can afford it and we can maintain the services and there's a proper evaluation and discussion and it's done in a rationale way then I'm sure that all parties would agree. But just putting that in place now, guessing that we're going to have 37 years of continuous economic growth, is really unusual and will definitely not be supported by this side of the chamber.

It really just beggars belief that the government can actually come in, as I've said, after 34 negative Newspolls and act as if they have broad community support for this plan, as if they've actually discussed it with the broader community. Has there been any feedback from all of the relevant stakeholders, or are they just going to say: 'Well, we're in charge. We're the government. This is going to happen'? Do they really think that Australians have a hip pocket nerve so big that they'll grasp at any tiny pittance of tax relief and forget that it could endanger valuable services that they get in education, health, transport, defence and, as Senator Whish-Wilson said, the environment? If we do decrease our national income, will we then have to make choices about how much we spend on the Great Barrier Reef? Will we then have to make choices about how much we spend on education? Will we then have to make choices about how much we spend on public transport or—dare I say it?—the infrastructure that connects our economy and makes it grow?

These are the simple propositions that are not answered by this extraordinary policy that's promoted by the Hon. Mathias Cormann, the Hon. Scott Morrison and others. It's quite extraordinary that any government would seek to come into the chamber and say the 45th Parliament will take action in the year 2024, which would probably be the 47th Parliament, when many of us may not even be here and there will be a vastly different composition in terms of the crossbenchers and the like. So I find the whole thing quite extraordinary and, to be perfectly frank, a bit bewildering. We're talking about $143 billion—not million but billion—in new tax cuts, much of it to be delivered in the years 2022 and 2024. It is quite extraordinary. I think Australians will judge it that way and reject it in a very clear, succinct and resounding manner.