I have received the return to the writ which I issued on 19 May 2008 for the election of a member to serve for the electoral division of Gippsland, in the state of Victoria, to fill the vacancy caused by the resignation of the Hon. Peter John McGauran. By the endorsement on the writ, it is certified that Darren Jeffrey Chester has been elected.
Mr Darren Jeffrey Chester made and subscribed the oath of allegiance.
Order! On behalf of the House, I welcome the new member for Gippsland.
I inform the House that on 14 July 2008 I received a letter from the Hon. Alexander Downer resigning his seat as the member for the electoral division of Mayo.
On 30 July 2008 I received a letter from the Hon. Mark Vaile resigning his seat as the member for the electoral division of Lyne.
They were out to lunch together!
The Minister for Tourism should not encourage the entertainment industry in that way.
Honourable members will be aware that, on 4 August 2008, I issued writs for the election of members to serve for the electoral division of Mayo, in the state of South Australia, and the electoral division of Lyne, in the state of New South Wales, to fill the vacancies caused by the respective resignations of the Hon. Alexander Downer and the Hon. Mark Vaile.
The dates in connection with the two by-elections are fixed as follows: issue of writs—Monday, 4 August 2008; close of rolls—Friday, 8 August 2008; date of nominations—Thursday, 14 August 2008; declaration of nominations—Friday, 15 August 2008; date of polling—Saturday, 6 September 2008; and return of writs—on or before Wednesday, 12 November 2008.
I move:
That the House record its deep regret at the death on 8 July 2008, of SAS Signaller Sean McCarthy, killed while on combat duty in Afghanistan, and place on record its appreciation of his service to his country, and tender its profound sympathy to his family in their bereavement
On behalf of the government, I want to express my heartfelt condolences to Signaller McCarthy’s mother and father, Mary and David, and to his sisters, Leigh and Clare. I also want to express my sympathy to his extended family and friends, including his fellow service men and women with the Australian Defence Force. On 18 July, together with the Leader of the Opposition, I attended Signaller McCarthy’s funeral at the Gold Coast’s Sacred Heart Church. It was moving to see so many friends and family gather to pay their respects to such a dedicated soldier.
There is no higher calling in Australia than to serve our nation in uniform. The men and women of the Australian Defence Force are the pride of the nation and the pride of the Australian people. I have had the privilege of meeting many of them, both in Australia and as they serve overseas, and I am always impressed by their bravery and their professionalism. Signaller McCarthy was a truly patriotic Australian, an outstanding soldier and a valued member of his regiment. He was known for his keen sense of humour and for his great work ethic. He displayed strength, determination and courage while serving in the challenging environments of East Timor and Afghanistan.
Together with his fellow service men and women, Signaller McCarthy worked with the people of East Timor and the people of Afghanistan to assist them in their efforts to achieve stability and peace. Signaller McCarthy lost his life serving his country and is owed a special debt of gratitude that can never fully be repaid. His sacrifice will not be forgotten. On behalf of the Australian government and on behalf of the Australian parliament, we offer our prayers and our support and our thoughts to Signaller McCarthy’s family and to his friends.
I join the Prime Minister in this condolence motion for Signaller Sean McCarthy. Signaller Sean McCarthy gave his life on 8 July this year. He did so as a volunteer member of the Australian Army. He was in Uruzgan, Afghanistan in our name, he was wearing our uniform and he was under our flag. He, along with other members of the Australian Defence Force, was engaged in a struggle against resurgent totalitarianism, predominantly in the form of Islamic extremism, and in particular in the military engagement of the Taliban in Afghanistan. This country has always been the crossroads to Asia. It is now in every sense of the word the crossroads to the modern world. Signaller Sean McCarthy gave his life to ensure that the Afghan people have the hope of enjoying the same freedoms that we too often take for granted in our own country: freedom of religious expression, political freedom, the liberating power of education and the equal treatment of men and women.
Sean McCarthy joined the Australian Defence Force in July 2001 and, finally, the Special Air Service Regiment in January 2007. He served in the fifth rotation of the Special Operations Task Group in Afghanistan in 2007, for which he received a citation for gallantry, and also in East Timor in Operation Astute in 2008. At his memorial service he was described by one of his fellow soldiers as ‘a courageous soldier and all round good bloke’. I could not help but note that he had planned his funeral very carefully. He had chosen the men who were to carry his casket, the music and who was to speak at the service. It says something about our country and these men and women who join the Australian Defence Force that that is, in a very real sense, what they have to think about at a very young age—in his case the age of 25. Signaller Sean McCarthy was described by his commanding officer at the service as:
... a highly respected soldier who served with distinction in the Australian Army and with great pride as a member of an elite team, the Special Air Service Regiment. He died doing his duty in a high-risk environment; it was a soldier’s death. His loss, whilst tragic, was not in vain. He fought and died for the enduring values of freedom and justice.
His father, David, said of his son:
He was lucky enough to find a career that he loved and was very passionate about. I know he’s my son, but those guys are doing some things over there which make them real heroes.
He, along with Andrew Russell, Luke Worsley, Matthew Locke, Trooper David ‘Poppy’ Pearce and Jason Marks, has given his life in the cause of freedom, not only for Afghans but also for us and the kind of world we will leave our children. His father, David, said to me after the service: ‘If he was going to die, that’s how he wanted to die. He would have been very angry if he had come back to Australia and been run over by a bus.’ To his father, David, his mother, Mary, and his sisters, Clare and Leigh, we thank you for his life and his service to our country. Our condolences go to you and your family and especially to the men and women of the Australian defence forces.
As a mark of respect, I invite honourable members to rise in their places.
Honourable members having stood in their places—
I thank the House.
Debate (on motion by Mr Albanese) adjourned.
I move:
That the House record its deep regret at the death on 13 July 2008, of the Honourable Peter Drew Durack QC, and place on record its appreciation of his long and meritorious public service, and tender its profound sympathy to his family in their bereavement.
Peter Durack was born on 20 October 1926 in Perth, an only child, descending from the pioneering Durack family of Western Australian. He served for 22 years in the Senate, from 1971 to 1993, achieving his greatest distinction as Attorney-General in the Fraser government from 1977 to 1983, a role in which he implemented several historically important legal reforms. Senator Durack was a man who was motivated by a deep sense of public service, a strong sense of personal integrity and a commitment to human rights and legal reform. Malcolm Fraser remarked following Senator Durack’s death that he could not remember ever hearing him say an unkind word about another politician or about anyone else. That is a remarkable reflection of this man’s great personal decency.
Senator Durack commanded respect from all sides of politics. Gareth Evans, as Leader of the Government in the Senate, in his valedictory remarks for Senator Durack in May 1993, spoke warmly of the friendship he had enjoyed with Senator Durack and the genuine respect that he held for Senator Durack’s commitment to good government, good policy and genuinely liberal reformist instincts.
Senator Durack’s interest in politics began in his early undergraduate years when he co-founded the University of Western Australia Liberal Club just a few months after the party was conceived by Sir Robert Menzies in 1944. After becoming a Rhodes scholar in 1949 he studied at Oxford and subsequently practised law in London and then in Western Australia. Before entering the Senate in 1971, Senator Durack served a term in the Western Australian Legislative Assembly from 1965 to 1968. He held ministerial positions as the Minister for Repatriation, the Minister for Veterans’ Affairs and the Minister for Administrative Services before being appointed Attorney-General of the Commonwealth in the Fraser government in 1977. As Attorney-General, Senator Durack oversaw one of the most significant periods of law reform and human rights protection in Australian history. He was responsible for the appointment of some of the most distinguished judges to serve on the High Court, including Sir William Deane, Sir Ronald Wilson and Sir Gerard Brennan. Early on in his time as Attorney-General he oversaw the implementation of freedom of information legislation that for the first time gave Australians a legally enforceable right to access information held by government. That legislation was one of the most notable changes to civil liberties in Australia.
Senator Durack had a strong personal interest in law reform and, as Attorney-General, oversaw changes to copyright law, administrative appeals and the powers of the Federal Police and ASIO. He worked on the Acts Interpretation Act—a brave man, I would say, for trying that—which was a historically significant piece of legislation instructing the judiciary to take a broader view of the purpose of legislation rather than adopting a literal interpretation. He was also instrumental in the ending of appeals to the Privy Council.
Senator Durack retired from politics in 1993 as the father of the Senate, and I know he was held in high regard as, in some respects, a father figure to some current Liberal members from Western Australia. On behalf of the government I offer condolences to his family and particularly to his wife, Isabel, their children, Anne and Philip, and their grandchildren.
On behalf of the opposition, I strongly support this condolence motion for Senator the Hon. Peter Durack. Peter Durack was born in 1926, the descendant of a family who were pioneers in the settlement and the early economic life of the Kimberley region of Western Australia. He was also the cousin of distinguished authors Mary and Elizabeth Durack. The Durack family’s history, beginning with the mid-19th century migration from Ireland, is presented by Mary Durack in Kings in Grass Castles and its sequel, Sons in the Saddle.
He served in the Western Australian Legislative Assembly as the Liberal member for Perth from 1965 until 1968. He was elected to the Senate, representing the state of Western Australia from 1971, where he served until 1993. Peter Durack was co-founder of the University of Western Australia Liberal Club, just a few months after the party was conceived in 1944. In 1949 he was selected as Western Australia’s Rhodes scholar, and tutored in law at Oxford before returning home to work as a barrister in Perth.
In 1965 Peter Durack was elected to the Western Australian Legislative Assembly, where he served until 1968. After serving as State President of the Liberal Party from 1968 until 1971, he was elected to the Senate, where he served until 1993. He remains just one of a handful of Australians to have served in the Senate for over two decades. Having served as Minister for Veterans’ Affairs, Peter Durack was appointed Attorney-General in the Fraser government from 1977 until 1983 and as Deputy Leader of the Government in the Senate.
Peter Durack was an early advocate for freedom of information laws and, as Attorney-General, presided over the introduction of the Freedom of Information Act in 1982. He was a champion for the rights of individuals who had disputes with the government, putting forward a freedom of information bill in 1972 and presiding over the introduction of the Freedom of Information Act in 1982. He was also one of the early advocates of economic reform in Australian politics, being among those calling for lower tariffs and labour market deregulation well before it became economic orthodoxy.
Durack was acknowledged by Fred Chaney as one of the best political and legal minds in the country. Former Prime Minister John Howard noted:
His first interest was not conniving and plotting; his first interest was good policy and good government.
As the Prime Minister has further observed, he had a reputation for being a thoroughly decent individual.
Peter Durack has mentored a generation of Liberal parliamentarians throughout Australia. As a fellow Western Australian, our deputy leader, the member for Curtin, has particularly noted how his wise counsel will now be missed but that his influence will continue. Peter Durack is survived by his wife, Isabel; children, Anne and Philip; and four grandchildren, to whom we offer our condolences and respect.
As a mark of respect to the memory of Peter Durack, I invite honourable members to rise in their places.
Honourable members having stood in their places—
I thank the House.
Debate (on motion by Mr Albanese) adjourned.
I move:
That the orders of the day relating to the resumption of debates on the Prime Minster’s motions of condolence in connection with the deaths of SAS Signaller Sean McCarthy and the Honourable Peter Drew Durack be referred to the Main Committee.
Question agreed to.
I inform the House of the death, on Thursday, 10 July 2008, of Donald Michael Devitt, a former senator who represented the state of Tasmania from 1965 to 1978. As a mark of respect to the memory of Don Devitt, I invite honourable members to rise in their places.
Honourable members having stood in their places—
I thank the House.
An incident having occurred in the chamber—
Order! Before proceeding, I invite the honourable member for New England to remove his advertisement. I thank the member for his cooperation. As those who are strict adherents to the standing orders would know, that might have been considered outside of the standing orders and action may have been taken. But, as on other occasions, I do not intend to take action. However, the chair does not condone the actions of the member.
On indulgence, if I may, Mr Speaker. This morning, together with the Leader of the Opposition, we had the great privilege of welcoming home the Australian Olympic team. Never a finer bunch of young Australians have we sent abroad. They were terrific in every respect, all 433 of them. Despite their overnight flight from Beijing, I think it is fair to say they came home well satisfied with their achievements in Beijing. As well they should be, not just in terms of medal tallies and the things which are often debated around the international sports media and general media but also in the way they carried themselves off as an Australian team in Beijing. They are a fantastic group of young people. They were out there not just competing hard and sharp but also, in the way in which they are competing, showing everything about the Australian character—and for that we congratulate them as well.
Our swimming team performed superbly in the Water Cube. The kayakers, rowers and sailors continued a theme of Australian mastery over the water. And on land, we saw people like Jared Tallent, who won the silver medal in the men’s 50-kilometre walk in Beijing, after winning bronze earlier in the week in the 20-kilometre race. In collecting the silver, Tallent became the first Australian since Raelene Boyle in Munich in ’72 to win two athletics medals at an Olympics. And we will all carry memories of the achievements and efforts of so many of our athletes—Stephanie Rice, Emma Snowsill, Grant Hackett and so many others.
Much history was made: we all know about Steve Hooker and the pole vault; Matthew Mitcham and his extraordinary performance in the diving pool, our first Olympic gold since 1924—that has been a while between drinks; and, at the end, of course, a medal tally of which the country can be proud. On behalf of the government and I am sure the parliament, we extend our congratulations to the team for their achievements, to the Australian Olympic Committee for their achievements and also to all those who supported them, those behind the scenes—the physios, the trainers, the coaches and the administrators, all of whom made this Australian Olympic team abroad such a success.
As I said this morning at the welcome home ceremony, a special thanks also should go out to the mums and dads and family members. Each of the stories about these 433 athletes is a legend in itself. To get to the stage where you can actually be a member of the Australian Olympic team is the end of a massive competitive journey—so much dedication, so much effort, so much training, so much trial and so much disappointment, supported all the way through by family, friends and loved ones. They were out there, as the Leader of the Opposition and I saw this morning, in force, welcoming them home in the best of Australian traditions.
I was told this morning that London double-decker buses have been bedaubed with a particular sign today. I think Fran’s campaign has finally come home to roost on this question: ‘Where the hell are you?’ Can I say this to our friends in Britain, and we wish them well for the 2012 Olympics: I am sure they are going to do a fantastic job in hosting those Olympics. If I know anything about the Australian competitive spirit, if I know anything about the Australian Olympic Committee, our lot will be there with spades on ready to take it up to the Brits in the best of Australian traditions come 2012.
On indulgence, I join with the Prime Minister in congratulating our Australian Olympic team—the 433 athletes whom we had the privilege of welcoming home to Australia this morning. I would particularly like to thank Qantas for the significant contribution that it has made to making this the success that it was and, also, John Coates and the Australian Olympic Committee. It is typical of Australians and Australian athletes, and these men and women in particular, that many of them thanked the Prime Minister and me for being there, when in fact it was our honour to be there on behalf of the nation to welcome them home.
Stephanie Rice achieved three world records and won three gold medals. For James Tomkins—whom, as I said this morning, my wife loves—it was his sixth Olympics and he carried the flag for Australia, and James has not ruled out going to a seventh Olympics. Also, Steve Hooker had a magnificent result in the pole vault. I did say to Steve rather jovially, ‘Goodness knows how much higher you might have gone if you’d had a shaven head!’ Ken Wallace was one of the standouts, I thought, in the kayaking in the K1 500. When Ken finished, he said, ‘Geez, I looked around and I thought: where are the rest of them?’ and he realised he had won a gold medal. And there was Drew Ginn in the men’s pairs. One of the memorable moments was when Drew revealed that he had a photograph of his kids in the boat.
I think, however, it is not only about the athletes themselves who have spent not just four years but an entire lifetime preparing for this; it is about their families and the sacrifices, over a very long period of time, in getting their then young athletes to their particular sports. It is also about the financial sacrifices, the employers who have allowed those athletes to spend time away from work, the coaches, the doctors, the physios, the administrators and the managers, and all those who have contributed to this success. We were the sixth highest in terms of the medal tally, at 47 medals, but we were first when it came to the inspiration of a nation. Every Australian has been inspired over the last two weeks or more by these men and women in their perseverance, determination and teamwork and their sacrifices for one another. They have made every single one of us very proud to be Australian. We salute them. And, in a country that from time to time can be known to have the odd knocker, could I also congratulate Channel 7 for the magnificent way in which it covered the Olympics—
You’re joking, aren’t you?
There you go, Mr Speaker; we have a few knockers in the Labor Party. I think they put in a pretty good effort along with the ABC.
Order! Questions without notice. Are there any questions?
My question is to the Prime Minister. Why are Australians worse off since the election of the Rudd government?
The challenges we face as an economy are in part globally driven and are in part a product of some of the economic conditions we inherited. That is just the truth of it. Let’s go to the global conditions. The global economic conditions, which have come off the back of the global financial crisis starting in August of last year, 12 months ago, continue to wash through. We have revisions down for growth forecasts in the United States, across the European Union, in Japan and also in the wider East Asian area as well. The roll-on consequences of that therefore are that we have a lesser pace of economic activity than was projected 12 months ago. That is just the facts as they present themselves. The other factor alive in the global economy is of course global oil prices. We have this significant spike in global oil prices in recent months, the third great oil shock since the two great oil shocks of the 1970s. That in turn has fuelled a further factor in overall global economic conditions which is, of course, the hike in global food prices. These factors combined have brought about significant pressures across the global economy.
That is what has happened globally. Then we go to the factors that we have inherited locally, here in Australia, as of the end of last year. There are three very uncomfortable facts that I would present to those opposite. One is this: when this government assumed office eight months ago after those opposite had spent 12 years in office, we inherited inflation running at a 16-year high. Secondly, we inherited a record from those opposite of 10 interest rate rises in a row. That is what happens when you allow inflation to get out of control; that is what happens when you put all the pressure on monetary policy through a slack fiscal policy—you get 10 interest rate rises in a row. I would say to the Leader of the Opposition, as he begins to lecture the House on economic policy: look carefully into the eyes of Australian mums and dads and those who are seeking to make ends meet out there and ask them about the cumulative impact of 10 interest rate rises in a row. It is significant. Thirdly, at the point at which this government took over, those interest rates were the second highest in the developed world.
There are three facts: firstly, we had inflation running at a 16-year high; secondly, we had 10 interest rate rises in a row; and, thirdly, we had the second highest interest rates in the developed world. Those are the economic conditions that this government inherited, which is why, as we approached the budget this year, having been in office for less than six months, the overall call on us from the country at large was a policy of responsible economic management grounded in a strong budget surplus. We delivered that with a $22 billion surplus. That surplus has subsequently been the subject of, shall we say, an attempted raid by those opposite, and it is going to be very interesting indeed to see where the credibility stakes now hang in this place in terms of those opposite and their behaviour in the Senate as they begin to launch their assault on this nation’s best fiscal preparedness for what will be uncertain global economic times ahead.
My question is to the Prime Minister. Will the Prime Minister outline why, in these times of global economic uncertainty, responsible economic management is required?
The challenges that have been reflected around the country have also been reflected abroad. The most recent revisions to growth projections in the United States, according to the IMF bulletin of July 2008, are for growth to be just 1.3 per cent. European countries are forecast to grow at just 1.7 per cent and Japan is forecast to grow at 1.5 per cent. Of course, in recent times we have seen negative quarters of growth from a number of developed economies as well. These are very difficult global economic circumstances due to the factors that I referred to. Therefore, the challenge that we face is what sort of policy response we adopt nationally and internationally in response to these difficult economic circumstances.
Firstly, on the question of the global financial crisis, objectively there is a problem in terms of credit availability. That is true. That is why the Treasurer and other representatives of the government have been actively engaged in the international financial forums, including the Financial Stability Forum and the G-20 as well as the IMF, to embrace a series of prospective reforms for the global financial system aimed at acting on regulatory transparency across global financial markets. We face a real challenge on this score because if global political leaders do not lend their political support to the reform proposals coming out of the international financial institutions then the problems which have become alive through the US subprime crisis will continue for longer than they need to. That is the objective we have for credit availability and the cost of credit.
Because of its impact on the real economy, you therefore have a roll-on consequence for confidence in the global economy as well. Whether you are looking at business and consumer confidence indicators in the United States, in the United Kingdom, in continental Europe or elsewhere, what we have is a roll-on assault on confidence across the global economy. Here in Australia our response is anchored, of course, in the strong budget outcome which we delivered as a result of the Treasurer’s statement to the parliament in May—that $22 billion budget surplus which I referred to before. Secondly, in order to assist working families, pensioners and carers across this country we have also, through the budget, delivered a $55 billion working family support package, in addition to further payments for pensioners, for carers and for those on the disability support pension.
There are many people across this country who counselled us prior to the delivery of the May budget that it would be irresponsible to deliver on tax cuts. We believe that those tax cuts were the right policy setting and we certainly believe that it is the right policy setting now because families, individuals, pensioners and carers in the Australian community are doing it tough. Therefore, by producing on the one hand a fiscally responsible document based on a $22 billion surplus—through a disciplined approach to spending control as reflected in the actions of the finance minister and the Treasurer in the preparation of the budget outcome—we were able to deliver on those significant tax cuts, as well as other payments to working families, pensioners and carers.
The third reason why we have confidence in our economic course ahead for Australia is that in the East Asian hemisphere we continue to be the beneficiaries of significantly high terms of trade because of the prices that continue to be generated for our commodity exports in this part of the world. Finally, we have in this country—and we should be proud of this fact—first-class economic and financial regulators. If we look at some of the regulatory performances elsewhere on the planet in recent times, I think that the performance on the part of our regulators has been first class, and that provides us with confidence going forward. We therefore have crafted an economic policy direction about which we have confidence for the future. We believe, therefore, that we can see Australia through these times of global economic uncertainty and that the Australian economy will emerge through these difficulties in a strong condition.
In terms of the threats which we face to that course of action, I return to the matter I touched on before, and that is the impending assault on this government’s budget surplus. If there is a single lesson which comes out of the global economic conditions which we have had to confront in recent times, it is that a strong fiscal position providing the government with a strong fiscal buffer to deal with contingencies as they arise is of fundamental importance. We have brought about a $22 billion budget surplus. We were still able to deliver a $55 million package for working families and additional payments for pensioners and carers. On top of that, we set aside funds for three major investment funds for the future: for infrastructure, for education and for health and hospitals. But if you start to eke away and undermine and cause to be threatened the fiscal surplus which the government delivers through the budget then these certainties begin to be removed. The Liberals at present are threatening at least a $3.7 billion hole in the budget and it depends, of course, on their internal political deliberations as to how much higher that will go. But we have now reached the point of truth and honesty: what will the Liberals now do in the Senate? Will they take the side of economic responsibility and side with the government in ensuring that we have a strong fiscal buffer for the future or will they take the path of economic irresponsibility, take the path of short-term populist politics instead and conduct a populist driven assault on the budget bottom line? That is the course of action, they are the choices, which those opposite face, and their statements to date give us no confidence at all.
I conclude with this: in these difficult economic times the worst thing you can do is blow a hole in the budget. If you are facing uncertain global economic times ahead, the worst thing you can do is send a message of uncertainty to the international economic and financial community about whether this government’s budget is going to pass the parliament and whether its surplus is going to remain intact. In times of global economic uncertainty, governments and economies around the world look for signs and clear demonstrations of strength and resolve. We have produced that through the budget, but that certainty and resolve is now under threat by those opposite as they seek to assault the budget surplus which we so carefully crafted in the budget of May.
My question is to the Prime Minister. I refer to the government’s claims that fighting inflation is its No. 1 priority. How will a new tax that will increase the price of domestic gas in Western Australia reduce inflation?
It is pretty interesting to watch the unfolding barney among those opposite on the future of the CPRS, the Carbon Pollution Reduction Scheme, and its application across the economy. I presume the reference here on the part of the Deputy Leader of the Opposition is in relation to the proposed new taxation arrangements for condensate. I say to those opposite that either you are serious about economic responsibility or you are not. I say to those opposite, as they seek to pursue populist politics on this, that either you are serious about adhering to the budget bottom line or you are going to continue to allow a tax loophole for a particular category of production to sustain itself into the future, a tax concession introduced at the original time for a specific purpose which has now expired.
Mr Speaker, on a point of order: it was a simple question—how will a new tax reduce inflation?
The question has been asked. The Deputy Leader of the Opposition will resume her seat. The question has been finalised.
My question is to the Treasurer. Why is the government’s budget right for the times and how does it meet the challenges of the future?
I thank the member for her question. Our budget struck the right balance, given the difficult global conditions out there and the difficult domestic conditions that we inherited. That is why we built a strong surplus. We built a strong surplus, a $22 billion surplus, as a buffer against international turmoil and to fund the investment for the future that those opposite would never fund.
Mr Ciobo interjecting
The member for Moncrieff is warned!
We built it also to make room for the Working Families Support Package, $7 billion in tax cuts this year, $10 billion next year and $14 billion the year after. In addition to that, we will provide extra relief for families, particularly when it comes to child care. The approach that we adopted in our first budget has been strongly endorsed by the International Monetary Fund. I will just go through and read what they had to say: ‘The reduction in public spending growth in the latest budget illustrates the government’s commitment to help reduce inflation,’ and ‘will take pressure off monetary policy in the near term’. That is what the IMF had to say about our budget.
Those opposite had a lot to say about our budget as well. I recall the member for Wentworth, for example, saying before the budget that we did not need to cut. The member for Wentworth said we did not need to build a big surplus. Mr Speaker, you might then recall that after the budget he said, ‘Oh no, they did not cut hard enough; what we needed to do was to have a bigger surplus.’ Of course, now the member for Wentworth’s position is we do not need a big surplus. He has got it wrong three times in a row. He is out there trying to argue that we do not need a significant surplus in these global conditions. We do. They are trying to blow a $6.2 billion hole in the surplus. We have heard today that they are going to block the condensate measure. We have heard that today. This is the height of economic irresponsibility, given the global conditions that we are facing at the moment. It is about time they put the national interest before their short-term political interest.
My question is to the Treasurer. I refer to the government’s claim that fighting inflation is their No. 1 priority. Treasurer, how does increasing the price of motor vehicles by $555 million through a new tax lower inflation?
The first thing it does is build our surplus—absolutely critical in this environment. Let me tell you about this—
Opposition members interjecting—
Order! The Treasurer will resume his seat. The question has been asked and the question is being responded to.
In May we delivered a responsible budget, a budget to build a $22 billion surplus to act as a buffer against international uncertainty and to fund global investment into the future. But it was also a budget which cut tax. Tax as a percentage of GDP came down; it came down overall. Those people over there cannot accept the fact that we brought down a responsible budget that built a significant surplus to tackle inflation, to fund investment for the future and to deliver fairness to working families.
Mr Dutton interjecting
Order! The member for Dickson is warned!
But what do they choose? They choose to stand up for people buying luxury cars but not for lower interest rates for working families. That is where they are. They choose to stand up for particular oil companies instead of standing up for Australian families who need lower interest rates and critical investment in education and infrastructure. That is where they are. They are not with the working families of Australia who are getting the tax cuts that they made them wait years and years and years for. They are out there defending the alcohol industry, they are out there defending the luxury car industry and they are out there defending windfall profits for oil companies. We know whose side they are on, and it is not the Australian people’s.
My question is to the Treasurer. At this time of global economic uncertainty, why is it so important that the government’s budget measures are passed in full?
It is very important to pass these budget measures in full, to provide a buffer against global turmoil, to ensure the Reserve Bank has room to move. What those opposite want to forget about is the 12 interest rate rises on the trot—10 of them under them. That is what has put Australian families under tremendous financial pressure. Their 10 interest rate rises in a row are slowing the Australian economy, and they will not admit to that. This is happening at a time of great global uncertainty, and the one thing this nation needs in these circumstances is a strong surplus—a strong surplus to give the Reserve Bank room to move so it can take pressure off interest rates to get those financial pressures off Australian families. And what are we getting from those opposite? They are going to vandalise the surplus at this stage to the tune of possibly $6 billion.
Now I have heard it all from the Leader of the Opposition. He had this to say on Sunday. He said he was not in the business of ‘writing blank cheques’ and he was not into ‘knee-jerk responses’. The farce over their response to all these budget measures has gone on for weeks but now we know where they stand. They stand with the alcohol industry against doing something against teenage binge drinking. They stand with the luxury car industry. They do not stand with this side of the House, which wants to put downward pressure on interest rates for working families. Now we find they are going to defend the indefensible: they are going to continue with a huge tax break for one particular oil company at the expense of the Australian people.
I do not really know anymore who takes the decisions over on their side of the House. You have got the Leader of the Opposition, one of the three stooges, who can’t do his job; you have got the member for Wentworth, who can’t get the job; and of course you have got the member for Higgins, who hasn’t got the courage to take the job.
Mr Speaker, I rise on a point of order. The Treasurer was asked how increasing the price of motor vehicles would reduce inflation. He has not answered the question. I would ask him to be relevant.
Honourable members interjecting—
Order! There was absolutely no substance to the point of order because it referred to the previous question.
Mr Speaker—
The member for North Sydney will resume his seat. On the overall question of relevance of the response to the question that has been asked, the Treasurer is being relevant. Further, I am being given advice from people on my left about relevance by way of interjection. Can I say that it would improve the standard of question time if there were less baiting and sledging, which I believe ends up getting a response during an answer which does tend to go to the extremes of relevance.
Mr Speaker, given that you want to engage in a debate on this now—
No, I do not want to engage in a debate.
You raised this, Mr Speaker.
Do you have a point of order?
Mr Speaker, I do—on relevance. The opposition are asking short questions—
No, that is not a point of order.
and are getting longwinded, irrelevant answers. The government are not even answering their own questions.
That is not a point of order. The member for North Sydney will leave the chamber for one hour.
The member for North Sydney then left the chamber.
Without wishing to have a debate about the vexed question of relevance, I think those who have been here long enough would know that a fairly wide definition has traditionally been used. The Treasurer is relevant in his response. The Treasurer will continue. Less debate during his answer would help, but the Treasurer has been relevant.
Thank you, Mr Speaker. We now have a fourth position. The question was about inflation. It is a very serious question, because we are dealing with a serious inflationary problem in this country. It reached a 16-year high in October, November and December last year. Those opposite may want to deny that they had anything to do with it or that their policies had contributed to it. But we are dealing with it, which is what we did in our budget on 13 May, which was to build up a significant surplus, to restrain public demand and to stop their reckless spending in the interests of Australians who are carrying very, very high mortgage rates. The legacy of those opposite is 10 interest rate rises in a row and absolutely fantastic financial pressure on Australian families. They might want to pretend that the election did not happen last year on 24 November. They might like to pretend it did not occur at the end of last year. They might like everyone out there to believe that, suddenly, inflation just emerged on 25 November last year. They might like to pretend that it did not happen. Well, it did and we are dealing with it. One of the ways we are dealing with it is by building a significant surplus.
Government members interjecting—
That is right—we are. We have responsibilities to fulfil to the Australian people. The irresponsible actions of the opposition in the Senate will plunder that surplus, will limit the capacity of the government to deal with inflationary pressures and will limit the capacity of the Reserve Bank. That will be on the heads of all of those opposite if they continue with this sort of irresponsible behaviour. But it gets worse than that. They will not put up their hands and accept responsibility for inflation being at a 16-year high. They will not put up their hands and accept any responsibility for the capacity constraints in the Australian economy, which are feeding through into inflation. They now want to deny that there are international and global factors which are slowing the Australian economy and which are also putting upward pressure on rates domestically. They simply want to deny that.
The member for Higgins said last week that, if he were in office now, the international financial crisis would not have happened. He said that, if he were in office now, there would not be a crisis in our stock markets. That is how ridiculous the opposition have become—no credibility and no consistency. On this side of the House we will do the responsible thing, and the responsible thing was done on 13 May in our budget—producing a sizeable surplus, putting in place spending and planning for the long term. Their short-term politics are playing havoc with the national interest. They should get on our side in the Senate and support our surplus.
My question is to the Treasurer. How does increasing the price of alcohol through $3.1 billion in higher taxation reduce inflation?
As I indicated earlier, in the budget we reduced taxation overall. The tax to GDP ratio went down. That might be another inconvenient fact which those opposite want to stick their heads in the sand and ignore, but it is a fact. But what is even worse is that they are not prepared to face up to their responsibilities when it comes to dealing with teenage binge drinking. They will not face up to that at all. This government will face up to it, because the loophole left by the former Treasurer led to an explosion in teenage binge drinking when it came to alcopops. A 250 per cent increase—we are dealing with it in a responsible way. We are dealing with it with the support of the police commissioners and with the support of all the responsible health authorities out there. But, once again, we have this rank irresponsibility from those opposite, which reflects very poorly on them and shows that there is not a shred of economic credibility left in any of them.
You’re a dud!
The member for Kalgoorlie will withdraw that remark.
Mr Speaker, I am not sure which word you are referring to.
The member for Kalgoorlie knows full well. He will withdraw.
Mr Speaker, I called the Treasurer a dud—
Is the member for Kalgoorlie going to withdraw unconditionally or not?
Mr Speaker, I believe he is a dud.
The member for Kalgoorlie will leave the chamber for one hour.
The member for Kalgoorlie then left the chamber
Mr Speaker, I rise on a point of order. Since when has ‘dud’ been unparliamentary?
I have requested the member for Kalgoorlie to withdraw the expression, which at the time I did not think was assisting the conduct of the chamber. He used it twice after the answer was finished. There has been a great deal of interjection throughout the day. I do not think that those types of remarks are assisting the proper conduct of the chamber, and it is not indicative of showing respect to other members of the chamber.
Further to the point you have just made on the point of order, Mr Speaker: if ‘dud’ is not unparliamentary, is it not rough to expel the member for using it?
In the context of what was happening at the time, I asked for its withdrawal. Therefore, by definition, it was unparliamentary at that point in time. And as the member for Warringah, who has experience as Leader of the House, knows, there is no definitive list of expressions or names. The fact is that, from time to time, it comes down to the context of what is happening in the chamber and it is in the hands of the Presiding Officer. The expression, I believe, was not helpful to the proper conduct of the chamber. I asked that the member withdraw; he chose not to withdraw—that is the reason he was asked to leave the chamber.
Mr Speaker, reluctant as I am to continue this, given that the language was not unparliamentary, would you—
No, I think that, by definition, if I have asked for the withdrawal then it is unparliamentary at that point in time.
Given that you have conceded that it is not generally unparliamentary, perhaps if you now ask the member to withdraw then that may be a better way to proceed, given the explanation?
No, in fairness I would say to the member for Warringah that I gave the member for Kalgoorlie ample opportunity. I did ask twice. I am not entering into debate.
Mr Speaker, I rise on a point of order. Just prior to your ruling, the Treasurer made a personal attack on three members of this House. I find it distinctly unhelpful, and I would ask him to withdraw.
The member for Solomon has the call.
My question is to the Minister for Finance—
Dr Jensen interjecting
The member for Solomon will resume his seat. The member for Tangney will withdraw from the House for one hour.
The member for Tangney then left the chamber.
My question is to the Minister for Finance and Deregulation. Will the minister outline the benefits to the economy of maintaining a strong budget surplus, and are there any threats to this position?
I thank the member for Solomon for his question. There are a number of reasons why it is very important to have a strong surplus in the budget settings. There are a couple that are particularly import-ant. Firstly, this is in order to ensure that the budget is putting downward pressure on interest rates. We inherited an inflationary bud-get setting, with spending growing at five per cent per annum in real terms. We have shifted that growth down to one per cent per annum. Secondly, it is very important that we have a strong surplus to build the infrastructure investment funds that the government has put in place: the Building Australia Fund, the Education Investment Fund and the Health and Hospitals Fund, which will invest in the long-term productive infrastructure that this nation needs to invest in. It will invest in national broadband, it will invest in major upgrades of hospitals, it will invest in new university infrastructure and it will invest in major transport—road and rail—infra-structure around this nation. That is why the emphasis in the budget was on the long-term economic prosperity of this country—not the irresponsible, short-term, politically-driven spending that had characterised recent budgets.
The opposition is threatening to blow a serious hole in this surplus by its behaviour in the Senate. It is seeking to undermine the government’s efforts to assist the Reserve Bank in the struggle to keep interest rates as low as possible, and it is also seeking to undermine the government’s ability to build the surpluses that will be invested in that long-term infrastructure for the nation’s future. I note that the opposition appear to believe that, somehow, nothing that has happened since 24 November reflects in any way on anything that they did before 24 November of last year. Alan Mitchell, a respected commentator in the Financial Review, who has, from time to time, criticised Labor governments rather vociferously—and who certainly could not be seen as a biased commentator—observed on 6 August:
If any politician is to blame for the current tight monetary policy and its consequences, it is Peter Costello.
It is Peter Costello, the member for Higgins. So much for the suggestion that, somehow, the 12 interest rate increases in a row can be retrospectively attributed to the Rudd government.
I note that, on the weekend, the Leader of the Opposition was calling on the government to make a major economic statement about the issues facing the nation. I think Laurie Oakes deserves a Gold Logie for keeping a straight face while he was interviewing him in response to this statement. It is the best example of projection that I have ever seen. There is definitely a need for a major economic statement in this parliament, but it is a statement from the opposition that is definitely needed. It is very clear where the government stands on the major issues of the day, whether it is the size of the budget sur-plus, cuts in government spending, climate change or investment in skills and infrastructure. But we do not know what the opposition believe is the appropriate level of the surplus. We do not know what they think the right setting for fiscal policy is. We do not know where spending cuts are going to be made by the opposition to pay for the billions and billions of dollars that they have already made in spending promises since the election. We do not know what agenda they have for long-term investment in the nation’s infrastructure. We do not know what tax reform plans they have, and we certainly do not know what their climate change strategy is because we are not even sure whether they believe climate change is real or not.
I note that the opposition is clothing its vandalism in the Senate in the guise of tax reform. I would make two points. One of the initiatives the opposition is opposing is, in fact, to remove a tax slug on middle-income Australians—namely, the Medicare surcharge levy, which was introduced by the government to apply to high-income earners. Because it was not indexed it has gradually come to apply to people earning $50,000 per year, who the opposition apparently still seems to think are high-income earners. Finally, Mr Speaker, if you look at the statistics in the budget papers you will see that the proportion of the nation’s economy going in tax from the federal government for this financial year, for the next one, for the one after that and the one after that is lower in each case than every one of the last six budgets of the Howard-Costello era. The tax take is lower under the Rudd government. It will continue to be lower.
My question is to the Treasurer. How will the government’s increased registration charges and fuel excise for heavy vehicles reduce inflation?
The most fundamental thing that we can do to reduce inflation is to build a significant budget surplus—absolutely. What we have got to do is make our economy much more productive. We have got to do something about the capacity constraints in this economy that were left to us by the previous government. The 20 warnings that the shadow minister opposite ignored when he was a minister of the Crown in the transport area signify more than anything the abject neglect of those opposite when it comes to real, longstanding, lasting action in the transport industry. Whilst they are frustrating our surplus, whilst they are blowing a hole in it, they cannot lecture anyone about inflation.
My question is to the Minister for Education, Minister for Employment and Workplace Relations and Minister for Social Inclusion. Will the minister detail the government’s progress in delivering new investment in vocational education and training during recent months and, further, are there any dangers to delivering a world-class VET system?
I thank the member for Hasluck for her question. We are addressing the consequences of more than a decade of neglect in our skills system, which has led to a skills crisis around the nation. And of course when skills are short, when the economy is running at capacity, that does put upwards pressure on inflation and interest rates. As a Western Australian member, the member for Hasluck would see this on display in her state—people crying out for skilled labour and unable to get it, and all as a consequence of more than a decade of neglect.
We have moved immediately to address skills shortages and the skills crisis through our Productivity Places Program, and I am pleased to report to the House that students con-tinue to take up these places. So far, around 42,000 people have enrolled in training through the program. These places started becoming available in April, and around 4,400 job seekers have finished their train-ing. So this is an urgent response to the skills crisis created by the neglect of the Liberal Party.
If we are going to have a skills system which meets the needs of the future then people need to be trained in first-class, 21st century facilities. A huge problem around the country is that people are being trained in facilities better suited to the fifties and sixties than to the 21st century. You cannot learn modern-day skills if you do not have good facilities and good equipment to learn them on. The government has moved to immediately invest in the capital of our training system so people can learn in modern facilities with modern equipment.
On 15 July, I was pleased to announce the successful schools for our first round of trades training centre funding; more than $90 million of funding was awarded to 34 projects involving 96 schools. I am also very pleased to inform the House that applications are open for the second round of funding. They opened on 23 July and will close on 17 October. There is $300 million available for allocation in that round—a huge investment in the training capacity of our schools.
But, beyond our schools, we need to renew our vocational education and training system throughout. We need to make sure that the places where adults train are up to the standards of the 21st century. I am asked about the dangers facing our desire to invest in the vocational education and training system. I regret to inform the House that there is a big danger facing new investment in vocational education and training. We, in the recent budget, created a new Education Investment Fund, an $11 billion fund to renew capital in higher education and vocational education and training. That fund is in part the recipient of moneys from the budget surplus. In particular, $5 billion for the fund is coming from the surpluses in 2007-08 and 2008-09. So now we have not only the spectre of the Liberal Party in government giving this nation a skills crisis but also the spectre of them punching a hole in the surplus that is going into the Education Investment Fund, amongst other funds, to meet the long-term needs of this nation.
The Liberal Party were never known for long-term planning; that is why we got the skills crisis. We are trying to renew our higher education and vocational education and training systems for the long term. In order to do that, our surpluses are going into nation-building funds, including the Education Investment Fund. In an act of economic vandalism, the Liberal Party, sitting opposite, are punching a hole in that surplus, and that means they are punching a hole in our ability to develop the productive capacity of our economy for the long term. What that means of course is that a huge hole in the budget surplus is going to cost this nation productive capacity in the long term. It is economic vandalism today and economic vandalism tomorrow from the Liberal Party. They are throwing the skills toolbox out the window for short-term politics, and Australians will judge them by it.
My question is addressed to the Treasurer, and I refer him to his remark earlier in question time that the policy decisions in his budget had been to reduce taxation. Would the Treasurer explain to the House why, then, Budget Paper No. 1 states:
Policy decisions ... are expected to increase taxation revenue by $2.4 billion in 2008-09 and $19.7 billion over the forward years.
Isn’t it the case that the only tax cuts referred to in the budget were the policy of the previous government?
The facts are very simple. Tax as a percentage of GDP in the budget is 23.8 per cent, down from 24.7 per cent. You can selectively quote any figure you like but you cannot escape from that one fact. While we are on it, the opposition are in here saying that they do not agree with tax increases anywhere. What about your proposal to abolish what we are going to do about the Medicare levy surcharge, imposing another tax on Australians? They are all hypocrites; they are all over the place; they do not have a standard position on anything.
Mr Speaker, I raise a point of order.
It is predictable if the member is seeking a withdrawal because he is offended.
We know one another very well, Mr Speaker.
To assist, I would ask the Treasurer to withdraw.
I withdraw, Mr Speaker.
My question is to the Minister for Infrastructure, Transport, Regional Development and Local Government. Will the minister outline to the House the benefits for the economy and infrastructure of the Building Australia Fund? Is the minister aware of any threats to the size of the fund?
On budget night this government produced a responsible budget, and part of that, at its core, was the $22 billion surplus and the funds that were set aside for the future—for future education infrastructure, for future health infrastructure and, with the Building Australia Fund, for future infrastructure investment in broadband, roads, rail and ports. That investment was a direct response to the fact that the Reserve Bank had warned on 20 separate occasions of the capacity constraints in the economy placing pressure on inflation and interest rates and reducing our productivity.
We also, of course, have established Infrastructure Australia, a body consisting of the private sector as well as levels of government, to develop and produce an infrastructure priority list in time for the COAG meeting in March 2009. But you cannot put funds from the surplus into funds to produce long-term investments if you then undermine the surplus. What those opposite are threatening to do—block the budget bills—will put a $6-plus billion potential hole in our surplus, therefore undermining our ability to invest in our long-term future. If these budget bills are not passed, funding for critical infrastructure will be lost.
On budget night we also announced a number of feasibility studies into the sorts of nation-building projects that are required. The Gateway Motorway missing links in Brisbane—is that project necessary or not? The western metro in Sydney, the east-west link in Melbourne or public transport in Adelaide—all of these issues are potential investments based upon these feasibility studies. But you cannot invest for the future if you are undermining the budget surplus today. This government is absolutely committed to laying down the tracks for future investment in infrastructure. The opposition seem determined to derail our efforts by undermining the surplus. I call upon them to move on from their 12 years of inaction on infrastructure investment and not block budget measures in a way that is totally economically irresponsible not just for today but for our future economic prosperity.
My question is to the Prime Minister. Prime Minister, I refer to the fact that the government will channel $40 billion from the 2007-08 and 2008-09 surpluses into three different spending funds. How can the government claim that they are protecting a surplus when they are simply transferring those surpluses into slush funds where both earnings and capital will be spent?
For the benefit and the information of those opposite, as we said at the time of the budget, the future dispensation of those funds from the Education Investment Fund, the Building Australia Fund and the Health and Hospitals Fund will be done through the budget process in an entirely responsible fashion. That is the first point. The second point is this: we as a government believe in investing in this nation’s economic future; we as a government believe in acting on the nation’s infrastructure bottlenecks; we as a government believe in acting on the skills crisis. And do you know something? To do that does not come from nothing. It does not come cheap. You have to actually invest and lay money aside for it.
If there is one howling critique out there in the community of those opposite as they, led by the member for Higgins, presided over this tidal wave of cash coming into the Australian economy off the back of the resources boom it is this: what did you do by way of productive investment for the future with that bucketload of cash? Answer: zero. That is despite the fact that they received 20 warnings from the Reserve Bank of Australia about infrastructure bottlenecks and skills crises and those two factors in turn further fuelling inflationary pressures in the economy and putting upward pressure on interest rates.
So there are two core reasons to have acted responsibly in this fashion: the first is to do something about the macro economy—that is, to act on the overall supply-side constraints in the economy which are so much part and parcel of the 20 Reserve Bank warnings that those opposite ignored—and the second is to act decisively on the skills and infrastructure inputs for long-term productivity growth in the economy by setting aside investment funds for the future.
In terms of macroeconomic responsibility, I also draw the attention of those opposite to the International Monetary Fund article IV consultation with Australia. It says in its bulletin released on 9 July:
The reduction in public spending growth in the latest budget illustrates the government’s commitment to help reduce inflation.
I go to this question about the funds in question:
Saving some of the revenue from the commodity price boom in three new funds will take pressure off monetary policy in the near term and enable increased infrastructure investment over the medium term.
Those are exactly the economic policy underpinnings of what we are doing through this. I ask those opposite: why was it, year after year from 2001 on, when the coffers of this country ran full with the taxation receipts off the resources boom, that you did not invest it, as did other sensible, resource rich economies in the world, in the long-term productive capacity of Australia? You failed to do so. This government has the economic vision to act in this space, and you are condemned for failing to do so.
My question is to the Minister for Health and Ageing. Will the minister outline to the House any recent achievements in health and how these achievements could be jeopardised?
I thank the member for Kingston for the question and actually thank her also for recently hosting the cabinet in her electorate and for hosting one of a number of GP superclinic consultations that have been held around the country. Over the last eight weeks, a lot has been happening in health. In particular, on 1 July a range of our election commitments signalled new services becoming available for Australians. These include $150 for a preventative dental check for teenagers under our new Medicare Teen Dental Plan. In just its first month, one in five dentists has already seen teenagers to conduct these checks. From 1 July, free health checks are being provided for four-year-olds—for those children who are getting ready to go to school—to make sure that they are healthy, happy and ready to learn. From 1 July, $400 is available for breast prostheses for women who have had a mastectomy and previously had to find the money to pay for those prostheses.
So far, all of these initiatives, plus a range of others, are going well. After just six months of operation, our elective surgery plan has already delivered 14,000 extra procedures, well over half the target set for this year. After years of stagnation and frustration in the sector, we delivered a $136 million plan to boost organ donation across the country and save lives. Just last week, while I was in Western Australia, we launched our Stephanie Alexander Kitchen Garden program, so schools are now able to indicate their interest in becoming a demonstration school as part of our strategy to fight obesity amongst young children. Also last week, we announced $50 million of funding to improve cancer research, including support for Australian researchers to take part in the largest ever international effort to unlock the genetic secrets of cancer.
I am sure nobody on the other side, let alone on our side, in this House would disagree that these are good initiatives, but the problem is that it is measures like these that are under threat because of the economic irresponsibility of the opposition. The government has built a budget surplus—the Treasurer has already taken the House through that—but if the opposition is determined to blow a huge hole in the budget we will not be able to keep providing many of the sorts of services I have just listed. If those opposite continue to oppose the Medicare levy surcharge, if they continue to refuse to remove a tax burden from people who are under pressure from the cost of living and if they are determined to side with the alcohol industry to play cheap politics, these sorts of initiatives are under threat. In the budget, we announced that a portion of our surplus would be invested in a new $10 billion Health and Hospitals Fund—the largest Australian investment in health infrastructure ever—but if the opposition continues to rip money from the surplus it is turning its back on that fund and all the benefits that it could deliver.
Just think for a moment what that $10 billion could pay for: several state-of-the-art, major metropolitan hospitals; $6.2 billion, if all of the threats are followed through with, to fund over 600 GP superclinics across the country or unprecedented levels of investment in medical research facilities. This is not the time for us to be putting the economy at risk. It is not the time for us to be baulking at investing in the health system that was neglected for so long under the previous government. We need responsible economic management. We need people to think for the long term so we can deliver for the health and hospital infrastructure that is needed. We do not need these short-term, cheap political stunts from the opposition.
My question is addressed to the Treasurer. Why did the Treasurer beg the Reserve Bank to raise rates at the beginning of the year when he said inflation, then at three per cent, was out of control and yet now, when the Reserve Bank says it is heading for five per cent, he is begging the banks to bring rates down?
It just shows that those opposite have not got a clue when it comes to the very basic elements of national economic policy—no understanding of the role of fiscal policy and no understanding of the role of monetary policy. I have already quoted what the IMF had to say about our budget and the role that it played in taking pressure off the Reserve Bank to get itself in a position to loosen monetary policy. Our surplus is absolutely fundamental in that and, if those opposite think they can blow a $6 billion hole in our surplus and it may not have any ramifications for future Reserve Bank decisions, they have another think coming. They are living on a different planet. We do still have in this community a substantial inflation challenge. One of the reasons the Reserve Bank is able to talk as it has been talking in recent times is that we put our budget together to take pressure off the Reserve Bank.
Mr Speaker, a point of order on relevance: it is not a question of a different planet; the Treasurer is answering a different question.
The member will resume his seat. The Treasurer is responding.
We said from day one we would tackle the inflation challenge. It was the right thing to do by the country. It was the right thing to do to get downward pressure on inflation so we could get downward pressure on interest rates. And that is what we have been doing, because we are dealing with the legacy of the 10 interest rate rises that occurred under the former government that have pushed interest rates to record highs. Those interest rates at record highs are slowing our economy and slowing our economy precisely at the time that international circumstances are also impacting. That is why the decisions taken in the Liberal party room yesterday are so utterly irresponsible and why those opposite should be condemned for their irresponsible behaviour.
My question is to the Minister for Education, the Minister for Employment and Workplace Relations and the Minister for Social Inclusion. Will the Deputy Prime Minister update the House about the latest developments in the reform of our vocational education and training system?
I thank my Victorian colleague the member for Corio for that question. Today the Victorian government has announced a significant package of reforms aimed at dramatically increasing the number of people able to access training and upgrade their skills. Of course, the Rudd Labor government is committed to reform of the nation’s training system to drive productivity growth, increase workforce participation and address skills shortages. I have already outlined to the House some of the major new investments we are making which are threatened by those opposite, but amongst the reforms we want to achieve apart from those new investments is to ensure that Australia has a training system that is truly responsive to the needs of people and industry.
We understand the need to build a highly skilled workforce to drive productivity and low inflationary growth in a modern economy. Of course, that was a reform direction neglected day after day, week after week, month after month, year after year by the Liberal Party when it was in office. We understand that, to grow our productive capacity and to compete in the international market, we depend increasingly on the supply of skilled workers, the availability of specialist knowledge and our innovation performance. This is true across all industries. It is true in financial services, in manufacturing, in mining, in health, in hospitality and in education. Lifting productivity and participation is essential for the future of this country and its long-term growth.
Just as Australian businesses cannot compete if they are hamstrung by poor infrastructure, Australian businesses cannot compete if they are hamstrung by a lack of skilled labour. The Rudd government is committed to establishing a flexible national training system as a central priority. To do so, we are working cooperatively with state and territory governments through the Council of Australian Governments to deliver solutions to the nation’s skills shortage. The Rudd Labor government does not believe in a ‘one size fits all’ approach, but we are committed to supporting all reforms that honour our election commitments to ensure we have a flexible and responsive training system for the future. We believe there are a number of ways the training sector can rise to these challenges, a number of roads of reform.
To ensure that cost is not a barrier to students accessing training and that every Australian has the opportunity to improve their skills, irrespective of their own financial resources, I have announced today that the Commonwealth will support Victoria in the introduction of an income-contingent loan scheme for government-subsidised diploma and advanced diploma students. The Commonwealth will also meet the administrative costs of the scheme and we will not charge a loan fee to students. This will increase access for those without financial resources, boost the quality of courses and expand the number of places for students. It means more opportunities, more quality courses and more places for students. It also overcomes the current division between some diploma and advanced diploma courses which are VET FEE-HELP courses and others which are not. We currently have a fragmented system where some diploma courses and some advanced diploma courses are covered with VET FEE-HELP and some of them do not qualify.
It may be staggering to realise, but there are around five million working-age Australians without a qualification at the certificate III level or above. We need to fix that through our education revolution. Can I congratulate Victoria on their commitment to increase investment and drive reform. They are working with the Rudd Labor government, and we will be working—
Four minutes!
with other states and territories on reform drives to improve our vocational education and training system. I know solving the skills crisis bores those opposite, but we are fixing 12 years of their neglect with an important step forward today in partnership with Victoria—something they clearly do not care about. Victorians will note their contempt for the skills development of Victorians.
My question is to the Prime Minister. I refer the Prime Minister to the government’s statement confirming that some of the $40 billion from the next two budget surpluses will be channelled into a COAG Reform Fund for expenditure by the states. What portion of the federal surpluses will wind up in the state slush fund? Why should the federal government surplus be used to bail out incompetent state Labor governments?
The government at present is engaged with the states, through the Council of Australian Governments, in a fundamental reform of Commonwealth-state financial relations. First of all, what we have done with our state colleagues is engage in a negotiation to collapse the number of specific-purpose payments from something near a hundred to something of a more manageable size. We are doing that because of the enormous compliance costs and therefore waste of taxpayers’ money which exist in servicing each of those individual, fragmented specific-purpose payments. This, of course, was not of interest to the previous government, not of interest to the previous Treasurer, because it was simply allowed to languish there, despite the enormous inefficiencies of the system.
That is one element of reform—collapse the number of specific-purpose payments and cut out the waste and duplication involved in the administration of those payments to the states. We are talking about tens of billions of dollars. The second reform is this: through national partnership payments, we intend to engage with the states and territories on specific new arrangements to encourage new areas of national economic reform in education, in health and in other areas, including Indigenous policy. This, we think, is an intelligent way to bring about a genuine program of long-term reform in the nation. That is why we will be embracing that as one of the frameworks that we will take to the next Council of Australian Governments and the one after that.
I say in passing that we are turning the Council of Australian Governments into a workhorse for the federation, making it work and making it deliver results. Hard and grafting though the negotiations may be, we are producing results on the question of the Murray-Darling, results on the question of elective surgery and results on the question of the deregulation of business overregulation—again left unattended by those opposite because they simply found it too ho hum, too boring and, frankly, too inconsequential to worry about. We do not think that any of those things are inconsequential.
As far as the payments to the three major investment funds for the future are concerned, we have made it quite clear that these are to drive future infrastructure development across Australia—new education infrastructure across Australia, for TAFEs and for universities, as well as for hospitals. As the Minister for Health and Ageing has just said, we are embarking, from the Commonwealth’s point of view, on the single largest investment fund ever seen for the nation’s public hospital system. Those opposite sought to withdraw Commonwealth activity from that area rather than add to it.
Of course, as we deliberate on the use of those funds and consider the applications that come to the government through the advisory mechanism established under Infrastructure Australia, we will be entirely mindful of what co-investment arrangements state governments may wish to embrace. If you want to do something about infrastructure, for example, and the Building Australia Fund, and you want to know what states are going to do off their own kick and what they cannot do, we will not do what our predecessors did and say, ‘So long, urban congestion is not a problem for us and we do not care.’ The member for Higgins famously said that urban water was not a problem and it was simply buck-passed to the states. We have a different view, and that is Infrastructure Australia, the Building Australia Fund, $20 billion and, on top of that, a rational, reasoned approach through the advisory mechanism set up under Infrastructure Australia to properly disburse these funds. We will therefore act on one of the great constraints in the Australian economy.
It is also important in the macroeconomic debate to take away supply-side constraints that have acted on inflation. It is the right course of action. Those opposite should think long and hard about their use of the term ‘slush fund’ in reference to an investment mechanism that will help Australians across the country dealing with challenges on their roads, dealing with challenges in their urban infrastructure, dealing with challenges in their ports and dealing with the fact that they gave this country one of the worst broadband networks in the developed world. It is as slow as the network in Slovakia but not quite as slow as the network in Slovenia. We intend to act on these things. Those opposite choose to bury their heads in the sand. That is why after 12 years of inaction on infrastructure—on investment in education infrastructure and investment in hospital infrastructure—we have a plan for the future. Those opposite have nothing but a rolling excuse for inertia.
My question is to the Minister for Sport. Will the minister update the House on Australia’s achievements at the recent Olympic Games in Beijing and achievements off the field to harness the benefits of sport?
I thank the member for her question. I begin by congratulating the wonderful Australian team for its inspiring Olympic performance. I think we all agree that the team has represented our nation with great honour and distinction. Of over 200 nations to compete in China, to finish sixth on the medal tally is a remarkable achievement and one that we should all be celebrating. Much to the disappointment of the House, I do not intend to name all of our medal recipients and all of those who com-peted on behalf of our country, nor do I have the opportunity to share all of the inspiring stories such as that of the truly heroic Anna Meares. But I will add my congratulations to those that have already been offered by the Prime Minister and the Leader of the Opposition.
For the record, Australia won medals in 14 sports, which is the same number of sports as in Athens. We had 136 individual medallists in the team of 435. Incidentally, in comparison, Great Britain had 74 individual medallists. That again illustrates what a truly amazing performance Australia put in. I congratulate John Coates and the Australian Olympic Committee as well as the vast number of coaches, support staff and managers who have all given their time to assist our fabulous team. I thank those at the Australian Sports Commission and the Australian Institute of Sport who have worked so long and hard on behalf the government—both past and present—to prepare our teams and to support them while in China. I commend the wonderful parents and family members of our athletes. Of course, I also commend the magnificent athletes themselves who have filled so many of us with pride and inspiration. They truly are remarkable ambassadors for our nation. The government has made very clear its intention to remain close and very strong supporters of them long into the future.
How much extra?
I invite the member opposite to ask a question if he would like to discuss funding issues further. I am more than happy to discuss our government’s intention to maintain our commitment to our athletes.
Of course, much was also achieved off the sporting field. This government is working to promote sport across Australia from the grassroots to the elite level not only every four years at the Olympics when the eyes of the world shine on sport but indeed every year, all year around. We recognise that sport is incredibly powerful in delivering healthy role models for our community, addressing obesity levels and preventable diseases, promoting social inclusion and achieving educational outcomes. The Olympic Games is a time when many stakeholders from the sporting community gather in one venue and much can be achieved through negotiation with other government representatives or other stakeholders and sporting officials. I had the opportunity whilst in China to chair a meeting of the Commonwealth sports ministers. It is with great pleasure that I can report back to the parliament on a number of very important issues that were successfully resolved at the meeting. At the Commonwealth sports ministers meeting we agreed to a communique which, amongst other issues, strengthened the resolve of governments to tackle doping in sport in our regions—something that the member opposite might think is lightweight but that we think is very important to supporting and maintaining the integrity of sport. Whilst developed nations often need to take the lead on these issues, we must remain focused on ensuring that developing nations have also got successful antidoping measures in place in order to ensure that our athletes are competing on a level playing field.
We gave our ongoing support to the work of the regional antidoping offices in Africa, the Caribbean and Oceania. We also recommended greater cooperation and information sharing amongst Commonwealth countries through the establishment of a new sports adviser position for the Commonwealth. We recognise that sport can be a mechanism for social change and economic advancement, particularly in developing countries. So this was an opportunity for us to have a look at some very successful programs across the Commonwealth such as the healthy benefits of sport in the Caribbean, the inclusive benefits of sport in India, an Australian program which is running in South Africa to increase participation rates, as well as the educational initiatives which are being progressed in the United Kingdom. It was agreed that we would work more cooperatively and share information rather than each of us reinventing the wheel on this. I also had the opportunity to meet with the British sports minister Gerry Sutcliffe. This meeting gained some coverage as a result of some other discussions which took place there. I would like to inform the House today that during that meeting we learned of—
Five minutes!
I am sorry if the members opposite do not think it is important to welcome back our Olympic athletes and share that—
Opposition members interjecting—
Order! Those on my left will cease interjecting! The minister will ignore the interjections.
I would like to share with the House that this government is committed to promoting the position of women in Australian sport. I note that when the Senate did an inquiry into this issue a couple of years ago the previous government left the report sitting on a shelf gathering dust. I had the opportunity to discuss with the British sports minister our work and our commitment to promoting women in Australian sport. We have committed to working with the United Kingdom to progress these issues and ensure that we can strengthen this.
We celebrate the success of the Olympics and of the Australian Olympic team. I would like to extend my heartfelt welcome home to them and wish them a well-earned break. Equally, I assure the parliament that this government is committed to ensuring that the energy and inspiration which have been provided by our athletes at the Olympic Games will be continually built upon, and we will ensure that we use that to continue to bring our sporting structures, from grassroots to elite level, up to the position where we can continue to prepare Australia for the challenges that will face us in the future.
Mr Speaker, I ask that further questions be placed on the Notice Paper.
Mr Speaker, I wonder whether I might ask you to review the tape of today’s question time and to consider the question of whether it should be the practice of this House for a member to be excluded for using language which is accepted as being parliamentary for which no prior explanation of the special circumstances has been given.
Do I respond to the member for Warringah or is this next question on the same point?
Mr Speaker, it is on the same point. Further to the question posed by the honourable member for Warringah, whilst you are reviewing that tape, I would ask you specifically to look at the question of the need to make a ruling that the conduct for which you asked the member to remove himself was disorderly. I would ask you to look specifically at standing order 91 where it says that it is necessary to rule that the word was objectionable in order for you then to say it was disorderly. I did hear you say—and that is why I am asking you to review the tape—that you did not make a ruling. I think it is quite an important issue because not to make a ruling of disorderly conduct prior to asking someone to remove themselves is very arbitrary. So I would ask that that be done.
First of all, I am not responding to these questions because they are not about matters of administration that I have responsibility for—and that is consistent with what I indicated earlier this year—but I will make some observations. I will not be reviewing the tape. Having said that, I am not saying that I do not have sufficient pride in my conduct in the chair not to review my actions. I admit that from time to time I am on a learning curve and I have to learn from any mistakes or any confusions that have arisen from things that I have said or rulings that I have made. At the end of the day, to put it bluntly, the action taken on the member for Kalgoorlie was for straight-up-and-down defiance of the chair. Whether people want to make critiques about that, I have to suffer the consequences. As I said, I will not be looking at the tapes, but I can assure you that from time to time I do review my actions. Sincerely, I do not wish to cause any confusion. But I just add that, for the last 50 minutes since that incident, my life in the chair has been much more tranquil and I thank the House for its cooperation.
I present the Auditor-General’s Audit report No. 46 for 2007-08 entitled Performance audit—Regulation of commercial broadcasting—Aus-tralian Communications and Media Authority; Audit report No. 1 for 2008-09 entitled Performance audit—Employment and management of locally engaged staff—Department of Foreign Affairs and Trade and Audit report No. 2 for 2008-09 entitled Performance audit—Tourism Australia.
Ordered that the reports be made parliamentary papers.
Documents are presented as listed in the schedule circulated to honourable members. Details of the documents will be recorded in the
by leave—I have the pleasure to make a ministerial statement to update the House on developments with the WTO Doha Round of world trade talks, and the meetings I attended at the end of July in Geneva to attempt to conclude the main negotiating phase of the round. This is my sixth ministerial statement in the House setting out the way in which the Rudd government has recalibrated its approach to trade policy. I want to concentrate today on why, as a result of the Geneva talks, we are now closer to concluding the Doha Round and why we must now finish the job.
The decision by WTO Director-General Pascal Lamy to bring ministers together last month in Geneva was not without risk—it was a bold call, but it was the correct call and I said so at the time. We had called for this ministerial meeting—we had actively lobbied for it, including at the May meeting of APEC in Peru and at the informal WTO meeting that I chaired on the margins of the OECD meeting in Paris in June. Today, whilst I cannot report to the House the breakthrough from those Geneva talks that I and others had hoped for, I can report significant progress:
After 12 long and exhausting days of negotiations, the vast majority of issues in the negotiations—representing over 80 per cent of the negotiating agenda—were effectively settled. And all of this progress is still on the table. The problem is that 80 per cent is not 100 per cent—and the round clearly requires 100 per cent for resolution.
As I have said before, the Doha Round matters because trade matters. In the post-war period, world trade has been growing at three times the pace of world output. Each new round brings impetus to world trade and that dynamic drives global economic growth. A successful conclusion to this round would bring a much-needed economic impetus at a time of some uncertainty in the global economic outlook. It will also make a big contribution to efforts to address the surge in global food prices.
Having said that, what then was on the table? Agricultural subsidies in the United States would have been cut to US$14.5 billion—a level the United States has exceeded in eight of the past 10 years. Today, in fact, the US can spend several times this sum. As we have seen again this year, without the Doha Round we will get the US Farm Bill. Further, agricultural tariffs in the EU, the US and Japan would have been cut by up to 70 per cent. In addition, tariff quotas for agriculture would have had a substantial boost, in some cases with hundreds of thousands of tonnes of new market access for key products into developed country markets. Add to this the fact that export subsidies in agriculture would have been eliminated forever and there was a commitment to eliminate the special safeguards measure for developed countries in agriculture. These were significant gains in the agricultural sector. On industrial goods, their tariffs would have been brought down in most cases to single digits or to the teens. On services, there was real progress on freeing up markets in a key sector for Australia.
During the July talks, we held a groundbreaking services ‘signalling conference’. Australia had strongly advocated for this conference in the months leading up to the July ministerial negotiations. This conference allowed us to test the concept that a ‘critical mass’ of the top 30 or so markets, which after all represent the vast majority of world services trade, could get together and show their commitment to opening their services markets. In terms of this conference, Australia set the tone by expressing our willingness to consider flexibility in our services offer, conditional upon reciprocal signals from others. At the conference, we heard important signals of flexibility from a number of markets of interest to Australia in key sectors such as financial services, telecommunications, and business mobility and in the limitations applying to foreign equity caps. In sum, we had on the table potential gains to the global economy of very significant proportions across all sectors. Developing countries in particular stood to benefit from these gains. These included not only the general opening of markets and reductions to farm subsidies but specific outcomes such as on tropical products, on the long-standing dispute over bananas and on the gains on offer to the least developed countries. The proposals on the table for agriculture and industrial products alone could result in savings in tariffs paid of more than US$150 billion, with developed countries contributing two-thirds of the cuts and developing countries receiving two-thirds of the benefits. Such outcomes would if realised give real meaning to the Doha Round’s formal name, ‘the Doha Development Agenda’.
Just as we have the concept of common but differentiated responsibilities in the area of international climate change negotiations, a challenge in the WTO is to give effect to the concept of ‘special and differentiated treatment’ for developing countries. My point is that, whilst these are difficult concepts to negotiate in fact, it is necessary if we are to respect the fact that countries are at different stages of development. And with the right political will it is doable.
So why did the talks fail? Unfortunately they broke down over the issue of the developing country special safeguard mechanism for agriculture. Interestingly, the debate was not about whether there should be an SSM—there was acceptance of that—nor was it about whether we could ensure that it did not interfere with normal trade, as there was also acceptance of that. The issue was how we could give real effect to the formula by which that would apply. The truth is that it involves more than just a technical solution to address the problem—we also need political will to find our way through, and Australia is actively working with other key players to find this solution.
The amount of distance that we covered in July and the relatively short distance left to travel does offer hope that WTO members can get back to the negotiating table soon. We were so close and the gains on offer were so substantial that there is a widespread recognition, not just by ministers but, importantly, by global leaders, that we cannot allow the opportunity to slip away. With further and sufficient political will brought to the task, we have a real chance to move forward. The July talks took us closer than we have ever been to our goal and that is why, with this most unusual type of break-up, there is such a compelling case for us to get back together again quickly to finish the job.
I have not given up on the Doha Round but, significantly, neither has the vast bulk of the WTO membership. That is because it is a reflection of how close we got and an understanding by many members of just how close that was. Since the breakdown in talks both the Prime Minister and I have spoken to the WTO Director-General, Pascal Lamy, and to world leaders and trade ministers on numerous occasions, emphasising Australia’s commitment to concluding the round and pressing for early re-engagement. In the aftermath of the talks we immediately set about trying to build momentum to get back to the table. Since then, in all our discussions, we have been advocating a three-point plan aimed at doing just that: firstly, building political-level support for re-engagement; secondly, working at the officials level to find technical solutions; and, thirdly, building support for ministerial level engagement at the appropriate time, and before the end of the year if possible, to finalise the main negotiating phase of the round. I am pleased to say that as a result of these advocacy efforts there is strong support for getting back to the negotiating table.
The discussions in Geneva were significant not only for what was brought to the table but also for the nature of the debate at that table. Through the Cairns Group, which Australia chairs, the developing world has, since the Uruguay Round, had a strong role to play in the talks, particularly in keeping the pressure on the major developed country subsidisers, the US and the EU. This dynamic dates back to when the group was formed, under Labor’s leadership, during the Uruguay Round of negotiations. But the Doha Round has seen a new dynamic at work with the emerging global powers of the developing world along with the United States, the EU, Japan and Australia engaged in what was referred to as the G7 ministerial talks. At the July ministerial, Brazil, India and China, along with the EU, US and the Cairns Group, showed they were strong and constructive partners with a leadership role to play in the Doha Round. Interestingly, there was no north-south division as some had predicted in the July talks. In fact, there was a high level of pragmatism among those developing countries that wanted a deal.
I was very pleased to have been able to work extremely closely with China’s Commerce Minister, Chen Deming, during the Geneva talks. The political and technical complexities of multilateral trade require real global leadership to unlock the way forward. Concessions need to be made; risks need to be taken. That always requires leadership, but China’s positive engagement in the G7 group at the talks was, in my view, an excellent sign that it intends to play a leading role as we move on from the July meeting. The Prime Minister and I recently held talks in China to build on this momentum. I took the opportunity to meet again with Minister Chen Deming and to talk through options for concluding the round. We found an encouraging receptiveness in the Chinese leadership to arguments about the need to re-engage. I am confident that China is committed to achieving an outcome to the round.
Brazil is also a close partner of Australia. As a long-time member of the Cairns Group and leader of the G20 developing country coalition, Brazil has strong common interests with Australia in agricultural trade reform. Again, someone I worked very closely and cooperatively with in Geneva was the Foreign Minister of Brazil, Celso Amorim. We have kept in close contact and, indeed, we are honoured to have him visiting our country this week. I have, in fact, just come from discussions earlier today with Minister Amorim, and I am encouraged by his continuing strong commitment to concluding the negotiations. As a result of those talks we have in fact agreed to continue to work together closely both on the technical front and in generating the necessary political will to finalise the negotiations. We will be issuing a joint statement later today.
India also has a seat at the table of the WTO talks. While Brazil and China were satisfied with the emerging package on the SSM, we did not have the same level of success with India. I am, however, confident that we can engage India to find a solution to the SSM that will also allow world trade in agriculture to continue to grow. Despite its concerns on this issue, India has recently also expressed an encouraging mood of willingness to re-engage. This political commitment, I believe, is matched by key developed country members, including the EU, US and Japan. Director-General Lamy held a successful visit to the United States late last week and was able to report a readiness on the part of the US Administration to re-engage. My recent conversation with US Trade Representative Susan Schwab also confirms this. I have been in close and regular contact with EU Trade Commissioner, Peter Mandelson, who is also doing all he can to support these efforts. I also hope to engage Japan’s Trade Minister Nikai in Singapore later this week to build on the very constructive contribution Japan played in Geneva in July in moving the round forward.
Multilateral trade negotiations are tough but they are also worth fighting for. The Uruguay Round took longer to conclude than the Doha Round has taken so far and it involved a far less complex negotiating agenda. We now have a WTO with 153 members, about 50 per cent more members than during the Uruguay Round. The most recent addition, Cape Verde, was joining the WTO as we were gathering in Geneva in late July. The truth is that this is an institution that countries want to belong to. There are many more players, many more issues and, as I mentioned earlier, a new dynamic with the leadership role being taken by several key developing countries. Decision making in this environment can sound daunting but there are mechanisms that help. Negotiating groups like the Cairns Group and other groups can help the decision-making process. So too can small groups like the G7, because there is a recognition that these groups can help manage the complexity of the WTO’s membership and agenda.
I want to pay tribute to my colleagues in the Cairns Group for their collaborative approach. The Cairns Group met regularly throughout the talks and played a constructive and pragmatic role. I also want to thank the Australian industry representatives who were part of my delegation in July: the National Farmers Federation and other agricultural peak bodies, and representatives of the manufacturing and services sectors. I appreciated their activism, their advice and their constructive role in the talks.
We remain within sight of a conclusion to the Doha Round. What is needed now is a combination of political leadership and technical ingenuity to help complete the job. Doing so would give a major boost to the global economy at a time of significant uncertainty. It would deliver significant commercial gains to Australia right across the board. It would strengthen the multilateral trading system and, whilst it is true we cannot achieve everything we want at the multilateral level, it is important to use the multilateral system to lay the most ambitious platform as the basis for continuing trade reform at the regional and bilateral levels. The government is actively engaged in building the regional architecture. It is committed to FTAs that enhance and build on the multilateral system, not those that detract from it. That has always been Labor’s longstanding policy. It is also what we have moved to secure within the first nine months of office in government.
I have already reported to the House the conclusion of an FTA with Chile, the most comprehensive bilateral trade agreement Australia has ever entered into. We are also negotiating FTAs with China, Japan and the Gulf Cooperation Council. We have FTAs in the pipeline with Malaysia, Indonesia, India and, I hope soon, the Republic of Korea. In fact, I will be attending over the next three days an important and, I hope, final negotiating session for the ASEAN-Australia-New Zealand Free Trade Agreement. This will take place at the ASEAN Economic Ministers Meeting in Singapore. We are also working to build on these efforts regionally and I will be involved this week also in important discussions in the East Asia Summit process. In addition, we are working intensively on a strong forward agenda for APEC beyond the leaders meeting in Peru in November, engaging the next three chairs of APEC: Singapore, Japan and the US. But none of this activity detracts from our efforts to secure a strong multilateral platform for our trade reform efforts internationally, a platform that brings order to world trade and that will boost world trade and economic growth. The relationship that we build at the WTO level creates a level of trust with our negotiating partners that will ultimately boost our prospects for stronger trade reform at all levels.
We stand on the cusp of a substantial breakthrough in Doha and we need these relationships more than ever. Persistence pays with the Doha Round. The world needs a successful Doha Round. The benefits on offer are simply too important for us to allow them to slip away and the platform it creates for further trade liberalisation is too important not to secure.
I ask leave of the House to move a motion to enable the member for Groom to speak for 21 minutes.
Leave granted.
I move:
That so much of the standing and sessional orders be suspended as would prevent Mr Macfarlane speaking for a period not exceeding twenty-one minutes.
Question agreed to.
Can I say how much I admire the optimism of the Minister for Trade. Speaking as an optimist, I am sure it will take every bit of that optimism if we are going to see any resolution to the Doha Round. I also join him in thanking the Australian industry representatives who were part of his delegation, particularly my old colleagues at the NFF and other agricultural peak bodies and also, of course, the manufacturing and service sector.
It is indeed a disappointment to Australian exporters and the export industry in general to see a breakdown in the Doha Round of world trade talks. The Doha Round represented a rich opportunity for Australian exporters who have much to gain from the continued pursuit of a robust trade liberalisation regime. The market-access gains from a successful conclusion to the round would have been considerable and would have benefited Australia’s traders greatly, stimulating global economic growth from which Australia could profit. The World Bank estimates that full merchandise trade liberalisation could boost global income levels by as much as US$287 billion in 2015.
The coalition understood exactly what was at stake at the Doha Round and had invested strongly in securing a positive outcome in the interests of Australian exporters and to open up commercial trade opportunities for agricultural produce, goods and other manufactures, and services. The Doha Round had the potential to open vast new markets for Australian exporters. Before the ministerial talks, the coalition had laid out objectives that the minister must meet in order to secure a positive outcome for local exporters. These objectives included dismantling farm subsides in the EU and the US; overcoming barriers in Europe to new opportunities for Australian agricultural exports; slashing applied tariffs in all markets; preventing special exclusions for certain products and long lead times; and, finally, ensuring new opportunities for agricultural exports, manufacturing and services in developed and developing nations. So, yes, it is indeed a disappointment that the global free trade talks have failed.
I have not received a briefing from the minister so I do not fully understand the depth of the cuts that were being offered, particularly the cuts to US trade subsidies. But it is my understanding that, based on current commodity prices, those cuts proposed and outlined by the minister may in fact not have had a great deal of impact in current economic times. I was not given the opportunity to understand what the coefficient that was going to be used on tariff reform was going to be set at or what its potential impact on industries such as the automobile industry was going to be. I look forward to having it explained to me what services concessions were going to be achieved, which countries we would get those concessions from and which countries would actually allow us better services access. But all that lies in the future.
Beneath the disappointment lies a fundamental issue: the way this government has pursued trade policy. The collapse of the round held recently in Geneva has exposed the weakness of the Rudd government and its chaotic, haphazard and politically motivated approach to trade. During its nine months in office this government has repeatedly gambled with the futures of Australian export industries and the investors in those industries by taking a narrow approach to trade that has undermined the pursuit of bilateral free trade agreements. The trade minister has told the House today that this is his sixth ministerial statement. But, as with everything we have seen from this government, those empty words have delivered nothing for the Australian businesses and families involved in exporting. The minister has omitted to mention that, even after six statements, the government has been caught out with a flawed trade policy that in the wake of the collapse of the Doha talks has left Australian exporters in a precarious situation. The member for Hotham speaks ad nauseam about being ‘so close’ to a deal on Doha, but we on this side of the chamber know that ‘so close’ is nowhere near good enough. Do you think the Australian pace bowler Stuart Clark takes solace after every delivery by saying to himself, ‘That was so close’?
You never got on the wicket!
Madam Deputy Speaker, I did not get on the wicket because the Minister for Trade, who is at the table, did not have the decency to invite me, despite the fact that the previous government took him to trade negotiations on numerous occasions.
Did not!
I will check the record for you, Member for Hotham, and see what it comes up as, but I understand you did quite well. That aside, there is no point rehashing what could have been. We need to give some comfort to our exporters by showing them that this government has something to deliver to them in the future. The minister cannot lament what could have been. He is in the position to effect change and must take responsibility for trade policy. He cannot hide behind reviews and David Mortimer forever.
The minister is correct in what he says about trade: it does matter. It matters a great deal. It is a pity that he has not carried this through in delivering a clear, coherent trade policy that allows exporters to plan with certainty and apply for EMDG with certainty. Instead of embracing a broad and comprehensive trade policy that incorporated both Doha and new free trade agreements, the Rudd government has taken a policy approach that has dismissed the benefits of FTAs and so compromises the opportunities available to Australian exporters. Exporters are now paying the price of a policy based on Labor ideology rather than on an understanding of the reality of world trade reform. The trade minister’s inability to put forward a coherent and achievable trade policy has left the Rudd government scrambling for a backup plan while Australian exporters are left high and dry. Remember that it was department officials who told Senate estimates in June that they had not been instructed to work on a backup plan should the Doha Round talks fail.
We have repeated evidence of the contempt in which this government has held bilateral free trade agreements. The Prime Minister claimed in 2006:
Multilateral trade liberalisation must be prioritised to number one, two and three—bilateral FTAs come in my view a distant fourth.
Then in 2007 the trade minister said before this House:
Bilateral trade deals are a very poor second cousin to multilateral or regional agreements.
But, while this government has been playing Russian roulette with the livelihoods of Australian exporters, free trade agreements negotiated under the previous government continue to deliver for exporters. The coalition government delivered FTAs, including those with the United States, Thailand and Singapore, and also did the heavy lifting on the preparation of the Chile FTA.
The US FTA is delivering real benefits to Australian industry and consumers. As well as providing enhanced market access for Australia’s services, manufacturing, agriculture and resources sectors and progressively eliminating tariffs on goods, it also works to make these sectors more productive by stimulating investment. Although the US FTA is in its early years, exporters have already taken advantage of the improved access that it provides, with significant increases in our dairy, lamb, mutton and orange exports.
The government cannot continue to base its trade policy on ideology. After nine months of reviews and policy confusion this government must get serious about trade policy. The Minister for Trade and the Prime Minister cannot cut and run or hope for the best.
On top of Fuelwatch, ‘grocery watch’, ‘childcare watch’, ‘obesity watch’, ‘alcopops watch’, ‘job-loss watch’, ‘tooth watch’, ‘pension watch’ and a whole range of other ‘watches’, we now have ‘trade watch’. There is simply too much at stake to just stand there and watch. There are enormous opportunities available for Australian exporters with a range of trading partners, especially China and South Korea—a market that a non-government study has shown could be worth an extra US$22.7 billion to Australia’s GDP. But they are not gains that can be won by an expensive photoshoot or by offering a token reference to bilateral agreements during overseas trips.
I agree with the member for Hotham, who, 12 hours after the Geneva meeting, stated that the breakdown in the Doha Round does not bode well for the Copenhagen summit on climate change next year. He conceded:
… if you think about it, we’re just about to get into the climate change discussions.
… … …
If we can’t resolve trade talks that recognise the balance between developed and developed countries and get stuck on a single issue, we’ve got to find a better mechanism to take this forward …
Unlike climate change negotiations, which essentially impose costs, Doha trade talks are about creating winners, especially in developing nations. The Doha multilateral trade round highlights the perils of reaching a global climate change deal without China, India and Brazil. As we work forward, we must not be deluded about just how difficult the tasks of resolving the Doha Round and achieving multilateral climate change reform are going to be.
Despite international support, the Doha Round of multilateral free trade has collapsed. And so the Doha Round rolls on unresolved, which is why the coalition government pursued FTAs and why the coalition opposition continues to pursue the policy that trade negotiations need to be based on both multilateral and bilateral trade reform. The World Trade Organisation remains an important framework for delivering further trade liberalisation. We should not resile from our commitment to trade liberalisation or use the breakdown in the Doha talks to fragment any other policy. We must work harder on free trade agreements, and the government must act quickly before Australian exporters pay the price, yet again, for its current policy chaos.
by leave—I move:
That the bills be referred to the Main Committee for further consideration.
Question agreed to.
I point out to honourable members that the member for Fairfax, the Chief Opposition Whip, supports this motion.
The Speaker has received a letter from the Leader of the Opposition proposing that a definite matter of public importance be submitted to the House for discussion, namely:
The collapse of confidence in the Australian economy and the fact that Australians are worse off since the election of the Government.
I call upon those members who approve of the proposed discussion to rise in their places.
More than the number of members required by the standing orders having risen in their places—
In November last year, when there was a change of government, the incoming government was given an economy that was described as the envy of the world. The Economist magazine in fact described the Australian economy as ‘the wonder down under’. After 11½ years of solid economic management by the coalition government, real wages, business and consumer confidence and economic growth were all up; interest rates were lower than they had been under the last Labor government; inflation was consistently between two and three per cent—the midpoint of the band given to the Reserve Bank of Australia; and unemployment had reached a 34-year record low. Now, some nine months after the election of the Rudd government, Australians are worse off than they were in 2007.
According to ABN AMRO and also the Reserve Bank of Australia, net household wealth in Australia—in plain language: what each of us is actually worth—dropped five per cent in the first six months of this year. Every Australian is, on average, five per cent less wealthy, less affluent, than he or she was when the Rudd government was elected. In contrast, in 2007, net household wealth increased 11 per cent. In the last year of the coalition government the average Australian increased his or her wealth by 11 per cent. In contrast, in the first six months of the Rudd Labor government their wealth has been cut by five per cent—superannuation savings, superannuation accounts, the value of our homes and the value of the share market. In addition to that there were cost-of-living pressures. At one stage, petrol was more than 40c a litre more expensive than it was when there was a change of government. There were increases in the cost of groceries, cost-of-living pressures in rents and a whole variety of challenges that Australians faced in everyday life.
The reality of it is that in the National Australia Bank survey, and in the Melbourne Institute-Westpac survey, business confidence is now the lowest that it has been since 1991—since the depths of the recession given by the last Labor government, a recession which Australians were told we had to have. Similarly, consumer confidence is the lowest it has been since 1991. In the first six months of this year, retail had the worst start that it has had in 30 years. We had four of the first six months of the year with falling retail sales, and a full one per cent drop in the month of June alone. The rate of growth in business lending in January this year was 24 per cent; by June it was growing at only four per cent. House lending for new homes was 9.9 per cent in June and the lowest it has been in 26 years. Personal lending growth in June, at four per cent, was the lowest it has been since 1992.
When it comes to business and what it actually believes in terms of government policy and the way ahead, I draw the attention of the House to two surveys in particular. The first is the Sensis small business survey of 1,800 small businesses for May. Only 10 per cent of 1,800 small businesses—employing 3.8 million Australians—had confidence in the policies of the Rudd Labor government. The other survey is the Dun and Bradstreet survey of business expectations for the September quarter—in other words, what does business expect; where is business confidence going? The survey shows that business has record lows in confidence for sales, for profits, for employment growth and for capital investment. What that means for average Australians is that the men and women who take risks and who invest in the creation of jobs have a bleak outlook for Australia’s economic future for the next quarter and beyond.
The question is: why are we in this circumstance? In the pre-election year fiscal outlook, the inflation forecast for this year was 2.75 per cent and for the following year it was 2½ per cent. Then, in December last year, we had a quarterly inflation figure of 3.6 per cent. What then happened was that the Prime Minister and the nervous man that is our Treasurer sought to talk up an inflationary crisis. What they endeavoured to do was to provide political cover for increased spending, in the budget delivered in May, to fund election promises. We had the spectacle of the Treasurer of this country, the day before the Reserve Bank had a meeting to consider whether or not it would change interest rates, describing inflation as being ‘a genie out of the bottle’. If the Treasurer of Australia says that, what do you think the Reserve Bank is likely to do? What it did was increase interest rates by 25 basis points. That bullish behaviour from the Reserve Bank, which actually considered a 50 basis point rise—that is half a percentage point—at its February meeting, was encouraged and egged on by the government to tighten monetary policy and increase interest rates.
Now we are in the position where we have had a budget deliver nearly $20 billion in tax increases. The average Australian is not an economist. The average Australian is an economist when it comes to kitchen table economics—trying to feed, clothe and house children, trying to put petrol in the car. But the average Australian does not have to have an economics degree to know that if you increase the taxes on cars, if you increase the tax on alcohol, if you increase the tax on computer software, you are going to increase inflationary pressures. But that is what the government did—a typical Labor government: increase spending and increase taxes at the same time that a $22 billion surplus is going to be delivered, thanks to the good economic management of the previous coalition government.
The situation this country is now in is this: the United States economy is faltering and has significant further challenges with asset devaluation and other things that will emerge over the next six to 12 months. It has been the source of much, but not all, of the global liquidity crisis. The UK economy is slowing sharply—very sharply. A number of the European Union economies are going into recession. Some think that the Chinese economy may well slow more than some analysts think will occur. We have already seen an impact in terms of nickel and zinc in Australia, with 450 jobs to be shed in Broken Hill as a consequence, in part.
Today the Prime Minister said the growth in the Chinese economy and the improvement in the terms of trade were important for Australia’s resources sector and would hold up the Australian economy. So the first thing is that we have a slowing global economy. The second thing is that the government, having described that 3.6 per cent inflation figure for December as a crisis, now has a situation where our headline inflation rate is currently 4.5 per cent—that is after six months of economic management from Mr Rudd and our nervous Treasurer—and the Reserve Bank of Australia is now forecasting inflation for this December to be five per cent. A figure of 3.6 per cent was recklessly and vandalistically described by this government as some sort of inflationary crisis. After not even a year of the government having their hand on the tiller of the $1 trillion Australian economy, the Reserve Bank is now forecasting a five per cent inflation rate for December.
But it is worse, because growth is now slowing. The Reserve Bank is forecasting two per cent growth for December. In other words, the government, which set out to slow the growth in the Australian economy—which we as sound economic managers said in plain language at the start of the year would mean Australians losing their jobs—and the Reserve Bank have slowed the Australian economy to the point where they have completely destroyed business and consumer confidence. And, worse still, we have growing unemployment. These people opposite lecture us about workers’ so-called rights at work. The first right is to have a job. The first right is to be able to get out of bed and be confident you can keep your job. There have been 930 jobs lost from Mitsubishi, 500 jobs from National Parts, 1,500 jobs from Qantas, 600 jobs from Insurance Australia Group, 630 jobs from Don Smallgoods and 685 jobs from Starbucks. You might find it funny but we do not. Those men and women who have lost their jobs will not be able to meet their car loans, meet their mortgages and look after their families. One hundred and eighty jobs have gone from Cadbury and 550 jobs have gone from Boeing—and it goes on and on and on. They are Australians and they deserve better economic management than they have received from this government.
That is the environment that we are now in. The government put $20 billion of taxes in the budget, telling Australians that their No. 1 priority was to fight inflation. And what have we got after a year in government? The Reserve Bank says that the outcome of the government’s policies will be an inflation rate not of 3.6 per cent but of five per cent—a slowing economy. We might have a very hard landing in South Australia, Victoria, Tasmania and New South Wales—and most people know damn well what that means.
Further to that, the government has created those tax increases when it has a $22 billion surplus plus $40 billion channelled into slush funds—with no transparency, no market evaluation that we are likely to see and no market contestability—for bailing out failed Labor states that over the next four years are going to increase their debt by $70 billion. We are lectured here about the importance of a $22 billion surplus—can I remind the government that it is not their money; that money belongs to Australians—and another $40 billion is going into slush funds at the same time the states are increasing debt by $70 billion over the forward estimates. Where is the logic? There is none.
We are opposing these tax increases in the budget for a number of reasons. First, we believe in lowering taxes, not increasing taxes—and that is why we will cut the excise on petrol by 5c a litre. There is no argument for increasing taxes. If you are fighting inflation you do not increase taxes. The second thing, Madam Deputy Speaker Burke, is that the economy is slowing very quickly. There are people in your electorate who will suffer very much as a result of that. People will suffer in all of our electorates, but more so in yours than in mine and more so in the electorates of many of those opposite and many of those sitting behind me. People will lose their jobs as a result of what is happening.
There is a very strong argument that these measures, which we will not support in terms of tax increases, will actually assist the economic environment that we are in. The Reserve Bank is, according to its minutes, about to look at reversing monetary policy, having raised it earlier in the year, to try and stop the slowing of the economy as a consequence of what the government has done. We believe very strongly in solid economic management. We do not believe in higher taxes. We do not believe in reckless, vandalistic talk about inflation. We do not believe in putting pressure on the Reserve Bank to increase interest rates rather than reduce them. It is time, and it is necessary, for there to be an economic statement to give confidence to business and investors in this country about the government’s policy settings for the way ahead. (Time expired)
When we hear such sophistry from the Leader of the Opposition, it is little wonder that the confidence of the Australian people in the economic management skills of those opposite has plummeted. Is it any wonder that we have seen the confidence of the Australian people in the economic management skills of the people who up until a short time ago formed the government of this country go through the floor?
We have seen confidence in the Leader of the Opposition sink because, on his watch, he has allowed the economic credibility of his party to be cast asunder. We see a Leader of the Opposition who is determined to blow a hole in the fiscal policy of this government and undermine its efforts to bring government expenditure under control. We have just heard again the sophistry of a Leader of the Opposition who expects the Australian people to agree that it would be responsible to raid the budget surplus by $2 billion a year to deliver $2.50 a week—if all the petrol tax excise cuts were passed on.
We know the member for Wentworth thinks that is sophistry. We know he thinks it is bad policy. We know he is more responsible than the Leader of the Opposition. We know he thinks he would do a better job as the zookeeper than the current person who sits opposite. We know he thinks that he would bring more economic credibility to those opposite. The Leader of the Opposition spent the last 15 minutes desperately trying to convince the House and the Australian people that the decline in Australian consumer confidence is the result of the actions of the Rudd government. That sort of short-term, glib populism will not return his economic credibility.
Across the OECD, consumer confidence has fallen to its lowest level in 30 years. In the United States the Conference Board index, the most prominent measure of consumer confidence, has fallen more than 50 per cent since the global turbulence began and is at its lowest level in 16 years—just as it is in Australia—while an alternative measure, the University of Michigan index, has it at around its lowest level in 28 years. In the United Kingdom, consumer confidence has fallen to its lowest level in 16 years. In New Zealand, consumer confidence has fallen to its lowest level in 17 years.
We are seeing growth slowing around the world. The UK did not grow at all in the three months to June. Japan, Germany, France, Italy and Canada all recorded negative growth in their most recently reported quarters. And the Leader of the Opposition contends, with his usual earnestness, that the decline in consumer and business confidence in Australia is for reasons entirely different to those in the rest of the world. The confidence of the rest of the world has gone down for one reason, and our confidence has gone down for an entirely different reason—it is all due to the election of those horrible socialists on 24 November!
The Leader of the Opposition would have us believe that in the rest of the world confidence has fallen for a very different reason. In Australia it is not because of the financial turbulence, the oil price shock and the increase in food prices around the world. They might be the reasons in the rest of the world, but there is a different reason here in Australia. Either he thinks that or he thinks the Rudd government is responsible for the decline in confidence around the world. Maybe that is his argument. Maybe he thinks that the people of Michigan and Denver have been waking up thinking, ‘I’m not very confident about the state of the world economy because of what Kevin Rudd is doing down in Australia,’ or that the people of Dunedin and Christchurch have been waking up saying, ‘We have the lowest confidence in 17 years because of those terrible decisions that Wayne Swan is making in Australia,’ or that across Europe, Russia and Japan, where confidence has fallen, it is all down to the Rudd government. That is the sort of argument that we might expect from the Leader of the Opposition, who casts around for cheap, populist and glib lines to save his leadership as the zookeeper, to save his hide. That is what we have come to expect.
Is he really serious? He comes into the House and argues that for some reason the Rudd government is responsible for negative returns in superannuation. He does not mention that we have seen global stock market downturns of 20 per cent which have seen pension fund returns down across the world. Again, it is a similar argument: there might be a reason around the world for that but it is a different reason in Australia. Really, how can we take that sort of glib populism seriously? As I said, is it any wonder their economic credibility has gone out the window?
Of course, part of the Leader of the Opposition’s narrative—and we heard it again today—is that everything was rosy until 24 November. Do you remember what it was like before 24 November? Australian working families had never been better off! Interest rates were coming down! The Leader of the Opposition said interest rates were coming down under them, which came as a great shock to Australian mortgage holders, I must say. We had the shadow Treasurer saying interest rate increases were overdramatised, which again came as a shock to those who were paying those increased interest rates; they thought it was quite legitimate to be concerned about them. But, of course, the Westpac consumer sentiment index hit its high point in May 2007. By the time of the November election it had already declined from 124 points to 110. It has continued its decline from then—somewhat unsurprisingly, given world events.
Talking of sophistry, I noticed that the Leader of the Opposition was out and about on the weekend, and he said this:
What are the economic circumstances facing Australians at the moment with falling growth, higher unemployment and it seems higher inflation?
Welcome to the party, Brendan! He has finally worked out that we have heightened inflation in Australia. We had the Treasurer point this out some months ago, and the Leader of the Opposition and the shadow Treasurer were wandering around saying: ‘Isn’t it terrible that the Treasurer talks about inflation? If only he’d stop talking about inflation, the problem would go away.’ Ostrich economics at its worst—stick your head in the sand, do not talk about inflation and we will not have a problem.
The Leader of the Opposition and the shadow Treasurer regularly insult the Governor of the Reserve Bank of Australia. They say to the Governor of the Reserve Bank, ‘You are so stupid that you just increased interest rates because the Treasurer made a statement the day before your board meeting.’ What an insult to one of the finest public servants this nation has! It insults the intelligence of the board of the Reserve Bank, who have done a magnificent job over recent months in the financial turbulence that has been going on in the nation. The Leader of the Opposition and the shadow Treasurer insult the intelligence of the Reserve Bank and the Australian people by engaging in their ostrich economics—‘just stop talking about it and it will go away’.
It seems, the Leader of the Opposition said on the weekend, that we have higher inflation. It only seems like that to him now. We have been pointing that out for months. The light bulb comes on in Brendan’s office: we have higher inflation. Finally they have worked it out: cost-of-living pressures on the Australian people are significant. At least the Leader of the Opposition has at last come to the realisation that inflation is not a charade and not a fairytale but is real and requires government action—that we have the highest inflation in 16 years. That is why the government have brought down a contractionary budget that puts downward pressure on inflation and interest rates, as the Reserve Bank has indicated.
We had the Leader of the Opposition say, ‘This typical Labor government! They just increase spending.’ I do not think he read the budget papers, because we have seen government expenditure reduced to its lowest level since 1989-90, making up for the financial and fiscal irresponsibility of those opposite, the tax-and-spend Liberals who we replaced, the people who let government expenditure increase by 4½ per cent a year, which put upward pressure on interest rates and put upward pressure on inflation, as we heard during question time. They just do not get the message. They continue to attempt from the other place to undermine our budgetary strategy to put downward pressure on interest rates and inflation. That is why we brought down a family relief package in the budget. We recognised the cost-of-living pressures on the Australian people. That is why we increased the utilities allowance for pensioners. That is why we increased the childcare rebate from 30 per cent to 50 per cent.
We know the Leader of the Opposition cannot make up his mind on an issue. We know he has trouble making a decision and sticking to it. We know he has trouble with a narrative. We saw this in the climate change debate. I think the record was seven positions in one day. But we just had four positions in one speech in relation to the world economic slowdown. We had him firstly saying, ‘Australia should be different from the rest of the world. Australia shouldn’t be affected by the consumer confidence decline. Australia shouldn’t be affected by the decline in economic growth.’ He then pointed out the slowdown in the world economy and that confidence had fallen around the world. In one speech he could not hold a narrative. No wonder the Australian people no longer know what those opposite stand for. No wonder the Australian people are wondering what the once-great Liberal Party in this country actually believes in anymore. No wonder the Leader of the Opposition is known as ‘the zookeeper’ by the shadow Treasurer. They just do not stand for anything anymore. They certainly do not stand for responsible economic management.
It has been up to this government to get government expenditure back under control. It has been up to this government to put a package in place to give relief to Australian working families, seniors and carers who are doing it tough. You see, we sit around the cabinet table thinking of ways to give Australians a better chance in times of increased inflation. They sat around the cabinet table thinking of ways to reduce people’s conditions and salaries. They sat around the cabinet table saying, ‘The Australian people have never been better off, and we’re going to rip into their conditions.’ They sat around the cabinet table saying, ‘Let’s think of new ways that we can rip up awards. Let’s think of ways we can reduce people’s ability to go onto collective agreements. Let’s think of ways that we can make life harder for working Australians.’
We sit around the cabinet table thinking of ways to get government expenditure under control and ways to put downward pressure on interest rates and inflation. That is why the Australian people chose us on 24 November. That is the defining difference between our two parties. We actually believe the Australian people deserve more of a hand. Those opposite believe the Australian people deserve less of a hand. The members opposite think that Australian working families have never been better off and, therefore, they should be made to suffer. Those opposite believed that things were so rosy on their watch that it was time to reduce working conditions and salaries. Those members opposite believed that inflation was right where they wanted it, that it was mission accomplished, that there was no more to do so they might as well start ripping into working conditions and they might as well start reducing salaries through Work Choices. That is what they believed. It continues to be a fundamental difference between our two parties, and if they continue to believe that then the Australian people will continue to believe that their economic credibility is non-existent.
We continue to hear sophistry of the like that we have heard from the Leader of the Opposition for 15 minutes—that the world economy is slowing but that should have no impact on Australia; that confidence in Australia has hit its lowest level in 16 years all because of the actions of the Rudd government. Presumably it has hit its lowest level because we have increased the childcare rebate to 50 per cent. Or maybe it is because we have brought down a family relief package. Or maybe it is because we have ripped up Work Choices. Let us have a look at the Sensis report on consumer confidence in Work Choices. The confidence of people in actually getting a fair deal in their workplaces is what has gone up since the election.
The Australian people are not mugs, but they know a mug when they see one and they know the members opposite are mugs because they are treating them like fools. They insult the intelligence of the Governor of the Reserve Bank and the Reserve Bank board, and they insult the intelligence of the Australian people. The Australian people have woken up to those members opposite.
The Assistant Treasurer has treated us to a classic tirade of irrelevance. He reminds us of his great performance with Fuelwatch, which is, I think, an emblem of the hopelessness of this government and part of the cause of this incredible collapse in confidence. Whether you look at business confidence or consumer confidence, the measures today are at all-time lows unless you go back to the ‘recession we had to have’ in the late 1980s. Times are not as tough now as they were in 1991. We hope they will not get that tough. But what we have with this government is a crisis of confidence. This is a government that has been in office for eight months, and yet there is only one government in Australia that the Sensis survey tells us business has less confidence in. Do you know which government that is? That is Morris Iemma’s government.
Morris Iemma and his colleagues have been working on hopelessness in government for 13 years. They are practised exponents of hopelessness. The Rudd government has got there in eight months. Consumer confidence and business confidence, by the other measures, are as low now as they were when business interest rates were 21 per cent. Why is that? The answer is a collapse in leadership. All during 2007 we had an outpouring of empathy from the Labor Party. There was not a shopping centre aisle or petrol station forecourt in this country in which you could not find the then Leader of the Opposition, the now Prime Minister, Mr Rudd, draping himself around, filled with sympathy and empathy. He was concerned about rising prices and he was going to fix them. Well, the empathy of Kevin07 has been replaced by the impotence of Kevin08. He has thrown up his hands. He cannot deliver; he cannot perform. That is why confidence has crashed.
The Assistant Treasurer said: ‘It’s all international factors. It’s got nothing to do with the Australian situation. There’s a global credit crisis. Confidence is down in many countries and we are no better or worse off than them.’ That is not true either. ACNielsen, as it happens, conducts a global survey which gauges consumer sentiment across 51 countries consistently. It is true that consumer confidence has fallen around the world. The survey shows that it has fallen by six points in the last six months. That is the largest single drop recorded in the last three years. But the drop in Australia was 11 points—nearly twice the average—and of the 51 countries surveyed only nine had a more negative shift in sentiment than Australia. And yet our economy is stronger than almost every one of those countries surveyed. We are not heading into recession. Economic growth is still positive. Unemployment is still at very low levels. Yes, the economy is slowing, but we are a strong economy nonetheless. Why has confidence collapsed?
At the beginning of this year the government made a very political decision. They decided they would not have any economic strategy; they would simply have a political strategy. They could see, as we all could, the looming problems of the global credit crisis. It was obvious that the collapse of the mortgage market in the United States, the lack of confidence between banks, between financial institutions, was going to put up interest rates and was going to cause lenders to have less confidence in their counterparts. It was going to mean money would be more expensive and harder to obtain—in other words, a credit squeeze.
Australia did not deserve to be hard hit by that credit squeeze. We did not create the subprime crisis. Subprime mortgages are 16 per cent of the US mortgage market. Here they are less than one per cent. Our banks are well capitalised. They are profitable. Our prudential regulation is first class. Our level of mortgage defaults is plainly higher than we would like it to be but it remains low by international standards and even low by historic standards. So we had a strong story to tell. We had a story to tell that should have enabled our markets to get the benefit of the superior economic management this economy had enjoyed over a long period of time.
A strong government, a government of leaders, a government that believes that leadership carries responsibility, would have called from the rooftops that Australia was different, that it was better and that we did not deserve to be tarred with the subprime brush. But instead we had a Treasurer who made headlines around the world when he said, the day before the Reserve Bank of Australia board met, ‘The inflation genie is out of the bottle.’ Then he said it again and again and again. He talked up inflation. He said inflation was out of control. That was the message from the Treasurer of the Commonwealth of Australia.
The Assistant Treasurer says the Reserve Bank board would be stupid to take any notice of the Treasurer. That may well be right. I think the real stupidity was on the part of the Prime Minister in making him the Treasurer in the first place, because words have consequences. The Treasurer is the man in charge of the economic management of the Commonwealth of Australia. His representatives, his secretary, sit on the Reserve Bank board. The idea that his remarks about inflation are just inconsequential political rhetoric, which is what the Assistant Treasurer was suggesting, is wrong. I think the Assistant Treasurer might want to review his remarks when he sits down with his boss a little later today. They are not just rhetoric. They matter and they made headlines around the world.
The Reserve Bank has to cope with inflationary expectations. If you have the Treasurer saying that inflation is out of control, believe me, it will become a self-fulfilling prophecy. That is the great difference. Wayne Swan, the Treasurer, is unique in the whole world. He is the only Treasurer in the world who has been talking up inflation. He was hysterically saying that inflation was out of control and egging on the Reserve Bank to put up rates. I might say that this is the same Treasurer who, now that inflation is, according to the Reserve Bank, heading to five per cent, is nervously begging the commercial banks to lower interest rates. He was egging on the Reserve Bank to put them up at the beginning of the year.
At the time that he was displaying no leadership and pursuing a shabby political strategy to blacken the economic reputation of the Howard government, in the United States, a country facing much graver economic challenges, much higher inflation, higher unemployment and much graver concerns about the stability of its financial system, the Treasurer, Henry Paulson, was doing his job. On the same day that Wayne Swan was saying, ‘The inflation genie is out of the bottle,’ Henry Paulson was saying:
The U.S. economy is diverse and resilient, and our long-term fundamentals are healthy.
… … …
While we are in a difficult transition period as markets reassess and re-price risk, I have great confidence in our markets. They have recovered from similar stressful periods in the past, and they will again.
That is real leadership. What we have seen is just political spin. Look at the nonsense we have been treated to today about tax. What about the Treasurer pretending that the budget cuts taxes? His own budget papers reveal that the budget increases taxes by over $19 billion over the forward estimates. How can he seriously suggest that putting up the prices of alcohol, cars, private health insurance and so on is doing anything other than fuelling inflation? This is an old-fashioned Labor government, just like its state colleagues—all spin, no substance, tax and spend, no leadership, politics first and national interest last.
The French king Louis XV ruled from 1715 to 1774. I doubt that there is anyone in this parliament in this day and age likely to enjoy similar political longevity. It is he who is credited with the expression ‘apres moi le deluge’—‘after me, the flood’. I think it is time that former Prime Minister John Howard put on the wig and donned the silk stockings of Louis XV because his attitude to government was exactly that: ‘apres moi le deluge’—‘after me, the flood’. It is that attitude which has bequeathed to us the economy we have now, the economy that the opposition describes in the matter of public importance before the House as ‘worse off since the election of the government’.
‘After me, the flood’ was John Howard’s attitude to the Liberal succession. We can see it in the absolute paralysis of members opposite while they wait for the member for Higgins to make up his mind: will he stay or will he go? Just last week the member for Higgins said he would not be challenging the Leader of the Opposition for the Liberal Party leadership. He has made a political career out of not challenging for the leadership. In the early 1990s he was not challenging John Hewson for the leadership and then he was not challenging Alexander Downer. He spent the last decade not challenging John Howard and now he is not challenging Dr Nelson. I told a young Labor audience last Friday, ‘If you want to get on in this country, just tell everyone you’re not challenging the leader.’ The Liberal Party’s present leadership vacuum nightmare is absolutely a result of John Howard’s refusal to plan for an orderly Liberal Party leadership succession, his selfish refusal to worry about anything other than the morning’s headlines and anything other than the next election.
‘After me, the flood’ was also the attitude which former Prime Minister Howard took to the economy. He preferred election bribes to long-term spending on education, skills and infrastructure. John Howard’s failure to produce a stronger budget surplus led to 10 successive increases in interest rates. After 12 years of John Howard, what did we inherit? Inflation at a 16-year high and 10 interest rate rises in a row, which gave Australia the second highest level of interest rates in the developed world.
The ‘after me, the flood’ attitude was even more apparent in former Prime Minister Howard’s attitude to climate change and sustainability. The present economic challenge facing Australia is in no small measure due to rising food prices and rising petrol prices, and the Liberal government failed utterly to tackle these issues. It should have been transitioning motorists out of petrol and into alternative fuels like LPG and LNG. It did no such thing. Rising food prices are a direct consequence of falling production and increasing demand.
We have seen the sad fate of the Murray-Darling. What has happened to the Murray lower lakes and to the world-quality wetlands of the Coorong is nothing short of a national disgrace. The Murray-Darling, our nation’s food bowl, is struggling because of a lack of water. That lack of water is a result of two things: reduced water in, caused by drought and exacerbated by global warming; and too much water extracted for irrigation, too much water out. Right through its term, the Howard government sat on its hands instead of taking action to protect the Murray-Darling, and its National Party members actively ran interference on any measures to reduce water from the Murray-Darling. They are still at it; I heard the member for Calare, Shadow Minister Cobb, warning just a few weeks ago against knee-jerk reactions to the plight of the Coorong—knee-jerk! For over 20 years, scientists have been warning about the need for action to protect the Murray-Darling, and while the goose which laid the golden egg has been slowly but irrevocably strangled the member for Calare has said we should not have ‘knee-jerk reactions’. Members opposite still do not get it.
Higher food prices are being driven by climate change and global warming. I have said this to the House before: global warming is the great challenge of our time. It is one of those ‘what did you do during the war?’ types of questions which our children and grandchildren will ask of us. Those opposite, having put the nation behind the eight ball on climate change and having sat on their hands while the Murray-Darling was trashed, are still at it. They sneak around this debate looking for the angle, looking for the hold like some ageing sumo wrestler, looking for the political advantage. You can hear their siren song: jobs will be lost, industries will go offshore and prices will go up. What they do not tell you is that jobs are being lost now and prices are going up now as a consequence of inaction on global warming. They refuse to face up to the conclusion of World Bank economist Nicholas Stern that the cost of inaction on climate change will be greater than the cost of action.
Having left us this legacy, the Liberal Party is no better in opposition. The shadow cabinet has said that the opposition in the Senate will oppose major elements of the government’s 2008 budget. It intends to block Labor’s budget announcements concerning condensate gas, alcopops and the Medicare levy surcharge threshold. It says that Labor did not announce these matters prior to the election and that therefore we do not have a mandate for these measures. But what is their mandate: to be economically irresponsible? Because this is precisely what they are up to in the Senate. They are trying to blow a hole in Labor’s surplus. They are trying to blow a multibillion dollar hole in Labor’s budget. If they succeed, this will put upward pressure on interest rates. The cost of this will be felt by every Australian household with a mortgage and every Australian small business with an overdraft. It is a breathtaking piece of economic vandalism.
The opposition’s attitude to Labor’s measures to tackle teenage binge drinking and our reduction of the tax slug on middle-income earners of the Medicare surcharge, which hits those earning as little as $50,000 a year, is truly remarkable. There is a strong element of personal responsibility for health care inherent in both of these measures: people who look after their own health should not be required to pay and pay and pay for people who do not. We all know that there is a problem with teenage binge drinking. The government is to be commended for seeking to tackle it. What is the Liberal alternative? They talk about a need for education and, yes, there is. But surely there comes a point at which taxpayers who do not binge-drink should not have to pay for the costs incurred by those who do and consequent upon their doing so.
You would think that those in the Liberal Party, which claims to be a party of personal responsibility, which claims to be a party of individual responsibility, would applaud these initiatives. But no, they are beholden to the private health insurance industry. They are beholden to the liquor industry. They are prepared to put sectional interest and corporate interest ahead of the public interest in better health outcomes and ahead of the national interest in a strong surplus and downward pressure on interest rates. Not only are they prepared to engage in economic vandalism, using their numbers in the Senate, but also they put forward no alternative at all. This is nothing short of economic sabotage. I remember something similar going on when I first entered the Victorian parliament. The Liberal-controlled Legislative Council refused to pass any of Labor’s measures to raise revenue, then attacked the Labor government for failing to balance the budget. They interfered in Labor’s attempt to balance the books through asset sales. A community body sprang up opposing asset sales. I assumed at the time that it was a left-of-centre group. After 1992, Jeff Kennett came to office and engaged in asset sales which absolutely dwarfed those of the previous government. I looked around for this community group in vain. It had melted into the night, disappeared without trace. It was just a Liberal Party front, aimed at ringbarking the Victorian economy.
That is what is happening now. Those in the Liberal Party are seeking to sabotage our economic strategy in the Senate. Revealingly, tellingly, the matter of public importance before the House says nothing about what the alleged sins of the Rudd Labor government are; it simply refers to outcomes. Did they produce an alternative in their budget reply? No, they did not. Have they produced an alternative since? No, they have not. It was entertaining to hear the opposition calling for Labor to make an economic statement. We have—it is called the budget. The opposition should pass our measures. Until it does, it will stand condemned by the Australian people for the naked, insincere, cynical opportunism it is showing in this parliament. This matter of public importance should be dismissed for the naked, insincere, cynical opportunism that it is.
I am delighted to speak on today’s matter of public importance about the collapse of confidence in the Australian economy and the fact that Australians are now worse off. I shall reflect on the housing market and the housing situation in my comments. I was at a debutante ball in Boree Creek on Friday night. Boree Creek is a small town in the Riverina. There having been several years of drought, one of the farmers said to me: ‘Confidence is a very fragile thing; it’s highly desirable. Once it’s lost, it’s very hard to regain.’ He was talking about confidence in the face of drought. He said: ‘We look to our leaders to give us that confidence, to give us hope and to give us a reason to get out of bed in the morning when all else seems impossible.’ I agree entirely with the shadow Treasurer and the Leader of the Opposition. What the Prime Minister and the Treasurer have done is to take away that feeling of hope and confidence from a lot of Australians by continually reinforcing just how bad things are.
I want to raise this interesting point about the surplus and ask the question: at what point do the government increase a surplus to the stage where they are taking too much from the Australian people so that they might in fact exacerbate an economic downturn? I have just had a look at the forward estimates. Over the next five years, the total budget surplus is projected to be $96 billion. That is a figure that resonates with a lot of people because it was the size of the debt that the Howard government inherited when it came to office in 1996.
There are pensioners who are struggling in my electorate and in everyone else’s electorate—yours too, Madam Deputy Speaker. If we are projecting these extremely healthy and fast-growing budget surpluses over the next five years, I reckon those pensioners would want to know at what point the government is going to stop taking their money and squirrelling it away in various funds, deciding that it knows best about what to do with it. This is a classic Labor government ploy: tax, spend and interfere. So, on behalf of the pensioners in my electorate, many of whom are cashing in the equity in their homes, the capital in their homes, in order to meet daily living expenses—it is called a reverse mortgage—I ask the Treasurer: when is enough enough? If he thinks that increasing the price of gas, private health insurance and alcohol is actually going to make a difference, he is wrong. It is going to make things worse, as we have clearly demonstrated. You could ask anybody who has got basic economics knowledge and they could tell you that increasing prices will fuel inflation.
Leading on to inflation, one of the main components of the CPI is rents. As the shadow minister for housing, I am interested in rents. I have seen an unbelievable increase and tightening in the rental housing market. Since the election of the Rudd government, median rents have gone up all over Australia. In Melbourne and Perth they have gone up 17 per cent. One of the reasons for this is a shortage of rentals—but why? People are not confident to enter the housing market. People are losing confidence, so they are staying in their rental accommodation and they are not taking the step to buy their first home. The vacancy rates that we are seeing in our major cities are unbelievable—0.9 per cent in Melbourne.
I have just finished visiting some of our major cities to look at the whole problem of rent and housing. I was horrified to hear of rental auctions, to hear of racketeering and profiteering by people who are renting out rooms in their houses. People are coming to these auctions—they are not official, of course—with six months cash in advance and are saying, ‘Please secure me the house.’ It is okay for those who have got the money, and it is okay for those who might be considering their next investment or their next step, but it is not okay for social housing tenants. This is flowing all the way down the housing market until you get to the people who are most deserving of public housing or social housing—people who cannot get a roof over their heads, who are being exploited, who have been racketeered and who are paying astronomical dollars for one room in one house. It is simply not good enough. It is a function of the housing market, the lack of confidence in the economy and the tightening of the rental market, which relates to interest rate rises. Housing affordability is worse—if I can use that expression—than it has been for a long time. It has decreased for the third straight quarter in a row, with the proportion of family income required to meet monthly loan repayments increasing to 37 per cent in the March quarter. (Time expired)
Today we heard the Leader of the Opposition—and I am advised that, at last check, he is still the Leader of the Opposition—making unqualified, inaccurate and hypocritical statements about the state of the Australian economy. If he wants to talk about a loss of confidence then let’s talk about a loss of confidence. The greatest loss of confidence happened in November last year when there was an absolute collapse in voters’ confidence in the former Howard government. There was a collapse in the former government’s ability to take this country forward in a fast-changing and challenging world. The voting population said quite simply that the last government—in terms of broadband, workplace laws and climate change—simply were not up to it. That is where we have seen the greatest collapse in confidence in the last 12 months.
We all remember the former Prime Minister, the former member for Bennelong, telling everyone that Australian working families had never been better off. The member for Bradfield, the current opposition leader, was using those tactics again today in the vain hope that people would somehow forget the absolute hubris that was displayed when the Liberal Party were last in government. Those on the other side of the House think that they are the word on economic management and that Australia cannot do without them. The truth is: we can do without them and we are moving ahead confidently without them. Our government are confidently putting into place measures to fight the 16-year high inflation levels left by the Liberal-National coalition. Our budget, which the opposition seeks to hamper and block for the sake of hampering and blocking, contains a raft of actions to strengthen the economy and to adapt it to the fast-changing world. We are putting money into education and making sure we improve our health system and our building infrastructure—something that the former government completely neglected over the last 12 years. These are things that the budget, delivered in May, is all about.
One of the cornerstones of responsible economic management is to have a responsible budget. If we are talking about confidence in the Australian economy, what do you think? Is it a $3.7 billion black hole or is it a $6.1 billion black hole? We are not quite sure where the opposition are at the moment in terms of trying to wreck the responsible budget that was brought down earlier this year. Does the Leader of the Opposition, or perhaps the member for Wentworth, really think that driving a Ferrari through a responsible budget will make our economic position any better? You will never hear us, on this side of the House, say that Australian working families have never been better off. We understand that working families are doing it tough. That is why, in this budget, we put forward a $55 billion package to assist those who are doing it tough—be they pensioners with the utilities allowance, be they working families with tax cuts, or be they people with children in child care. We also made sure that we had a budget surplus of $22 billion, because we on this side of the House recognise that inflation is the real evil. Inflation is the real enemy for working families and for people on fixed incomes, and we need to fight inflation by making sure that we have a responsible budget.
If the opposition think that Australians were better off under Work Choices and under a government that ignored 12 warnings from the Reserve Bank about high inflation, then there are serious problems with delusion on the other side. Attacking working families’ rights does not make for a better Australia. There is a lot of hypocrisy coming from the opposition benches, and we have had three great examples of it this afternoon. The opposition spent all year attacking the government, saying that we were talking down the economy. But what is this MPI about if it is not about attacking the economy and trying to talk it down? We heard last night on Four Corners the member for Wentworth being quoted as saying the Liberal Party has become a zoo. When I look opposite, I can see plenty of mountain goats, maybe a few snakes and the odd zebra. I actually hate to speculate who the head baboon may be, but let me say on behalf of the non-zoo side of parliament: we will continue to run a prosperous economy with the needs and aspirations of working families at the heart of our approach. In a time of global economic uncertainty, we need a measured approach. We need tough decision makers, not grandstanders. We need responsible managers, not irresponsible blockers of budgets.
Order! The discussion is now concluded.
Mr Speaker has received a message from the Senate informing the House that the Senate concurs with the resolution of the House relating to access to records of the Joint Standing Committee on Foreign Affairs, Defence and Trade inquiry into the loss of HMAS Sydney.
Message received from the Senate informing the House that the Senate does not insist upon its amendments Nos 4 and 5 disagreed to by the House.
Message received from the Senate returning the bills without amendment or request.
Mr Speaker has received messages from the Senate acquainting the House of the appointment of senators to certain joint committees:
Messages from the Governor-General reported informing the House of assent to the bills.
Mr Speaker has received advice from the Chief Opposition Whip nominating members to be members of certain committees.
by leave—I move:
That:
Question agreed to.
I present a letter to the Clerk from the Registrar of the Federal Court, forwarding in accordance with the Commonwealth Electoral Act a copy of the order made by the Federal Court of Australia sitting as the Court of Disputed Returns dismissing the petition relating to Mitchell v Bailey—Order, dated 11 July 2008.
Debate resumed from 26 June, on motion by Mr Garrett:
That this bill be now read a second time.
It was quite a few weeks ago that I was speaking on the Great Barrier Reef Marine Park and Other Legislation Amendment Bill 2008. It is a bill of great importance, but in deference to the newly elected member for Gippsland I will make my remarks on the bill very short. I know what it is like to be waiting in the wings to give that first speech.
I will pick up from exactly where I left off in my previous contribution. This bill further establishes the Environment Protection and Biodiversity Conservation Act 1999 as the basis for the environmental impact assessment and approval of actions in the marine park, involving significant environmental impacts. The marine park itself will now become a matter of national environmental significance under the EPBC Act. These changes come with accompanying powers of investigation and collection that allow inspectors to use the investigatory related powers of the EPBC Act. They also allow for the repealing of then relevant and now redundant powers in the Great Barrier Reef Marine Park Act. To complement the powers of investigation and evidence collection, the bill is importing a broader range of enforcement approaches, including new administrative mechanisms, expanded availability of infringement notices and the introduction for the first time of civil penalty provisions.
In conclusion, I would like to recap a bit of what I said at the outset. This bill establishes a modern framework for the administration of the Great Barrier Reef Marine Park Act. It does not duplicate other legislation but puts in place robust and streamlined environmental impact assessment and permit processes. It enhances the capability for investigation and evidence collection; provides a wider range of enforcement options; enhances deterrents and encourages more responsible use of the marine park; establishes new emergency management powers, allowing the Great Barrier Reef Marine Park Authority to respond to incidents presenting a serious risk to the marine park; and honours an election commitment to reinstate a requirement for the authority to include an Indigenous member.
At the beginning of my contribution, I said that it is not very often that one gets the opportunity to speak on a matter of such profound importance to the marine life of Queensland and that is also a matter of national importance and of international significance, given its World Heritage status. That is the Great Barrier Reef. I commend the amending bill to the House.
by leave—I move:
That standing order 76 be suspended for the duration of the first speech by the Member for Gippsland on the second reading debate on the Great Barrier Reef Marine Park and Other Legislation Amendment Bill 2008.
Question agreed to.
Order! Before I call the honourable member for Gippsland, I remind honourable members that this is his first speech. I therefore ask that the usual courtesies be extended to him.
Mr Speaker, it is a great nation where the son of a Sale plumber finds himself in such magnificent surrounds and with such an important job to do on behalf of his community. We all, I know, arrive at this place through different life experiences which have shaped our views, but I count myself blessed to have been born in Gippsland, a place that I regard as the greatest region in Australia. I am also blessed to have grown up in a loving family home in Sale, with the support of a large extended family and of friends. As one of five kids, I had a very rich family life. My parents, Jim and Lois, taught me the value of respecting others, of hard work, of honesty and of taking responsibility for my own actions. My father, who passed away last year, also demonstrated the importance of making a contribution to the community, always being one of the first to volunteer for school councils and local organisations.
Finally, I count myself blessed to be here today in the company of my beautiful wife, Julie, and my four wonderful children Morgan, Jamieson, Clancy and Lachlan. I believe that government policies which help families stay together, which strengthen the family unit, will help build stronger communities in the future.
But I am here, first and foremost, to represent the people of Gippsland. For me, it is an enormous honour and privilege, and it is something that I will never take for granted. I make that point at the outset because I anticipate that there will be many challenges facing the Gippsland region in the near future, and I make no apologies for my parochialism in standing up for the Gippsland community. As I am about to highlight, the Gippsland region is blessed with outstanding natural resources, and it makes an enormous contribution to the wealth of our nation. But we are exposed to government policy directions on a range of issues which have the potential to shape my electorate in the future. The most basic test that I will be applying to my deliberations in this place will always be to ask myself: what is in the best interests of the people of Gippsland? In applying this test, I will continue to seek the counsel of many Gippslanders whom I respect for their wisdom, their common sense and their personal integrity.
I join the House today as the eighth person to represent Gippsland since Federation. I am deeply humbled by the vote of confidence that I achieved in the recent by-election. As we have all experienced in by-elections and elections themselves, they are testing times for candidates, their families and their supporters. The Nationals, I believe, passed this latest test with flying colours. I take the opportunity now to thank party members, our supporters and my family and friends again, who did so much to assist my campaign team; and I thank so many of you for joining me here today. It was such an outstanding team effort, and it is great that you could be here for this special occasion.
I believe that the Nationals and the Country Party have held Gippsland for 86 years for some very good reasons. I think it is an endorsement of our style of grassroots representation. Having worked closely with state leader Peter Ryan—who is also here today—and the state team for several years, I have come to appreciate that the Nationals are at their very best when they are standing up for people who choose to live outside our capital cities. Our record of success in Gippsland is proof that we must be doing something right. For me, that something right was directly linked to the service of our previous members, in particular Peter McGauran and Peter Nixon. I have had the privilege of working with both men over a period of time. Their contribution—over a combined total of 47 years—is impossible to measure in just the length of roads sealed, the buildings constructed or in simple years of service. To me, their legacy to Gippsland is contained in the leadership that they displayed and their willingness to serve our community and our country at the very highest level, often at significant personal cost.
In my involvement in community groups and in politics at a local, state and now a federal level, I have formed the view that we must do more to encourage our young leaders of the future to get involved in community affairs and the formation of public policy. We need to stimulate the interest of younger people in the importance of making a contribution to their community, whether it be through organised politics or through serving local organisations. As I look around Gippsland, I see that there are too few younger people taking up the challenge of community service, and their involvement in public life is suffering as a result. Rather than accuse them of a lack of interest, I believe that we are at least part of the problem. Participation in structured parties is by no means the only way to make a contribution to public life, but I fear that people are switching off politics because they do not like what they see here.
If we want young people to serve our community as elected representatives, we must become better role models ourselves in the future. We must demonstrate through our words and through our deeds that serving the community through an elected office is something which is worth while and an important way to make a meaningful contribution to our nation. I think we owe it to the Australian public to conduct ourselves in a manner which reflects very highly upon the offices we hold and demonstrates our respect for the democracy that we have inherited. Who can blame people for disengaging with Australian political life when their most direct experiences are the nightly news broadcasts of question time or student groups who witness the spectacle sometimes from the public gallery? I believe there will always be room for robust debate, but it does not need to descend into theatre and farce. I agree with the Speaker’s comments earlier today that it would improve the standard of question time if there was less baiting and sledging. I am reminded of a contribution to the state parliament of Victoria made by a good friend of mine, the Hon. Damian Drum, and I quote:
What we believe in as political party members are our opinions. Our job is to attend parliament and to argue those opinions with all the passion and enthusiasm we have, but they are still just opinions. To think that either side has a mortgage on what is right or what is wrong is absolute folly. What both sides have a mortgage on is a responsibility to respect each other’s opinions.
As I said at the outset, it is an extraordinary honour and a privilege to serve our nation in this parliament, and I feel a very strong sense of responsibility to respect this parliament, to respect all who serve their communities and to fulfil my role to the best of my ability.
I believe my main role in this place is to stand up for the people of Gippsland and give them a voice. Gippslanders are telling me that they want results, not petty political games from their elected representative. In the short time since I was elected, many Gippslanders have contacted my office or spoken to me personally. They are concerned about the future of our region. There are many issues and challenges we face as a nation and as the community of Gippsland: government policies in relation to climate change; the increased cost of living and the impact it is having on families, pensioners, carers and low-income earners; the need for ongoing investment in better education, child care, aged care, health services and sporting facilities; our desire for safer roads and improved access to public transport; the impact the drought and the economic downturn are having on local workers, farmers and small business owners; and the need for infrastructure investment in transport and water security that will help Gippsland prosper in the future. In fairness, the community of Gippsland does not expect a new government to solve all those issues in just 12 months. But, equally, Gippslanders do not expect a new government to keep looking backwards and blaming the previous administration.
Our treatment of people who are socially or economically disadvantaged will be one of my main focuses during my term in office. Despite our incredible natural resources and significant wealth, Gippsland performs poorly on a range of socioeconomic indicators. I want to spend my time in office fighting for a fair share of resources and fighting for a fair go for all Gippslanders. We live in a wealthy nation—so wealthy in fact that we can afford to have a conscience. As individuals, many of us listen to our consciences—we volunteer our services and we support charities, because it is our way of making a difference and our household budgets can afford the time and the expense. As a nation, we must also have a conscience, and our federal budget can afford the expense. We must do more to help those less fortunate—people like our older Australians, living on a single pension rate of $273 per week or just $39 per day. I believe we must do better than that—and our pensioners cannot afford to wait.
This is as much a health issue in Gippsland as it is an economic concern. Older Gippslanders have told me that they are going without food because they cannot afford to eat healthily, or they are forgoing involvement in community and sporting activities because they cannot afford the transport costs. Further isolation caused by financial distress will have an impact on the physical and the mental health of older Gippslanders. It is a similar story for carers of family members with a disability—whose selfless dedication saves our nation a king’s ransom, but who often live the lives of paupers.
In addition to improving the level of financial support, we need better access to health services in regional areas, particularly for children with disabilities. We all know that early intervention will allow children with autism and other special needs to achieve better outcomes. But the lack of availability of allied health services is frustrating the efforts of parents to support their own children. The need to attract and retain skilled health professionals in regional areas is an issue which state and federal governments must continue to address.
Then we have our Indigenous community—children born into a wealthy nation but with a 17-year life expectancy gap when compared to white Australians. Our conscience demands sustained action. I do not seek an argument about the merits of past policies or whether or not they were well intentioned, but there must be an acknowledgement that, whatever we have done in the past, it has not delivered the right outcomes for our Indigenous community. In Gippsland, we do not have the same problems of extreme remoteness that hamper other regions, but our Indigenous people still perform poorly on a wide range of measures. The Victorian government’s Indigenous affairs report for 2006-07 revealed that there are many symptoms of an ailing culture, and we must work smarter and work harder to find a cure.
It must be noted that the level of disadvantage experienced by young Indigenous Australians is not confined to communities living in the remote parts of Australia. The urban Indigenous experience in regions like Gippsland requires its own intervention and strategies to break the cycle of welfare dependency. Passive welfare and handouts are not the answer. The road to reducing the gap in life expectancy begins with better health and education services and it must have the basic aim of securing a job. I believe the decency of a job is central to individual success for our Indigenous communities in the future. To our credit, the work has already started in Gippsland, and I believe that we have an obligation to the people who elected us to spend our time in this place working in good faith to address such major problems in the future.
Naturally I accept that representing the views of Gippsland is an enormous challenge in itself. Gippsland is one of the most diverse regions in Australia and our community is dispersed across 33,000 square kilometres. There are many larger electorates, but few can lay claim to the rich diversity and strategic importance of Gippsland to our nation’s future prosperity. Gippslanders from all walks of life make an enormous contribution to our nation as they go about their daily lives involved in the power industry, oil and gas sector, defence and a range of agricultural activities. We have a thriving small business sector, which I am continually promoting through measures such as urging local families to support local traders. There are more than 11,000 small businesses in my electorate. These are the people who take the risks and have the confidence to invest in Gippsland’s future. I will champion their cause at every opportunity because they are helping to build a better future for our young people.
Gippsland boasts incredible extremes in both natural and man-made features. We have the world-renowned Gippsland Lakes and a network of rivers and streams which feed some magnificent estuarine systems, perhaps none more famous than the Snowy River, which meets the sea at Marlo, near Orbost. Many of our waterways have been heavily impacted by activities in the catchments, and there are significant environmental issues for the future. As a community volunteer, and now as a member of parliament, I will continue to work to improve the local environment. I have already called on state and federal governments to increase their investment in practical environmental projects to improve water quality and the health of the Gippsland Lakes catchment.
I also support increased investment in natural resource education and world-class research within the Gippsland region, because poor public land management over several decades has contributed to the environmental problems we face today. The work has already begun, but I believe there must be a greater commitment to actively manage our forest reserves, to minimise the impact of wildfires and to control the pest plants and animals which are having a devastating impact on native species and agricultural production.
Tourism is also a very important industry to my region and, without wishing to sound too boastful, Gippsland does have it all. Just to name a few attractions: we have snow skiing in the high country; the goldfields heritage of the historic township of Omeo; beautiful coastal villages like my home town now of Lakes Entrance, and Mallacoota, Paynesville, Metung, Loch Sport and Seaspray; world-renowned limestone caves in Buchan; welcoming rural centres like Bairnsdale, Yarram, Maffra and Heyfield; the vast expanses of the Ninety Mile Beach—which, incidentally, is 90 miles long; the maritime history of Port Albert; and a network of national parks and reserves, including the lush rainforests of Tarra-Bulga, which are the envy of many other regions.
I believe that state and federal governments must work together and work harder to promote regional tourism and small business opportunities. There is too much focus on marketing and major events in capital cities alone, which have very limited flow-on benefit to country and coastal areas. I think regional areas need a fairer share of the tourism budget in the future.
Perhaps in contrast to Gippsland’s outstanding natural beauty, the electorate also features the industrial heartland of the Latrobe Valley and its major towns of Traralgon, Morwell and Churchill. I know it may be hard for others to appreciate, but there is a rugged beauty in the industrial landscapes of the power stations and open-cut mines which have underpinned economic growth for decades in Victoria.
Recognising that brown coal is an extraordinary natural resource and accepting the challenge to use it in the most environmentally efficient manner will help to protect jobs in my region in the future. We still depend on brown coal for baseload energy security. We need the Latrobe Valley power generators to remain commercially viable so that they can invest in the research and the technology required for a cleaner coal future.
Naturally I do see a future for renewable energy forms, particularly with the development of larger scale solar facilities, but I offer a word of caution regarding our treatment of coal-fired power stations in the development of environmental policies such as the proposed emissions trading scheme. We must not make the mistake of imposing enormous economic pain on Gippsland for very little environmental gain. Given that our nation’s contribution to global greenhouse gas emissions is less than two per cent, any policy which sacrifices jobs in my region will be met with strong resistance.
We need a mature and well-considered debate where people are not typecast as ‘true believers’ or ‘climate change sceptics’. If we are prepared to give the planet the benefit of the doubt and we accept that climate change is real, then we are going to need a strong and sustainable economy to deal with the challenges that it will present. In my region alone, there are forecasts of storm surges and sea level rises. If those scenarios are accurate, it will cost us billions of dollars to relocate public infrastructure or to undertake risk mitigation works in low-lying coastal townships. We need to be tackling those challenges from a position of economic strength.
On perhaps a brighter note: the Gippsland area is a world-class producer. Our region features some of the most productive agricultural land in the nation, with a prosperous dairy industry, lamb and wool production, beef cattle, horticulture in its various forms, a large commercial fishing industry, and timber harvesting from plantations and sustainably managed native forests.
Ensuring long-term water security needs across Gippsland will give our agricultural sector the confidence to invest and encourage young people to seek their future on the land. Parts of my region are still facing extremely dry conditions. We were disappointed to learn that exceptional circumstances funding will not be extended after 30 September this year, but I will have more to say about that in the weeks ahead.
Gippsland’s natural resources also extend offshore, where we have the Bass Strait oil and gas fields, which have delivered wealth to our nation for more than 40 years. Using that resource in an efficient manner while managing any environmental impacts in the Gippsland Basin will require constant vigilance in the future.
Speaking of vigilance, the East Sale RAAF base is an outstanding defence facility which performs a vital role in Gippsland and beyond. My electorate has a very proud history with the defence forces and I will be working hard to see that base extended if possible in the future.
It is timely for me to mention the men and women of the defence forces and a practical local problem which demands a national solution. Each time a defence family moves interstate, the logistical task becomes enormous—from the most mundane tasks of transferring vehicle registrations and applying for drivers licenses, to the most significant issues of inconsistencies in the education curriculum.
I think it is time for a debate about the future structure of government in our nation. The blame game and the cost-shifting between different levels of government, along with wasteful duplication of resources and the wide range of border anomalies we encounter, make me at least open to considering a better way of governing Australia.
We must consider moving toward a two-tiered system, perhaps a regional and a federal government, in the interests of a more cohesive and united Australia. In any case, we need to fully explore the opportunity to take advantage of improved communications technology, decentralisation of government services and private industry where possible. The unending urban sprawl and the grab for resources such as productive farmland and water which typified Melbourne’s growth will be unsustainable in the future. Rather than the state government piping more water to Melbourne, we should be encouraging industries to relocate to regional areas where water is located.
From a public policy viewpoint, I believe that better decisions would also flow from having more staff based in regional communities. Gippslanders have spoken to me regularly about their frustration with decisions made by city based politicians and bureaucrats with little understanding of the impact of their policies on the ground. I think a deliberate policy of decentralisation would provide direct benefits to our regional communities and allow more of our young people to pursue careers closer to their families and friends.
Gippsland already exports many products to the world; we need to stop exporting so many of our young people. Helping our young people to reach their full potential is an aim we all aspire to in our electorates, but there are many, many barriers to achievement in rural and regional areas. The economic barriers to participating in higher education are a fundamental obstacle that must be addressed. Country students are often forced away from home to study and the additional accommodation costs and living expenses are an underlying factor in the decision to defer or abandon studies completely. Governments have the capacity to intervene to reduce the cost barriers for students from rural and regional areas attending university. That is not to diminish in any way the need for continued investment in trade and technical skills and the promotion of careers in small business or on the land. But in Gippsland our year-12 retention and university and further education participation rates are well behind those in the metropolitan area. I believe we must do better.
The long-term skills shortages we face can best be addressed by investing in the towns of our own young people in regional areas, because Gippsland’s greatest natural resource will always be its people. Throughout our history Gippslanders have demonstrated a remarkable community spirit, resilience and determination. I have witnessed several natural disasters and seen my community pull together to tackle bushfires, floods and droughts. There is no doubt that we will need to do that again and we will need governments that work in partnership with us to overcome the hard times.
We need governments that recognise the value of rural and regional communities and everything that country people contribute to our nation. We need governments that are prepared to invest in education and our children’s future and to help support us with the infrastructure that will sustain our communities and encourage private enterprise to prosper. We need governments which listen to the common sense of locals and support the practical and sustainable management of natural resources in all their forms. In short, we need governments which will give us a fair go.
in reply—I take this opportunity to congratulate the honourable member for Gippsland on his first speech in the House and wish him well in his time in this place. I know that he will diligently represent the interests of everyone in his electorate.
It was heartening to hear such strong support in the debate on the Great Barrier Reef Marine Park and Other Legislation Amendment Bill 2008 from members on both sides of the House. That confirms the fact that the Great Barrier Reef is widely recognised as a national treasure and one of the world’s most important natural assets. Certainly the Australian government recognises the World Heritage status of the Great Barrier Reef and has an enduring commitment to its protection and conservation and its transmission to future generations.
This bill will put in place a modern regulatory framework that will provide for the long-term protection and ecologically sustainable management of the Great Barrier Reef into the future. I note that the honourable member for Herbert in his contribution to the debate remarked that neither members of this chamber nor the public want a ‘paper park’; they want a park that is actively managed and well managed. I can assure the member and other members that this bill will give the authority greater capacity to ensure that that happens. Marine park users, local communities and other key stakeholder groups who were consulted prior to the introduction of this bill have also acknowledged the importance and timeliness of these changes. Since its introduction I have received correspondence welcoming the reforms.
During debate, members opposite flagged an intention to seek an amendment to the bill in the Senate requiring one member of the Great Barrier Reef Marine Park Authority to be a person with knowledge of or experience in tourism or another industry associated with the Great Barrier Reef Marine Park. The Great Barrier Reef is of considerable economic importance and the government recognises the need to engage with the industries, businesses, communities and individuals that rely on it. However, the government does not believe that the appointment of a specific industry representative to the Great Barrier Reef Marine Park Authority is an appropriate way to achieve that.
A wide range of industries have a strong interest in how the Great Barrier Reef Marine Park is managed. Most obviously there are the on-water industries such as tourism, commercial fishing, shipping and aquaculture. A wide range of land based industries such as seafood processors, recreation related businesses, mines and manufacturers that ship their products from the many ports along the Great Barrier Reef coast, sugar growers, cattle farmers and others also operate in the catchments adjacent to the marine park. The list could be endless. A comprehensive range of mechanisms is already in place for engaging these industries in the protection and management of the marine park. The Great Barrier Reef Marine Park Authority has four reef advisory committees providing for direct engagement of key stakeholders on the issues of tourism and recreation, fishing, water quality, coastal development and conservation and heritage. The authority has a further 11 local marine advisory committees providing for engagement of local committees on a regional basis. Their terms of reference require a range of industries to be represented on each committee. In addition, the authority has regional offices in Cairns, Townsville, Mackay and Rockhampton. The government is also establishing an advisory body, as recommended by the 2006 review of the Great Barrier Reef Marine Park Act, and this body will comprise representatives from key stakeholder peak bodies and industries associated with the marine park. It will provide advice directly to the minister on specific matters affecting the Great Barrier Reef.
Membership of the Great Barrier Reef Marine Park Authority is not the place to engage with particular industries. As members opposite noted during the debate, this bill implements key recommendations of the 2006 review of the act, a review that was commissioned and accepted by the then coalition government. This review considered the issue of industry appointments to the authority and found that such appointments do not provide for good governance. They lead to appointees having potential conflicting interests between promoting industry objectives on the one hand and pursuing the objectives of the authority on the other. Appointing a representative of one particular industry—for example, tourism—to the exclusion of others is clearly problematic, given the wide range of industries and others with an interest in the marine park.
I draw the attention of the House to the point made with some clarity by Senator Abetz—I did not think I would find myself saying that in the House!—last June during the debate on the bill with the first tranche of amendments implementing the 2006 review of the Great Barrier Reef Marine Park Act. Senator Abetz said:
... if we start picking and choosing with the Great Barrier Reef Marine Park Authority, which has such a large and extensive range of interests associated with it, I daresay we could get a list with over a hundred different categories and classifications on it ...
He went on to say:
Quite frankly, the list could go on. In my own portfolio area of fisheries, undoubtedly there would be recreational fishing interests, commercial fishing interests—the list could go on.
I agree with Senator Abetz on this point. For these reasons the government will not support such an amendment should it be moved during Senate debate on the bill.
This bill provides for management of the marine park that is integrated and aligned with the EPBC Act and other relevant legislation. It will put in place robust and streamlined environmental impact assessment and permitting arrangements. Investigation capacity will be enhanced and allow for a more tailored and flexible approach to enforcement and compliance. Responsible and ecologically sustainable use of the marine park will be encouraged by ensuring appropriate incentives are in place and management tools are available.
The bill makes long overdue and much-needed changes to put in place a comprehensive, modern regulatory framework for the Great Barrier Reef. Together with the $200 million reef rescue plan and action on climate change, this bill demonstrates the Australian government’s commitment to the long-term protection of one of the world’s oldest, richest and most complex living systems, the Great Barrier Reef. I commend this bill to the House.
Question agreed to.
Bill read a second time.
Message from the Governor-General recommending appropriation announced.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
The following notices were given:
to present a Bill for an Act to amend the law relating to social security and veterans’ entitlements, and for related purposes. (Social Security and Veterans’ Entitlements Legislation Amendment (Schooling Requirements) Bill 2008)
to present a Bill for an Act to amend the Offshore Petroleum Act 2006, and for other purposes. (Offshore Petroleum Amendment (Datum) Bill 2008)
to present a Bill for an Act to amend the International Tax Agreements Act 1953, and for related purposes. (International Tax Agreements Amendment Bill (No. 1) 2008)
to move:
That, in accordance with section 5 of the Parliament Act 1974, the House approves the following proposal for works in the Parliamentary Zone which was presented to the House on 26 August 2008, namely: Pavement Artwork at Reconciliation Place.
to move:
That the House:
to move:
That the House:
to move:
That the House:
to present a Bill for an Act concerning the provision of emergency assistance for the communities of the Lower Lakes and Coorong region of South Australia. (Emergency Assistance Fund for the Lower Lakes and Coorong Region of South Australia Bill 2008)
to move—
That the House: