Alan Eggleston (WA, Liberal Party) Share this | Link to this | Hansard source

I move:

That the Senate:

(a)

notes:

(i)

the concern of Australians given the impending budget cuts proposed by Labor’s razor gang;

(ii)

that Labor is showing with its backflips and ill-conceived proposals that it has no idea how to run our trillion dollar economy; and

(b)

calls on Labor’s razor gang to ensure that no Australian will be worse off when the Budget is delivered in May 2008.

Today we are speaking on a motion related to the budget and the economy, something we on this side, as parties in the coalition, recognise as the foundation upon which all other achievements in all other areas rest. We all know that the best policy counts for little when there is little money to put it on the ground and when social development is held back by a lack of basic needs. Let me start by saying that no other party in this parliament can lay claim to such a great economic record as our coalition government had.

Since the election of the Rudd government, all we have heard is how bad things are. One of the terms regularly used when justifying these impending budget cuts to the Australians who depend so much on good economic management is ‘the Howard legacy’. The problem with this term is that they have been using it with a negative connotation. However, as far as its legacy in terms of the budget and the economy goes, the coalition government is very proud of its achievements in this area. With budgets and the economy being measured mainly in numbers, we can safely say that our claim of a first-class economic legacy is backed by the numbers.

As a member of the previous government, it is with pride that I go through some of the many achievements of the coalition during our time in office. Firstly, average GDP growth from 1996 to 2006 was 3.6 per cent. As an achievement, this is even more impressive when you compare it with other developed countries, such as the United States, with average growth of only two per cent; the United Kingdom, with growth of only 2.8 per cent; and Germany and Japan, with growth of 1.4 and 1.2 per cent respectively. For the time that we were in government our budget and our first-rate economic management saw our GDP grow over 10 years at a rate of 1.3 per cent higher than the OECD average. The coalition government presided over the longest and strongest sustained period of growth in Australia’s history, despite numerous challenges such as the Asian financial crisis and September 11. The effects of these were greatly felt by many economies around the world.

With such a record, it should come as no surprise that the then opposition began copying our policies to the point that the phrase me-tooism came about, and they continue to do so in many ways. You cannot get this kind of growth without lowering unemployment, which is a win for Australia and a win for those individuals who were brought back into the workforce. Since coming into power in 1996 the coalition government, through macro and micro reform, saw around 2.2 million extra Australians enter the workforce, with 60 per cent of these new jobs being full-time jobs. From an unemployment rate of 8.2 per cent in March 1996, the coalition, through its first-rate budgets and economic management, saw the unemployment rate in this country drop to 4.3 per cent in August 2007, the lowest it had been since 1974. We also managed to reduce the number of long-term unemployed to 66,700 by August 2007, around a third of the number that there were when we first came into power.

All of these jobs would mean little if people were paid inadequately, but during its term of office the coalition saw real wages rise by 21.5 per cent. This is a great achievement for workers, especially given that wages in this country fell in real terms by 1.8 per cent only over 13 years. So after 13 years of budget management the Labor government, which refers to itself as the workers’ party, has brought to the table a drop in wages and an unemployment rate during the period until 1996 that was almost twice as high as it is today. Most are aware of the union campaign during the previous election campaign about Your Rights at Work. In my view, it is hard to have rights at work if you do not have a job, and for those who saw their real wages go backwards, where were their rights?

Another great budget achievement of the coalition was our management of Labor’s mismanagement of government debt. We managed to completely pay back the $95.8 billion debt that had accumulated under the previous Labor government. By paying back that money we saved billions of dollars in interest payments, with the interest bill for the 1996-97 period totalling $8.4 billion. Now, the current Labor government is boasting about the $642 million in programs that its razor gang has managed to axe. Those savings are over the next four years and represent only one-fourteenth of the interest bill generated by the previous Labor government’s debt in only one year.

Much to our credit, not only did we manage to pay all that money off and have our credit rating upgraded twice to its current AAA rating but we also managed to drop the tax burden from 22.3 per cent of GDP to 20.7 per cent of GDP. In short, the numbers clearly show that the Howard government legacy in terms of our budget and economy means nothing less than history-making growth, more jobs, higher wages, zero government debt, a top credit rating and a lower tax burden. Australians are definitely not worse off for having had the coalition in government and what we are asking today is for the current government to ensure that Australians will not be worse off when the budget is delivered in May. It is an assurance many Australians are anxious to have, given the performance of previous Labor governments.

So how did we do all that we did, and where did this all come from? Despite the ideas that were put forward during the election campaign, economies do not run themselves; they need good policies and hard work. The coalition are fully aware that some of the best work that can come from government is the work that helps Australians work to their best. With this in mind, the coalition brought many well planned and executed policies forward which made sure that when the Australian economy wanted to function it could do so efficiently and competitively with minimum government interference and maximum support. To create such a healthy economic environment there were many areas that needed action, and I would like to discuss some of those now.

To help Australia’s exporting sectors, the coalition government worked very hard to complete three free trade agreements with the United States, Thailand and Singapore, bringing the number of completed free trade agreements from only one to four. During its term the coalition also began talks with ASEAN, Malaysia, China, Japan, the Gulf Cooperation Council and other Gulf states. These efforts, aimed at building on the commitments already agreed to in the WTO, will make Australian export industries more competitive by lowering and sometimes eliminating completely tariffs, quotas and other restrictions under which Australian exporters would otherwise have to operate.

In terms of being worse off from Rudd’s razor gang and its budget cuts, it is worth recognising here that the previously mentioned negotiations with Japan on a free trade agreement have been axed by $1.1 million, which was allocated for the commencement of these negotiations. Given that Japan is Australia’s largest trading partner and it has long been, by far, Australia’s largest export market, this $1.1 million saving pales in light of the $31.6 billion worth of exports from Australia to Japan in 2005. Those figures came from a DFAT study group paper which strongly recommended a free trade agreement, highlighting the fact that in 2005 exports to Japan were greater than those to both China and the United States combined. It is that sort of economic short-sightedness that has so many Australians concerned about what the Rudd government is up to, and warrants today’s motion.

Besides making the Australian economy more open, we have produced many reforms that have allowed Australians to better participate in our economy and reap their share of Australia’s current prosperity. We helped this happen through welfare reform—through the Welfare to Work program, for example, which played a part in many people coming off unemployment benefits and entering the workforce. This helped address labour shortages, improved their independence and self-confidence, and reduced the welfare burden.

Another great initiative can be found in the Job Network, which provided assistance to all job seekers but was of greatest help to those who were most disadvantaged in the labour market. The success of this initiative can be seen in the large number of placements recorded for all job seekers, with the 12 months leading to the end of February 2007 seeing a total of over 650,900 job placements being recorded. The coalition also introduced workplace reforms which, despite prophecies of doom and gloom, saw real wage increases and the creation of new jobs, most of which were full time.

Not only did the coalition government help Australians to be better off in a purely economic sense; we also helped with programs that helped Australians in areas such as education, health and culture. It is from many of these non-economic areas that concerns about the Rudd government’s razor gang are being raised. For example, relatively small amounts of expenditure have already been axed from programs, with little foresight of what it will mean for the economic, social, cultural and environmental health of Australia—many people and industries have already been left worse off.

Examples of such funding cuts, as I have already discussed in Senate estimates, include the $6 million cut from the Australian Nuclear Science and Technology Organisation for its graduate recruitment program. This has far-reaching implications, including implications for the nuclear medicine industry, which will be disadvantaged by these cuts and it will be more difficult for people to obtain radioisotope scans.

Another example of razor gang cuts leaving Australians worse off comes from the reversal of the 2007 drought package, which will see $10 million of assistance to rural research and development corporations and companies being axed. For a government that is constantly telling people just how much we are going to be worse off with climate change, I find it hard to understand how it justifies axing a program to better equip us to handle climate change and how this is going to make Australians any better off, in particular how it is going to be of any assistance to people of rural and regional Australia.

This is just a quick review of some razor gang actions that have definitely not left Australians better off. There are many more involving cuts to music programs, sports programs, research programs and so on, but time limits me from going through them all.

In conclusion, this country was left with a very fine economy by the coalition government. It is absolute nonsense for them to claim with any credibility that the coalition was lax in its management of the economy or lax in its awareness of the growing problem of inflation. We can only be greatly disturbed, and we have a sense of great misgiving, about the impending budget cuts being proposed by Labor’s razor gang. There is no doubt at all that the Labor government is showing a reckless disregard for the interests of many people in this community, as was shown during this last couple of weeks with the proposed cuts to the carers allowance. I feel a great sense of foreboding at the possibility of across-the-board budget cuts which will undermine the wellbeing of many Australians, and perhaps hit most of all the most vulnerable people—people who depend on welfare and the kinds of extra benefits that the coalition government gave them. Strangely, these people are generally traditional supporters of the Labor Party. The people of Australia have every right to be very suspicious of what this government is up to in terms of the actions of its razor gang, and I implore Labor members in the Senate to ensure that there is a sense of responsibility and that the most vulnerable in this community have their interests protected rather than being undermined by this process of the razor gang budget cuts.

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

I enter this debate on the motion relating to the budget and the economy rather surprised that the opposition would move such a motion in general business, especially when they talk about trying to ensure that no Australian is worse off, given their record. It was interesting to hear Senator Eggleston say that to run a good, strong, modern economy you need good policies and hard work. That is something the previous government, now the opposition, used to talk about a lot but do very little of indeed.

A number of years ago I remember speaking in this chamber about the skills shortage—the very skills shortage that plenty of members of the now opposition were prepared to admit at the time. In fact they were happy to say it was a skills crisis. I remember Senator Abetz saying that the skills crisis is a victim of our success with the economy, and I will come back to that in a minute. It is interesting that the shadow Treasurer—the shadow Treasurer who wanted to be a member of the Labor Party but did not join, thankfully—now says that the skills crisis does not exist at all. It seems very strange to me that the new opposition seems to be floundering around. They are not sure what to ditch from when they were in government, what to discount, what to abandon, what to keep and what to modify. They seem to be all over the place.

The fact is the previous government let Australia down in terms of the skills issue. They did not invest in training. They did not ensure that there were enough training programs and systems in place to identify that the skills crisis was coming. Of course, Senator Abetz’s remarks were telling, because you do not have a modern efficient economy that you have actually planned for unless you address one of the key elements, and that is ensuring that there are enough skilled workers in place to cope with the growth that a successful economy will deliver. One can only conclude that when Senator Abetz, speaking on behalf of the then government said, ‘The skills crisis was simply us being a victim of our own success,’ any economic success that the previous government had was purely accidental.

If they had planned for it, there would not have been a skills crisis in this country. The fact is they were not planning for it. They were relying on the general strength of the global economy and reaping significant rewards from that. They failed to address the skills crisis and have clearly made Australians worse off as a result. I find it strange that they are now asking us to guarantee that no Australians will be worse off as a result of the budget when they did nothing to put in place all the factors that need to be in place and well entrenched in order to run a strong economy.

Of course the same is true for inflation. When did the inflation genie get out of the bottle? It was some time ago. It was not just the Labor Party talking about it at the time. The Reserve Bank gave warning after warning to the then government about the inflationary pressures of their policies and they went on spending like drunken sailors and making promises right through the election campaign. An example of the ridiculous expenditure they were engaging in—and it was drunken sailor-type spending—was the Dairy Regional Assistance Program which gave a grant to the Indigo Cheese factory in the electorate of Indi. The former government in May 2005 gave a $426,962 grant under that Dairy Regional Assistance Program. But here is the catch—as part of the grant the former government paid an instalment of $22,135 of taxpayers’ money on 28 June 2007. The trouble is, 28 June 2007 was three months after the factory had already closed its doors.

Under the former government there was a slack regime in place for these programs. I probably will not have time to go into all the regional assistance programs which were rorted to the hilt by the previous government and by the National Party in particular. We will just concentrate on this one for a moment. Once the previous government was unceremoniously chucked out by the electorate and after seeking legal advice, the factory found that they were actually deemed to have complied with their contractual obligations even though they had accepted money three months after the factory had closed.

Just think about that, the factory shuts in May 2007, but this company under a scheme managed by the previous government still gets $22,000-odd of taxpayers’ funds just before the end of the financial year because under the contract that they had signed under the former government’s regional arrangements, you could get that money. The factory did not even have to stay open! This is the sort of program—

Ian Macdonald (Queensland, Liberal Party, Shadow Parliamentary Secretary Assisting the Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Tell us about the dead tree.

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

I know Senator Ian Macdonald does not like to listen to these real-life examples of how incompetent the previous government was in managing these programs. We will talk about lots of things, Senator Macdonald, but maybe you should listen and you might learn something. One of the lessons you are going to have to learn in opposition is how to actually run and manage yourselves and present yourselves to the public where you might become competitive again.

Julian McGauran (Victoria, National Party) Share this | Link to this | Hansard source

Senator McGauran interjecting—

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Senator McGauran laughs. I know he has had many years previously in opposition and he did not like it. He knows and probably recognises and lays awake at night thinking, ‘We’re going to do the same things as we did in that last long 13-year period during opposition.’ You have leadership tensions again; it is all over the place. How long will the existing Leader of the Opposition last?

Ian Macdonald (Queensland, Liberal Party, Shadow Parliamentary Secretary Assisting the Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

About as long as Kevin before Julia gets in.

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Oh, do you really think so? Senator Macdonald, I would like to have a little wager on that with you because I do not think Mr Turnbull would last very long at all.

Michael Forshaw (NSW, Australian Labor Party) Share this | Link to this | Hansard source

Order! It is against standing orders to have any proposed wagers across the chamber. You should direct your remarks through the chair.

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Thank you, and I will. It is a little bit ironic that the current Leader of the Opposition was a member of the Labor Party and he is about to be replaced by the shadow Treasurer who wanted to be a member of the Labor Party. Then again, you have a Leader of the Nationals in the Senate who is not even a member of that particular party. There is a sort a bizarre world going on in opposition. I do feel a little bit sorry for you. In time you will work it out. It will settle down and you will start to focus on some of the issues that actually impact upon Australian people.

One of the other things I found interesting in what Senator Eggleston talked about is their sudden new-found interest in looking after the most vulnerable Australians. I find that a little bit strange coming from an opposition that, when in government not long ago, introduced one of the most evil, pernicious pieces of legislation called Work Choices that systematically ripped away the wages and conditions of Australians. And do you know which Australians were most affected?

Opposition Senators:

Opposition senators interjecting—

Nick Sherry (Tasmania, Australian Labor Party, Minister for Superannuation and Corporate Law) Share this | Link to this | Hansard source

They have still not learnt their lesson.

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

This is the other thing I find interesting when listening to the interjections from the other side: they are defending their position. They are laughing about it because they have still not accepted the fact that Work Choices hurt working people. And the people who have been hurt most are the most vulnerable people in our community—the people in low-paid, low-skilled jobs who did not have any bargaining power. They allowed and set up a system of systematic abuse and the stripping away of wages and conditions.

The strange thing is that lots of evidence about the massive abuses that were taking place is now coming from departments that are no longer controlled by that government. I do not like to use the word ‘hypocritical’ very often, but I do find it somewhat hypocritical that the previous government—the now opposition—have a new-found interest in vulnerable Australians when they did not really seem to care before. If they had cared before, they may not be over on the opposition benches now. But it is a little bit late to care now. We see their new-found interest in openness, in transparency and in fairness and we find they have a new-found interest in VSU. During estimates we had senators coming in saying, ‘Isn’t it outrageous the impact the VSU legislation has had on people who used to work for the university unions?’ I did suggest to the coalition senator during estimates that maybe he would want to move a private member’s bill to undo the legislation that he supported in the previous government.

It is quite bizarre to see these flips, flops, flaps and fuddles going on with the opposition as they try to sort themselves out and work out what they actually stand for now, where they want to target themselves and who they need to attract to give them some traction in the political arena. Given their performance so far, I think they are going to struggle.

We have heard a lot of data on what Work Choices actually did to people, but I want to give the Senate some information about some of the impacts of agreements that have failed the fairness test. I understand that the previous minister, Mr Hockey, in some of his interviews around the place explained the introduction of the fairness test in this way: no-one in the cabinet of the previous government seemed to understand that Work Choices could actually rip away the terms and conditions of employment of many Australians and reduce their wages. They were either all ignorant—I suggest that that is what he must have been getting at—or asleep at the wheel. That is not surprising. That was obvious in so many things that the previous government was flapping around trying to do. But he wanted to be the champion and, once he was able to convince his cabinet colleagues that Work Choices could rip away the terms and conditions of vulnerable working Australians, they wanted to introduce a fairness test. It was a phoney fairness test, but nonetheless there it is.

What happened was that so many agreements still continued to fail the fairness test—the miserable low base that the previous government decided to put into the fairness test. For having their conditions, their penalty rates, their shift loadings, their public holidays and all those things ripped away the phoney fairness test was put in place to compensate them. But of course the problem was that that did not discourage shonky employers from trying to rip everyone off as much as they could. I do recognise that there are many fine employers that have integrity and treat their employees very well indeed. But there are a lot that do not, and nothing could be a better example than the fact that, of all the agreements that failed the government’s fairness test—and you should understand that the fairness test is for the worst possible wages and conditions allowed for by law—50 per cent failed because they offered less than $50 per week below the required rate and 39 per cent failed because they offered from between $50 and $199 per week below the required rate. And again, that is the lowest rate required by law. A further 10 per cent failed because they reduced wages and conditions combined by between $200 and $499 per week below the legal minimum, and one per cent—and thank heavens it was only one per cent—failed the fairness test because those AWAs were offering more than $500 per week less in wages and conditions than the legal base minimum rate.

Even with the fairness test in place, with employers supposedly understanding it and with the $100 million or so of taxpayers’ money that the previous government spent on advertising as well, we still had this large percentage of agreements coming through trying to rip off workers, many by more than $500 per week below the worst possible wage allowed under law.

Mr Hockey was just dead wrong when he said that the government did not know that this was going to be the outcome and that he had to explain to his cabinet colleagues that this could be a consequence of Work Choices. In the first WorkChoices booklet that went out with the original Work Choices legislation, there is the example of Billy. This is what the government said in their advertising propaganda:

Billy is an unemployed job seeker who is offered a full-time job as a shop assistant by Costas who own a clothing retail store in Canberra. The clothing store is covered by a federal award. The job offered to Billy is contingent on him accepting an AWA.

Take it or leave it was a common approach with AWAs.

The AWA Billy is offered provides him with the relevant minimum award classification wage and explicitly removes other award conditions.

As Billy is making an agreement under WorkChoices the AWA being offered to him must at least meet the Fair Pay and Conditions Standard. The AWA Billy is offered explicitly removes award conditions for public holidays, rest breaks, bonuses, annual leave loadings, allowances, penalty rates and shift/overtime loadings. Billy has a bargaining agent assisting him in considering the AWA. He understands the details of what is in the AWA and the protections that the Fair Pay and Conditions Standard will give him including annual leave, personal/carer’s leave, parental leave and maximum ordinary hours of work. Because Billy wants to get a foothold in the job market, he agrees to the AWA and accepts the job offer.

The government’s own propaganda talked about a Work Choices AWA being able to strip away public holidays, rest breaks, bonuses, annual leave loadings, allowances, penalty rates and shift and overtime loadings. We have Mr Hockey saying that the cabinet ministers did not understand that these things could actually happen, but it was in their own propaganda. I may be wrong about this, but I think on that initial campaign the then government spent $55 million of taxpayers’ money to make people sign a take it or leave it AWA which made them worse off.

I can only suggest to the now opposition that it is a little bit too late to care. You did not care then; you do not really care now. When the next election comes around you will not be talking about Work Choices and the reintroduction of these sorts of AWAs, yet that is what you want to do. The Australian public know it. We see it throughout the public hearings into the inquiry into the bill that is about to come before the Senate—the constant defence, day after day, witness after witness, by coalition senators protecting AWAs, harking back to the glory days, trying to get employers to say we really want them, just so the coalition can put AWAs back on the agenda and introduce them again. It is because they have not learnt from their mistakes. They do not care about vulnerable Australians; they do not care about working people. Quite frankly, this motion before us today is just a political stunt, an opportunity for them to get up and grandstand, but it means nothing—

George Brandis (Queensland, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

You wanted to abolish the carers allowance.

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

It is interesting that Senator Brandis joins the debate at the last minute and it will be interesting to hear what he has to say about this issue. I will be interested to hear what you say, Senator Brandis, when you get up during this debate and make your contribution. But you, like everyone else, are a bit late. (Time expired)

Julian McGauran (Victoria, National Party) Share this | Link to this | Hansard source

I join with my colleague Senator Eggleston to support and endorse the motion before the Senate. It was only last week that the final report card, if you like, on the Howard government was handed down in the national accounts for the December quarter. It showed quite clearly that the economy continued to grow at record levels above the OECD countries, growing at 3.9 per cent a year. It showed that the economy maintained its strength, its resilience and its flexibility, that it had entered the 17th consecutive year of uninterrupted growth and that unemployment rates were at 35-year lows. Moreover, the investment boom was continuing. Businesses were investing in future capacity. The national accounts said that new private business investment grew by 0.6 per cent in the December quarter to be 11 per cent through the year. Profits remained strong. Pressures on wage breakouts were contained; nevertheless wages increased. Consumer confidence maintained its high levels even in the face of several interest rate rises.

That is the final report on the Howard government handed down in the national accounts. A strong, resilient economy was handed over to the new government. Let us have a look at the first report handed in on the Rudd government. It happens to be quite starkly on the front page of the Financial Review today. It is all centred around market expectations and market confidence. Its headline says ‘Consumer confidence slumps’. From December last year to now, we have had a slump in consumer confidence. It is worth while to read passages. Senator Sherry, you may want to hear this if you have not already read the front page of the Financial Review—the first report card on the Rudd government—as you slink out of the chamber, not wanting to hear the economic facts.

Michael Forshaw (NSW, Australian Labor Party) Share this | Link to this | Hansard source

Order! Senator McGauran, you will address your remarks through the chair and you will address the issues in the debate and not seek to make those sorts of comments about a senator.

Julian McGauran (Victoria, National Party) Share this | Link to this | Hansard source

I do apologise for being provoked by and provoking Senator Sherry.

The Acting Deputy President:

Senator McGauran, return to your speech.

Julian McGauran (Victoria, National Party) Share this | Link to this | Hansard source

I will quote from the Financial Review, because it is important to do so. I do not wish to quote big slabs of it, but it is poignant. It is poignant because it goes to the fact that the issue goes deeper than what Mr Rudd has just flicked off in saying that ‘international volatility’ is causing this. No. Read the actual results of the surveys and you will realise it certainly goes deeper than that. It is in fact a comment on the ability of this government to run the economy. To quote certain paragraphs:

Consumer confidence has plunged to its lowest point in almost 15 years amid signs the economy is slowing under the weight of successive interest rate increases and the effects of global financial market turmoil.

…            …            …

The Westpac-Melbourne Institute index of consumer sentiment has plummeted more than 21 per cent in the past three months—

three months of the Rudd government, precisely—

to record its sharpest quarterly fall on record, a development that follows softer retail sales and signs that growth in employment, forward orders and profits are moderating.

Moreover:

… Westpac chief economist Bill Evans said the significance this time was that it came on top of similar sharp falls in the previous two months—

of the Rudd government. It continues:

The index measuring expectations about family finances over the next 12 months plunged by 8 per cent this month to be almost 15 per cent lower than in March last year, while optimism about prospects for the economy in the next year has collapsed, dropping by 33.3 per cent from a year ago …

The results are consistent with a Sensis survey of 1500 consumers reporting a 17 per cent plunge this month in the number expressing confidence in their financial prospects for the year ahead—a record fall for the survey …

As I say, that goes deeper than the subprime effect from the United States and the recession that they are tipping into. It is a survey result that really goes to the confidence in the new government’s ability to run the economy—and why wouldn’t consumers have lost confidence? In the words of the Financial Review, confidence has ‘plunged’, ‘plummeted’ and ‘drastically fallen’. Why wouldn’t it? Since those from the other side have taken up the privilege of government, they have done nothing but run down the economy.

The worst of all of this is the man who has been put in the position of responsibly running the economy, and that is the Treasurer, Mr Swan. I am sure that in everyone’s minds this is a drowning Treasurer. This is a job that is really quite beyond him. I think Senator Fifield compared him to another failed Treasurer, John Kerin, saying that he could well be heading the way of John Kerin. There is no doubt about it: the biggest task, to manage the economy—a responsibility that is probably greater than a Prime Minister’s in many ways, because he gets the initial response and draws up the initial briefs for cabinet—is in the hands of someone who cannot handle the job.

After all, to just flick this off as ‘international volatility’ does not explain why under our watch, when the Howard-Costello team were running the economy, we were able to ride out the Asian crisis in 1997 and 1998, the collapse in the Asian economy. There was also a similar US recession after September 11; the worst drought that this country has faced in 100 years; and the SARS crisis, where the tourist industry collapsed. All those crises buffeted the economy, but I can tell you consumer confidence, business confidence and business investment never slumped as low as they have in the past three months.

There is no doubt that the weakest link in your government is the ability of this Treasurer to manage the economy. His irresponsibility and his lack of knowledge of market expectations and market confidence are borne out by the comment that ‘the inflation genie is out of the bottle’. It ranks with the comment of another previous Labor Treasurer, Paul Keating, when he sent the market into a plunge by saying that Australia was in danger of becoming a banana republic. The worst thing about this is there is not one sensible government member, at least in the chamber, because they are all repeating the same comment. None of them have woken up to how it affects market expectations and confidence to say that the inflation genie is out of the bottle.

I have good reason to say that, because two very good sources—our own Reserve Bank governor and the equivalent in the United States, the US Federal Reserve chairman, Ben Bernanke—both give an outline of what drives future inflation rates. Our own Reserve Bank governor, Glenn Stevens, said on 11 December last year:

Even more important are expectations of future inflation. When people expect prices to rise rapidly, they bring forward purchases, put up their own prices, demand higher wages and so on. That helps to create the very inflation they expect.

To back up that comment about the nature of inflationary expectations, the chairman of the US Federal Reserve, Ben Bernanke, said:

Undoubtedly, the state of inflation expectations greatly influences actual inflation …

When you have the Treasurer of this country stepping out and saying the genie is out of the bottle, running down the economy and misrepresenting past inflationary levels, then what do you expect? You get 15-year slumps in consumer confidence and business confidence. That is the result of it. It goes way beyond the international volatility. Do not think you can just ride through a Financial Review headline and continue on as you are, running down the economy and using it for your own political advantage against the opposition. This will cascade through the economy. Don’t think that it won’t. Consumer confidence will cascade through the economy where you will start affecting the employment rate. Don’t think that you won’t. A very good Treasurer—the best Treasurer in this country, and the longest serving Treasurer in the world, Peter Costello—compared the economy with a Formula 1 racing car. It is finely tuned; it can go fast and smooth and take the corners, but if you make one drastic, sharp move—if you drive it badly; if you put a bad driver in there—you will tip that Formula 1 car up. That is what the economy is like. It is finely tuned. The market is a creature unto itself. A bad Treasurer that makes outlandish comments—just because he is driven by a political aim—will affect the economy, and that is what this Treasurer has done. He was left the legacy of a Formula 1 car and he is ramming it into the sides. He is going to do somersaults and spin out.

I know I am limited for time, but I cannot let the moment pass—having made those comments—without restating that the economy that the Labor Party were left, now that they have come into government, was described by no less than the OECD as ‘the wonder down under’. I saw it printed in the Economist: the ‘wonder down under’ economy. It is worth stating that when we first came into government in 1996 we were left with the legacy of a $96 billion debt—the highest debt run up by any government—and a $10 billion budget deficit. In contrast, when you came into government you were left with zero government debt—one of the few governments in the world that had the discipline and the foresight to reduce debt to zero. We had a string of surplus budgets, the last budget surplus being $18 billion. The economy had 11½ years of record growth, interest rates were always some five points less than the previous government’s highs and we had the significance of the unemployment figures. If I can just highlight one particular figure, it is the unemployment rate, which is our proudest legacy, because you do all this work so people can get a job and lift their living standards and leave a legacy for their family and their children. That is the whole aim. Every decision that you make funnels down to people being able to get a job. It is a pretty glib and easy thing to say—to give people the right and the opportunity to have a job. But it is hard to get to that point. We were fast reaching full employment. It is a proud legacy of the government, but it requires discipline and sound economic management to be able to open those opportunities up for Australian families. We left a legacy of record unemployment of 4.3 per cent.

In conclusion, I would appeal to those on the other side. I know you are in this chamber to make cut and thrust political points, but I appeal to those on the other side, for the sake—

Government Senators:

Government senators interjecting—

Julian McGauran (Victoria, National Party) Share this | Link to this | Hansard source

We can take a bit of the rough and tough, but you are doing damage to the Australian economy—and to working families that you so well espouse—by running down the economy. Just get down to running the economy.

Kerry O'Brien (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

It is amazing, isn’t it? The coalition has the temerity to come in here and put up this proposition, and Senator Ludwig chided them in a very restrained manner about the method by which it was brought to the chamber. The normal procedure—for all of the time that I have been in this place—for the generation of general business is for the opposition to have the wit to place a notice of motion on the Notice Paper that they can ask be made general business. What did we see this morning? Not one motion on the Notice Paper with which general business could be generated. So what have we seen? Around question time the proposition that is being debated now was circulated in the chamber. Frankly, if that is a measure of the effectiveness of the former government, is it any wonder that we find ourselves in this difficult economic situation, which Senator McGauran just blithely suggests does not exist? Senator McGauran is a bit like the shadow Treasurer: he does not think there is a problem. Yet the Reserve Bank has been saying we have capacity constraints. We have problems in the economy that have been generating inflation. We have the highest inflation rate in 16 years. We have productivity at zero—the lowest in 15 years.

Opposition Senators:

Opposition senators interjecting—

Kerry O'Brien (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

This is the fiction that Senator McGauran and his colleagues are trying to create. They have been in charge of the economy and they are saying, ‘Oh, it’s all fine.’ The shadow Treasurer is trying to tell the Australian people, ‘There’s nothing wrong; we left it all in good condition.’ But the fact of the matter is that the Reserve Bank and all other commentators are talking about the significant capacity problems, the skills crisis in the economy, capacity constraints, infrastructure problems, inflation problems, low productivity and 11 interest rate rises in a row under the former government—the government that promised to keep inflation at record lows.

This is the economy which they would have Australians believe is in good shape after their stewardship. They have the temerity to then come in here with this proposition. It is understandable why they would not have wanted it to be on the Notice Paper for too long. They finish the proposition by calling on Labor’s razor gang to ensure that no Australian will be worse off when the budget will be delivered in May. For years, they refused to guarantee to the Australian workforce that no worker would be worse off under their industrial relations legislation. For years, they maintained that that was not necessary. Only in the shadows of their defeat did they come to the conclusion that they had to go back to a no disadvantage test. Then they bungled that and a massive bureaucratic arrangement had to be faced by employers who had AWAs before them. There is a mess out there that was created by their industrial relations system which this government will correct.

That is the disaster that the former government imposed on this country. For Senator McGauran, those opposite and the shadow Treasurer to suggest that there is not a problem demonstrates just how out of touch they still are. They were out of touch at the last election, and that is why the Australian people got rid of the coalition. They remain out of touch. What more do you need to be convinced that they remain out of touch than to have heard the last contribution from Senator McGauran? I have seen senators come in here with various aids, but I have not seen many stand there reading from a newspaper on the lectern as part of their contribution to the debate. Perhaps that is because they are generating nothing and the newspapers are creating some ideas that may be useful to them. That is a good thing, because clearly they do need ideas. They clearly need someone to tell them what the real facts are. They need someone to come in and tell them that there is a problem in the economy, that there is something that needs to be attended to and that in fact this government is attending to the problems that their government was part of creating.

We have the legacy the former government left for the Australian people in the highest inflation in 16 years, fuelled by their reckless spending. This Labor government has made it clear that we need a new era of fiscal discipline to take Australia forward to combat the scourge of inflation. It is, as Mr Swan has said, public enemy No. 1 to our government. Inflation hurts working families, puts upward pressure on interest rates, erodes living standards, harms businesses, threatens our future prosperity and threatens job creation. This government is committed to a budget surplus of at least 1.5 per cent of GDP in 2008-09, a concrete demonstration of our commitment to fiscal restraint—unlike the previous government, which had a record of profligate spending, a growth in spending of—

George Brandis (Queensland, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

Mr Acting Deputy President, I rise on a point of order. When Senator O’Brien claims that the commitment of the new government to a surplus of 1.5 per cent of GDP is unlike—

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Yes, but what is your point of order, Senator Brandis?

George Brandis (Queensland, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

the previous government when as we know the previous government had itself observed that commitment—

The Acting Deputy President:

Senator Brandis, you are simply adding to the debate.

George Brandis (Queensland, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

he is misleading the Senate.

Kerry O'Brien (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

I rise on that point of order, Mr Acting Deputy President. That is an abuse of the standing orders by Senator Brandis. We have seen it repeatedly in question time, where, instead of taking a bona fide point of order, a debating tactic is used to intrude other matters into the debate. The facts of the matter are that Senator Brandis is not entitled to use that device to intrude into the debate.

The Acting Deputy President:

Yes. You are right, Senator O’Brien.

Kerry O'Brien (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

There is no doubt that reaching this surplus goal will be a difficult task. It will require a disciplined approach to spending and a very hard-nosed approach to savings. We are working hard to pare back the excesses of the former government. We are working at cutting wasteful spending and we are working to find additional savings over and above the $10 billion that Labor identified prior to the last election.

This government will not go down the same road the now opposition did when they sat on the treasury bench and simply rely on surprise upward rises in revenue. We are not going to be a government that depends on the surplus being driven by growing revenues. The Howard government did not have the discipline to budget for a fiscal target of 1.5 per cent of GDP. In the 2007-08 budget, the surplus for 2008-09 was projected to be 1.1 per cent of GDP—so much for a 1.5 per cent target. At the time of the Mid-Year Economic and Fiscal Outlook this was revised upwards to 1.2 per cent of GDP. Remember: this was not planned in the budget; this was because there were other factors and growing revenues.

Australia needs to do better than that. So long as economic conditions hold up, under Labor we will do better than that. This government has set a target of 1.5 per cent of GDP, and, to the extent that we need to tighten our belts, we will be doing that. The Treasurer will be making those announcements in relation to the outcome on budget night. I venture to say that we understand that the Australian people expect better of their government than they had under the previous government. Families will not thank a Labor government if we continue to run the lax fiscal policy of the previous government that led in part to eight interest rate rises over the last three years and 11 rises in a row.

Through the past 100 days in office, this government has been working hard on the task of building a stronger, more modern economy. I have touched on the point of fiscal restraint, but we are also looking at fast-tracking measures to address skill shortages, including rolling out 450,000 new training places and 6,000 more skilled worker visas. We are also working to address critical infrastructure bottlenecks through the formation of Infrastructure Australia to prioritise and fast-track key projects. We are also looking at some very important savings initiatives to provide more incentives for saving, because we need to encourage Australians to save more. This includes the First Home Saver Accounts, which commence on 1 July. They will be very important for young Australians in building their deposits so that they can participate in Australia’s real estate markets, many of which are beyond the affordability of many young Australians.

We also want to develop new participation incentives, including the government’s personal income tax reforms and, in addition, the 50 per cent childcare rebate. They are positive initiatives and part of the plan we have to build a strong economy, while dealing with some of the challenges the economy faces because of the profligacy and neglect of the previous government. To build a stronger, more productive economy, we need a new partnership with state governments to further drive economic reform. The government has already negotiated streamlined specific purpose payments to the states, freeing up resources to deliver better services through outcome based payments. To build a stronger economy, we need a more competitive taxation system. The reforms introduced into parliament are expected to deliver an additional 2.5 million hours of work to the economy each week.

Further, to build a stronger economy, we need a competitive, well-capitalised financial sector with measures implemented to increase competition and allow banking customers to look at the ways they can change their financial provider if they are not getting the best deal that is available in the market. That will encourage competition and a better deal for consumers. These are all reforms that Labor has introduced in its first 100 days of office—things which, I remind the Australian public and the Senate, the former government failed to do in 11½ years.

When the coalition come here with a proposition which talks about impending budget cuts, as if they have no responsibility for the conditions that require attention to the spending of the Commonwealth, they really do have a cheek. In terms of the so-called cuts to programs, let me say this. When the coalition failed to include programs in their forward estimates and made commitments during the caretaker period and then expects a subsequent government simply to say, ‘That’s a commitment of the former government; we will not assess it and we will not make decisions in the budget context having regard to all the information available and to all of the interest that might potentially have access to certain funds,’ then they are wrong to think that we would fall for that trick. We, Labor, will make assessments on the basis of the best information available and the best bang for the taxpayers’ buck in those expenditures.

There were some questions raised about consumer sentiment. We expect consumer sentiment to be affected after eight interest rate rises in the last three years—eight rises in a row. There has been a great deal of consumption in the economy. The former government were keen to encourage spending and, frankly, did very little to remind the Australian public that there is a settling day and that at some time interest rates will go up. One wonders, in the context of eight interest rate rises in a row, why they were so reluctant to say that, but they were. It is completely understandable that consumer sentiment would be affected by a tightening of fiscal conditions, by an increase in interest rates and, therefore, by an increase in the cost of borrowings and the ultimate overall cost of commodities, property and other items that consumers have been spending on over the years.

It is also true in the domestic context of eight interest rate rises in a row that we find ourselves in challenging times in the global economy. That is why we have to modernise our own economy—so that it is strong and flexible enough to meet the major economic challenges we face. Both domestically on the inflation front and globally on the uncertainty front, we need an economy that is able to respond. Figures out today show that a lot of families around Australia are doing it tough on the back of eight interest rate rises in the last three years. That is why it is so important that we have a commitment, as this government does, to tackle the inflation legacy of the previous government, to put downward pressure on interest rates in the long term.

Our immediate goal is to strengthen the budget position and to target investment in key drivers of productivity, especially infrastructure and skills. Again, apparently, the shadow Treasurer does not think we have a skills problem. We heard that in question time today. What a remarkable statement to have made. Anyone who has been talking to business in the various sectors of the economy around this nation over the last three years and has come to the conclusion that there is not a skills crisis either has a hearing problem or just does not comprehend the words of Australian business, because those words have been resonating loud and clear for some years.

In the agriculture sector, everywhere you go the farming community is talking about skills problems. They are talking about the availability of labour. They are talking about having to compete with other sectors drawing away labour because they can offer greater salaries. It is a great challenge for a very important sector of this economy. You would have thought that, if the coalition had any concern for that sector, they would have done something about it—but, no, they did not. More to the point, they currently do not believe that there is a problem. I wonder what the farm sector of this country thinks of the shadow Treasurer when he says that they are imagining the skills crisis they are experiencing. I venture to say that Mr Turnbull has absolutely no credibility with that sector of the economy. He would not have any credibility with the mining sector of the economy either.

George Brandis (Queensland, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

I think he knows a little bit more about economics than you do, Senator O’Brien.

Kerry O'Brien (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

If he knows so much more about the economy than I do, why has it taken him all this time to assimilate the information? Yet he comes out with a ridiculous proposition that we do not have a skills crisis. If he knows more than I do then, frankly, he is not demonstrating it with what he is saying. What he is saying is demonstrating that he probably does not. If we are to modernise our economy, we must do it in the face of increasing global uncertainty.

The severe downturn in the US housing market and the volatility of associated financial markets pose significant challenges for the global economy but, more importantly, our own economy. We are never immune to developments such as these, as Australian families who are now being hit with interest rate rises greater than the Reserve Bank rises know all too well. Acknowledging these challenges is the first step towards beating them, and that is what we are doing. Again, unfortunately, the opposition are not prepared to acknowledge these challenges and the part they played in creating them.

In terms of the proposition that we have before us, I am certain that Australians will look at the next budget with a critical eye. They will be looking at what the first budget of a new Labor government does. They will be looking at how it addresses the concerns they have and not at the political posturing of the opposition. That is what this motion is about. It is political posturing from this opposition. But, in fact, when the Treasurer announces the first budget of the Rudd Labor government in May, he will be announcing the implementation of measures designed to address the potential catastrophe that the former coalition government brought to bear on the Australian economy and its people. Australian families would expect no less from a responsible government.

We will not be deflected from the responsibilities of government by this politicking by the opposition. Frankly, it will not be very effective. The Australian people will see through it. They will be looking at the budget from the point of view of what it will mean for them over the next three years in terms of the interest rates burden they face, the opportunities to get better skills and better paid jobs, and getting the economy functioning better. They will be looking at the health and education initiatives that we have announced, and they will be looking at the budget from the point of view of wanting to live in a better, fairer nation governed by a government that has real regard for its economic responsibilities and the needs of the Australian people.

Ruth Webber (WA, Australian Labor Party) Share this | Link to this | Hansard source

As Senator O’Brien was saying, on the election of the Rudd Labor government we outlined three major commitments. One was to build a modern Australian economy to meet the challenges of the future that not only confront us globally but also confront our internal economy that were ignored for far too long by those opposite. One of the other major commitments was that we would honour our election commitments and that would be our priority. Our priority is to deliver on the commitments that we made to the Australian people—not the commitments that the former Prime Minister may or may not have made and may or may not have actually budgeted for but the commitments that we, the elected government, made to the Australian people. They will be our priority.

As we have seen in our first 100 days, the Labor government is well on the way towards implementing a range of the commitments that we made to the Australian people. We are seeing the rollback of Work Choices. We are seeing the implementation of a fairer, more equitable industrial relations system that protects the pay and conditions of hardworking Australians and their families. That was an important commitment that was made to the Australian people and it is a commitment that we have started to deliver. We have started to deliver the rollout of training places. We have started to deliver the provision of infrastructure to our schools. We have started to deliver on a range of the commitments we have made to ensure that we do develop a modern economy to meet the challenges of the future.

Why is it that we need to develop this modern economy? Why have we come to a point where we need to make so many changes in priority? It is because we inherited a mess. It is plain and simple: it is a mess. In the last year of the Howard government there was zero productivity growth. There was absolutely not one bit of productivity growth. This was delivered by a party that talked up productivity but did not actually deliver it. The Howard government delivered interest rate rises endlessly for three years and got inflation to a 16-year high. Those are the circumstances that we inherited when we came to power.

Why is it that interest rates have risen so high and why is it that working families are doing it so tough in Australia thanks to the Howard government? It is because of the lax fiscal policy of the previous government. It is because of the record level of expenditure over the last four years of the Howard government. When inflation was going up, all the Howard government could do was throw money around to try to buy their way back into office. It is little wonder therefore that the only position the Reserve Bank—that independent body that was given its independence by the previous Labor government—could take was to look at tackling inflation by increasing interest rates. Time and time again, organisations like the Reserve Bank, the Business Council of Australia and numerous other well-respected organisations defined some of the challenges facing the Australian economy. What did those opposite do? They just ignored every warning.

We have said that we will look at all forms of expenditure. Our priority is to deliver on our own election commitments that we made to the Australian people, not necessarily the commitments that those opposite may or may not have made and may or may not have budgeted for. We will deliver on our commitments, but we owe it to hardworking Australians and their families to contain and fight inflation and to reform our economy to make sure that it is modern and can meet the challenges of the future.

Ever since I have been in this place we have had a debate about the skills crisis. It has been a well-heralded debate, and there is no doubt the skills crisis is one of the capacity constraints facing our economy—one of the top three. A skills crisis does not suddenly pop up overnight. The skills crisis that we have in the Australian economy is something that the previous government was quite determined, obviously, to deliver to us. You cannot consistently cut spending to training places, training organisations, TAFE and other institutions and then, all of a sudden, 10 or 11 years later, say: ‘Oh dear, we do not have enough skilled labour. I know—we have to import them.’ That is not the way that you build a modern, sustainable economy. What you do is forecast where the demand for skilled labour is going to be and ensure that you fund the training places accordingly so that hardworking Australians who deserve those opportunities are trained for the jobs of the future.

As I said, the skills crisis is something that has taken quite a long time to develop. It has obviously been a determined policy of those opposite. All of a sudden, they discovered that there was a skills crisis—something that senators like Senator George Campbell have been discussing in this place for a lot longer than I have. All of a sudden, when the previous government started to listen to some of the industry bodies about the shortage of skilled labour, what was their solution? Rather than work cooperatively with the states and others, they decided to replicate a TAFE training system but made it a privately provided system.

In my home state of Western Australia, which has a massive challenge in the provision of skilled labour—there is no doubt about that, given the amount of economic growth and development that is going on there at the moment—the previous government granted us two of those private technical colleges. Neither of them have graduated a student yet—not one. We have not seen a graduate from anywhere. Two technical colleges for the whole of the Western Australian economy and not one trained person has come out of either of them, and that is the only contribution that the previous government was prepared to make to the massive need for skilled labour in Western Australia. That is one of the capacity constraints within our economy.

Another capacity constraint is the provision of infrastructure. Infrastructure is something that we have also debated long and hard in this place, but the previous government decided to just leave the big infrastructure needs to the state governments. So our major capacity constraints are the skills crisis, the infrastructure bottlenecks and the need for reform to have a more cooperative approach in the relationship between the Commonwealth and the state and territory governments. But there are other contributions that we can make in terms of addressing the needs and the development of our modern Australian economy.

One of the things that the Rudd Labor government has said that it is determined to deliver on—and it is in the process of delivering it—in order to increase the vitality of our labour market and increase the participation rate in our labour market, is of course tax reform. Our tax reform proposals—

Cory Bernardi (SA, Liberal Party, Shadow Parliamentary Secretary for Families and Community Services) Share this | Link to this | Hansard source

They are ours.

Ruth Webber (WA, Australian Labor Party) Share this | Link to this | Hansard source

they are not yours, Senator Bernardi; they are the Rudd Labor government’s tax reform proposals—are specifically designed to increase labour force participation. They are designed to address the inflationary pressures currently evident in the economy, which are a product of the skills shortages and labour shortages more generally. The chronic labour and skills shortages have been reported regularly, as I said, by business as the most significant constraints on their expansion. Our tax reform proposals are designed to assist in addressing that. By introducing those tax reforms, it is our aim that they will not put pressure on wages and inflation. By delivering a tax reform package, we are hoping that is one way that we can actually address some of the inflationary and wage pressures within our economy.

What we have also done to try and address some of the skilled labour shortages in our economy is announce 450,000 new skilled training places, including 25,000 which are being rolled out between now and July this year. The tax reforms themselves will increase the financial incentives for skills formation because they increase the marginal gains associated with higher wages that typically flow from higher skills attainment. When you match that with the roll-out of 450,000 new skilled training places, including 25,000 between now and July, that is a significant step towards addressing one of the key capacity constraints within our economy.

As I said, the other significant issue that we think needs to be addressed in terms of developing our modern economy and addressing some of those capacity constraints is the provision of infrastructure. There has been a debate about the need for the provision of infrastructure within the Australian economy for quite some time, but that is all it ever was under the previous Howard government: it was a debate; it was a blame game exercise. It was not actually a productive, national contribution to huge national projects. That was left to the states, particularly my home state of Western Australia. The infrastructure bottlenecks—bottlenecks that have been defined by many people—have been holding back our export performance. They have been clogging up our cities. And where was the previous government? Just playing the blame game.

The previous government was not interested in any way in the provision of the major public transport infrastructure that has now been provided by the Carpenter Labor government in Western Australia—the Perth to Mandurah train line. There was no federal support for that. There was no federal support for the need to expand our port facilities in regional Western Australia so that we can actually expand our mining industry at a time of booming resource prices. There was no support for that.

So that is another challenge. Labor’s response within the first 100 days was the announcement of the formation of Infrastructure Australia and the legislation that will establish that body and enable it to work cooperatively with the states, with local government and with business to establish a national framework for what the infrastructure priorities need to be to help develop our dynamic economy. So that is another initiative, another priority, another promise delivered on by the Rudd Labor government to actually address some of the challenges that are ahead of us.

In the meantime, where were the Howard government? Where were they? Where was their policy to fight inflation? Where was their policy to address the significant bottlenecks in terms of infrastructure provision? Where was their policy to address the skills crisis, which took 10 to 11 years of neglect to develop into what is a significant crisis? As I have said before, we have inflationary pressures largely because of the lax fiscal policy of the previous government. In the last four years, the former government had the highest increase in spending over any four-year period in the last 15 years. That is just staggering. When you are looking at the inflationary pressures within our economy, when you are looking at the interest rate rises and when you are looking at the fact that working families were struggling and many of them were having their take-home pay reduced, what was the solution of those opposite? It was to throw money all around the place and to have the highest increase in spending over any four-year period in the last 15 years.

That comes on top of the fact that the previous government ignored the 20-odd warnings from the Reserve Bank about the effect on the inflation rate of the capacity constraints and skills shortages in our economy. It is just staggering that any government could leave us with such a huge skills crisis. So our priority here is to build a modern, dynamic economy and to actually deliver on the commitments that we made to the Australian people and the election promises that we made.

Contrast that with the approach of those opposite at a time when government should have been using the fruits of the mining boom in places like my home state of Western Australia to reinvest in the future, to invest in education, to invest in skills and to provide the leadership so that we had First World infrastructure. That should have been the priority of those opposite, and it was not. Those opposite were quite happy to allow the skills crisis to continue on its merry way. As I say, my home state has an enormous challenge when it comes to the provision of skilled labour. The only contribution the Howard government made was two private technical colleges, neither of which has actually delivered one trained employee or one new skilled worker to the Western Australian labour market. That is just not good enough.

What we need is productivity growth. Productivity growth comes with an increase in the provision of skilled labour. It comes with the rollout of the infrastructure that our education system needs, that our communities need and that the business sector needs to ensure that we train people for the jobs of tomorrow, not just addressing the immediate skills crisis but anticipating where the next demand for skilled labour is going to come from and working hard to address that accordingly.

Of course, our third priority in terms of developing that modern economy and delivering on our promises is to reform the way that the Commonwealth and the states and territories interact with one another. So we end the blame game; we sit down; we talk about the combined resolve that we are going to have to address these significant capacity constraints whilst looking after hardworking Australian families who have had to bear the brunt of the mismanagement of the Australian economy—the hardworking Australian families who have had to put up with those end-on-end increases in interest rates because that was the only piece of economic response available to the Reserve Bank because of the spending approach of the previous government; the hardworking Australian families who had to put up, under Work Choices, with working longer hours for lower pay and then to pay increased prices for their goods and services.

Our resolve is to actually protect the pay and conditions of hardworking Australians and their families, to help them develop the skills they need for the jobs of the future and to ensure that their children get the education and training they need to be well placed in the future. Our resolve is also to work with the states and territories, with industry and with local government to have a comprehensive plan to deliver the infrastructure priorities that should be worked at across the board to ensure that our economy makes the most out of the mining boom that is coming from states like mine, to take the financial resources out of that and continue to develop the economy by addressing some of the infrastructure bottlenecks. They have to be the priorities. That is responsible economic management and that is what was lacking in the previous, Howard government.

Cory Bernardi (SA, Liberal Party, Shadow Parliamentary Secretary for Families and Community Services) Share this | Link to this | Hansard source

I have to start with an apology to the listeners, to those at home and those in their cars on their way home from work, because I have heard some bunkum in my time but nothing like what has been displayed in this chamber today. What we have is a Labor government that is prepared to completely rewrite history—a history that has delivered unprecedented prosperity to the people of Australia. Let us go through some of the things that the Howard government did and their proud record. They reduced Labor’s $96 billion black hole of debt to zero. The interest on government debt decreased from $8.4 billion a year to zero. The average mortgage rate under Labor was 12.75 per cent; under the coalition it was 7.25 per cent. Small business lending rates were 14¼ per cent under Labor, and under the coalition they were 8.9 per cent.

Unemployment was a hideous, destructive 8.2 per cent under Labor. Under the coalition it reached 4.2 per cent, and it is still dropping today. Those are the conditions that this Labor government have inherited. More Australians are in work than ever before. Average inflation over the past 10 or 11 years has been half that which it was under the previous Labor government. So, rather than acknowledging the great things that the previous government did, who do we have playing the blame game now? The spinmeisters of the Rudd-Gillard Labor Party. All of the things that I have listed have benefited Australia’s economy.

Let us look at what the Rudd government have done in their first 100 days. We have seen economic confidence down. We have seen interest rates up. We have seen personal responsibility down, making a mockery of the ‘buck stops with me’ claim which we heard so much about last year. We have heard political rhetoric and spin go up whilst substance has come crashing down. We have heard about government by committee. If you want to talk about bottlenecks, there is a bottleneck for all the Labor apparatchiks to get appointed to one of the many dozens of committees that are going to be running the country pretty soon. We even heard some nonsense from Senator Conroy earlier today about his committee to appoint a committee. Which committee is going to be appointing that committee? It is going to go on and on.

The Rudd government have promised around 100 committees and in the process are actually achieving a goal which we have hitherto never seen: in their first 100 days they have set up a committee every four days. That is an astounding record. That is eight committees a month or thereabouts or 96 committees a year. Those who are going to be newly unemployed as a result of this government’s policies could actually be appointed to a committee. That would keep unemployment rates quite low—dysfunctionally low.

We have seen backflips, broken promises and a whole range of disgraceful cuts from the razor gang. Mr Rudd of course does not announce these cuts himself, because he wants to maintain his squeaky-clean image; he sends his henchmen out to do it. The henchmen go out and say: ‘We’re going to cut $150 million from Centrelink—a very important service provider—and we’re going to leave maybe 2,000 Centrelink workers unemployed. We’re going to make them redundant.’ That is what Centrelink Chief Executive Officer Jeff Whalan said.

What about the superannuation co-contribution savings? Senator Nick Sherry would not say whether $1.1 billion for low-income families would survive Labor’s razor gang. They have slashed $40 million from arts funding—and this is when they are spending $20 million to get young kids to stop binge drinking. Don’t you think it is important for people who are susceptible to binge drinking to have other outlets? The arts is one of those areas for young people to get involved in—not only in areas like dance, theatre or painting but also in music, which is so important to young people today. But, no, the Rudd government is going to slash $40 million from the arts, which will reduce opportunities for young people to pursue a positive agenda.

I spoke to the Australian Sports Commission during estimates. They were having to revise some of their programs because of budget cuts and constraints. These are things that are going to cut to the quick of Australian society. We have a heartless government that are clearly intent on deceiving the public in as many instances as they can. They put out the spin, they put out the rhetoric and they talk about how apparently heartless the Howard government was—saying that it did not help people and would not go the extra mile. The simple fact is that in the area of carers, which is something that this government was prepared to turn its back on, we provided more funding. We funded more carers. Recipients of the carer payment grew by about 465 per cent over the 11 years of our government. There was a 561 per cent real increase in the amount of money available to carers. They knew they could rely on us and, sadly, they were deceived by this government. The blame game is real and is continuing. Labor are reinventing history in some Orwellian theory that they can control all, rather than accepting and placing responsibility where it fairly and squarely lies—which is the bad economic management of the states.

If you want to know where drunken sailor spending has taken place then have a look at the $40 billion of state deficits that have already been run up. It is expected to be $80 billion in only a couple of years time. Gee, have we got an inflation problem? Maybe a $40 billion injection of credit from wasteful state governments is responsible if that is the case. My question to the Rudd government is: when are you going to accept responsibility? They said to us there was not a sliver between their economic management and our economic management, but there is a chasm. It is as wide as the Grand Canyon because we on the coalition side were effective economic managers. What we have on the other side is something that threatens to destroy the Australian economy; and by destroying the Australian economy they destroy the opportunities for our young people—and the benefits that have been passed on to carers, those with disabilities, and the most vulnerable in our society will disappear.

Mark my words: the Rudd government are actually hoping that things do get worse, because then they can play the blame game. Stand up and be counted. Do not pass the buck, because we know the buck stops with Mr Rudd. It is absolutely time for responsibility to be taken. The public demand it—and I believe the public will wake up to the ruse, to the wool that has been pulled over their eyes. You cannot sit on both sides of the fence, Mr Rudd and the Labor Party. That has never been better demonstrated than by Mr Rudd’s claim that he is a Christian socialist. Where I come from, you cannot be a Christian socialist: one does not support the other. You cannot be an economic conservative and lead a terrible, wasteful Labor government.

We know what we are dealing with; the public are already seeing it. They are slashing and burning money so they can increase their committees. They are slashing and burning real programs that benefit real people, people that need help, so they can establish government by committee. It is a travesty. And, despite their reassessment and realignment of Australia’s economic history and the benefits that accrued over the last 11½ years under the leadership of Mr Howard and Mr Costello and a wonderful team that guided Australia through very difficult waters to be the nation we have today, that good work cannot be rewritten. It should not be undone. You should not rewrite history; you should accept that you were given a great economy and a great opportunity, and already you are squandering the legacy of the Australian people.

Michael Forshaw (NSW, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to speak to this supposed general business motion by Senator Ellison. Frankly, I think this is more an attempt by the opposition to manufacture an air of concern and to shift the blame to the current Labor government, knowing full well that it is their own stewardship of the Australian economy that has put us in the difficult inflationary position we now confront.

I was going to start by dealing with the economy, but I cannot help but respond to the comments made by Senator Bernardi at the end of his speech. He made some reference to the Prime Minister being a Christian socialist and he said you cannot be both. I am not sure what point Senator Bernardi was really trying to make, but I have a reasonable suspicion that this was a cheap shot at Kevin Rudd, the Prime Minister, because he has made it very clear that he is a practising Christian.

I want to remind Senator Bernardi, because he says he comes from the same background and professes the same beliefs, that at the heart of Christianity is the concept of helping one’s fellow man, particularly the poor, the oppressed and the downtrodden. You might want to go back to the New Testament and read the Sermon on the Mount, or read the writings of Thomas Aquinas or those of Saint Vincent de Paul, where they talk about extending the hand of support to those who need it, remembering the words of Christ: ‘When you do it to one of these, the least of my brethren, you do it to me.’ That is, the mark of a true Christian is not to push the downtrodden even further down but to offer support and help. When you look at the history of the previous government and what they did in the area of social policy, you cannot help but think that any notions of Christian values went out the window. They talked the talk but they certainly did not practise what they preached.

I sat on many a committee in—I have to acknowledge—the long years of opposition, along with my colleagues here in the Senate today, Senator McLucas and Senator Webber. Among those committees was the Senate Standing Committee on Community Affairs inquiry into poverty. The committee made a series of recommendations to the government of the day, the Liberal-National coalition government, to address the appalling situation with poverty and hidden poverty in this country, where people could not get access, for instance, to decent dental care or health care; where they could not get access to appropriate financial counselling and assistance because the financial counsellors were overburdened with so many applicants. Everywhere we went around this country, we heard depressing stories about the financial pressures on Australian families. I remember going to the city of Lismore in northern New South Wales and the representative of St Vincent de Paul telling us that they now had to be financial counsellors. Their role had changed over the years because of the incredible financial stress on Australian families. They were doing the job that the government should have been doing. That was a message we heard constantly.

And what was the government’s response to that Senate committee report on poverty? Nothing. I think it took them months and months and months—I cannot remember how long, but it was well past the Senate requirement for the government to respond within three months—and then it was just a paltry dismissal of all of those considered recommendations, recommendations that arose out of the evidence of the organisations working at the coalface in Australian society, looking after the people who needed support. So do not come in here and lecture us about Christianity or socialism or helping the poor or looking after them.

The same thing happened in health care. Senator McLucas and I recall the inquiry into Medicare. We all remember former Prime Minister Howard and his original view on Medicare. I do not think he ever changed his real view. His original view was that Medicare was an abomination and should be got rid of. The opposition took that as a policy to the election in 1993 when they thought they were going to win. They were going to win under Mr Hewson. They were going to get rid of Medicare. They were going to attack working families, industrial relations legislation and they were going to bring in a GST at the time. They were the three great policies on which they went to the 1993 election, which they lost. They lost what, at that stage, probably should have been an unlosable election. The Labor government had been in power for a long time. One of their central policies was to get rid of Medicare, and of course the Australian people were not going to cop that. Australians rejected the Hewson-led opposition, of which Mr Howard was shadow minister for industrial relations at the time, and they rejected their proposals on GST and industrial relations.

So Mr Howard had a change of public position: ‘Medicare is here to stay.’ However, one of the first things they did when they got into government in 1996 was to start to dismantle Medicare. They claimed that they brought a fairer Medicare system about, but they did not. They did nothing about the declining rates of bulk-billing.

Ron Boswell (Queensland, National Party) Share this | Link to this | Hansard source

That is a nonsense.

Michael Forshaw (NSW, Australian Labor Party) Share this | Link to this | Hansard source

It is not a nonsense, Senator Boswell. It is not a nonsense at all. Remember that every month the figures for bulk-billing rates were trending down. Of course bulk-billing was ultimately what assisted people, particularly the low paid, but it was also a fundamental component of Medicare when it first came in.

The then government did so many other things in those early budgets in 1996 and 1997. I remember, because I was here. Senator Boswell was here. I remember what they did in aged care. Do you remember they were going to impose bonds on families when older persons needed to go into a nursing home? That policy lasted only a few months, because the public rebelled. They just said, ‘We’re not having this.’ I remember what they did in terms of funding for universities. I could go on and on. I have a list a mile long. I can remember them all. So do not come in here and lecture us about supposed backflips, ill-conceived proposals and so on.

I will never forget the famous words of Mr Howard after he won the election in March 1996. He said, ‘I want Australians to feel relaxed and comfortable.’ I know how relaxed and comfortable Mr Howard feels to date. He is actually over in the United States—or was last week. Within a couple of months, he has breached one of the fundamental conventions: you do not go overseas and trash your own government. Mr Howard lectured us about that during his term in office, but he could not wait to get overseas and start telling his friends on the far Right in the United States about the supposed evils of the Labor government, because we are going to bring fairness back into the workforce.

Helen Coonan (NSW, Liberal Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

At least he is not talking down the economy like you are. You should give that advice to Mr Swan; he is the one who is trashing the economy.

Michael Forshaw (NSW, Australian Labor Party) Share this | Link to this | Hansard source

I am sure that Mr Howard is comfortable living the life of an ex-Prime Minister, but hundreds of thousands of Australians were not relaxed and comfortable during the years of the Howard government.

Helen Coonan (NSW, Liberal Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

And they certainly won’t be after a few years under Labor.

Michael Forshaw (NSW, Australian Labor Party) Share this | Link to this | Hansard source

Let us go to some of the statistics. Let us note that this is the government that lectured us constantly about interest rate rises. What happened with interest rates under the Howard government?

Helen Coonan (NSW, Liberal Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

Senator Coonan interjecting—

Michael Forshaw (NSW, Australian Labor Party) Share this | Link to this | Hansard source

They just kept going up and up, and up and up, and up and up. What was it, six times, eight times, that interest rates went up in a row? The Reserve Bank was even required—

Helen Coonan (NSW, Liberal Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

Senator Coonan interjecting—

Michael Forshaw (NSW, Australian Labor Party) Share this | Link to this | Hansard source

Mr Acting Deputy President, are you going to bring the rabble on the other side to order so that I can actually hear myself speak?

John Watson (Tasmania, Liberal Party) Share this | Link to this | Hansard source

I am listening to you.

Michael Forshaw (NSW, Australian Labor Party) Share this | Link to this | Hansard source

Thank you. Because I know that what I have to say is worth listening to and I would like to be able to hear it. When the opposition were in government, interest rates went up every couple of months. The Reserve Bank put them up. They needed to put them up because of the threat of inflation. But the Howard government sat back and said, ‘No, no, no.’ They wallowed in the surpluses that they were gaining through the resources boom, threw more money out into the community and hoped that they could buy another election win, just as they did back in 2004. Of course, the chickens have come home to roost.

For the first time ever I think that anyone can remember—certainly that I can remember—the Reserve Bank put up interest rates in the middle of an election campaign. The Reserve Bank, being the independent body they are, felt that even during the election period they had to put up interest rates again, because of the inflationary pressure, which of course destroyed any semblance of credibility that the Prime Minister may have had, or believed he had, about his great economic record.

The other important thing about rising interest rates is the amount that people have to pay to pay off their mortgage. Even when interest rates were comparatively low—and I acknowledge they were low—the proportion of income that families had to pay on their monthly mortgage, has continued to go up. I will stand corrected, but I think the figure is somewhere over 40 per cent. It grew during all of the years of the Howard government. They kept telling us about how they kept interest rates low, but of course what was happening was that the actual dollars that had to be paid each month kept going up.

That is why we have a housing affordability crisis in this country. The huge increase in housing prices combined with the growing financial difficulties of families that have to meet mortgage payments means that many struggling families live on the edge day to day to meet those commitments. It also means that many people are having greater difficulty today entering the housing market than they did during the years of the Hawke government or previous governments. You do not have to read the economic statistics to know that; you just have to talk to people. I know how much more difficult it is for my kids today—they are at an age when they would be thinking about endeavouring to purchase a home or take out a loan—than it was when I purchased a home back in the seventies. It has got to the point where it is pretty much out of reach for most young people. That is the real legacy of this government.

Let us also look at credit card debt. Not much is ever said about credit card debt—or at least it is not publicised as much as I think it should be. You can talk about interest rates in terms of the rates that are set based on the Reserve Bank’s decisions, which essentially relate to home mortgage rates, but the rates for credit cards are 17 per cent, 18 per cent or 19 per cent. What has happened to credit card debt in this country? It has gone out of control. The figures I have obtained indicate—and I am indebted to the library for being able to produce this for me rather quickly this afternoon so that I could give an update—that in March of 1996 the total debt owed was $6.649 billion. Do you know what it was in November 2007? It was $41.919 billion. That is a massive increase.

We know that today families are using their credit cards for everyday living, and they are running up major debts of $10,000, $20,000 or $30,000 on their credit cards. There was a time when people paid off their Bankcard, their Visa card, their MasterCard or their Amex card each month so that they did not accrue interest. That is no longer the case and these debts are just getting greater and greater. Each time the Reserve Bank makes a decision on interest rates we focus on that, as we should, but there is another area of debt which is crippling families because it just gets rolled over and rolled over—that is, credit card debt.

This motion today suggests that we have no idea how to run a trillion-dollar economy—but get real; get serious! The opposition should treat general business debates with a bit more respect and a bit more seriousness. They have come into this chamber with this bland statement that really says nothing. The Labor government now have the responsibility for managing this economy. The electorate said overwhelmingly last November: ‘We’ve had enough of Mr Howard, Mr Costello and all the others. We want the Labor Party, under Kevin Rudd, Julia Gillard and Wayne Swan, to run this country and run this economy.’ The electorate had had so much of Mr Howard that they kicked him out of his seat. It is only the second time in the history of the country that that has happened to a Prime Minister. Why? For all the reasons I have given and, of course, because of Work Choices.

Where was the Christian value in Work Choices? There was none. Work Choices was about saying to the mother who was working in the supermarket to earn some extra money for the family: ‘Sorry, you’ve got to work weekends without penalties; you’ve got to come in when we say you have to. We don’t care about your son or daughter’s sport, or your school commitments or whatever; you work the rostered hours now that we tell you or that’s it. You’ll sign this AWA or you don’t get the job—or you don’t keep it.’

Work Choices was about saying to those families on low incomes that relied upon the overtime payments for the extra hours: ‘No longer are you going to get that overtime. You work the extra hours for nothing or we’ll find someone else who’s more desperate than you, or who’s prepared to do it.’ Work Choices was about saying: ‘No, there’s no longer four weeks annual leave or sick leave. We want you to cash that out.’ It was about taking away. There was nothing ever in Work Choices about how we might enhance awards in this country; it was about getting rid of them, about taking them away.

So, when the opposition says that we have to ensure that no Australian will be worse off, I can say this with great confidence: Australians will always be better off under a Labor government than they ever will be under a conservative government, whether it is a merged Liberal-National Party or whatever else they want to call themselves in the future. Just as they have done in every state and territory in this country, the people have now put their faith in a Labor government federally. We will return that faith.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary to the Minister for Health and Ageing) Share this | Link to this | Hansard source

I also rise to speak against the motion that we are debating this afternoon in the time that is available for non-government business. I know that it has been 11½ years since those that sit on the other side have been in the non-government place in this chamber—and, can I say, it shows. Non-government business has a special place in the Senate. It provides an opportunity for those members of the Senate who are not on the government benches to raise issues of importance, not to run an advertising campaign. When I read the motion that we are debating today I have to say that it is political rhetoric. The opportunity that was afforded the opposition this afternoon to have a sensible debate about the economy, if that is what they wanted to talk about, has been undermined by fatuous language that sounds more like what you would say when you are at a Liberal Party branch meeting. There will be no respect shown by the community when they read what I think are the silly words that someone in the opposition has dreamt up for this debate which we have now been having for around two hours. It is a lost opportunity when the opposition have dreamt up petulant words in order to have a debate. I am not one for giving advice a lot, but my advice to those on the opposition benches is to use the time on Thursday afternoons to have a sensible debate, to raise issues that you think are important. Don’t just make it an opportunity not even for a political debate—and ‘debate’ would be stretching the language—but for the sort of sloganeering that might sound good to those people Senator Bernardi said were listening to us in their cars on the way home. Rather, it would be more appropriate to educate them about something that maybe the Liberal Party thinks should happen differently.

In the last few months the new government has used the time available to it very wisely in a number of ways. First of all, it has used the time to consult with communities. We have heard a lot of criticism from those on the other side about the number of committees that have been established. I do not resile from the fact that, yes, we have set up a number of committees. They are for good reasons. We have shut down a few as well—ones that probably were not providing us with balanced and fair advice. And I take umbrage and offence at Senator Bernardi’s comment that we were stacking these committees with Labor apparatchiks. I am sorry, but there has been a very sensible and balanced approach to ensuring that the breadth of community views is reflected on the number of committees we have established. So I refute Senator Bernardi’s comments about the purpose and membership of committees. It is important to consult. It was good to hear Senator Coonan acknowledge that in her contribution. It is important to consult and to have a number of people who are part of the public debate. That is called leadership. We will not be cowed into not taking the responsible position of ensuring that consultation occurs with committees.

The other thing which is not dissimilar to what happened under the previous government is that we have used this time in the pre-budget period to ensure that assessment of current programs is undertaken, and decisions will be made in the lead-up to the budget. Senator Coonan, as a former minister in this place, will agree that you do not discuss deliberations around the budget in the lead-up to bringing down the budget.

Helen Coonan (NSW, Liberal Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

But you don’t leave people hanging around having no idea what is going to happen to them either.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary to the Minister for Health and Ageing) Share this | Link to this | Hansard source

I am sorry, Senator Coonan, you did exactly the same in government. But let us go to the question of carers. There have been some absolutely spurious allegations made in this place about the commitment of the previous government to carers in the community. For the last four years the former government pulled the rabbit out of the hat every budget and told carers, in a totally patronising way, how important they are and how much they are valued in our community and then said, ‘And for your good work we will give you a one-off bonus of $1,000 if you are a person on the carer payment—

Helen Coonan (NSW, Liberal Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

They seemed to appreciate it!

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary to the Minister for Health and Ageing) Share this | Link to this | Hansard source

Let me get to the end of this, Senator Coonan—‘and $600 if you are a recipient of the carer allowance.’ I cannot tell you the number of carers who said to me: ‘Of course we value the $1,000’—or the $1,600, or the $600 if they are a carer allowance recipient—‘but, gee, I hate the way they do it. They make me feel as if I am begging for this money.’ Of course they value that money. Every senator in this place knows how hard it is for people who are on fixed pension-like incomes, like people who are on the carer payment, to make ends meet. It is enormously valuable to get that money. But they were given it as, well, a bribe—and that is what people have said to me, that they felt as if they were being bribed or ought to be grateful for this money. I am very pleased and proud of our government for recognising the reality that carers are now budgeting this money into their annual budgets. They do that, and we know that.

Helen Coonan (NSW, Liberal Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

They like it as a lump sum.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary to the Minister for Health and Ageing) Share this | Link to this | Hansard source

They may like it as a lump sum but they are factoring these one-off payments into their budgets. It always concerned me that, by pulling this rabbit out of the hat every budget, Mr Howard was ensuring that these people’s budgets were becoming more and more aligned with that money continuing to turn up. There was no surety that that money was always going to be there. Whenever it was announced it was always in the context of Mr Costello patting himself on the back and saying, ‘We’ve done a fantastic job of balancing the budget and we’ve got this bit left over and, because carers are good and fine people, we’ll give it to you.’ That is not a way to have an honest relationship with a group of people who do enormous things for their families and for our community. To make them feel grateful for their one-off payment is simply, I think, an unfair way to work with a very vulnerable group of people in our society.

We have also heard that, because of the way the Labor Party has responded, we somehow lack compassion. I am afraid that there are many people out there in our community who would beg to differ. If you want an example of compassion, I think you should go back to the first week of sitting of the new parliament and have a look at the enormous compassion and leadership that our Prime Minister showed by first of all inviting the local Indigenous people of the Canberra region to do what should have been done many years ago: the traditional welcome to country. This was followed by what I think is one of the most amazing days that I have experienced in this place, and that was the apology to the stolen generations.

I am deviating a little from the motion, but if there is a charge of there being a lack of compassion on this government you simply have to look to that day to see otherwise. It was a momentous day; it was a day that will go down in history—that is an understatement. It is a perfect example for anyone who is doing a bit of study in political science of how leadership actually works. Mr Rudd showed enormous leadership, supported admirably by Ms Macklin, in explaining to the Australian community why this was such an important event. I noted with incredible pride the Newspoll on the following Tuesday which showed that 65-odd per cent of Australians supported the apology that was given. If you had done that same Newspoll about a year ago you would not have achieved that result. That is what leadership is about—leadership is bringing a community with you. The most pleasing part of that Newspoll—if I am wrong, I do apologise but I think it was a Newspoll—was the fact that 70-plus per cent of women also supported the apology and the process the Prime Minister undertook to achieve that.

To make the claim that our government is not compassionate is simply not supported. If you want to go to a lack of compassion and understanding of working families, their day-to-day lives and how the economy and the way it was managed by the former government affects Australian working families, you only have to go to the impact of Work Choices on the Australian community. I think Mr Hockey got it right on the Four Corners show when he said that he thought all—I think he said all—of his frontbench colleagues did not understand how much Work Choices was affecting ordinary working people and how it was concerning them.

Mr Hockey was perfectly right in making that comment because even now we find denial and lack of understanding from the former government, and the hurt and the betrayal that people felt. People did trust the former government—you had to see it in the polling figures. People did trust the government to look after them, but Work Choices absolutely betrayed that trust because it was ideologically-driven policy that almost peeled back the covers from people’s eyes so they could see what the government truly stood for. We know that the government had wanted to do that for a very long time. We know that the only reason the government achieved it was from what happened in the 2004 Senate vote. In some respects, whilst it was a very concerning time for most, and a very distressing time for some who personally bore the brunt of Work Choices in their workplace, it did tell the truth to the Australian community of the always held intent of the Liberal Party, supported by the National Party, in terms of industrial relations in this country.

I hope that Australians in the future do remember and recall what was proposed, and what was delivered to the Australian community in terms of industrial relations. This is what the Liberal Party stand for; this is exactly what they would do if they were ever returned to government. Australians should remember and recall what happened in 2006-07 under Work Choices and the former Liberal-National Party government because that is what it really means when compassion is lost in Australian political dialogue.

I can assure those on the other side that the new Rudd Labor government intends to be prudent and fiscally conservative. It intends to treat taxpayers’ money carefully and wisely. We will not see the regional rorts that we saw in my neck of the woods under this government. We will not see hundreds of millions of dollars being wasted. I thought Mr Albanese’s comments in the House yesterday were another example of an incredible waste of money: a dog-food company—which had never been opened—was given an enormous amount of money, and it sat in their bank for two years. This is the sort of wasteful approach that the former government took to managing taxpayers’ money. It is not the government’s money; it is Australians’ money and needs to be used wisely and to ensure that there will be an outcome for our community. I can assure those sitting on that side who wrote this bit of fluff, that this is what will occur under Labor.

Debate interrupted.