Michael Ronaldson (Victoria, Liberal Party, Shadow Minister for Veterans' Affairs) Share this | Link to this | Hansard source

I move:

That the Senate take note of answers given by the Minister for Finance and Deregulation (Senator Wong) to questions without notice asked by Opposition senators today relating to the 2011-12 budget.

What an appalling first day for the government after the budget was given. They have no idea and there is no plan and no process. And not one question was actually answered today—but that should be of no surprise at all.

Nick Sherry (Tasmania, Australian Labor Party, Minister Assisting the Minister for Tourism) Share this | Link to this | Hansard source

Why didn't you ask a question, Ronno?

Michael Ronaldson (Victoria, Liberal Party, Shadow Minister for Veterans' Affairs) Share this | Link to this | Hansard source

Senator Sherry, of course, is interjecting—and he is one of the greatest recalcitrants on the other side. He cannot answer a question. He is not across his portfolio and all he does is either snooze or interject during question time—and normally in that order.

I now want to talk about what this budget does not include, which means that it is not set in stone but rather it is a budget built on sand. This budget will not stop the boats. This budget will not pay off debt, but rather will increase it. This budget will not put the budget into surplus. No-one believes this government can ever, ever deliver a budget surplus. It will take very, very minimal movement in the economy of China—upon which this surplus is built—for the surplus to dissipate in front of our very eyes. This budget will not stop the government's waste and mismanagement. It will not ease the cost-of-living pressures on Australian families, but rather will add to them. It will not assist private health insurance and it will not do anything about the government's dishonest dealings with the Australian community.

But what this budget will do is impose a carbon tax and a mining tax and destroy private health insurance. It will increase net debt. It will require the borrowings of approximately $135 million per day this financial year and, over the next four years, $20 million a day in borrowings—$4,200 for every Australian over the next four years. This is a government that inherited a strong economy. This is a government that inherited a budget surplus. This is a government that inherited no debt. And in the short space of three years they have driven the net debt into the second highest in this country's history. It was a despicable act last night. It was not a budget; it was an excuse for inactivity. It was an excuse for a government that simply has not got any control of itself. It has no control of our borders and it has no control of the economy, and families are ultimately the ones who have suffered.

I will repeat the comments that Senator Eggleston made when he said: 'Why should families be responsible for this government's refusal or inability to do anything about properly protecting our borders?' This so-called Malaysian deal, which will cost close to $300 million, is a complete and utter farce. There is not one person in the Australian community who believes that it is going to resolve the situation. The solution is there, as Senator Eggleston said, with Nauru. It is quite simple. The Prime Minister knows that, the Labor Party backbench knows that, but the Prime Minister will not swallow her pride, admit she has made a mistake and get on and do something about it. Why should the Australian community pay for her refusal to acknowledge the mistakes that she has made? Why should they pay for her ego? Why should they continue to pay for her refusal to protect Australian families and to ease these increasing cost-of-living pressures?

This government had an opportunity to do something significant for this country in last night's budget. But, instead, they have put every single egg of every single Australian family in the basket of the Chinese economy. This is a Chinese economy driven budget—and if there is a sneeze in the Chinese economy we will get a very, very serious does of the flu. Not one economic or political commentator thinks for one minute that there will not be a sneeze in the Chinese community. It beggars belief that in the next three years there will not be a shiver in the Chinese economy. No-one for one minute thinks that the Chinese economy is at risk, but no-one believes that there will not be some— (Time expired)

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

This is the 17th budget that I have witnessed as a member of this parliament. I arrived here at the time of the budget in 1994. So I have seen a lot of budgets—both Labor ones and coalition ones. And let me tell you something: the history of this country shows that when the country gets into some trouble you have to go to a Labor government to get us out of it. It happened in World War II—you fell apart and John Curtin had to take over to save the country. It was Chifley, of course, who started to rebuild the Australian economy after World War II and it was the Hawke and Keating governments that transformed this economy and opened it up to the world—and today we see the great benefits of those visionary decisions. hat have we had in the last couple of years? We have had the worst global financial crisis since the Great Depression. What do we have in Australia? We have an economy that is the envy of the Western world. We have the only economy in all of those great nations that did not go into recession. We have an economy that has low unemployment, that has a low inflation rate and that has one of the lowest government-debt-to-GDP ratios of the world. We are a country with an economy that did not have all of the crises that we continue to see in Europe, in countries like Spain, Greece, Ireland and so on. Why was that? It was because of the great economic management of the Rudd and Gillard governments, through, as I said, the worst economic crisis this world has seen since the 1930s.

But it is as if the opposition thinks that it did not occur—because we fixed it, or because we made sure that our economy did not suffer in the way those other nations did. Senator Ronaldson talks about how when China sneezes we get a cold. A couple of years ago the world had one of the worst cases of economic flu in the history of the world in this century and the last century, but we did not catch a cold. We did not even sneeze, and that was because of the decisions taken by the Labor government at the time, decisions which those on the other side opposed. You opposed the economic stimulus package which ensured that our people stayed in work and that our economy continued to grow.

Now we hear the latest pronouncement on this budget. Senator Ronaldson just rattled off his problems as if he thinks this is the worst budget in history—as somebody over there said. It is not. This is a budget for the times. This is a budget that delivers some real increases in important services and important programs to this country, to areas, like mental health, that people have been screaming about for years. I served on a Senate select committee where we made recommendations for increased funding to mental health. I acknowledge that the Howard government did belatedly do something about it, but we have now put another $2.2 billion into that area. That is one of the most vital areas and it has been crying out for government support. Other changes we have made clearly will benefit many Australian families, particularly in terms of getting more people into the workforce.

The budget has also had to have some savings cuts in it, because we are still going to meet that target to get this budget back into surplus by the next financial year, 2012-13. Those cuts are important. But what do we get from the opposition? On the one hand, as Minister Wong said, the opposition says that it will just happen. They say they will just take us back into surplus if they were in government. But, as Senator Wong also pointed out, Mr Hockey is saying he will not support any of these savings cuts. What are you going to cut? Tell us the areas you are going to cut. You have an opportunity tomorrow night to tell the Australian parliament and the Australian people in what areas you will find the savings in government spending?

When you were in government, govern­ment spending grew by an average of three per cent. Under the Rudd and Gillard governments it has been growing at one per cent, so do not lecture us about wasteful government spending and all the rest of it. This is a terrific budget for the times and for the Australian people. (Time expired)

Ian Macdonald (Queensland, Liberal Party, Shadow Parliamentary Secretary for Northern and Remote Australia) Share this | Link to this | Hansard source

Before I correct Senator Forshaw's attempt to rewrite history, I want to congratulate Senator Wong, who, together with the Treasurer, Mr Wayne Swan, has been responsible for putting Australia in a position where we now borrow $135 million each and every day. We pay something like $18 million to $20 million every day in interest on those monies that Labor keeps borrowing. In the time we have had question time today, Labor has borrowed another $5.6 million—ticking it up on the credit card. That is something like $92,000 a minute. While I am speaking today, Labor will have borrowed something like $500,000—in the five minutes I have today.

Senator Forshaw reminded us of the Keating days. What he forgot to tell us is that, when we took government in 1996, we found a $10 billion deficit that had been hidden by the Keating government out of that year's budget alone. When we looked at the books, we found that there was a $96 billion deficit run up by Labor's prolific spending, Labor's incapacity to run a country without taxing, spending and borrowing. It took the Howard government something like seven or eight years to pay off Labor's $96 billion debt. We did that through a lot of hard work and here we are a couple of years later with another Labor debt of in excess of $100 billion.

No wonder they moved Senator Wong from climate change; they should move her from this as well, because she is completely incapable. She talks about what a great economy Australia has. Australia used to have a great economy. Why? Because John Howard and Peter Costello paid off Labor's $96 billion debt and then put us into a $50 billion to $60 billion surplus, which in two short years Labor has blown and run us into additional debt of over $100 billion. Sure, we had a great economy. It was recorded by I think it was the OECD as the miracle economy of the world when it was under the control of Peter Costello and John Howard. Now we are rapidly moving down to the bottom. As one of my colleagues interjected on the GDP, Labor would have us try and emulate those countries who are in debt to the extent of 90 per cent of GDP. It is not, can I say to Senator Wong, a race to the bottom. As I look through this budget I see very little for rural, remote and regional Australia and I see absolutely nothing for agriculture. The minister sits in the chamber—he should hang his head in shame. There is no new money whatsoever for agriculture. We have a cutback in the Defence budget of some $4.3 billion over four years. At least the Defence budget puts a bit of money into rural and regional Australia, but that is being slashed by this government. Dealing with asylum seekers, as one of my colleagues has mentioned, has eaten up $2.5 billion over five years out of this budget, due to Labor's incapacity and inability to manage it properly.

I note with some amusement the money allocated for the NBN rollout. I wonder where the 'private investment'—which was so lauded by Senator Conroy prior to the NBN starting—is. I see in the budget papers some reference to 'infrastructure bonds', but you ask them about it, you say, 'What are these about?' and nobody wants to talk about it.

This is a budget from a weak, indecisive government who simply cannot be trusted to manage Australia's economy. (Time expired)

Dana Wortley (SA, Australian Labor Party) Share this | Link to this | Hansard source

As the minister pointed out, last night the Treasurer delivered a budget that aims to put the opportunities that flow from a strong economy within reach of more Australians. It is a budget that aims to get more people into work and to train them for more rewarding jobs. We know Australia emerged strongly from the global recession, with hundreds of thousands of jobs created, while around the world we saw record unemployment and the enormous social consequences it triggered. As the Treasurer pointed out last night, our public debt is a tiny fraction of that carried by comparable economies and our fiscal position is the envy of the developed world.

Today we have sat in this chamber and heard those opposite—and I was listening earlier to Senator Nash and, just now, to Senator Macdonald—talk about regional Australia. I would like to point out a few facts. The 2011-12 budget will invest a record $3.7 billion over the next 12 months in renewing and extending road, rail and aviation infrastructure across regional Australia—a sum far greater than anything ever provided before. Compared to what was spent in the last full year of the Howard government, we will be providing more than twice as much regional infrastructure funding.

The latest budget figures should make the National Party feel particularly uncom­fortable about their record in government because they again confirm that, when it comes to regional infrastructure, Labor governments deliver more than coalition governments. The choice for regional Australia is clear: a record infrastructure budget under federal Labor or cuts and the shelving of nation-building projects such as the NBN with Mr Abbott and his mates in the Nationals.

Other areas of interest include the mental health package. There was a fantastic contribution there. The mental health reform package, of $2.2 billion over five years, will improve the lives of thousands of Australians with mental illness and their families, providing more intensive support services and better coordinating those services for people with severe and persistent mental illness who have complex care needs. It targets support to areas and communities that need it most, such as Indigenous commun­ities and socioeconomically disadvantaged areas that are underserviced by the system as it is today. It will help to detect potential mental health problems in the early years and support young people who struggle with mental illness. Given the impact of mental illness on individuals, their families and the community, the Gillard government believes mental health reform should be a priority. That belief is reflected in the funding provided in what is a very responsible budget.

The budget also builds on the government's strong record of lifting educational standards. Over three years, $200 million will be invested to support students with disabilities in their classrooms and to improve their learning outcomes. This package applies to students with a disability in our government, Catholic and independent schools and includes new services such as speech and occupational therapy delivered at schools, additional hours of in-class support and access to specialist equipment.

From 2012, students from years 9 to 12 will be offered a new national trade cadetship as an option under the Australian Curriculum. This cadetship will be delivered through local trades training centres and other eligible venues. Up to 50,000 additional structured work experience places will also be provided to students.

All Australians, regardless of their background or where they live, should have the opportunity to gain a university education. Labor is investing a further $1.4 billion to meet the growth in university enrolments. We will see 480,000 under­graduate places funded this year. A fund will be created to upgrade infrastructure at regional tertiary institutions and to assist universities to support, attract and retain students from lower socioeconomic backgrounds.

Jobs are another important issue. Training a bigger workforce is vital for the strength of the economy and the living standards of our community. The 2011-12 budget invests in education, apprenticeships, jobs and training. This government is delivering the skilled workers our economy needs while ensuring more Australians benefit from our growing prosperity. (Time expired)

Scott Ryan (Victoria, Liberal Party, Shadow Parliamentary Secretary for Small Business and Fair Competition) Share this | Link to this | Hansard source

Well, I have heard everything! If nothing is the responsibility of this government then for some reason they will claim credit for everything. The conceit on the part of this government—claiming credit, as we have heard from previous speakers, for the resilience of the Australian economy over the last three or four years! The conceit to say that all the small business people who worked harder and all the people that took reduced hours contributed nothing! The conceit of this government to think that it controls the economy and that the success of the economy belongs solely to it is unbounded. e know this from the last 70 years of economics. While I am a big fan of the writer that wrote about the 'fatal conceit', the point is that this government only claims credit for those things it wishes to. It seeks to avoid responsibility and makes excuses for those issues it wants to avoid. It says we should compare Australia's debt to that of other nations. I have never heard a successful defence when a bank comes to repossess a house or business being based on, 'My neighbour owes more.'

It is ridiculous to compare the success of the Australian economy and the massive run-up in debt that we have experienced over the last three years with what is happening in other parts of the world because, quite frankly, they are profoundly mismanaged. Unlike those governments in other parts of the world, this government did not inherit a mismanaged economy. It inherited the most sound finances of any government in the Western world.

What the government does not want to tell you is that, while the average debt in Australia is lower than some of our competitors, if we look at other countries we have had the third fastest run-up of public debt in the OECD over the last five years. You have got the bronze medal there. I suppose you are going for gold very soon if we keep up this record of 20 per cent explosions over six months in budget deficits. In one year this government has run up half the debt that was repaid by 10 years of the previous government. That is $50 billion of debt in one year—up by $10 billion in six months. The children of Australia are never going to see a debt-free Commonwealth if this government stays in office. I fear for the work that will have to be undertaken, the difficult decisions and the sacrifices that will have to be made, if this government stays in office much longer. It has run up $50 billion—half of the previous debt of the Commonwealth that was repaid in a decade.

At its core is a profound misunderstanding of the Australian economy. Yes, the Australian Commonwealth does not have as much debt as some other nations. If we look at net public sector debt around Australia and the behaviour of our state governments, we have a fairly significant debt level in Australia. All this, due to the terms of the Loan Council provisions in the Constitution, is effectively guaranteed by Australian taxpayers. Let us not just look at the Commonwealth balance sheet; let us look at what is happening in the states to see what Australian taxpayers are really up for.

While we have had historically low public debt in Australia since the coalition paid it back, we have incredibly high private debt. Our private banks are dependent upon levels of funding on a regular basis from overseas that, quite frankly, their competitors in the private sector banking systems of other countries are not dependent on. You do not need to be an economist to know that the only reason our four big banks could continue to access the funds they needed for functioning during the credit-squeeze phase of the global financial crisis was that, even though their debt position was safe, the Australian financial system was regarded as strong—that there was indeed a strong net financial position for the Commonwealth of Australia. You cannot have a situation where both of your private banks are dependent on massive borrowings from overseas. You cannot have a situation where you are a capital-importing country having regular levels of foreign investment from overseas and at the same time are continuing to run up Commonwealth debt.

This budget is going to sink without trace. This government looks at the next three years and says it is not increasing spending. It is like an alcoholic saying 'I am not having a drink today' after a three-day binge, because in the last few years spending has increased by more than 15 per cent, in real terms. This government will stand condemned for its mismanagement and run-up of debt in Australia.

Question agreed to.