Linda Reynolds (WA, Liberal Party) Share this | Link to this | Hansard source

I rise to speak about an issue that I believe is the single greatest act of national reform that we can achieve together as a nation—that is, change is required to generate new jobs and increase national wealth in our rapidly changing world economy. That reform is reform of our highly dysfunctional federation.

I believe that today our current intergovernmental arrangements are the single biggest drag on current and future prosperity. It is not a problem that will fix itself, but it is something that very few Australians notice and even fewer discuss. However, in this place we daily see the symptoms of a highly dysfunctional federation: the perpetual, unedifying and demeaning fights between states for Commonwealth funds to pay for the services they are responsible for providing. We also see the apparent perpetual inability of politicians to get things done and the increased disillusionment and cynicism with politics and politicians in our community inquiries, where we see so many circumstances where millions of Australians fall through bureaucratic chasms. These are all symptoms, I believe, of a greater national malaise.

Australia has a magnificent Constitution—one that has served our democracy so well for the past 115 years. It is one of very few constitutions that were born out of decades of talk and very, very considered negotiations and not born out of war and conflict. Its simplicity is its greatest strength, but it is also its greatest vulnerability—a vulnerability that should never be ignored. Our own founding fathers very carefully and thoughtfully assigned specific accountabilities between state and Commonwealth governments—between sovereign governments. They did that based on which jurisdiction was best placed to deliver services to all Australians. They also very deliberately did not codify how it was to operate in practice. They left that responsibility to Australian citizens through their elected representatives—through us—to adapt and transform with changing times and changing social circumstances. But, as Prime Minister Robert Menzies wisely cautioned, there are inherent dangers for our nation if the health of these relationships and these processes that underpin our Constitution are not regularly reviewed and reformed. Sir Robert said in 1967:

… I cannot pretend that the growth of the Commonwealth power … does not present great problems of future adjustment for both Commonwealth and States if both are to co-exist and succeed.

…   …   …

The theoretical reason is that, as good Federalists, we would not wish to impair the autonomy of the States in the important functions for which they are responsible. Clearly the strictness with which this principal is applied will depend very much on political circumstances and contemporary pressures.

But he also noted:

But the practical reasons is that the Commonwealth knows that the States are better informed and better equipped administratively and technically in relation to their constitutional functions, their 'reserved' or 'residuary' powers, and that overall efficiency would suffer from too large a Commonwealth invasion—

into their responsibilities.

I have reflected a great deal on Sir Robert's cautionary note and I think sadly, today, for most Australians, if not all Australians, how prescient he was in those observations. Reform and centralisation of powers, particularly financial powers, have progressively occurred for over a century now in Australia, but rarely have we ever stopped to consider where these reforms are progressively taking us as a nation. Are they taking us somewhere better or are they taking us somewhere worse?

In politics, money is power. Today's vertical and horizontal fiscal equalisation and our Byzantine COAG processes are some of the main drivers of our national dysfunction and national economic underperformance. Our founding fathers may have been great constitutional drafters but they were lousy with numbers and accounting in their estimation of what the cost of government would be to deliver services.

Prior to Federation it was predicted that a federal government's responsibilities would only cost 25 per cent of total national revenue and that the delivery of state government responsibilities would be 75 per cent. Today, that is reversed: 75 per cent of revenue goes to the Commonwealth and 25 to the states, and state governments now rely on the Commonwealth for over half of their budgets, which are mostly tied to Commonwealth, not state priorities.

Greg Craven wittily noted that having a Prime Minister talk about states being sovereign is akin to Vladimir Putin turning up at the Ukrainian president's house with his wife and an esky—not very welcome, indeed! But I think that, if Australia is to succeed in a highly competitive global economy as a nation, all aspects of our nation, including all levels of our governments, must be agile and innovative. They must be empowered to respond rapidly to the demands of an increasingly interconnected and disruptive global economy—one that we all live in. These are all qualities that I think most Australians would say are not inherent in any of our bureaucracies today.

So where do we start? I believe the answer lies in the most unexpected of areas and starts with an understanding of the difference between two little but profoundly important words that today are used interchangeably by Australians. Those two words are accountability and responsibility. So what is the significance of these two little words to our Federation? Benjamin Disraeli once famously explained the difference between two English words that are often used interchangeably—'misfortune' and 'calamity'. He described it thus: 'The difference between a misfortune and a calamity is this: if Gladstone fell into the Thames, that would be a misfortune. But if someone dragged him out again, that would be a calamity.' That is a wonderfully witty way of explaining the importance of the meaning between words.

Being responsible means not only being involved but being responsible for delivering a process. Conversely, being accountable means performance is actually judged on success; it means somebody can be held accountable for something happening or not happening. It is important because somewhere along our democratic journey as a nation an understanding of the difference between who is accountable for delivering the services outlined in our Constitution and who is responsible in a process sense for delivering them has been lost. I believe this is to the significant detriment of our nation. Today, it is almost impossible for any Australian to work out who is to be held accountable for individual government outcomes, which I think significantly increases the cynicism of Australians towards all of us in the federal and state parliaments.

The future prosperity and success of our nation is not predetermined, and growth is neither perpetual nor self-sustaining in a world where many countries and many societies are much hungrier for innovation, commercialisation, success and growth. To remain competitive and prosperous, we must reform Australia's Federation. But until we find a way to restore clear and transparent accountabilities to all of our sovereign governments, and the funding provisions to deliver that, we have little hope of reforming how we deliver government services to and on behalf of all Australians.

Reform of our Federation is hard, but it is possible. To do so, we must encourage all Australians to participate in the discussion and encourage and support reform. It is in all of our interests to do so. The last government, under both coalition prime ministers, engaged in good faith with state and territory leaders; and the conversation on Federation reform, while not widely publicised, has already begun. I believe it is now critically important that these conversations continue, with bipartisan support, in this chamber and in the other place. The time to restart this process is today. I do not believe our nation can wait any longer for the reforms that we so desperately need.

Helen Polley (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Aged Care) Share this | Link to this | Hansard source

I am delighted to follow on from that speech. When we are talking about accountability and responsibility, clearly those on the other side do not understand the meaning of those words. What have we seen from the government over the last three years and, in particular, the last year? They have been preoccupied with their own self-importance and division; they are dysfunctional. What have they actually achieved? Well, there are a couple of things they have achieved: a long list of ideas and a long list of thought bubbles which, unfortunately, most of the time just burst into thin air. But on Monday it was 100 days since the federal election—it is hard to believe; in some ways, it has been a very long 100 days—and, as usual, the Turnbull government is still trying to figure out which way is up. Internal division and dysfunction are rife within the Turnbull government. We do from time to time hear that it is 'the Barnaby Joyce government'. And just recently Mr Abbott spoke in the UK about how he is going to come back as Prime Minister. So it is not just about what we on this side are reading in the media and what we hear around the corridors in this place; the former Prime Minister himself says he is coming back.

But I have to say that there is nothing that demonstrates more clearly the dithering, incompetence and division of this government than their burst bubbles. Let's take a trip down memory lane. Let's talk about superannuation—that was one of Mr Turnbull's thought bubbles. The Prime Minister promotes himself as an economic lion, but in fact he is just a pussycat; and he has had more backflips than a gymnast when it comes to superannuation. In September a journalist asked Mr Turnbull what his greatest achievement was, and he said: 'Superannuation and the big business tax cuts.' What a joke! The only problem is that Australians are not laughing when it comes to wanting to give the big end of town more tax cuts. Superannuation is another issue on which we have seen the backbench dictating to the Prime Minister what the government policy should be. If he cannot control his own backbench, if he cannot govern with the support of a united caucus, how can he govern this country? That was another surrender, another stuff-up and another policy trashed by his own party. We have a Prime Minister who said 'I give an ironclad commitment that we will not change superannuation' but did not even have the courage to turn up to the press conference where the humiliating surrender was announced. No wonder Australians are saying: 'We voted for Mr Turnbull to be Prime Minister. Now we do not know who we have.'

Let's turn to another issue that they have stuffed up—which has affected not only my own state of Tasmania but right around this beautiful country—and that is the backpacker tax. What has this government done? There was another thought bubble floating in front of them. They thought: 'Let's grab this. Let's start taxing the backpackers who come to this country!' The tourism industry depends on them. The agriculture industry depends on them. The berry industry and fruit growers right around this country rely on them—and nowhere relies on them more than my home state of Tasmania. So what did they do? They waited for over 12 months. They continued this whirlwind of turmoil after turmoil, not knowing which way was up. Even now, there is still division with the fruit growers in my home state. They are now saying to the fruit growers: 'If you don't accept the 19 per cent tax, then it will go back up to 32 per cent.' This government, as I said, chases those thought bubbles. Then they burst and what do we have? Nothing but turmoil in this country. We are not seeing any leadership at all—none at all.

Then there is aged care, my area of responsibility. I was at LASA's congress on the Gold Coast on Sunday. I had to sit through Minister Ley's speech where she said absolutely nothing. What she did say, though, was that the cuts that they have made—over $3 billion worth of cuts to aged care—are not cuts but savings.

Dean Smith (WA, Liberal Party) Share this | Link to this | Hansard source

Do you oppose them?

Helen Polley (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Aged Care) Share this | Link to this | Hansard source

She then went on to say that she wanted to be open, transparent and honest with the aged-care sector. I will take that interjection from the other side. Release the modelling on which you base the $1.2 billion cuts to ACFI. Come into the parliament and release the modelling that you used, because the reality is that the cuts are over $3 billion, and those in the sector are saying that there could be up to $5 billion in cuts to the aged-care sector. The reality is that this sector will not be able to provide the same services and the same care to the most vulnerable people in our community—older Australians—if this government does not step up to the mark. We know the minister for health has no authority around the cabinet table. That is the reality of it. She obviously cannot stand up to her colleagues and speak up for the most vulnerable members of our community. It is a disgrace. It is something that those who are on the other side in the chamber should be hanging their heads in shame about.

As I said, we have had 100 days of this new government. What we also heard from the Prime Minister when he was asked by a journalist about what he thought his government had done over the first 100 days is: 'So far so good.' That is an unenthusiastic answer from a leader who is struggling to lead. As I have said before, it is not just us saying that this Prime Minister is struggling to lead the country; the Australian community believe that. Last month's poll was the worst two-party result since Mr Abbott was toppled by the Prime Minister. We may have a Prime Minister who can string more than three words together. In fact, most people would prefer that he actually shortened the rhetoric and speeches that he continues to give. They are hollow, just as his election commitments have been to this country.

Zed Seselja (ACT, Liberal Party, Assistant Minister for Social Services and Multicultural Affairs) Share this | Link to this | Hansard source

The public would love it if you shortened this speech.

Helen Polley (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Aged Care) Share this | Link to this | Hansard source

You always know when you are touching a nerve when those on the other side come in and start interjecting. I love it because the reality is that what I am saying here today is what the Australian people already know. As I said earlier, former Prime Minister Tony Abbott has been in the UK talking to journalists, talking to conservatives and talking to anyone who will listen to him, saying that he will return to be the Prime Minister. Mr Turnbull, at the election, promised all sorts of things, but what has he actually delivered since he has been the Prime Minister of this country? He has presided over a second-rate NBN, which has gone from bad to ridiculous; an unfunded education sector; cuts to family payments that will leave many Australian families worse off; and continuous attacks on penalty rates.

I spoke before about the two bills. He is continuing to talk up and deliver what we know is his plan to privatise Medicare. We know they want to undermine Medicare. It is in their DNA; it is in their belief system that we should not have a universal health system in this country. We saw further evidence as the bills were laid on the table here today. We know they are underfunding the hospitals. I spoke yesterday about the crisis in Tasmania. Yet again at the Launceston General Hospital and the Royal Hobart Hospital, patients, elderly people in their nineties, are left waiting on the floor of accident and emergency for three days before they can have surgery. We also know that those on the other side are continuing, under Malcolm Turnbull, to increase the cost of pathology and diagnostic imaging. We know their plan for higher education is to introduce $100,000 degrees. The list goes on and on. But Australians do not want Mr Turnbull's excuses. Australians do not want his thought bubbles. They want Mr Turnbull to show some real leadership and start leading this country, not be hamstrung and tied up to the right-wing conservatives in his party on a whole range of issues. This country cannot be run by somebody who has no ability to lead his own caucus, let alone this country. (Time expired)