Katy Gallagher (ACT, Australian Labor Party, Shadow Minister for Finance) Share this | Hansard source

Labor will support these three appropriation bills. Labor does not block supply. However, this should not be seen as Labor giving a free kick to the government's approach in the handling of the budget or the economy. These bills, aside from appropriating the remainder of this financial year's funding—the other bit having been covered by the supply bills passed by the 45th Parliament before the election—also incorporate some election commitments as well as machinery-of-government changes announced since the election. Appropriation Bill (No. 1) 2019-2020 seeks to appropriate a total of $58.4 billion in 2019-20 for ordinary annual government services; Appropriation Bill (No. 2) 2019-2020 seeks to appropriate a total of $7.4 billion for new services and payments to the states and territories; and Appropriation (Parliamentary Departments) Bill (No. 1) 2019-2020 appropriates $160.8 million for the four parliamentary departments.

That's what's contained in the bills, which, as I said before, Labor will support. But I think what's more important is what's not in them and what that shows: a glaring lack of a plan to support an economy that is floundering on this government's watch. Last week's statement by the Reserve Bank, where they kept the cash rate unchanged at a record low of 0.75 per cent, noted, 'The main domestic uncertainty continues to be the outlook for consumption,' and it pointed to subdued wages growth which is likely to continue for some time. We have weak domestic consumption driven by wages growth at record lows, which is seen as the main piece of uncertainty for our economy, and this means that, in real life, Australians are doing it tough. The Reserve Bank has seen fit to cut interest rates three times since the federal election. We have household debt at record highs. There are almost two million Australians either looking for work or looking for more work. Just last week we saw the latest retail trade results, which showed the worst result in 30 years, and we saw the RBA, in its latest Statement on monetary policy, downgrading its forecast for economic growth in 2019-20 and wages in 2020-21.

But what do we get from this government? They're just sitting there doing nothing. Instead they're making monetary policy do all of the heavy lifting when there are continual calls from the Reserve Bank, economists and even the New South Wales Liberal Treasurer, Dominic Perrottet, amongst others, for the government to do something. It's not clear either that the income tax cuts which are in effect today and which Labor supported are having the effect that the government seems to put so much stock on.

We've continually argued that we can have responsible, proportionate and measured stimulus. Instead, from the government, we get just tired old political attack lines, bringing up policies initiated by the then Labor government which, as they like to conveniently forget, helped save the Australian economy from going into recession during the global financial crisis. Labor's called for a bring-forward on infrastructure projects, and we're not the only ones. The Reserve Bank governor has called for greater investment in infrastructure at least seven times since the election, particularly in regional Australia. Last week, 13 senior economists supported the RBA governor's call that further stimulus is needed, with 10 of them calling on the government to use fiscal stimulus like fast-tracking infrastructure investment to help the economy. They joined a list including Ai Group, EY, Master Builders Australia, NAB and Hostplus, who have all called for the fast-tracking of infrastructure investment, all of which could be done without putting the budget surplus in jeopardy.

Labor has also called for an increase to the Newstart allowance, and again, as on infrastructure, we're not the only ones. KPMG recently released a report saying that an increase to Newstart will provide much-needed economic stimulus, boosting domestic consumption, especially in regional areas. Organisations such as the BCA, Deloitte Access Economics, Ai Group and COSBOA have all called for an increase—so have ACOSS, the Council of the Ageing, National Seniors Australia, St Vincent De Paul and the Brotherhood of St Laurence. Just to demonstrate that it's something that crosses the political divide, the following individuals have also called for an increase to Newstart: former Liberal Prime Minister John Howard, former Nationals Deputy Prime Minister Barnaby Joyce, Liberal Tasmanian Premier Mr Will Hodgman, Deputy Nationals leader Senator Matt Canavan, Liberal Senator Dean Smith, Liberal MP Russell Broadbent, Liberal National MP Andrew Wallace, former Liberal senator Arthur Sinodinos and former Liberal MP Fiona Scott. The Treasurer himself has admitted that increasing Newstart would be effective stimulus given that Newstart recipients would be more likely to spend the money out in the economy. These are just a couple of areas where the government could take action now to turn around an economy that is clearly floundering on their watch, but they choose not to do so.

We do hear on a tiringly repetitive basis slogans about how the budget is forecast to be in surplus this financial year. Let there be no mistake: Labor supports the budget being in that position, but there is one thing that the government don't like to highlight, particularly as they were apparently elected into office six years ago to get debt under control. This is another example of the government saying one thing but doing something different. Net debt has more than doubled since the government took office with debt at $174.6 billion in September 2013. The most recent monthly financial statements show that net debt has crashed through the $400 billion mark for the first time in Australia's history at $401.7 billion in September 2019. Gross debt has also nearly doubled since the government took office with $280.3 billion in September 2013. The latest data put out last week shows that gross debt is now at $555 billion. These figures don't sound like debt is under control.

We know that the government have got their priorities all wrong, with no plans for the country other than a political plan. I would like to highlight a few areas in the remaining time that I have. The first is one of the very few election commitments that the government actually did announce. As is their wont, they announced it along with the rest of their election costings with the barest level of accountability two days before the election. It was an increase to the rate of the efficiency dividend, something which is reflected in the appropriation bills before us today. The proposal involves maintaining the rate at two per cent for a further two years, 2019-20 and 2020-21, before reverting to 1.5 per cent in 2021-22 and then the standard base level of one per cent in 2022-23. Over the forward estimates, this is meant to generate savings of $1.5 billion and, over the medium term, nearly $5 billion. That's another $1.5 billion over the next four years cut out of the Public Service, which follows on from an additional net $1.9 billion of cuts from increases to the efficiency dividend from 2014-15 to 2019-20 that were already in previous budgets. It is a very typical approach from this government to the Public Service to cut jobs, slash budgets and then point the finger when something goes wrong.

That $3.4 billion in cuts to the Public Service is going to have a detrimental effect on services to the Australian people. We are talking impacts on frontline services, such as from the ATO and Centrelink. We are talking a long-term impact on capability building and ensuring the APS is fit for purpose as we move into the 21st century. All this government has done through the impact of the efficiency dividend increases, protracted industrial disputes, job cuts and the ASL staffing cap has led to a steadily growing reliance on the use of contractors and consultants and the steady erosion of the capability of the APS. A strong, responsive and apolitical public service can challenge governments to be better and to think about the long-term implications of decisions forged in the bearpit of federal politics. An accountable, transparent and effective public service can deliver services and programs in a way that puts people before profit and manages the needs of our most vulnerable citizens, something that drives all of us in this place. If we continually erode the capability of the Public Service, it makes it more tricky to do these things. At the very least, it makes it more difficult for the Public Service to be 'congestion busting', as the Prime Minister so eloquently put it a few months ago in his finger-pointing tirade to the Public Service.

This leads me to a another point about the government's priorities. Just last week we saw a scathing audit report from the Auditor-General about the administration of regional jobs and investment packages. We had $220.5 million in grants. That was $220.5 million of tax payers' money awarded by ministerial panels, with the Auditor-General finding that they approved ineligible applications for funding, approved five late applications for funding with no exemption reasons recorded and awarded 89 per cent of the funding for the New South Wales South Coast region to applications from the highly marginal Liberal seat of the electorate of Gilmore at the expense of the Labor-held seat of Eden-Monaro. They failed to verify claims around ongoing jobs created by each proposed grant. They did not rescore or provide reasons when rejecting 28 per cent of the applications that had been recommended by the department. They approved 17 per cent of applications not recommended by the department, without adequate reasons. They failed to appropriately consider co-funding exemptions, awarding four of the 16 applications where a co-funding exemption was requested a total of $1.74 million. They increasingly overturned decisions over time. They did not consistently apply the eligibility requirements relating to the content of applications, did not manage conflict of interest to a consistently appropriate standard and did not soundly assess applications in accordance with the program guideline. It's an absolutely scathing report. It's one thing to drop this scathing report on Melbourne Cup day; it's another thing to completely mismanage a $220 million grants program.

Another revelation last week was that a company originally hired to run a call centre assessed the grants for this program. This company was awarded a $3.15 million contract without a tender or quote from any other company. And the contract itself was incorrectly described on the AusTender website as being for 'professional recruitment services'. Believe me, this is something we will come back to and continue to analyse. This episode is simply emblematic of a government that has no plans other than political plans, has it priorities wrong, and has an aversion to transparency and accountability.

Finally on priorities, it's telling that the government is able to spend $220 million on a grants program in a fashion that raises serious questions about how it's being administrated and managed, but then not deal with the situation in our aged-care system. We've recently seen the interim report of the Royal Commission into Aged Care Quality and Safety. As the shadow minister for ageing and seniors said a couple of weeks ago, it's a heartbreaking and shocking reminder of the unacceptable state of Australia's aged-care system.

But the government refuse to do anything. They've known for more than a year that 16,000 older Australians died in a year whilst waiting for home care. They've known for even longer that 120,000 older Australians have been waiting for the home care that they have been approved for. The interim report of the royal commission describes the unacceptable number of older Australians waiting for home care as 'unsafe practice and neglect'. So while it's busy mismanaging a $220 million grants program, it has done nothing to address these very, very serious issues, and the contrast couldn't be starker.

As I said, Labor will support these appropriation bills, but this is not a leave pass for the government's approach to the budget, the economy and the priorities for Australian people. Its failings are stark and many, and it's clear that its priorities are wrong. Labor will continue to hold the government to account to ensure that, in its third term, it is actually implementing an agenda which will be a benefit to all Australians and which will help to turn the economy, which is floundering on its watch, around.