Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

My question is to the Minister representing the Minister for Revenue and Financial Services, Senator Cormann. On Monday evening this week, Sky News reported that the budget would include a bank levy. The next day, bank shares fell nearly four per cent, wiping $14 billion off their valuations. It was also reported during budget day, the AFR reporting details about the bank levy and sources. Can the minister confirm if there was a leak from the Treasury and whether he is investigating any leak?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

I thank Senator Whish-Wilson for that question. Sadly, in the lead-up to any budget, there is a lot of rumour and speculation leading to the budget. That is not a recent phenomenon. That is something that happens in the lead-up to every budget, and so it was in the lead-up to this budget.

In answer to the specific question: Treasury—which, of course, takes a whole series of precautions when it comes to protecting the security of information inside the lockup, through measures which are consistent with those measures that have applied for some time under governments of both political persuasions—is not aware of any evidence of a leak out of the lockup. There is no evidence, according to advice that we have received from Treasury, of any leak out of the lockup. But of course there is, sadly, in the lead-up to any budget, a lot of pre-budget speculation, and so it was on this occasion.

Stephen Parry (President) Share this | Link to this | Hansard source

Senator Whish-Wilson, a supplementary question.

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Senator Cormann, on budget day, before the lockup, the AFR reported, on the afternoon before the lockup, that banking sources were aware of the design of the levy. How were banking sources aware of the design of the scheme? Did Treasury staff, or other government staff, or government MPs or ministerial advisers inform or consult the banks about the design of the scheme before the release of the budget?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

I am not aware of how banks would have been aware of the design of the scheme. The banks were advised of the bank levy announcement just prior to the budget speech.

Stephen Parry (President) Share this | Link to this | Hansard source

Senator Whish-Wilson, a final supplementary question.

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Unfortunate or not, rumours have to start somewhere, Senator Cormann. My next question is: given that there have been leaks, has the government asked ASIC to investigate if there has been any anomalous trading of equities, derivatives or options on the banks in the lead-up to the budget? If not, yet, will you do so?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

The Treasurer actually directly addressed these questions in his Press Club address yesterday, when he was asked similar questions from a journalist, and the point the Treasurer made—and I would refer you to those comments—is that, obviously, to investigate something, there has got to be some evidence. Our advice from Treasury is that there is no evidence of a leak out of the lockup. I am not aware of any other leak. But pre-budget rumour and speculation is obviously not something that is in any way unusual.

Kimberley Kitching (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister representing the Prime Minister, Senator Brandis. When asked on 2GB why he could barely muster a slow clap for the budget on Tuesday night, the former Prime Minister Tony Abbott said, 'I gave the Treasurer the applause I thought he deserved.' I think, Mr President, that that quote is worth repeating: 'I gave the Treasurer the applause I thought he deserved.' If even Tony Abbott thinks that this budget deserves nothing more than a slow clap, what kind of Liberal budget has Prime Minister Turnbull overseen?

George Brandis (Queensland, Liberal Party, Attorney-General) Share this | Link to this | Hansard source

I did not see the interview. If the remarks attributed to Mr Abbott are correct, I do not agree with them.

Stephen Parry (President) Share this | Link to this | Hansard source

Senator Kitching, a supplementary question.

Kimberley Kitching (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Former Prime Minister Howard is reported to have been politely scathing of the Turnbull government's federal budget, labelling it as a 'highly political document' and a 'divergence from conservative ideals'. If even John Howard is criticising this budget, what kind of Liberal budget has Prime Minister Turnbull overseen?

George Brandis (Queensland, Liberal Party, Attorney-General) Share this | Link to this | Hansard source

One day you will go beyond undergraduate-level questions, but I am not holding my breath. As a matter of fact, I can assure you that Mr Howard is a very strong and very enthusiastic supporter of this budget. The view that you have attributed to him, which I note you do not source, is a falsehood.

Stephen Parry (President) Share this | Link to this | Hansard source

Senator Kitching, a final supplementary question.

Kimberley Kitching (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Why is it that conservatives like John Howard, Tony Abbott, Peter Costello, Peta Credlin and Andrew Bolt will not endorse Prime Minister Turnbull's budget?

George Brandis (Queensland, Liberal Party, Attorney-General) Share this | Link to this | Hansard source

Without accepting the premise of your question, I will tell you who will be very strongly endorsing this budget, and that is the Australian people. They see in this budget a charter of fairness—a charter of fairness for access to schools, based on the needs of those schools; a charter of fairness in the health system by guaranteeing Medicare and investing an extra—

Opposition Senators:

Opposition senators interjecting—

Stephen Parry (President) Share this | Link to this | Hansard source

Order! Senator O'Sullivan, on a point of order.

Barry O'Sullivan (Queensland, National Party) Share this | Link to this | Hansard source

Mr President, the noise from those opposite is so loud that I can hardly hear my own interjections, and I am interested in these answers from the Attorney.

Stephen Parry (President) Share this | Link to this | Hansard source

I remind all senators to exercise restraint and to listen to the minister's answer.

George Brandis (Queensland, Liberal Party, Attorney-General) Share this | Link to this | Hansard source

An additional $10 billion invested in the health system—I think the Australian people will think that that is fair. I will tell you what else I think that the Australian people will think is fair, and that is making proper financial provision for Australians with a disability. It is all very well to talk about an NDIS—to dream up a scheme on the back of an envelope—but the test of your sincerity is, 'Will you fund it?' This budget does, and I think that that is fair, too.

Cory Bernardi (SA, Australian Conservatives) Share this | Link to this | Hansard source

My question is to the Minister for Finance. The government lifted the debt ceiling to $600 billion in the lead-up to the budget, yet, as Senator Ketter has pointed out, budget papers indicate that total debt across all government agencies is projected to reach $725 billion. Some of the debt that is being incurred in the budget is through equity vehicles similar to NBN Co in the form of corporations to establish, for example, a $5 billion Western Sydney Airport and the $8.4 billion Melbourne to Brisbane rail project. Minister, what specific criteria was used to determine which spending by government counts as equity and which counts as general expenditure?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

I thank Senator Bernardi for that question. The first point I would make is that capital investments are those that generate returns to the government over time, providing benefits for current and future generations. It is a matter of public record that this government is committed to delivering the Western Sydney Airport and, of course, we have made relevant announcements in recent times. Given that Sydney Airport was not prepared to take on, on their right of first refusal, the opportunity to develop the other airport, the government has decided to develop that airport with an intention to sell the airport once developed and operational. That is something we have already announced.

Obviously, in developing the Western Sydney Airport, for example, we are developing an asset that will have a value on our balance sheet. The reason it is treated as equity is that it is assumed to generate returns to the government over time. The specifics in relation to the total equity injections in this budget, including the profile over the forward estimates, are disclosed in table 9 on page 3-36 of Budget Paper No. 1. Also, towards the back of Budget Paper No. 2 you will be able to find the various projects that the government has decided to support with equity injections.

Stephen Parry (President) Share this | Link to this | Hansard source

Senator Bernardi, a supplementary question.

Cory Bernardi (SA, Australian Conservatives) Share this | Link to this | Hansard source

I thank the minister. Having regard to the prospect that the government will have to write off up to $20 billion in their supposed equity investment in NBN Co, which would generate a massive negative return for taxpayers and shareholders, what have the government identified as their minimum rate of return on the inland rail and Western Sydney Airport projects?

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

That's a very good question.

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

Firstly, I completely reject the assertion that the government is going to have to write off the value of the equity investment in NBN. Secondly—and I heard Senator Wong say that this is a very good question—there is a very straightforward answer: it is actually not the government that determines whether something is classified as an equity injection or as a grant; it is based on an assessment by the Australian Bureau of Statistics which is done quite independently. They, of course, assess based on what the expected rate of return is. In relation to whether that is a rate of return sufficient to qualify as an equity injection, in simple terms, it obviously has to be above the rate of inflation.

Stephen Parry (President) Share this | Link to this | Hansard source

Senator Bernardi, a final supplementary question.

Cory Bernardi (SA, Australian Conservatives) Share this | Link to this | Hansard source

I thank the minister. It was recently reported that the former head of construction giant Thiess, Martin Albrecht, wanted to tender for the Melbourne to Brisbane rail project, had spent $20 million on feasibility studies and believed that he could achieve the same aims as the government with $3 billion in federal funding. Given that a truly conservative government would intervene only in cases of market failure, can the minister guarantee that there was no commercially competitive alternative to the government's rail project?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

Governments of all persuasions are presented with private sector proposals of a good deal on a regular basis. Not every deal that comes from the private sector that is put to you as a government is indeed on closer scrutiny necessarily a good deal for the taxpayer. The government has—and this is a matter on the public record for some time now—gone through a robust market-testing exercise where all potential private sector partners in delivering the inland rail were able to put their proposals forward so that they could be properly tested and scrutinised. What we have done here in the context of the inland rail project, with an $8.4 billion equity injection through the Australian Rail Track Corporation and assuming that there will be further private sector investment to complement that as well as ARTC borrowings to deliver the full project cost, is based on the advice that came out of the market-testing process. (Time expired)