Penny Wong (SA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I rise to speak on the three appropriation bills forming the additional estimates for 2014-15—appropriation bills Nos 3 and 4 and of course the parliamentary departments bill. In total, these bills seeks to appropriate additional funds in the order of $1.7 billion for the 2014-15 year. They reflect changes in expenditure as a result of the 2014-15 MYEFO decisions as well as as a result of the machinery of government changes that were announced as part of the ministry reshuffle prior to Christmas of last year. Some of the measures that are the subject of the appropriations in the three bills include additional funding for defence overseas operations, additional funding for a number of agencies in the Attorney-General's portfolio and the immigration portfolio, funding for DPS and the AFP, funding for the Department of Employment in relation to job seeker compliance framework measures, funding for the Department of Health in relation to various upgrades and one matter which I did note, which is funding for the Department of Finance in relation to the Kenbi land claim on the Cox Peninsula. That caught my attention as I recently visited there with Senator Nova Peris.

The appropriation bills do give me an opportunity to speak a bit about the economic circumstances the nation faces and the damage that this government is doing to Australia's economy. Since the election we have seen a government that, by its actions and its words, is continuing to risk economic growth and economic prosperity and that is continuing by its actions and its words to damage economic confidence. This government has since its election done little but talk down the Australian economy. It is as if ministers on the other side have failed to make the transition from opposition to government and recognise that what they say as ministers in government carries much more weight than the irresponsible rhetoric they engaged in in opposition. We had an example of that in the Senate chamber during a dorothy dixer in question time one day when the Leader of the Government in the Senate said that the country was bankrupt. This was completely untrue, completely false, but that is what was said by the Leader of the Government in the Senate. There are plenty of examples of this rhetoric, of the Treasurer suggesting that the country was on its knees to the bankers of the world, of Senator Joyce suggesting that we were like Greece. None of these statements were based on facts, all of them were nothing more than fearmongering, but, worse, it was completely irresponsible from ministers of the Crown.

On top of this, what has the government done? It has brought down a budget which has slashed benefits for low- and middle-income families and slashed investment in education and health. It has slashed many of those investments which are important for the future of the nation. The reality is that these budget cuts are hurting people, they are damaging confidence and they are hurting the economy. We know that growth remains weak, and outside the resources sector the economy is contracting. According to many economists, we are officially in an income recession.

Let us look at some of the figures since the budget was handed down in May last year. Economic growth has slowed. The annual growth rate has declined from three per cent in the year to March 2014 to 2.5 per cent in the year to December 2014. GDP grew one per cent in the March quarter 2014, half a per cent in the June quarter, 0.3 per cent in the September quarter and 0.5 per cent in the December quarter. This is what has happened to economic growth under this government—economic growth has slowed. Business confidence is down. We remember the Treasurer spouting forth about how there could be a jolt in confidence, an adrenaline surge in confidence. Since he has been Treasurer, since those opposite have occupied the treasury bench, business confidence has gone down. The NAB monthly survey shows that business confidence has collapsed from positive eight points at the time of the budget to zero in February 2015—well below the long-run average for business confidence. Consumer confidence has taken a battering. Unemployment is up, from 5.7 per cent to 6.3 per cent, hovering at its highest level for more than a decade; youth unemployment has risen to just under 20 per cent—19.9 per cent—and is hovering at its highest level in 16 years. Nearly 50,000 more people are unemployed, and there are now over 750,000 people unemployed—777,000, the highest number in 16 years. Of course the Reserve Bank has had to cut interest rates to support the economy.

We hear all the rhetoric from Minister Cormann and others on the other side about what great economic managers they are, yet they are presiding over slowing growth, a decline in business confidence, consumer confidence taking a battering, an increase in unemployment, an increase in youth employment and more people in the unemployment queues. What a fantastic record to date. The reality is that Mr Hockey and Mr Abbott have mismanaged the budget and have mismanaged the economy. Slower growth means we are not creating enough new jobs to keep up with the number of people entering the labour force—hence the rise in unemployment. Let us recall that those on this side of the chamber kept the economy growing through the largest global financial crisis the world has seen since the Great Depression and that we created over 900,000 new jobs during our time in government.

Let us turn now to the budget. A lot of chest beating goes on over the other side about how well they are managing the budget. The truth is the opposite. Not only are they presiding over higher unemployment and lower growth; they are presiding over an increase in the budget deficit and an increase in debt. The budget deficit has blown out under the Abbott government. Under them, we have seen a deterioration in the projected deficit over the four years to 2016-17—that is compared with what they inherited, as set out in Treasury's Pre-Election Economic and Fiscal Outlook, from the Labor government. In the seven months between Mr Hockey's first budget and his midyear update, the projected deficit for the four years to 2017-18 deteriorated by $44 billion—a blow-out of more than $200 million for every day between Joe Hockey's first budget and his midyear update in December 2014.

Senator Cormann, who, I am sure, will turn up at some point in this debate, often tells me what a great finance minister he is. Let us compare how things were prior to him becoming finance minister—when we were in government and I was finance minister—with how things are now. Whilst I held the portfolio, we had lower federal government spending as a share of GDP than under the Abbott government, we had lower taxes as a share of GDP than under the Abbott government, and we left Australia with one of the lowest levels of government debt of any advanced economy. Since Senator Cormann has become finance minister, he is now budgeting over the next four years to increase spending by $70 billion, increase taxes by $80 billion and increase net debt. That is quite an achievement!

Over the four years to 2013-14, federal government spending averaged 24.75 per cent of GDP. Under the government's budget, spending will average 25.5 per cent of GDP over the four years to 2017-18. Tax receipts under the Labor government averaged 21.1 per cent of GDP over the four years to 2013-14; the Abbott government is budgeting for tax receipts averaging 22.6 per cent of GDP over the four years to 2017-18. So under this government we see higher spending as a share of GDP and higher taxes as a share of GDP—at the same time as they are presiding over lower growth and higher unemployment. Australia's net government debt stood at just under 13 per cent of GDP in 2013-14. According to the IMF Fiscal Monitor in 2014, that was the sixth lowest of the 26 advanced economies. Under the Abbott government, net debt is projected to rise by over $100 billion by 2017-18 and gross debt is also projected to increase to $484 billion by 2017-18. This is again an increase of in excess of $100 billion—some $165 billion.

So, for all the rhetoric, let us remember what this government is presiding over: higher unemployment, lower growth, lower business confidence, higher debt, higher deficits, higher spending and higher taxes. That is the record of this finance minister and this Treasurer thus far.

I now want to make a few comments about measures which are reflected, but not necessarily given effect, in the appropriation bills. This budget has been roundly condemned by the Australian community, by this parliament and, frankly, privately—and sometimes publicly—by members of the Liberal Party and even members of their own cabinet. We have seen a budget predicated on broken promises, on a breach of faith with the Australian people, and measures which are fundamentally unfair. This government seems to think that people who oppose them do so because we somehow do not understand the issues, because we are blinkered and ideological or because we are irresponsible—or whatever other insult they can throw at people who are opposed to their propositions. The reality is: this government's budget is unfair and has been roundly condemned because it targets those who can least afford it and because it is predicated on broken promises.

The reason this government cannot gain support for so many of its key budget measures—and let us remember that a number have been passed; I will come to that shortly—either from the community or in this parliament is that they have lost the argument. They have lost the numbers because they have lost the argument. They cannot sustain an argument that says, 'We told you there would be no cuts to health and education', whilst putting forward a GP tax which is nothing less than an imposition on families and other Australians going to the doctor. They cannot sustain a proposition that supports increasing university fees and cutting Commonwealth funding per place at university by 20 per cent after going to the election promising no change to the way universities would be funded. They cannot sustain a proposition that says indexation of the pension should be changed such that the real value of the pension declines over time—condemning more Australian pensioners to poverty—after going to the election saying 'There will be no changes to the pension.' I could go on.

The proposed changes to pension indexation have been estimated by ACOSS to be an $80 per week cut to pensions—a cut that is allowed for in the budget papers. We also know that the impact over the decade will be even more significant. The budget also included cuts to various family payments—for example, the restriction of access to family tax benefit part B to families with children under six, the reduction in the supplements and the freezing of the payment rates for two years. Those changes led to NATSEM estimates that $6,000 per year was being cut from a typical Australian family's budget.

Perhaps one of the most shameful measures in the budget is the government's proposal to leave young job seekers with nothing to live on for six months—a measure we were told recently was, in fact, one of the Prime Minister's so-called captain's picks. Despite the 'no new taxes' rhetoric that taxes would always be lower under this government—another lie—we have also seen an increase in the petrol tax, which was implemented through regulation, thus getting around the parliament, despite there being legislation on the increase in the excise sitting in the Senate. We have also seen cuts to the ABC and SBS, despite the Prime Minister saying 'no cuts to the ABC or SBS'. And, despite Ms Julie Bishop opposing it, we have seen continued cuts to foreign aid—some $11.3 billion over the 2014-15 MYEFO and the 2014-15 budget.

For all of these reasons, we condemn many of the measures in the government budget. I would make the point that Labor has in fact supported a number of savings—some $20 billion worth of savings in this budget—and we have also proposed a range of alternative savings, which include ensuring multinational companies pay their fair share of tax and a reduction in the superannuation tax concessions for high-income earners. We have also proposed—and we are pleased that the Prime Minister recognised this—scrapping his paid parental leave scheme, which was costed at over $5 billion a year.

With a number of the measures I have outlined, whilst reflected in the budget figures that ground these appropriation bills, obviously Labor will continue to oppose legislation giving effect to them. However, Labor is a party of government. We have made it clear that we would not be so irresponsible as to block supply. So we intend to support the passage of the appropriation bills through the parliament.

David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Link to this | Hansard source

I believe that all political parties seeking votes in an upper house election, like elections for the Senate at the Commonwealth level and for the legislative councils in various states, should let potential voters know of their approach to appropriations bills and the blocking of supply. Today, I rise to set out the approach of the Liberal Democrats. I also speak for the Outdoor Recreation Party—our sister party in the New South Wales election. We reserve the right to block supply. This announcement is of little consequence right now. After all, I have only one vote. But voters should know that if they want members or senators who will always wave through government spending, regardless of its size or composition, they should not vote for us.

Appropriation bills come in various forms. The central appropriation bills are those that appropriate money for the ordinary annual services of the government. These bills effectively authorise spending on the continuing and settled operations of government. While the Liberal Democrats and the Outdoor Recreation Party oppose many of the continuing and settled operations of governments, it would be rare for us to attempt to block such bills. Even if we had the numbers in the upper house, we accept that government is formed in the lower house. We would seek to block these central appropriation bills only if they were used to significantly increase the size of government, contrary to any mandate or if a government was so dangerously bad that forcing an early election was the responsible thing to do. Accordingly, I will support the central appropriation bill before us today—the No. 3 bill.

However, our approach is different for other, more peripheral, appropriation bills. The Liberal Democrats and, obviously, the Outdoor Recreation Party will freely oppose or amend these peripheral appropriation bills. These are bills that usher in new policies that are not already authorised by special legislation.These are bills that authorise capital spending.And these are bills that authorise grants to the states.

The Liberal Democrats and the Out door Recreation Party are small- government parties. We want the government out of your hair , off your back and out of your pocket. As such, we will represent our constituents by opposing the incessan t proliferation of new policies that seem to meddle in every imaginable aspect of our lives. The Liberal Democrats and the Outdoor Recreation Party believe that government is not good at running businesses and that a lot of infrastructure can be built and maintained by the private sector. For instance, the Outdoor Recreation Party provides a unique option for voters in the N ew S outh W ales election because , while we support the rights of shooters and fishers, w e also think it is eminently sensible to privatise government-owned electricity assets. Given this support for the role of the private sector, we reserve the right to oppose appropriations for capital spending by government.

The Liberal Democrats and the Outdoor Recreation Party also think that centralising power in Canberra is a terrible idea and that governments that spend money should raise the required taxes themselves. As such, I will represent my constit uents by opposing Commonwealth government transfers to s tate and local governments, particularly those grants that come with strings attached. Given this, I will be moving an amendment to App ropriation Bill (No. 4) 2014-2015 before us today, and I will seek to remove the authorisation for $ 250,000 of tied grants to state, t erritory and local governments in that bill . The state d purpose of these grants is to strengthen:

… the sustainability, capacity and diversity of regional economies including through facilitating local partnerships between all levels of government and local communities.

This is otherwise known as pork-barrelling. Blocking $250,000-worth of grants will not balance the budget, but it is better than nothing. It should be supported and there should be more like it.

Fiona Nash (NSW, National Party, Assistant Minister for Health) Share this | Link to this | Hansard source

Firstly, I would like to thank those senators who have contributed to this debate. These additional estimates appropriation bills seek authority from the parliament for the additional expenditure of money from the Consolidated Revenue Fund.

I would like to highlight five areas relating to the delivery of the government's commitments that are supported by these bills. First, these bills would provide the Department of Defence with just under $558 million reflecting, in the main, additional funding for Defence's overseas operations, the reappropriation of amounts between appropriation acts to better align funding with Defence's work programs, and supplementation for foreign exchange movements.

Second, the Department of Employment would receive just over $115 million, primarily for increased payments to providers following an increase in the number of successful job placements and to implement the new employment services 2015 contracts. Third, the Department of Agriculture would receive $90 million for concessional loans under the Drought Recovery Concessional Loans Scheme. These funds will be used to provide support to eligible primary production businesses in Queensland and New South Wales who are experiencing financial difficulties resulting from the impacts of severe and prolonged drought conditions, or as a result of the combined effects of drought and the mid-2011 disruption to live cattle exports to Indonesia.

Fourth, the Australian Customs and Border Protection Service would be provided with just under $35 million for additional counterterrorism activities and to repurpose the Australian Defence Vessel Ocean Shield, for transition of its ownership from the Department of Defence to the Australian Customs and Border Protection Service. Finally, the Department of Parliamentary Services would receive additional appropriations to enable it to enhance the security of the Australian Parliament House, including the enhancement and upgrade of closed-circuit television equipment and access systems. It will also cover additional parliamentary protective service staff.

In responding to the amendment to be put by Senator Leyonhjelm, the government is not in the practice of accepting amendments to appropriation bills, known as supply bills. Entertaining such amendments will put us in the terrain where supply could be put at risk. We will not entertain line item amendments. The total of the appropriations being sought through these three appropriation bills is just over $1.7 billion, and I commend this bill to the Senate.

Question agreed to.

Bills read a second time.