Brett Mason (Queensland, Liberal Party, Shadow Parliamentary Secretary for Education) Share this | Link to this | Hansard source

I move:

That the Senate take note of the answers given by the Minister for Broadband, Communications and the Digital Economy (Senator Conroy) and the Minister for Innovation, Industry, Science and Research (Senator Carr) to questions without notice asked today.

Paradoxically, in politics the truth often comes from unusual sources. This morning I was reading the Australian Financial Review and an article by a former Labor leader, Mr Mark Latham. He said this, speaking about Mr Rudd and Mr Swan:

They—

Mr Rudd and Mr Swan—

have jumped all over the financial crisis, not with a clear economic strategy in mind, but with an urgent sense of the political opportunity it presents.

This is not an economic stimulus package; this is a political stimulus package. A principal part of the package, as Senator Carr did say, and I agree with this, was the so-called second tranche of the education revolution. The government promises to provide a school hall for every primary school in our nation, at a total cost of about $15 billion. It sounds good. On the face of it, it sounds terrific. But I know of schools that already have a school hall, that do not have room for a school hall or that have even more pressing priorities. The opposition believes that schools should be able to determine how that money is spent—that school principals, school boards, parents and teachers know much more than a central government about how to spend money in primary schools. We should decentralise this back to the schools who need the money. That is why the opposition is proposing to again commence the Investing in Our Schools Program that was scrapped by the Labor government. It was absolutely ridiculous. Labor has this view of a great leap forward, spending billions of dollars, and they do not even know if primary schools need it. School boards, principals and teachers know far more than the Labor government here in Canberra about how to spend billions of dollars.

The Investing in Our Schools Program would be far more efficient, because schools would set their own priorities; it would be far, far, far cheaper; and finally of course and principally you do not have to deal with state governments. The fiasco thus far of the Computers in Schools program is all because it has had to go through the coffers of state governments. The great benefit of the Investing in Our Schools Program was that the money went from the government directly to the schools concerned and not through the sticky fingers of state governments—all the way to schools, principals, their boards, their teachers and their schools.

Thus far the education revolution has been a shambles. Just think of it. This is what is going to happen to the $15 billion that has been promised. The problem is the delivery of the service. What have we seen so far with the delivery of computers? One million computers were promised. At the end of the school year last year, how many computers had hit the desks of year 9 to 12 students across this country? I can tell you: about 10,000—one per cent of the computers promised. At this rate it will take 100 years for those one million computers to be distributed. So-called partnerships between state and federal governments have become an absolute shambles, with New South Wales in particular not wishing to take the computers because the federal government, until the other day, would not pay the infrastructure costs of those computers. Finally, when the federal government fessed up, they realised something—that their proposal was short-changed by $800 million. That is on Commonwealth estimates. It was short-changed, under budgeted, by $800 million. On this sort of form for the $15 billion now promised, it is not going to cost $15 billion; it is going to cost about $30 billion. It will be another shambles. What worries the opposition is not the commitment and the money; it is the fact that it has been impossible thus far for this government to deliver services to schools. Whether it is trade training centres or the Computers in Schools program, it has been an absolute fiasco. If Labor cannot put a computer on the desk of every year 9 to 12 student in this country—and they have not been able to—how the hell are they going to be able to deliver a school hall for every primary school in this country? It is absolutely impossible. (Time expired)

Mark Bishop (WA, Australian Labor Party) Share this | Link to this | Hansard source

When times change, when circumstances change, what reaction does a responsible, efficient, effective and caring government have? It changes its policy settings to cater to the new circumstances. We face in the forthcoming years the greatest economic challenge this country has faced—indeed, the world has faced—since the 1930s and the time of the Great Depression. That challenge facing Australia, the Australian people and the rest of the world is colloquially known as the global financial crisis. Its origins are now clearly understood. It is caused by a meltdown of net debt instruments around the world and a gross rundown of the availability of credit—credit that is usually accessible by government, by corporations, by families, by businesses to carry on the ordinary and every day part of business and private life. It is the equivalent of a national economy.

So what is the reaction of the Rudd Labor government to this acknowledged emergency, this greatest threat to our times since the Great Depression? It is to extend a hand, to work in partnership with the Australian people. Working together, facing and fighting this challenge together so that the Australian nation can overcome this challenge and go on living the lives that they have created for themselves.

So we have this problem: a lack of credit, a lack of finance, an anticipated lack of spending by government and corporations, a decline in consumption and, in the short term, a decline in growth. That change in immediate circumstances requires a change in reaction, a changed response on the part of government. So what does the Rudd Labor government propose to do? It proposes to engage in a modest increase in spending of some $42 billion over a period of three or four years to stimulate the Australian economy. One-quarter of that increase in spending will go to families to assist them in meeting immediate demands and payments—this will immediately be reflected in consumption and spending—and three-quarters will be spent immediately, and over the next two or three or four years, on assets and asset building—otherwise known as infrastructure. So $10 billion for families and $30-odd billion for infrastructure.

And what is going to be the net result of that increase, that package of $42 billion spent over a period of three or four years, which is apparently of such concern that it has caused the opposition to say—before they have examined the bills, before there has been any inquiry—that when it comes to a second or a third reading vote in this chamber, they will oppose it? What is the net increase? The net increase in debt is going to be from zero net debt up to five per cent—a lousy five per cent.

I ask the question: what is the current average of net debt in all 24 OECD countries? It is 45 per cent of their GDP. And this modest—the proper adjective is ‘modest’—stimulatory fiscal package to be brought by the Rudd Labor government into this chamber in due course is $42 billion, which will result in a net increase in debt from zero up to five per cent—a minimal amount, a modest amount. As I said, $10 billion is going to be spent on immediate consumption to keep people in work, to keep businesses active, to keep jobs going, and another $30 billion is going to be placed, over time, into assets.

The net result is twofold. The opposition shrieks in horror, does not understand the consequence of the figure and says, ‘We will oppose this package,’ without understanding that the increase is minimal and modest—modest by the standards of any well-run country in this world. The example of that is the OECD, where their current average net debt is 45 per cent of GDP, and we want to go up to five per cent to keep tens of thousands of people in work. (Time expired)

Sue Boyce (Queensland, Liberal Party) Share this | Link to this | Hansard source

I would also like to take note of the answers given by Senator Carr and Senator Conroy in question time today. I must admit I concur thoroughly with Senator Conroy when he says that there will be some senators going back to their constituents this weekend to say ‘sorry’. But it will not be the coalition senators; it will be the Labor Party senators. If we are apologising at all, it will be for the indecent haste with which this package of bills has attempted to be put through. If you look at the number of emails that have come in, the number of phone calls that have come in, there is a small number that are saying, ‘Yes, give me the money.’ There are many saying: ‘I’m embarrassed. Why am I getting this money? I don’t need this money. There are plenty of people like pensioners and the unemployed who need this money more than I do.’ They are the ones who are going to be asking those opposite to apologise for spending a huge amount of money and for spending it in the areas that they are with so little notice of process as they go.

I was much amused by Senator Carr’s views on whether questions should be asked about the schools program. Why, he wondered, were we quizzing this package if we were not going to pass it? So we have the lovely double dip here from the government: don’t query it, just pass it—oops, you’re not going to pass it, so why query it? ‘Scrutiny? What’s that? We don’t want any.’ That is what this government is all about.

We have examples raised already by Senator Bob Brown about mistakes and errors in this package. If we are talking double dipping, let us look at some of the provisions that already involve double dipping. Parents who work part time are quite likely to be eligible to receive the $950 twice. For students with jobs, there is also the possibility that a lot of them will be eligible to receive the $950 twice. Let us get this right. Let us look at this package with something that looks vaguely like scrutiny.

I was also quite interested to hear Senator Carr’s view about what happens in the real world. This is the same minister who boasted that he did not go to schools to find out what to do about computers; he went to the education departments. They were the ones who would know about computers. You do not have to go to a school to know what is happening in the real world, according to Senator Carr. We can see the result of that very poor research and that attitude in the very poor way, or the non-way, that the computers in schools program has been rolled out. What hope, what trust is there? That is certainly what P&Cs and schools are saying to us. What can we expect to be the reality of this program from a minister who does not understand what is really happening in the real world?

The problems go on and on. We have the suggestion that, for $14.7 billion, all 9,540 schools get a new hall or a new library. That is excellent for those that do not have one. That is excellent for those for whom this is a desperate priority. But of course they have not got a clue as to whether this is the case or not. Then we look at how this might be delivered in places like Queensland by QBuild. This is a monopolistic government organisation described by Terry Sweetman in the Courier Mail as ‘an organisation of monstrous inefficiency’. That comment was backed up just yesterday by talkback radio people who were quite keen on the idea of a schools package and quite keen on the idea of something that their schools actually want but who said that they do not want this delivered by an organisation universally regarded as ‘a costly, bureaucratic and inefficient monster’. This is yet another example of the poorly thought out results that you get when you try to bully legislation through the parliament. It is time that this government was brought to account.

Louise Pratt (WA, Australian Labor Party) Share this | Link to this | Hansard source

The Rudd government knows that it must do everything in its power to avoid a prolonged recession. This is about supporting jobs. We know that unemployment in this country is forecast to rise, and we are taking decisive action to contain it. Alternatively, those opposite can force families into unemployment, causing people to lose their homes, causing further deflation in housing values and, indeed, causing further collapse in the building industry with people forced to sell their homes for less than they owe. These are the consequences of the current global economic crisis, and it is not the future that we want for Australian citizens.

The Rudd government has, on that basis, taken decisive action with its $42 billion investment to support the Australian economy and jobs. We know that there is an overwhelming and immediate case for our Nation Building and Jobs Plan. There is a global recession around us, and the outlook has deteriorated just so sharply in the past few months. We know Australia is better placed than many countries, but we cannot resist the pull of these international forces. That is why our Nation Building and Jobs Plan is so important, as highlighted by our ministers in question time today. It has been carefully designed to support jobs and bolster the economy in the short term. It has been welcomed by commentators for doing just that.

The key to this plan is laying the groundwork for having a stronger economy when we emerge from this recession. We will do that by investing in essential community infrastructure like schools, housing and local road projects. The plan is about supporting these local economies and local jobs. We are also providing support to families and individuals to ensure that we keep demand and consumption in the economy flowing in the short term. These are important economic fundamentals that clearly those opposite are blatantly ignorant of. We have a global recession that has wiped $115 billion off the government’s revenue and has brought our budget into deficit. In the face of the most serious global recession since the Great Depression, there can and should be no apology for choosing to support Australian jobs. Of course, the government remains committed to returning the budget to surplus once we are through this recession. There is going to be a debt to repay, but repaying a deficit will be much harder if the whole economy falls over on its arse.

Alan Ferguson (SA, Deputy-President) Share this | Link to this | Hansard source

Senator Pratt, I suggest you withdraw that comment.

Louise Pratt (WA, Australian Labor Party) Share this | Link to this | Hansard source

I withdraw. We need to cushion the economy’s fall or it will fall much further. We know how hard we have been hit by this global recession. I see it in Western Australia, where we have lost hundreds of jobs already. We have lost 300 from Lennard Shelf and 180 from Cloud Break. We have 300 to 500 projected job losses at Argyle Diamonds. We have already heard about the 1,800 to 3,000 at Ravensthorpe. We have lost 300 at Mount Keith, 400 at Telfer, 190 at Koolan Island, 200 at Wicherina and 70 at Spinifex Ridge. Where are these workers going to go? We need to restimulate and create jobs, and the Rudd government is doing just that. We will create new jobs in communities throughout Australia in local construction, in our schools and through our Investing in Our Schools program. It is a tragedy that so many Australians are losing their jobs, so the Rudd government needs to make no apology for pursuing these policies. When those opposite get their economics straight, they will understand that there are certain times when it is quite fine to move into deficit and support the economy and to stimulate the economy so that it does not fall further. (Time expired)

Russell Trood (Queensland, Liberal Party) Share this | Link to this | Hansard source

We all know when a government is in trouble, because it suspends rationality. It suspends trying to make a credible case for its policies. It suspends the capacity to make an argument. That was on display during question time this very day, as it was on display in question time towards the end of last year and earlier this week. From the government during question time, especially from Senators Conroy and Carr, we had polemic and we had rhetoric. We had a series of charges of a kind which we have heard before.

These charges are not new. They are of things like economic illiteracy and economic vandalism. These kinds of prescriptions, argued and directed at the opposition, have been made consistently over weeks, and certainly during this particular question time. And these are serious charges. Economic vandalism is a serious charge. Economic illiteracy is a serious charge, but we would be delinquent if we allowed them to stick because we are being lectured by a government whose capacity for economic vandalism knows very few bounds considering the time it has been in office.

Consider this. A few months ago the Australian people were being presented with the threat that the economy was under serious danger of increased inflation. The consequence of that was that the government spent hours, days, weeks, months trying to drive the so-called inflation genie back into the bottle. The government virtually intimidated the Reserve Bank into increasing interest rates and, having done so, caused great pain in the Australian economy and to the Australian people.

And then suddenly the government discovered that the threat was not inflation. Suddenly the government discovered that the dangers to the economy were elsewhere. So no longer were we worried about inflation. Increasingly we were unworried about saving or preserving; increasingly we were worried about the jobs which were now under threat from a deteriorating international economy. So what we got was not an injunction to save nor an injunction to increase surpluses but an injunction to spend. So towards the end of last year we had a $10 billion stimulus package, or thereabouts—the results of which were argued to be the delivery of tens of thousands of new jobs to the Australian economy, none of which have been delivered. What in fact has been delivered is a series of deteriorating job numbers. The economy is losing full-time jobs.

So, having failed with that stimulus package, what does the government do? It comes into the parliament early this week and tells us that we need yet another stimulus package. In blind panic—as the economy slows, as jobs disappear from the economy, as equity markets bounce around with no clear bottom, as companies announce decreasing profits—the government decides something has to be done. What do they do in this situation? Lemming-like, they reach for the solution that governments around the world are seeking. They reach for the stimulus package to spend money. They will spend a large amount of money. They will spend as much money as they think the Australian people will stand, in the hope that that will redress the dangers to the global economy.

This is an interesting proposition because it rests on an assumption. It rests on the assumption that stimulus packages actually make a difference. It rests on the assumption that you can spend your way out of problems. It rests on Keynesian economics. In that context I refer the Senate to an article that appeared in the Australian this morning headed ‘New Deal prolonged the Great Depression’ because all of these economic nostrums grow out of the experience of the Depression. That article by two eminent professors tells us that that is not the case. (Time expired)

Question agreed to.