Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

My question is to the Minister for Finance and Deregulation, Senator Wong. Minister, why is the government claiming the $1.7 billion-plus flood tax and $4.5 billion in other new taxes, tax increases and revenue measures as if they were spending cuts? Isn't it true that, without those tax increases, the government's net spending actually increases over the forward estimates rather than decreases?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Isn't it extraordinary! The first question on the budget and the best the opposition can do is to question a levy which has already gone through this place which they opposed with a real amount of—

Honourable Senators:

Honourable senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Order! Senator Wong, if I could just interrupt you for a moment: I need some silence.

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

A levy which was the subject of an enormous amount of chest-beating on that side and went through this chamber very quietly with the opposition opposing, but not too loudly. What an extraordinary thing! This is a budget which is about bringing the budget back into the black, a budget that is about jobs, jobs, jobs—creating jobs, training people for jobs and getting more people into jobs—and the best they can come with is: 'We don't like a levy to help rebuild Queensland. 'That is the best they can come up with! It is amazing, isn't it? This is an opposition which in government was happy to have a levy to help the sugar industry and happy to have a levy to buy back guns, but they are still fighting an argument on a levy to help rebuild Queensland and other areas of Australia that were hit by a natural disaster. But the most interesting thing is this—

Honourable senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Senator Wong, I will just get you to sit down for a moment. I understand that people want to debate this issue but, as I point out constantly, the time to debate these issues is at the end of question time when ample time is given for people to put their views forcefully. I need to listen to the answer. I call the minister.

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

The most interesting aspect of the question is that Senator Cormann does not know how many additional levies and taxes were in his own supposed $50 billion worth of cuts. Remember that the opposition went to the election with a levy to fund their paid parental leave scheme. We know that the opposition have included these sorts of things in the past as savings measures. If you want to apply that rule in terms of savings, your theoretical savings— (Time expired)

Honourable senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Order! I remind senators that it is disorderly to shout across the chamber. I need to listen to the answers that are given. Senator Cormann.

Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

Mr President, the minister clearly has no explanation as to why a tax increase is said to be a spending cut. I have a supplementary question. This was supposed to be a tough budget. Why then has the government failed to offset new spending in both 2010-11 and 2011-12 with savings, increasing the deficit by more than $7 billion? Is the minister aware of comments by respected economic commentator Alan Kohler that 'any decent chief financial officer would be embarrassed by this budget'?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

First, we have identified $22 billion worth of savings in this budget. Second, the net save/spend position in this budget is a net save in excess of $5 billion. And I should say that, in terms of restraint on expenditure, the average real growth in expenditure in the years of this budget is about one per cent per year. Under Peter Costello, in his last five budgets it was around three per cent a year—I am talking about real growth. The last time a government showed this sort of expenditure restraint was in the 1980s. This is a budget that brings the budget back to surplus and puts more Australians into jobs, trains more Australians and increases participation. If Senator Cormann wants to talk about performance, why don't we talk about Mr Hockey's performance last night and this morning? (Time expired)

Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

Mr President, I ask a further supplementary question. Now that the minister has started talking about tight fiscal discipline and limiting spending growth, does she accept that the government's commitment to keep spending growth below two per cent in real terms is a very easy target to achieve given that government spending is coming off a highly inflated base with spending growth of more than 17 per cent over the last two years in real terms, the highest since Whitlam?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

If it was so easy, why did you never achieve it?

Senator Cormann interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Senator Cormann, you have been given your chance to ask the question. I want to listen to the answer. There have been many people interjecting on both sides, which is completely disorderly, and everyone knows that.

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

If it was so easy, why did they never achieve it? That is the first response. Why did they never achieve this amount of spending restraint? But the more important issue is this: the shadow Treasurer—

John Hogg (President) Share this | Link to this | Hansard source

Senator Wong, resume your seat. If you want to debate the issue, the time to debate the issue is after question time. I have just reminded the Senate that interjections are disorderly.

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

I can understand why they want to interrupt. Their shadow Treasurer has given the most embarrassing performance that an opposition has given in a very long time. This is a shadow Treasurer who says he wants to bring the budget back to surplus earlier, who says there are not enough tough savings and now has opposed at least two or three of the saves. How is it possible that you can come back to surplus and oppose savings measures? Perhaps the opposition should have a think about that.

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

My question is to the Minister for Finance and Deregulation, Senator Wong. Can the minister inform the Senate of the importance of setting out a plan to return the budget to surplus?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Last night the Treasurer presented the government's budget that will bring the budget back to black by 2012-13, as we have committed to. It is a surplus achieved by taking some $22 billion worth of savings and a surplus achieved despite the significant downgrade in revenues from the legacy effects of the global financial crisis as well as the effects of a high dollar and the floods and disasters on the Australian economy—things that the opposition seem to like to avoid.

We have seen revenue write-downs in 2010-11 and 2011-2012 of some $16.3 billion but, despite this, this government has taken the decisions to ensure the budget comes back to surplus and that the budget prepares Australians for the increase in employment which we will see continue. Remember, this is a government under which there have been some 750,000 jobs created and we anticipate another 500,000 jobs in the year ahead. It is a budget focused on ensuring we reprioritise expenditure, make spending cuts and apply our investment to those things which are good for the economy, good for Australian workers and good for Australian families.

We know that some of the decisions in this budget will not be popular, but they are necessary because we must build surpluses. We must not compound the price pressures we know will increase as a result of the gathering pace of the mining boom. That is why the government have made the disciplined decisions necessary to achieve that surplus. We look forward to the opposition finding some semblance of economic responsibility in the number of hours between now and the budget reply. (Time expired)

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

Mr President, I ask a supplementary question. Can the minister outline to the Senate why it is important to detail the cuts that the government is making in order to bring the budget back into surplus?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Last night's budget set out a clear path on the return to surplus. The govern­ment set out its decisions about where we are reducing expenditure, where we are taking savings, where we are reprioritising and how we bring back the budget to surplus by 2012-13. We are very conscious of cost of living pressures; we are very conscious of the price pressures arising from the gathering pace of the mining boom. That is why it is responsible to bring the budget back to surplus.

We have presented our decisions and our discipline. What we look forward to, and the Australian people deserve, is Mr Abbott tomorrow night in his budget reply demonstrating that same discipline. It is very interesting: they have gone very quiet over there. When they talk about discipline on this side, they do not want to talk about what they would do. They simply want to pretend they can get— (Time expired)

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

Mr President, I ask a further supplementary question to Senator Wong. Can the minister outline to the Senate any alternative approaches that are a threat to sound economic management?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

There is a range of alternative approaches on the other side. Some of them are quite novel. It might be instructive for senators from the opposition to be aware of just where Mr Hockey is taking them. Mr Hockey has committed to bringing the budget back to surplus by 2011-12. He has done it all by himself but he has committed you to it. He also says he does not want to support the government's savings measures. He is complaining that a number of the measures that the government put forward in last night's budget which will return funds to the budget to help the return to surplus should be opposed. I wonder if opposition senators, who pretend to care about economic and fiscal responsibility, would be aware that they have been put in a position of opposing savings measures but delivering a surplus earlier. It simply does not add up. (Time expired)

Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Link to this | Hansard source

My question is to the Minister representing the Treasurer , Senator Wong. In its agreement with the Independents to form government, the government agreed to invest $1.4 billion in community infrastructure. Can the minister please outline how much of this money is being spent on regional infrastructure projects over the forward estimates as outlined in last night's budget, and did your negotiations with the Independents insist on investment in such things as crazy ants, the Australian Antarctic Division, Canberra centenary celebrations and Perth airport roads?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

This budget has delivered for regional Australia like no other budget. I know that is embarrassing for the National Party who, when they were in coalition, never managed to deliver what a Labor government with this parliament has delivered last night. I can understand why Senator Joyce might feel a little embarrassed about that issue. an I go through some of the many investments in regional Australia that the government is putting in place. There is a $4.3 billion investment in health, education and infrastructure initiatives for the benefit of regional Australians. One of those is, as the senator would know, the Health and Hospitals Fund where there is a commitment of $1.8 billion, of which $1.3 billion was delivered last night. There were a great many regional hospitals and other health investments out of that $1.3 billion fund for Queensland and for states and territories all around Australia. I hope that the coalition will be supportive of those investments in regional health programs. In addition, the government is delivering a $500 million investment in the regional priorities round of the Education Investment Fund to support capital investments in regional higher education and vocational education. So they are amongst the $4.3 billion worth of investments in regional Australia delivered under this government and in this budget.

The senator should also be aware of the Regional Development Australia Fund. That was referred to last night and has previously been announced by Minister Crean. So this is a government that has not only delivered on its commitments to the Independents; more importantly, it has delivered on its commitments to regional Australia and delivered on— (Time expired)

Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. In March this year the government announced the five-year $1 billion Regional Development Australia Fund. Can the minister please inform us directly how money in this fund is actually listed in the budget over the next four years? What is the amount?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

It does sound like we have got to an estimates question pretty quickly. My recollection of Minister Crean's announcement is that it is obviously his portfolio as that was a grants based program. My recollection is also that provision for at least some of this fund was made in the MYEFO as well as referenced in last night's budget, but I can come back to the senator in more detail on that.

I think the question is about profiling of that particular line item of the federal budget and I do not have that detail in front of me. It is the case—

Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Link to this | Hansard source

Mr President, I rise on a point of order on relevance. If the minister does not know the answer, or is not capable of giving the answer, she can just take it on notice and get back to us. We do not need to waste any more time.

John Hogg (President) Share this | Link to this | Hansard source

Senator Joyce, there is no point of order.

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Thank you, Mr President. As I said there is $1 billion in the Regional Development Australia Fund which is about additional investment in economic and community infrastructure in regional Australia. The senator might also be aware that, through Minister Crean's portfolios, we have—

Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Link to this | Hansard source

Mr President, I rise once more on a point of order on relevance. The minister has approximately six seconds to say a number. She either knows the number or she does not know the number. She is the finance minister; she might possibly be able to have a crack at it. All we need is the number of how much, over the next four years, is actually listed in the budget.

Joe Ludwig (Queensland, Australian Labor Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

Mr President, on the point of order: Senator Wong has indicated that the question is most likely well outside the budget portfolio that she has. Together with that, it is a question about an announcement in March by the regional development minister, Simon Crean, about a $1 billion announcement. Minister Wong also indicated that she would have a look at that. But, notwithstanding that response, Minister Wong was also directly relevant to the question by dealing with the substance of the matter—that is, the question around the $1 billion announcement. All of that means that Senator Joyce is well outside his comfort zone in asking this question and I would ask that no point of order be recorded.

John Hogg (President) Share this | Link to this | Hansard source

There is no point of order.

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Thank you, Mr President. My recollection is that Minister Crean, prior to the budget, did announce guidelines for the program the senator has mentioned.

Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Link to this | Hansard source

The answer was $300 million, but anyway. Mr President, I asked a further supplementary question. How can regional Australia trust this government to deliver when it does not put the money it promises into accounts it keeps?

Government Senators:

Government senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Order on my right!

Senator Conroy interjecting—

Senator Conroy! This is wasting valuable question time. Senator Joyce, you are entitled to be heard in silence. Continue.

Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Link to this | Hansard source

Thank you. What guarantee can the government give that after the next election this government will not raid these funds to deliver on its increasingly fanciful predictions of a more than $50 billion turnaround in the surplus in two years time?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

I am happy to answer the question, Mr President, but perhaps we could ask you to consider how that is a supplementary question given it is about post the next election.

We have announced the Regional Development Australia Fund. We have announced the guidelines to that and Minister Crean made that announcement pre the budget. If the senator is asking about what is linked to that fund, he may be referencing the fact that the minerals tax does provide a contribution to that fund. So I suppose the National Party will be in a position, when that legislation comes before this Senate, of whether it supports additional investment in regional infrastructure in this country.