Katy Gallagher (ACT, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

I move:

That the Senate take note of the answers given by ministers to questions without notice asked today.

The performance today from the Leader of the Government in the Senate and his colleagues really goes to the heart of the concerns that Labor has around the government's management, or lack of management, of the economy. The economy is floundering on this government's watch; there is no doubt about it. They have been in office for six years, but they don't have a plan to turn things around. They got elected in May, but they obviously didn't go to that election with any view of how to manage if they won the election.

The key economic data that's come out since the election is apparently nothing to them—'There's nothing to see here. This is all expected. The economy is travelling well.' The fact is that the key economic indicators aren't great. We have economic growth at the lowest levels since the GFC. The government is presiding over stagnating wages. There are 1.8 million Australians looking for work or looking for more work. Household living standards have declined since 2013. Productivity is going backwards. Household debt is high. It surged to record levels, increasing by $650 billion under the Liberals to 190 per cent of disposable income. Business investment is down since the Liberals came to office and is now at the lowest level since the 1990s recession.

With all of these economic indicators, you'd think that this government would have a plan or would be putting together a plan or an agenda for dealing with this. But all we get from the government is, 'This is a test for Labor'. Everything is a test for Labor. Well, we want the government to focus on tests for the economy and to actually concentrate on the policies, the plans, the support that they can provide to the economy, because the economy matters. We can talk about all the statistics we like, but at the end of the day the economy affects all of us. When you've got the economic indicators that have been released since the May election, I think any responsible government would be looking at them with concern, not just crossing their fingers and hoping that the tax cuts—which Labor supported and which would have been flowing through the economy had Labor been elected—are going to do the job for everything. That is placing everything in one area, when it's clear that the problems and the global challenges that we all acknowledge are there are having a much more significant effect.

So, the test we are setting for the government is: what are you going to do about the economy? We can't keep accepting the line that everything's going okay, that there are some challenges but everything's going to shore up once the September quarter's results are in. We would say that there are things that you should be doing now. There are actions and steps that you should be taking now—not just writing a letter to the states and hoping they'll do something but looking at other levers available to the government. The Reserve Bank is doing what they can. Rather than pointing the finger at the private sector and urging business to take steps that they should be looking at—and if they can, then great—what is the government going to do? Bring forward part of stage 2?

Look at how you can bring forward infrastructure, particularly infrastructure in the regions where there aren't some of the supply constraints that exist in the cities. Look at whether you can bring some of those shovel-ready projects forward into these forward estimates. We know that 70 per cent of the government's infrastructure program falls outside this forward estimates. We know that the budget forecasts have changed, and they may have changed quite significantly, if we look at the Treasurer's comments on the weekend. Bring forward the budget updates so that all Australians can see exactly where we are and what the budget forecasts actually look like now. Look at responsibly reviewing Newstart. Engage in that conversation that the country is having without you. These are all things that could be being done, if there was a government that was prepared to accept responsibility for how to support the economy over the next little while.

It's not a test for Labor. This is not about the Labor Party. It's not about what the Labor Party went to the election over. This is about what happens for the economy going forward and how that translates into people's households. What does it mean for jobs? What does it mean for wages? What does it mean for household income? What does it mean for consumer confidence? What does it mean for household debt? What does it mean for savings? All the decisions the government should be taking at the moment should be focused on how to strengthen the economy and not just pointing the finger at others, like the Labor Party.

James Paterson (Victoria, Liberal Party) Share this | Link to this | Hansard source

Question time today offers us the opportunity to engage in an interesting thought experiment. What would have happened if, on 18 May, instead of Scott Morrison and the Liberal and National parties winning the election, Bill Shorten and the Labor Party had in fact prevailed? Would they, having succeeded in an election a few months ago, right now be implementing the economic plan that they took to the election, or would they be abandoning it? In particular, would they be proceeding right now through this very chamber their plans for $387 billion of new and higher taxes on the Australian economy? Imagine the consequences for Australian families, workers and businesses if that were the case—if, in the face of the global economic headwinds that Australia and the rest of the world confronts, the Labor Party were piling on top of that $387 billion of higher taxes.

Helpfully, we have an insight into what the Labor Party might have done if they had been successful at the election, and it comes in the form of an interview conducted this morning by Andrew Leigh on Sky News. You might remember that prior to the election Mr Leigh was a key member of the economic team of the Labor Party, although I don't believe he is any longer.

The reporter, Annelise Nielsen, asked him the very reasonable question: 'What would Labor do if they were in government today? Would they have been proceeding right now with their election plans?' After some dancing around the question, Mr Leigh argued that what the Australian economy needed right now was higher government spending. Now, this could only be delivered in one of two ways. It could be delivered through their plan for higher taxes on the Australian economy, or it could be delivered with higher debt. Unfortunately, Mr Leigh didn't share with Sky News viewers or Australians exactly which side he came down on. Was he in favour of Labor's higher taxes or more debt delivered by the Labor Party for future generations to pay? So, unfortunately, we are none the wiser as to which side of the debate raging within the Labor Party at the moment Mr Leigh would fall on. Does he fall on the side of Wayne Swan, who says: 'Full steam ahead. No problems here. Nothing to see here. A great election policy platform that we took on the economy should be retained whole-heartedly'? Or does he fall on the side of Mr Butler, who says, 'Actually, guys, I think there might be good reason to review the policies we took to the election'?

The question the Labor Party is grappling with is: was it the economic policies they took to the election, was it the social policies they took to the election, or was it the leader they took to the election that cost them the election? The disturbing thing for those on the opposite side of the chamber is: the answer to that question may be 'all of the above'.

Of course, as Senator Cormann outlined in question time today, the government is very well aware of the uncertain global economic environment that we're operating in, and we have a strong economic plan that deals with that situation. It was outlined only a few months ago in the budget, and it was subsequently endorsed by the Australian people. Unsurprisingly, we are not going to be following the Labor Party's economic advice here. We're not going to be adopting either the policies they took to the election or the new policies they now advocate in light of the election result. We will be sticking to the strong economic plan we outlined.

It is important to put in context Australia's economic performance. The national accounts show the Australian economy has now completed its 28th year of unbroken economic growth. That is a world record and something which all Australians should be very proud of. It is a reminder that we do, in fact, have a remarkably resilient economy, and it is a repudiation of those who seek to talk it down. In advance of the release of the most recent national accounts, there were many commentators who said Australia would have a negative quarter of growth, and they were quickly proven to be wrong. Real GDP grew by half a per cent for an annualised rate of 1.4 per cent. In average year terms, real GDP in fact grew by 1.9 per cent through 2018-19.

The government is very proud of the economic plan that it took to the election and which has been endorsed by the Australian people. It includes immediate and meaningful personal income tax relief for the Australian people, which has been warmly received, judging by the record tax returns that have been submitted to the ATO, and the billions of dollars that have flowed into household family budgets around Australia. So we won't be adopting the Labor Party's plans in this instance.

Kimberley Kitching (Victoria, Australian Labor Party, Shadow Assistant Minister for Government Accountability) Share this | Link to this | Hansard source

Those opposite are now in a third term of government. They have been in control of the nation's economy for six years. That's six long years for the Australians who are working longer and harder but just can't seem to get ahead. Like a bird trapped in an oil slick, the harder they work, the more they try, the more they 'have a go'—to quote the Prime Minister—the worse their situation seems to become. The economy is floundering. It has all but ground to a standstill; 'moribund' is another description. The economy is growing at its slowest rate since the global financial crisis. Wages have flatlined. Almost two million Australians are looking for work or cannot get enough hours of work. The nation's productivity is going backwards, and this is having real world effects on people's living standards.

These are not abstract measures. Australians are hurting. And all the while the Prime Minister, the Treasurer and the Minister for Finance, day in, day out, give their Pollyanna pronouncements that, 'You've never had it so good.' Tell that to Australians who are choosing between paying record electricity bills and buying their kids school essentials. These are the children, by the way, to whom this government is leaving the legacy of paying down the debt that this government doubled. Remember, federal government debt is now more than half a trillion dollars. The government, with the Greens political party—who I like to think of as the party of all care and no responsibility—voted to remove the debt ceiling. And what was the consequence of that? The federal government debt is now at more than half a trillion dollars. This is the government that would tell you that they naturally occupy the treasury bench. They are not good economic managers, and they have not been so in their various terms of government. Tell that to the anxiety ridden workers who are terrified about job security. Tell that to families who are struggling with the increasing cost of child care.

This is a government that may have a political plan—and we're seeing that with the reprosecuting of legislation from the last term—but it doesn't have an economic plan. The Treasurer is playing roulette with the livelihoods of the Australian people. He is so desperate to have a surplus recorded against his name that he's willing to put the whole economy, not to mention the aspirations of Australians, at risk in order to do so. God forbid there's a downturn in resource prices! And let's face it: with the Vale mine now going back online and increasing its production, what we're going to see is that the iron ore prices that have kept our economy going will start dipping. We've actually built our economy on a disaster in a Brazilian valley, which killed about 300 people earlier this year. Iron ore, priced at $72 a tonne at the time of the lethal sludge slide, started steadily increasing as Vale's production slipped. It reached about $122 a tonne. It's since dipped to $91 a tonne, but this is still 65 per cent higher than the $55 a tonne forecast by Treasury for the current financial year. When Vale comes fully back online, iron ore prices are going to start dipping and our economy will go further backwards than it already has.

The Reserve Bank governor, Dr Philip Lowe, has already warned that the Reserve Bank is not able to jump-start the ailing economy alone. They are not able to do it by themselves. The RBA has already cut interest rates to one per cent, many times lower than we experienced during the darkest depths of the global financial crisis. Dr Lowe has called on the government to intervene—a call that has been repeated by Labor—to bring forward planned infrastructure spending, increase Newstart payments to some of the most vulnerable, and stop attacking our industrial relations system, which protects workers from exploitation and ensures that they are treated fairly. It is, after all, the unions who uncovered the mass exploitation of workers, particularly in the hospitality industry.

If this government were serious about stimulating the economy and promoting economic growth, we on this side of the chamber would be happy. We are not in government, but we would be very happy if the government were to take on the responsibility that comes with sitting on the treasury bench. But it has not done so. This is a government with no agenda and no plan for the country. They went to the election with the promise of a tax cut— (Time expired)

Hollie Hughes (NSW, Liberal Party) Share this | Link to this | Hansard source

I'd just like to acknowledge the family of former deputy prime minister Tim Fischer here in the gallery. If Tim had been here, he would have understood the importance of not talking down our economy, whilst understanding the significant impact that the drought is having on GDP and the devastation that is occurring across much of western New South Wales and Victoria, affecting so many farmers.

If Australians had gone to the polls, as they did a few short months ago, and elected a Shorten government, we would've seen $387 billion of new taxes, and we know what impact that would've had on our economy. It certainly wouldn't have seen the continued positive growth in outlook and resilience in the economy and the improving business confidence that we're seeing with the re-election of the Morrison government. And only on the weekend we saw Wayne Swan, now the national president of the Labor Party, come out in support of keeping all the tax cuts that Labor took to the last election, saying that losing the election had nothing to do with the economic plan, the killing off of aspiration and the destruction of the dreams that Australian families so often have. He said it was all Bill's fault; Bill was so unpopular, and that's why Labor lost. Chairman Swan encourages the Labor Party to tax and spend and stay true to those socialist values.

These two weeks will show why the Morrison government was re-elected—why Australians opted to return a Liberal-Nationals government as the stable and reliable choice, and in the face of many challenges we're facing as a nation—in the face of global headwinds economically, in the challenges that we face across the world and internally and domestically with issues like the drought. We'll see why Australians continue to stick with the Morrison government, who will deliver a clear plan and deliver on the promises that we made, versus a Labor Party that's conflicted and tarnished by scandal, whether it's ICAC in New South Wales and the Aldi bags full of cash, whether it's the Setka sit-in happening in Victoria at the moment, or Jackie Trad in Queensland and whatever department she sits over. And again, Tim would probably be quite interested in Queensland Rail, as the dispute goes on up there.

Labor just don't seem to know what they stand for any more, or whose side they stand on. Is it the side of workers or the side of families? It's certainly not on the side of aspiration, and Australians saw that last time. Thankfully, most Australian voters took the advice of Chris Bowen and they decided not to vote for Labor's policies. We were, of course, very grateful for that, and the Australian economy continues to be grateful for that. On taxes and budget, on border protection, on union power and on work and welfare, Labor can't tell you what they believe or whose side they are on. There's no certainty and there's no consistency. But also these days you can't tell who's calling the shots in Labor. We saw, as the poll came out today, that Albo continues to slide down the polls—

Sue Lines (WA, Deputy-President) Share this | Link to this | Hansard source

Senator Hughes, I have given you a fair amount of leeway. You need to refer to those in the other place by their correct titles.

Hollie Hughes (NSW, Liberal Party) Share this | Link to this | Hansard source

The Leader of the Opposition, Anthony Albanese, continues to fall down in the polls. But we're getting on with the job, and the proof is in our agenda. You'll see that over the coming fortnight with the bills that we're going to bring forward: ensuring multinationals are paying their fair share of tax, stopping the abuse of workers' entitlements by unions and employers, preventing the misuse of welfare and helping more Australians get into jobs through the expansion of the cashless debit card and trialling mandatory drug-testing for welfare recipients. We're going to protect farmers from activists as they illegally trespass on their land. We're going to prevent child exploitation with new mandatory sentencing laws for offenders and we're going to outlaw uncompetitive practices from big energy companies, delivering lower prices for Australian families.

And that's the big difference between the coalition and Labor, and that's why Australians made the right choice. The cashless debit card is something that I'm particularly keen to see enforced, having lived in a rural and regional area where we saw significant social and economic issues, children who were suffering with alcohol abuse and drug abuse within the community, and high levels of welfare dependence. We're going to make sure that we find the best ways of supporting people and families, that children receive the services and the access to the materials that they need, and that they're getting the proper food and the access to school equipment that they require, as opposed to allowing welfare funds to be spent on gambling or alcohol. These funds are more appropriately spent on the family. We've also seen the statistics that have shown youth unemployment has dropped significantly in areas where the cashless debit card has been introduced, and we hope to see that continue into the future.

Alex Gallacher (SA, Australian Labor Party) Share this | Link to this | Hansard source

I rise to take note of answers to questions asked by Senator Wong and Senator Gallagher. Before I go to that point, it's good to follow Senator Hughes—perhaps she should have lost another couple of pages of her notes and winged it a bit! She certainly does better on her feet than reading puerile notes. In question time today, it appears to me that we asked a question about the economy to the Minister for Finance and the other appropriate minister, and the answer from the government was, 'Were you elected, things would have been worse.' I hardly see that that is an answer to a question that's legitimately asked. It is a legitimate question asked not only by the Labor Party but also by every section of economic commentary—that is, what should we be doing right now?

Senator Kitching went to a very valid point. The disasters that have happened to Vale have certainly impacted on the iron ore price, and we are the world's largest iron ore exporter. The contribution to GDP was 13 per cent growth in the year to the March quarter. So we're certainly doing very well out of metallurgical coal, thermal coal and iron ore, and rightly so. We've got the most efficient production systems in the world, and we've got access to very big markets. So our quality product is buoyant, and it is keeping the economy going.

But when you look in this chamber and see the type of legislation that comes through this chamber and you say, 'What is the government's agenda since its victory on 18 May?' you find the government saying: 'Oh, I think we're going to improve the economy by bringing in some drug testing for some welfare recipients. I know: we'll do some more robo-debt. That'll boost the economy.' These are things which governments need to prudently do, but they're not going to bounce the economy.

The argument is that the tax cuts haven't washed into the economy yet, and that probably is a fifty-fifty argument. Harvey Norman are saying they haven't seen it come into their accounts. Maybe people didn't take that tax cut and go and buy a new TV. Maybe they put it aside because they know things are getting a bit tougher. Maybe their earnings are a bit flatter—and we do know that real wage growth is stagnant and declining. So maybe the boost that Senator Cormann and others are waiting for after the $15 billion is paid into the economy by the ATO isn't coming. Maybe people are saving that money. Maybe they're paying it out in higher electricity bills, higher school fees or higher transport costs—all manner of things.

We do know that young Australians are in danger of being the first generation in memory to have lower living standards than their parents' generation. Think about that. The Grattan Institute's Generation gap: ensuring a fair go for younger Australians report found:

Today's young Australians are in danger of being the first generation in memory to have lower living standards than their parents' generation.

It's not hard to look around to see young Australian who are working not one job or two jobs but three jobs to make ends meet. There is massive underemployment, particularly for under-30s. If you do get out into the suburbs and places where young people talk and share their experiences, it's extremely difficult to find regular employment outside labour hire companies. There's a lot of casual employment and labour hire employment, and people are struggling to make ends meet. They don't get 50 or 55 hours of work; they get 15 to 20 hours of work, which doesn't sustain them, and then they have to go and look into other opportunities.

So it's a curious argument when we have three speakers on the other side who are asked: 'What are you doing about what looks like a flatlining economy being bolstered by a buoyant minerals sector? Are you looking in the looking glass or down the road to make sure that we don't come into a crash and don't have a recession, which would throw lots of people out of work?' We have 750 jobs about to go at Virgin. You don't have to look around too far to know there are testing times in the economy, but the answer from the government and the government senators over there is, 'Oh, if you were in there, it would be a lot worse.' Well, I've got to remind you: you're the government. You need to have policies in place that protect the Australian public. You need to have far-sighted policies. You need to look at the infrastructure pipeline. What is the point of having a surplus in a stagnant or declining economy? You're contributing to more stagnation and more decline. If you have a surplus in a growing economy, everybody can clap and cheer, but a surplus in a declining economy is not right.

Question agreed to.