I move:
Customs Tariff Proposal (No. 2) 2009.
The customs tariff proposal that I have just tabled contains alterations to the rates of customs duty applicable to certain alcohol and tobacco products of Chilean origin under the Australia-Chile Free Trade Agreement.
These rates of duty are set out in schedule 7 of the Customs Tariff Act 1995 and will commence on 6 March 2009.
First, the alterations increase rates of customs duty for certain alcohol and tobacco products in line with movements in the consumer price index.
Second, the alterations apply increased rates of excise equivalent customs duty to ‘ready-to-drink’ beverages, also known as ‘alcopops’.
These latter alterations reflect amendments contained in the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009 that was tabled in the parliament on 11 February 2009.
These alterations will ensure that rates of customs duty imposed on alcohol and tobacco products from Chile are the same as the duty imposed on these goods when imported from other countries. I commend the alterations to the House.
Debate (on motion by Mr Pyne) adjourned.
by leave—I move:
That the bill be referred to the Main Committee for further consideration.
I inform all honourable members that the Chief Opposition Whip, the honourable member for Fairfax, supports this motion.
Question agreed to.
On behalf of the House of Representatives Standing Committee on Legal and Constitutional Affairs I present the committee’s report entitled Whistleblower protection: a comprehensive scheme for the Commonwealth public sector, together with the minutes of proceedings and evidence received by the committee.
Ordered that the report be made a parliamentary paper.
by leave—It is my pleasure to present the report Whistleblower protection: a comprehensive scheme for the Commonwealth public sector, which is the second report of the legal and constitutional affairs committee for this parliament.
Blowing the whistle, or speaking out against suspected wrongdoing in the workplace, can be a very risky course of action. Outcomes can fall far short of expectations. Whistleblowers may risk subtle or more obvious forms of workplace discrimination or harassment. In the Commonwealth public sector, whistleblowers can be exposed to serious civil or criminal liability if they report misconduct through the wrong channels. On balance, these risks provide a significant disincentive for people to question and disclose wrongdoing and malpractice in their workplace.
Despite Australia’s high standards of public administration, improper conduct and maladministration does occur from time to time. Major recent examples would include the Australian Wheat Board, the outbreak of equine influenza and the wrongful deportation and detention of Australian citizens.
The Commonwealth is the only Australian jurisdiction without dedicated legislation to facilitate the making of public interest disclosures and protect those who make them. Existing Commonwealth law only protects limited categories of public servants, provides only a limited range of protections and insufficient oversight of the system. That is why the Attorney-General asked the committee to consider and report on a preferred model for legislation to protect public interest disclosures, or whistleblowing, within the Australian government public sector.
In conducting the inquiry, the committee received a wide range of evidence from academics, lawyers, leaders within the Australian Public Service and whistleblowers themselves. The report reflects the committee’s unanimous view that the Australian government should introduce a public interest disclosure bill to the parliament as a matter of priority. The purpose of the legislation should be to promote accountability and integrity in public administration. We heard from many submitters and witnesses that legislation should contain four main features: comprehensive coverage; clear guidance for participants; flexibility; and should recognise workplace culture issues.
The committee recommends that those able to make protected disclosures should be broadened to include current and former Commonwealth employees including employees of agencies under the Commonwealth Authorities and Companies Act 1997, contractors, consultants and their employees, persons overseas and parliamentary staff. Statutory protection available should include protection against detrimental action in the workplace and immunity from criminal and civil liability.
The system recommended by the committee comprises a two-stage process of internal and external disclosure with the Commonwealth Ombudsman overseeing the administration of the proposed Public Interest Disclosure Act. New obligations have been recommended to ensure that agencies act on the disclosures they receive. The committee has also recommended that, in certain circumstances, disclosures made to third parties such as the media, legal advisers, professional associations and members of parliament, should be protected.
I would like to acknowledge the contribution of all those who shared their time, expertise and experience with the committee during the inquiry. In particular, I would like to thank Dr AJ Brown and the Whistle While They Work project team; members of Whistleblowers Australia who enthusiastically contributed to the inquiry; key public sector leaders, the Australian Public Service Commissioner, Ms Lynelle Briggs, and the Commonwealth Ombudsman, Professor John McMillan. Finally, I would like to thank other members of the committee and the secretariat—Dr Anna Dacre, Mr Mark Rodrigues, Mr Michael Buss, Ms Melita Caulfield and Ms Claire Young—who worked on this important inquiry.
by leave—As Deputy Chairman of the House of Representatives Standing Committee on Legal and Constitutional Affairs, I am very pleased to be able to associate myself with the remarks made by the chairman of the committee, the honourable member for Isaacs. This committee has developed, in recent parliaments, a reputation for working together, and this is yet another unanimous report as far as the recommendations are concerned. The chairman, in presenting the report, outlined the need for whistleblowing legislation and, while we always seek to encourage people to come forward, it is obvious that the legislation as it currently exists has serious defects.
All of us have heard of circumstances where people have come forward to expose wrongdoing—to do the right thing, so to speak—but where ultimately their own careers are destroyed. The purpose of this report and of the recommendations—all 26 of them—cumulatively is to create a regime where people are able to make disclosures in the public interest and make sure that those disclosures are properly investigated and, in the process, to try to guarantee that the whistleblower is not personally disadvantaged.
I would also like to thank the highly professional approach of the secretariat. I would like to thank fellow committee members and, in particular, the chairman for, shall we say, organising and running the inquiry in a way that gave all members of the committee—and, indeed, all people who made submissions to the committee—a full opportunity to participate.
by leave—I move:
That the House take note of the report.
Order! In accordance with standing order 39, the debate is adjourned. The resumption of debate will be made an order of the day for the next sitting.
by leave—I move:
That the order of the day be referred to the Main Committee for debate.
Question agreed to.
Debate resumed from 11 February, on motion by Ms Roxon:
That this bill be now read a second time.
At the outset, the coalition does not, of course—as any Australian would not—deny that there are binge-drinking problems among some in society. And we are certainly concerned about those problems, as any responsible person would be—any adult; in particular, any parent who is concerned about their teenager going out on a Friday or Saturday night. We share those concerns and we are genuine in our efforts to try to address that particular concern that parents have at that formative stage of a young person’s life. This coalition will stand wherever we can to rectify what is a serious problem.
But the coalition is opposed to these bills, which seek to validate a substantial excise increase imposed on one category of alcohol products: ready to drink, or RTD, beverages. The government claims that it increased these taxes as a health measure—a measure aimed at cutting the rate of binge-drinking, particularly among young women. But it is, of course, as we now understand, nothing more than a tax grab; a measure drawn up in the finance ministries to boost the budget bottom line. On both health and tax counts, it is clearly a failure. The fundamental question here is: if this was a genuine health measure, why were the minister and the Department of Health and Ageing not involved in its formulation? Why did this particular measure emanate from finance ministries, and why was the health department not consulted when, in its coord comments to the ERC, it actually opposed this particular measure?
The next question that the government needs to answer is: where are the ‘hundreds of millions of dollars’ Minister Roxon said would flow to preventative health measures when she appeared on the Nine Network’s Sunday program on 27 April, the day the measures were brought into effect? Instead, the government will spend a relatively meagre $53 million on the National Binge Drinking Strategy, comprising $14 million for community initiatives to confront binge drinking, $19 million to assist young drinkers, $20 million for anti-binge advertising, with each of those measures funded from existing programs. We support programs, but much more needs to be done.
No further indication has been given by the government of how much of the alcopops revenue they are prepared to allocate to preventative health measures. Perhaps the hundreds of millions of dollars were never going to materialise, because this is a prime example of how media spin is more important for this government than real outcomes. That is particularly the case in the health portfolio. This proposal was rolled out at midnight on 26 April in an orchestrated announcement from the Prime Minister’s office for the nation’s Sunday newspapers. It is part of the Prime Minister’s ‘war on binge drinking’—one of the Prime Minister’s many wars. Is it a health measure or a tax grab? The Australian reported on May 17 that the excise increase first emerged ‘in a Finance budget submission couched in terms of closing a tax “loophole”’. As Christian Kerr wrote in the Australian:
Was the alco-pops tax motivated by concerns about the health of teenage girls or the health of the budget surplus?
It is a very reasonable question to put. And the question remains today because the government has been unable to provide any firm evidence, amidst the welter of its rhetoric, that the tax has had any impact on binge drinking whatsoever. The bills before the House—make no mistake about it—are purely about the tax impact. The near 70 per cent increase in excise on RTDs from $39.36 per litre of alcohol content to $66.67 per litre—an increase of almost 70 per cent—will raise $1.6 billion across the estimates. This is less than the $2 billion when the tax hike was first mooted, and far less than the $3.1 billion estimated in the last budget. Current estimates are that the government has collected somewhere between $220 million and $345 million with this tax binge.
RTDs are now to be taxed similarly to full-strength spirits, rather than at the same rate as full-strength beer—which more appropriately reflects their alcohol content. It is a position that the Labor party denied in 2004 that they would take. And the now Minister for Resources and Energy, Martin Ferguson, was reported in the Australian at that time as saying it would be ‘unfair to do so’. Minister Roxon argues in her second reading speech that it is logical to do so—so much for consistency from this government!
The minister makes much of the fact that RTD sales have slumped by, she says, 35 per cent since the excise was increased, and she then has to admit that sale of full-strength spirits have increased over the same period. The minister says that the increase in full-strength spirit consumption is small, neglecting to put figures on it, but the rise has been somewhere between 19 and 21 per cent—as I am advised—and certainly anything but small. She also neglects to mention, of course, that among young consumers, sales of beer, wine—in particular, cask wine—liqueurs and cider have also risen, some markedly. One survey, Roy Morgan for DSICA, reported the sale of cider was up 349 per cent in the June to September last year, compared to the year before.
This government was warned that this is exactly what would happen—that there would be a displacement effect and that consumers would switch from one product to another. The minister relates how companies have skirted the tax by making new RTDs based on beer or wine. But again, the government was warned that this would happen. It claims it is a sign that its tax measure is working. It is more likely, though, that the market is being met with a different product.
The minister told the parliament that all of this was significant and an achievement. But even some of the groups who support the government’s actions acknowledge that they certainly do not know whether young drinkers have simply switched to higher strength alcohol products. The minister quotes a series of figures to show just how serious the binge-drinking problem is, but the most comprehensive source of data is the National Drug Strategy Household Survey conducted by the Australian Institute of Health and Welfare. Let us look at what that authority has to say.
This is what they said to the first RTD Senate inquiry. The drinking status of the Australian population has been stable over the past two decades. There has been a modest increase in the apparent consumption of RTDs over the past five years. The preference for RTDs has increased slightly, on their evidence to the Senate inquiry, from 2001 to 2007, particularly in older age groups. The trend among under-18s is unclear. There has been virtually no change in the pattern of risky drinking over the period 2001-07, including among young Australians. The increased availability of RTDs does not appear to have directly contributed to an increase in risky alcohol consumption. The dominant drink for young males is beer, followed by RTDs. There is no clear trend in preference for RTDs among males under 18 years in the period 2001-07. Young females have an equal preference for RTDs and bottled spirits. Again, there was no clear trend in preference for RTDs among under-18-year-old females. Notably, for girls aged 16-17 years, there appeared to have been a decrease in the proportions drinking at risky or high-risk levels. In summary, they say that the increased availability of RTDs does not appear to have led, in and of itself, to an increase in risky consumption.
That is a summary of the advice given by that authority to the Senate committee. Then we go to the report of the National Preventative Health Taskforce’s Alcohol Working Group, which notes a downward trend in risky drinking by young people aged 14-19 years, over the period 2001-07. The trend was apparent for both males and females, though less pronounced for females. It noted the great increase in RTD consumption was among males. The trend in youth drinking was unclear. Victorian data on young people between 12 and 24 years of age found no clear trend in rates of risky drinking. They also made this point: increasing the price of individual products may not necessarily achieve the goal of reducing per capita consumption of alcohol. That is the advice that the taskforce gave to the Senate committee.
In the August 2008 edition of the Lancet, researchers from the National Drug and Alcohol Research Centre at the University of New South Wales surmised that although the Australian government’s recent decision is likely to arrest the increased sales of premixed spirits:
… it is unlikely to substantially reduce the overall rates of usual or binge consumption.
The Access Economics report on trends in alcohol related hospitalisation by young people can be summarised as follows: data collected so far did not support claims the alcopop tax had reduced risky drinking by young people; hospital admissions for young people aged between 12 and 24 years per 100,000 population for alcohol related diagnoses in May and June 2008 were higher than some months in previous years; emergency department presentations by young people aged between 12 and 24 years per 100,000 population for alcohol related causes were higher in May to August 2008 than previous years; there was an overall increase for the months after the RTD tax relative to the months before; and combined admissions and ED presentations for females were substantially higher than previous years and also higher than months pre the tax rise in 2008.
Access Economics said the time frame was too short to draw firm conclusions, but it concluded that the tax may not have reduced alcohol consumption by young people because they may have switched to other products. A switch potentially enabled them to buy more alcohol for the same budget than prior to the RTD tax.
It is also important, of course, as part of this debate to listen to consumers, in particular to what teenagers have had to say. I report some of their accounts, as broadcast on ABC 666 in Canberra on 12 February. When asked whether increasing the price of alcopops had worked and whether it had cut drinking levels, as a group they responded with a resounding, ‘No.’ As I say, some of these people need to be listened to. Some of the quotes from this broadcast are as follows, firstly:
When you put the tax up on the Alco pops, it’s not really the drink that people drink to binge drink anyway. It pushes them to drink boxed wine and straight spirits.
The second quote:
Jemima … are the kids drinking any less? ‘What I find is that they … buy … just straight spirits.’
The third quote:
I think the consensus … was … that the tax had actually fuelled the binge drinking. I know in my area it’s even got worse because people are just buying straight grog.
If the minister thinks that those comments are not common amidst a large segment of young people to whom she should be paying attention, perhaps she should visit the Facebook website where people have spoken in loud voices. On Facebook she will find a group called Aussies Against the Alcohol Tax Increase, and it has more than 70,000 members. A Galaxy survey asked whether Australians thought the tax on RTDs was effective and whether it should be scrapped. The survey produced the following results: only 12 per cent of people thought the tax was effective; 78 per cent thought it was ineffective; and 77 per cent thought it should be scrapped—that is exactly what this government should do. They should scrap this tax, which it tried to portray as a genuine health policy. The government have produced no evidence to indicate that it has done anything to improve the health of young Australians.
The important point to make in this debate is that the coalition will stand with the government on reasonable measures to address the serious problem of binge drinking, but we will not stand in this parliament and say to the Australian people that we support what is nothing more than a tax grab by a government fast running out of revenue. They have tried to dress it up as some sort of a health measure to pull the wool over the eyes of Australian families, in particular parents who are deeply concerned about the activities of their teenage children and young adults in pubs, clubs, venues, private homes and parties around the country on weekends. We want to make sure that this is a government which addresses a serious problem and not a government hooked on tax revenues because they love to spend in other ways.
My call today is for the government to abandon this measure. My call today is for the Senate to make sure that this bill is rejected and that the tax collected over the last 12 months not be remitted to the industry but that it be preserved for education and other measures. My call today is for the government to abandon this measure. It is bad policy. It is about a tax increase. It is not about helping young people with drinking problems. It is not about helping to curb teenage binge drinking. It is all about tax. They should end the tax and they should put up measures funded from that $200 million or $300 million, whatever the figure turns out to be, that they have raised over the last 12 months and put it towards education programs, towards counselling, towards rehabilitation and towards diversion programs to provide support to those community groups who support people in most need during difficult times in their lives.
We need to provide more support to law enforcement agencies to curb the growing problem of violence on the streets, which is not just related to alcohol but, importantly, related to the use of amphetamines and the mix of amphetamines and alcohol. That is the real problem that this government needs to address. This government is more concerned about the media cycle than it is about addressing the binge-drinking concerns that parents have around the country in relation to their teenage children and young adults. This is a government which is more concerned with the Sunday paper media cycle than it is with trying to address genuine health concerns.
This is a government which have, of course, spent all of the money that they inherited from the previous government. All of the money that was in the bank has now been spent by this government. Not for one moment will they be able to address the difficulties being faced in this particular area because they do not have the revenues now to spend on these measures. This government should own up to the fact that this program was never supported by Health. The coord comments never supported this measure. This was proposed by ATO, Finance and Treasury as a tax loophole that needed to be fixed—a way this government could, on their initial estimates, gain $3.1 billion in revenue. This was never about trying to address the genuine health issues in relation to binge drinking and alcohol consumption. It was all about tax right from day one.
If this minister has the guts or integrity that she claims she has, she should come into this parliament and declare that to be the case—she should draw a line, start again and put together a suite of programs which will properly address binge-drinking issues in this country. This is a minister who, frankly, has no control in cabinet whatsoever. That is clearly the case. The previous health minister would certainly have been able to carry a much better argument more persuasively than this health minister at both cabinet and ERC. This is the reality that needs to be faced by this parliament. This is a health minister who cowers in cabinet. This is a health minister who has rightly been nicknamed ‘Reba Roxon’ after her mentor, Reba Meagher, in New South Wales, because this is a government that does not have a handle on health policy. This is a government that seems to be adopting the same health policy outcomes and the same health policy management that the New South Wales Labor government has done. That is bad for health policy not just today but also into the future.
If genuine concern is to be expressed by those members opposite as part of this debate, they need to recognise that this is a tax grab. It is a tax binge; it is not about helping those young Australians that deserve help. Nothing has been said by this health minister about the way they are going to address amphetamine use in particular, which is a real concern for young women. On Friday nights at clubs, it is a real concern not just for young women but for young men as well, because there is a combined intake not just of alcohol but of party drugs as well—in particular ecstasy, which is freely available. This government has not considered, as part of these measures, that very important part of this discussion.
The other important issue for the government to address is the spiking of drinks. Many people, particularly young women, are concerned at parties, nightclubs and other venues about ordering spirits that are mixed by somebody else. They have a very just concern, because the prevalence of drink spiking is a real problem in this country. It is a national disgrace, frankly, that anybody would conduct themselves in that way. Ready-to-drink spirits, which come in a can or bottle, have given parents whose children do drink responsibly a way to overcome at least that concern when their teenage child is out drinking on a Friday night. To push those young adults into a position where, at a party, they have to rely on a third party—in some cases not known to them—to premix their drinks because they cannot afford to buy an RTD is a sad reflection on this government. And it is a sad reflection when a young person who does have the capacity to drink responsibly goes out to enjoy a night with his or her friends, finds that they cannot afford an RTD, goes to a full-spirit mix and finds themselves in a position where that drink could be spiked. That is also a significant part of this issue and needs to be addressed by the government.
So there is a long way to go in this debate. But the important call today is for the Senate to recognise that the government has the ability to call an end to this tax impost. It has the real ability—with revenues already raised—to redirect that money into education programs which would see a real effort to curb some of the most dangerous drinking. It will take away the broadbrush approach of this particular policy announcement, which has an impact on people in their 20s, 30s, 40s, 50s who go to parties or decide to consume alcohol through an RTD product, who think that they are acting responsibly. The majority of people drink responsibly, and this tax is an attack on them as well, because now many of those people have gone to cask wine—for argument’s sake—which is much cheaper and available in much greater quantities. Many people have gone to mixing their own drinks or, as I said, relying on others to mix those drinks which, in many cases—on the evidence provided to the Senate inquiry, anecdotally and through other avenues—means that those people end up consuming more alcohol. Teenagers at a party who are mixing spirits from a bottle of Bundaberg Rum or Malibu, or whatever it might be, will generally—and most people with common sense would tell them this; I am sure there would not be any argument from members opposite—consume more alcohol in that mix than they would through a premixed, bottled or canned drink.
So the coalition will continue to fight in this debate because we want to make sure that we attack the problem of binge drinking but we do not support the government doing it through a tax grab. This government has not been able to provide one shred of evidence that this is a policy that has impacted positively on young people. Despite all the calls, we have had to demand in a Senate inquiry that this information be produced. Even at Senate estimates, the department was directed to not provide the detail sought by the senators, and that is a very sad reflection on this health minister. The department should be able to release the information—if they have it—to show that this measure is working. Then we could have a properly informed debate. But, for as long as the government refuses to produce even one shred of evidence that this measure is working, how can they seriously stand here in this parliament as part of this debate and say that it is anything but a tax grab?
That is why we oppose these bills and that is why we will be opposing them in the Senate. It is incumbent on this minister to demonstrate to the House today exactly how she is going to properly address this very serious concern and how she is going to carry the arguments in public. People want to hear how the Labor government is going to live up to its election promise of continuing to fight this war. We oppose the bills and we oppose them with good reason.
I rise to speak in support of the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009. I say to the honourable member for Dickson: you and your cohort had 12 years to fix some of these problems that have been left to the government to fix, and all you could do in 2000 was lower the tax on alcopops. I also say to the honourable member for Dickson: you talk about attacking the problem of binge drinking, but you and your cohort had 12 years and I did not see any evidence that you were doing anything to attack binge drinking. Amphetamine use, ecstasy and spiking of drinks—all of the problems you raised in your contribution—none of them are new problems.
Member for Page, I ask that you refer your remarks through the chair rather than refer to ‘you’, in that context being the speaker.
Yes, Mr Deputy Speaker. I stand corrected on that. I will speak through the chair.
Through you, Mr Deputy Speaker, to the honourable member for Dickson, I put it that the opposition had 12 years and I saw no evidence—simply a reduction in the tax on alcopops. Alcopops are what we are talking about here today, and we are talking about our young people. Put simply, this public health initiative is saying clearly to distillers and producers that we, the community, do not want drinks designed to appeal to our young people. That is what alcopops are about. The opposition can put whatever spin on it they like but the fact remains that this is, first and foremost, a public health initiative—one that in general policy settings has the support of the World Health Organisation. The member for Dickson said that there was no support from the Department of Health and Ageing anywhere for this initiative. I would consider the World Health Organisation to be the pre-eminent health advisory body, and its advice is very clear. It says that increased alcohol taxation has proven effective in reducing alcohol related problems among young people. That is pretty clear. Faced with the choice between the musings of the opposition and the member for Dickson, who are the architects of the 2000 reduction of tax for alcopops, and the World Health Organisation, I know where my money would be; it would be with the World Health Organisation.
The amendments, which I refer to quite simply as ‘alcopops amendments’, ensure that beer and wine based products that attempt to mimic alcopops with regard to their taste are taxed correctly as a spirit product, which we know has a higher tax, as it should have in this case. The amendments will not impact on regular wine and beer drinks. The amending bill imports a definition which sets a combination of minimum limits on the bitterness and maximum limits on the sugar content that has to be consistent in measurement in the final beverage. This means that no flavour will be able to be added to wine and grape wine products, either natural or artificial. These definitions, as I read them, will apply from July 2009.
We know about what are called ‘malternatives’. These were introduced. The Bills Digest says:
It is also important to note that drink substitution has been rendered easier with the recent introduction to the Australian market of so-called ‘malternatives’. The new drinks, which are pitched at drinkers aged between 18 years and 30 years, are similar in alcohol content, flavour and appearance to many alcopops. However, because these drinks are beer rather than spirits-based, they attract far less excise than do their alcopop equivalents, and retail for around half their price. The maker of one of the new ‘malternatives’ is reported as having introduced the new product directly as a result of the alcopop excise increase. Corporate relations director of Diageo, the world’s largest alcohol company, has stated that ‘this is a time when [the launch of the product] makes sense …
It does not make sense because we are trying to reduce the intake of alcopops. I will also quote from the opposition leader, the member for Wentworth, addressing the National Press Club on 22 September 2008. He was talking about binge drinking. The direct quote is:
One should never underestimate the enterprising ingenuity of the Australian drinker.
The comment should really be that we should never underestimate the Distilled Spirits Industry Council of Australia and the independent distillers association or the people who make the products, for their ingenuity in coming up with other products. That is why this amending bill is necessary—so that we do not have the market flooded with products like alcopops.
A number of related associations have supported the government’s initiative—as, indeed, have parents—within a policy framework designed to target binge drinking as well as excessive drinking or risky drinking, but what we commonly know and call binge drinking. We and the community understand that. It is aimed at lessening the drinking of alcopops. It is a public health initiative, and that is the business of government; it is about prevention and it is about promotion. This is clearly about prevention of alcopops and it is clearly about promotion in saying that these products are no good for young people. I have spoken with young people in the community and canvassed their views on this initiative. Some of them who drink it, and who like to drink it, understand that the government is correct in trying to make sure that they do not drink it.
The government is committed to reducing binge drinking, and these amendments are located squarely within that policy setting. This is one tool of a number of health initiatives within that framework. We can debate what we like about who said what and what we can and cannot do, and we can sit back and do nothing, but nothing will change and the drinking will increase. That is just not acceptable.
I say to the nay-sayers that they can continue to do nothing or they can reduce taxes on alcopops and things like that, but we have to do something. Recent comments from, in particular, my local papers and in my local community are replete with incidents of alcohol fuelled violence, primarily with young people, but not just young people. The link between alcohol and violence in our society is strong, and binge drinking adds to and exacerbates that. It is a factor, and we cannot ignore it.
In Australia we have a culture of drinking. We celebrate it and we celebrate by drinking. That leads to excessive drinking and we as adults are responsible for a lot of it. We have to try and change it because we cannot blame our young people. They grow up in a culture where alcohol is legal, alcohol is common and we drink alcohol. This is one of the ways that we can try and reduce excessive drinking. Also, within the context of binge drinking, alcohol and alcohol-fuelled violence, the costs are enormous. I have read that it costs the community anywhere from $15 billion up because of the demand on our health services due to accidents and fights, because of insurance costs, because of court costs and because of prison costs. Yet we as a society often have our head in the sand about this problem. We use selective legal sanctions and mores—but often to little avail—to curb binge drinking or excessive drinking, particularly for our young people. One of the best ways is to lead by example, and I am afraid that as a community and a society we have not led our young people too well sometimes in not drinking too much and not having a culture that celebrates alcohol and incorporates it into our everyday life.
The honourable member for Dickson forgot to say in his contribution is that in 2000 the opposition, the then government, agreed to a tax break for alcopops. That is correct. It was damaging decision. Can you imagine any health minister agreeing to such a damaging decision as this? The Labor government’s amendments, led ably by the Minister for Health and Ageing, Nicola Roxon, reverses the Liberals’ 2000 decision concerning the alcopops tax break. I have to say again: what health minister in his right mind could support such a proposal? It baffles me that that one got through, that it went through to the keeper, and I am quite gobsmacked that they did it. Of course the opposition have to come in here today and oppose it, because we are reversing their bad policy or what I call their lazy policy decision making in 2000.
The opposition has also said that there is no evidence that the excise on alcopops is working, and I will turn to that in my contribution. There is clear evidence that it is working. I would like to say firstly that the binge-drinking problem is a real problem. We can debate it and talk about the quantum of it and manifestations of it in various communities, but the fact is that it is real. We know it. We see it. We live in communities. We are part of communities. We are not blind. We can see it all. Closing the alcopops loophole is supported by community leaders, police and health experts. In any given week approximately one in 10 12- to 17-year-olds—that is very young—are binge drinking or drinking at risky levels. The number of young women aged 18 to 24 being admitted to hospitals because of alcohol has doubled in eight years. That is a big health problem and a big societal problem.
In a year more than three-quarters of a million Australians are physically abused by persons under the influence of alcohol. The annual social cost of alcohol misuse in Australia is estimated to be about $15 billion. Last year the New South Wales Commissioner of Police, Andrew Scipione, estimated that:
… something like about 70 per cent of every police engagement with a member of the community in the streets of NSW has alcohol as a factor.
Not all of that is related to alcopops, of course, but we are talking about alcohol. We are talking about one particular product that is very problematic. Alcopops deceive young people. They are targeted at young people. We have all seen the advertising campaigns. We know that advertising works, and alcopops are dressed up to be sexy, attractive, exciting: the world is your oyster; get on the alcopops and everything will be well. But alcopops clearly target young people and underage drinkers and, if we have a look at the facts that I have iterated—that one in 10 12- to 17-year-olds is binge drinking or drinking at risky levels—we can see that they are the group being targeted by the industry and by advertising.
Between 2000 and 2004 the percentage of female drinkers aged 15 to 17 who had consumed alcopops at their last drinking occasion increased from 14 per cent to 62 per cent. That was between 2000 and 2004, and 2000 was when the Liberal-National coalition government gave the tax break to alcopops. Consumption increased from 14 to 62 per cent. Some of that would be through advertising as well, but the fact is alcopops were made a lot cheaper and therefore far more attractive. Remember the WHO said that taxing does work to reduce drinking in young people. For females drinking at risky and high-risk levels in 2004, 78 per cent had drunk alcopops on their last drinking occasion. That figure had increased threefold after 2000. You only have to look around your local communities or go to the local pub to see that alcopops are very popular, particularly with young girls.
The Rudd government has taken the logical approach by taxing all spirits, bottled or premixed, at the same rate. As a result, consumption of alcohol has dropped. Researchers agree that the measure works. An independent expert report by Collins and Lapsley, commissioned not by the Rudd government but by the Howard government, found:
… alcohol excise taxes are capable of being designed explicitly to target the types of alcohol known to be the subject of abuse (for example, high strength beer and alcopops) …
That was a report commissioned by the Howard government, yet they still gave a tax break on alcopops. The report went on:
For example, studies show that young people are more influenced by the price of alcohol so that increasing the tax rate on alcoholic drinks which are specifically targeted at the youth market is likely to be effective.
As a result, there would appear to be strong justification for the April 2008 increase in the tax of 70 per cent on premixed drinks and alcopops. The ATO figures, drawn from the first nine months of this measure, show that alcopops sales have dropped by 35 per cent, compared to the previous year. In fact, alcopops sales have slumped, bringing overall spirit sales with them, despite a smaller increase in full-strength spirit sales. Overall spirit sales have fallen by almost eight per cent. That was something that the honourable member for Dickson did not add when he talked about sales of spirits.
I will turn to what some of the experts say. The CEO of the Australian Drug Foundation, Mr Rogerson, said:
This tax fixes a problem started with the introduction of the GST and shows that the Government is serious about tackling alcohol problems in our community.
The CEO of the Alcohol and other Drugs Council of Australia, Mr Templeman, said:
… this initiative clearly recognised the problems created by the excessive consumption of RDTs which were attractive to the youth market.
Mike Daube, President of the Public Health Association of Australia, also a member of the National Preventative Health Taskforce, said:
There is now dramatic evidence showing that young women are out-drinking their male counterparts—and unfortunately many of them drink to get drunk …
We know that price is the most effective single measure in reducing alcohol consumption, especially by young people. This increase will make a real dent in one of our biggest current social problems.
These views are in contrast to that of the alcopops industry, which is motivated by profit. I am not condemning that. That is what industry does, that is what the market does, but don’t have it joining the debate, talking as though it is concerned about our health, acting like the Florence Nightingale of the distillers industry, because clearly it is not.
A whole lot of products were delivered to our office at the end of last year. I am sure they came from the distillers. All of a sudden, various drinks arrived in our office. They were sending various drinks around. I am really not too sure what it was designed to do. It rather puzzled me. They delivered a bottle of passion wine and other things. I am really not sure what it was about. It was probably a waste of their money. In terms of a campaigning strategy, it was an absolute loser. I am not sure where all the drinks went to, but they seem to have disappeared.
The industry continue to try to confuse this issue, and it is not working. They argue about annual seasonal variations, which occur year in, year out, and they show trends that simply do not show that. This initiative shows that the Rudd Labor government is clearly committed to reducing alcohol consumption by young people, particularly young girls. We are in the business of protecting health— (Time expired)
I rise also to speak on the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009. The government claims that this legislation was designed to fund a new preventative health program and tackle binge drinking among teenagers, particularly girls. The price of ready-to-drink beverages and alcopops increased by 70 per cent overnight when this measure was announced in April 2008, and I will deal with the announcement in my remarks.
Drink prices increased by between 30c and $1.30 a bottle, depending on the level of alcohol content. This was the first and not the last tax hike of the Rudd government. It was expected, when announced, to raise over $2 billion. Under the tax increase, the level of excise jumped from $39.96 per litre to $66.67 per litre. Alcopops are now taxed at the same level as spirits. This is the government’s attempt, so they claim, to address the problem of binge drinking in younger people, particularly girls. They make the point—and the previous speaker tried to make the point—that it is a new problem. I would contend that binge drinking amongst young people is not a new problem. I think it has been a problem since alcohol was packaged. It certainly was a problem when I was at school and, unfortunately, in the past, at times, I have been part of the problem—
You didn’t break the law and have a drink!
Minister, I never would have undertaken any activities and broken the law—this was binge drinking after 18! It is not a new problem. Binge drinking is a very serious issue and it is a major concern, particularly for those of us who have young children, going forward. We need to educate our children on how to deal properly with alcohol use. It is also not the only problem for young people in society today. We have seen in recent times the problem with illicit drugs, particularly ecstasy at some of these dance and rave parties that have occurred or even at festivals sponsored by a very well-known Australian funded broadcaster. It is not the only issue that haunts young people and that is a challenge to young people. In fact, I would contend it is not the major issue which challenges young people. The truth is that the majority of people in our society use alcohol properly. They do not drink to excess and they do not become a statistic of violence or some of the other problems that occur with overindulging in alcohol.
The other truth is that the alcohol industry is a major employer in Australia. Whether it be through the wine industry in my electorate of Mayo in the state of South Australia or through the distilled industries, it is a major employer. So those on the other side should be careful not to take too much of a wowser approach to alcohol, because we are dealing with people’s jobs and people’s lives.
But what is the real purpose of this bill? The real purpose of this bill is a tax grab. It came from the finance department, it was built in the finance department and it will be implemented by the finance department. It is a tax grab. That is simply what it is. It is spin over substance. It was a measure drawn up to boost the budget bottom line. If it was a genuine attempt to address a health issue, why were the Minister for Ageing or the Department of Health and Ageing not involved in its formulation? We have seen another example of this kind of thing today. Last night the Prime Minister, under the cloak of darkness and under pressure from this SAS Defence pay bungle in which our great fighting men have been ripped off, announced another attempt at addressing executive remuneration. Of course, there is nothing serious in it; it is just another way to get the front-page story and to prevent any serious analysis of a major problem that his defence minister has.
This sort of thing was part of the strategy with the alcopops tax. It was sold to the Sunday newspapers on 26 April last year. There was an orchestrated announcement by the Prime Minister’s office. It was part of one of the wars. We all remember the shadow Treasurer in this parliament just before Christmas going through all of the wars that we are fighting. This of course was one of the early wars: the war on binge drinking. The Prime Minister briefed the Sunday papers and it got a great run, which is exactly what the hollow men in the Prime Officer’s office were out to do. They were out to get the good press about an issue and say, ‘We are going to fight this scourge of binge drinking amongst our young people and we have got this brilliant new way to do so, which is a tax.’
But like many—in fact, probably all—of the wars that the Prime Minister has announced, it was not actually designed to attack binge drinking. It was designed to attack the real problem of the budget bottom line. We know that this government cannot manage the budget bottom line. We had a situation where they inherited a $20-odd billion surplus and now we are $40-odd billion in deficit and looking at being about $200 billion in deficit in a short time. What they needed was a new tax to build the budget bottom line, and the hollow men said, ‘We need something we can sell as a war on a popular public policy issue.’ What they stumbled across in doing so was the war on binge drinking. So it is not a policy designed to address a health problem. It is a dog whistle. It is designed to make Australian parents think, ‘Oh, that’s great, isn’t it, that the Prime Minister is addressing an issue that my kids face every day. These poor teenage girls are overindulging in these RTDs and alcopops and we must stop it.’ But, of course, that is not what it was about; it was about lifting the tax revenue of the country.
The current estimates are that the government has collected somewhere between $220 million and $345 million with this tax binge. Part of the reason for the great leak on 26 April was that it would be part of this massive strategy of preventative health measures for our young people, so that they would understand better how to deal with alcohol, and to prevent the problem of binge drinking occurring. We had Minister Roxon on the Sunday program on 27 April—a coincidental performance, of course, when the story appeared that morning—saying that hundreds of millions of dollars would flow to preventative health measures from this new tax. Of course, that is simply not true. What we have is $53 million from existing resources, which comprises $14 million for community initiatives to confront binge drinking—I am not sure what that is designed to do; $19 million to assist young drinkers—I presume to assist them in understanding binge drinking and not of course helping them to do it; and $20 million for anti-binge-drinking advertising.
As I made the point, this is from existing resources, not from the hundreds of millions of dollars that the minister proposed would be used for this campaign. That is further evidence that this is a spin over substance, front page over health policy, approach of the government, because what they really needed was extra tax revenue. This of course was in the pre-financial crisis days. This was in the days when the inflation genie was out of the bottle and they were spinning the line that they were reducing the budget spend to help take pressure off inflation—right at the wrong time, as it turns out, and that has cost many Australians their jobs. It was part of that campaign at that time. Equally, at the same time, they were looking at their budget bottom line and thinking, ‘We need some extra revenue.’ And this looked like a good one because the hollow men could sell this to the Sunday papers, as they did, and it got a good run. The minister went on Sunday the next day and got a good run out of that. She promised hundreds of millions of dollars for preventative health measures, which of course, on this side of the House, we support. However, that just has not happened. What has happened instead is a tax grab.
What we on this side of the House wanted to see when this was announced was a genuine attempt at addressing a serious issue—not just the issue of binge drinking but the multiple issues that affect young people as they grow into adults and go through the pressures of becoming a young adult. Of course, many of them do overindulge in alcohol. But, as I said earlier, many of them also have issues with illicit drugs, which cause a great deal of harm to many young people in our community. Unlike alcohol, which you can use in a measured way—and most do—illicit drugs of course you cannot. So many of our young people get caught in the cycle of trying different illicit drugs, and it all too often damages their lives. It seems to me that if we were serious about addressing this binge drinking issue, we would also be looking at that as one of the other challenges for young people moving into adulthood. Of course, illicit drugs have to be a major part of that strategy. It is disappointing to us to see that the promise of hundreds of millions of dollars on a preventative health campaign turned into simply $50 million designed to run some ads, as it appears to have done.
Let us deal with the health issues that the government claim they are designing to address with this new tax. In the last couple of days we have seen a report released by the respected economic firm Access Economics, the firm which the Labor Party often like to quote—and which they quoted back at us with great fervour when we were in government about how respected and beyond repute they are. The Access Economics report on trends in alcohol related hospital use by young people since the introduction of the alcopop tax found that data collected so far has not supported claims the alcopop tax has reduced risky drinking by young people; hospital admissions for young people 12 to 24 years of age per 100,000 population for alcohol related diagnoses in May and June 2008 were higher than for the same months in previous years; and emergency department presentations by young people 12 to 24 years per 100,000 population for alcohol related causes were higher in May to August 2008 than in previous years. There was also an overall increase for the months after the RTD tax relative to the months before, and combined admissions and emergency department presentations for females were substantially higher than for previous years and also higher than in the months pre the tax rise in 2008.
Access Economics said that the time frame was too short to draw firm conclusions but that the tax may not have reduced alcohol consumption by young people because they may have switched to other products—and that is really the point here. It is all very well to address the issue of binge drinking and, as I said earlier, we on this side of the House support a campaign to highlight and address the issues of binge drinking. But what strikes me as passing strange is that the government has implemented a new tax which has moved people from a drink which is at least measured to bottled spirits where they measure it themselves. I am sure those on the other side of the House, like many on this side of the House, would be well aware that when young people are doing the measuring themselves things can get out of hand very quickly. That is not to say they cannot overindulge in the ready-made drinks either. However, when I was talking to a very well-known and respected hotelier in Adelaide in recent days he made the point that the sales of spirits in his bottle shop have gone through the roof. Young people come in and buy a bottle of vodka and a two-litre bottle of Coke. While the first couple of mixed drinks may be reasonable, as they run out of Coke the later drinks become a lot stronger and a lot more dangerous. I am sure all those in this House would agree that it is extraordinarily dangerous for a young person to drink a bottle of vodka.
The whole idea of the health policy aspect of this was to reduce the amount of alcohol young people were drinking, I would have thought, but in fact the outcome is that they are drinking far more dangerous levels of hard liquor than they were before. That is extraordinarily dangerous and very badly thought through by those on the other side of the House. It is not about health policy; it is about a tax grab. This is what this policy is about, and any claim that this is about reducing the number of young people binge drinking is completely false. It is completely spin over substance, which is the trademark of this Prime Minister.
The question is: is binge drinking getting worse? We changed the laws, because presumably there is an attempt to reduce the amount of binge drinking since evidence suggested that it was getting worse. But a report to the government’s National Preventative Health Task Force—technical report No. 2—which is broadly supportive of taxation action to reduce drinking, notes a downward trend in risky drinking by young people 14 to 19 years of age over the period 2001 to 2007. The trend was apparent for both males and females, though less pronounced for females. It noted that the greatest increase of RTD consumption was amongst males and that trends in youth drinking were unclear. Victorian data on young people between 12 and 24 years found no clear trend in the rates of risky drinking, and increasing the price of individual products may not necessarily achieve this goal. Of course, we know that. What will happen is that if the price of the RTD goes up young people will go to the next cheapest thing or they will pool their money and buy a bottle of spirits. If young people want to drink they will drink unless alcohol is banned completely, and we know that will not work. We know that the laws which the minister just commented on, about people not being able to drink until 18, are always ignored in our country.
The point is that this policy is not about reducing binge drinking. It is about tax. It is about increasing the revenue base of our country. If it were a serious policy about reducing problems for young people with alcohol and drugs then we would see a serious and substantial campaign to address this. In fact, we would see the money raised from this tax pumped into these campaigns, but we do not, of course. We do not see any of the money from this new tax pumped into these campaigns. We see the money from this new tax pumped into government revenue. This is where the disgrace of this policy is.
I commented that we have seen, through evidence given to me in my electorate, increased sales. We also have actual evidence presented. The minister claims that RTD sales have slumped by 35 per cent since the excise was increased, but then she had to admit that sales of full strength spirits have also increased. The minister says that the increase in full strength spirit consumption is small but neglected to put figures on it—but the rise has been somewhere between 19 and 21 per cent, which is barely small. In fact, it is nearly the complete reduction in the RTD sales.
This is the point I was making earlier: the dangers of this are that we are pushing young people into harder liquor and harder drinking habits, with serious consequences. I say to this parliament that this is the danger of this policy. It is a very ill-thought-through policy, where we have encouraged the use of hard liquor amongst young people by increasing the price of premixed drinks. The attack is on young girls.
This is the problem with this government. We see, time and time again, spin over substance. They say one thing but really mean another. It is the Hollowmen approach to public policy, where you have a tax implemented for the purposes of increasing the financial revenue of the government being sold as a health policy. It is not a health policy. If it was a health policy there would be a large emphasis on the prevention of binge drinking through a well-funded education campaign, and the money being raised by this tax would go not into general government revenue to bump up the budget bottom line but into a serious campaign to address a problem in our society. It would also be a wide-ranging campaign that would look at all the other issues which our young people face going into adulthood, including illicit drugs and drink spiking in hotels, which is a big problem for young women. It is a problem which many of us on this side of the House have had experience with. We have seen the effects of this type of problem.
The opposition are opposing this legislation in the House of Representatives and we will oppose this legislation in the Senate. I understand Independent senators are minded that way as well, but of course we will have to wait and see. We oppose this legislation because it is a tax grab; it is not a health policy. This is not a genuine attempt to address a health issue in our country. It is not an attempt to make our young people safer or more educated about the serious impact of overconsumption of alcohol. This government should scrap the tax grab and go back to the drawing board. It should go back to the drawing board and work out a genuine health policy to address this issue. The government has produced no evidence that it has done anything that will help the health of young Australians through this policy. All it has done is help its own budget bottom line, and it is a disgrace. It is a disgraceful move to sell a policy as a health policy when all it is is a tax grab. In fact, it has dangers for the health of young people in our country, and I think the government should be ashamed of this very poorly thought through and spin-over-substance policy that it has presented.
I am very proud to rise to speak in favour of the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009. These amendments confirm in legislation the increased rate of taxation for alcopops from 39.36c to 66.67c per litre of alcohol content, effectively bringing the tax on alcopops back to the equivalent rate for spirits. These amendments close a loophole on excise for alcopops that has been around since 2000 that has effectively left the liquor industry with a tax break on the sale of sweet, sugared drinks that are marketed predominantly to young people.
The opposition argues that we should not close this loophole. I am going to address some of the arguments made by the two previous speakers but, first, I just want to talk about how this loophole came about. Prior to July 2000, excise was paid on the premixed spirits component and then RTDs were manufactured to meet the desired strength, flavour and other properties. But on 1 July 2000, the former government introduced the tax rate on ‘other excisable beverages not exceeding 10 per cent by volume of alcohol’. The then government also imposed excise on these products at a broadly equivalent rate to that applying to full strength beer. As a result of this change, the rate of excise on spirits used in the manufacturing of RTDs went from the spirit rate to the lower beer rate. I do not assume that this was a deliberate move on the part of the previous government to create an effective tax break on drinks marketed to young people. I think it was an unintended consequence. But it was a consequence.
I will deal with the rise in sales and the effective increased alcohol abuse later, but I am just going to return to some of the arguments put forward by the members for Mayo and Dickson. They seem to argue against the closing of the loophole for four reasons. One, they seem to question our motives. I am not sure whether our motives or the outcome of the bill should be the principal consideration, but they do question our motives. Two, they seem to want much more done about illicit drugs. I doubt that there is anybody in this House who does not want more done about illicit drugs, but I would suggest to them that you do not knock off a bill that addresses abuse of alcohol because you want things done in other areas; you try and do both, as we on this side of the House are doing. Three, there seems to be a bit of disagreement on the other side about whether we do or do not have a binge-drinking problem in Australia. For those on the opposite side who do think it is an issue, they clearly want something done but they seem to argue that the liquor industry will simply find another way—which of course they will. This is one of the ways they found because of a tax loophole that was introduced in 2000, and there is no doubt, watching the behaviour of the liquor industry in exploiting that tax loophole over the last eight years, that they will attempt to find other ways. But that is not a reason to close this bill down. It is a reason to be vigilant and to continue to watch and monitor the activities of the industry in relation to its promotion of a drug—albeit a legal one—to young people.
Four, the member for Mayo also seems to be arguing that alcopops actually protect young people from excessive drinking, that somehow providing them with a measured amount of alcohol in these extremely sugary drinks is effectively protecting young people from excessive alcohol consumption. That is an astonishing point to make. From analysis by health experts and conversations I have had with young people, it seems to be just the opposite—these drinks which are designed to disguise the taste of alcohol lead to young people who do not like the taste of alcohol actually being introduced to alcoholic beverages at a much younger age. For those of us who did go through the binge-drinking phase when we were younger—and I confess to being one of them—we would all be aware of how out of control drinking can be when the taste of alcohol is not present. I think we have probably all had cocktail nights. As we mature and get older and become more experienced, we learn to appreciate the danger of those sugary, easy-to-drink beverages and exercise a little more adult and experienced restraint.
Let us have a look at exactly what we have with these drinks that we call alcopops. Alcopops are those bright-coloured, sugary drinks that you often see these days around the front doors of liquor stores. The alcohol taste in them is disguised, they are largely targeted at young people, and they are frequently consumed by under-age drinkers. Since the loophole was introduced in 2000, the use of that loophole for tax breaks seems to have worked. The industry itself admits that its sales of alcopops have grown by 250 per cent since 2000. Between 2000 and 2004, the percentage of female drinkers aged 15 to 17 who had consumed alcopops at their last drinking occasion increased from 14 per cent to 62 per cent. For females drinking at risky and high-risk levels in 2004, 78 per cent of them drank alcopops on their last drinking occasion. That figure has increased threefold since the year 2000 when the tax loophole came into effect.
In any given week, approximately one in 10 12- to 17-year-olds are binge drinking or are drinking at risky levels—that is one in 10 12- to 17-year-olds in today’s society. Almost 20,000 girls aged between 12 and 15 drink daily or weekly. The number of young women aged between 18 and 24 being admitted to hospitals because of alcohol has doubled in eight years; and, in a year, more than three-quarters of a million Australians are physically abused by persons who are under the influence of alcohol. These are all facts that we should be concerned about, and we in this place should be finding ways to minimise the risk of binge drinking in our society and in our communities.
Alcohol is, of course, a drug. It is a legal drug, but it costs our community much more than illicit drugs. The annual social cost of alcohol misuse in Australia is estimated to be around $15 billion. Last year the New South Wales Police Commissioner, Andrew Scipione, estimated that something like 70 per cent of police engagements with members of the community in the streets of New South Wales had alcohol as a factor. This is an extremely important issue that we face in our community, and we should all be concerned at the rise in the misuse of alcohol among young people, particularly people between the ages of 12 and 17, and we should all be concerned about the rise in the misuse of alcohol among young girls.
I am not a health expert. I think everyone knows my background; I am actually a musician. But musicians know a bit about alcohol, because most of us work at times when everyone else is playing. I have played piano in clubs seven nights a week between 7 pm and 2 am in the morning, where every customer buys you a drink. When everyone else is playing, we are actually working, and when we are trying to play everyone else is at work. With musicians you find that by the time they get to about the age of 40 they do not drink at all. When you go out for a drink with one of your mates from the music industry, you are all on water. That is either because they are already an alcoholic or because they do not want to become one. I was raised by one, by the way. My father is a musician. He took up the clarinet when I was a baby and went full-time as a musician when he was in his late 20s. Because of that, we did not have alcohol in the house at all. It did not exist in the house when we were growing up. My father always said that the danger of alcohol is not so much the binge drinking; it is when you have a glass of wine today, or you have a beer before you go to sleep, or when you are working you have a beer, and the drink becomes part of that activity. After a year or so, you start to think that you cannot play unless you have had your scotch. Effectively it becomes essential to the activity that you do, and that daily intake is what leads so many musicians, in particular, to excesses. I guess I have been raised in a family which was very aware of the danger of making it easy—of surrounding yourself with easy-to-drink alcoholic beverages.
I find the idea that liquor companies would produce alcoholic beverages that are designed not to taste like alcohol, that are actually designed to be easy to drink and not have the taste of alcohol, quite reprehensible. I find the idea that people who do not like the taste of alcohol get into the habit of that alcohol experience without the taste of alcohol quite reprehensible. I think that we in this place are obligated to close a loophole that allows the liquor industry to do that. I absolutely believe that we are obligated to close that loophole.
The members opposite have got one thing right, from my perspective: this measure alone will not fix alcohol abuse. No single measure will fix alcohol abuse. This alone will not do it. There will be people who already are enjoying that alcoholic experience of parties who will find other ways to get alcohol, and the liquor industry will create other products in an attempt to do the same thing, and we will have to be vigilant. This alone will not fix alcohol abuse. Of course it will not. That is why we on this side of the House have developed a program to address binge drinking. We are not foolish enough to assume that the program that we put in place will solve the problem absolutely, but we do believe that our program will improve attitudes to binge drinking.
In March 2008, the Prime Minister announced the first steps in our National Binge Drinking Strategy. The strategy includes $53.5 million to address binge drinking among young people. Elements of the package include $14.4 million to invest in community-level initiatives to confront the culture of binge drinking. Grant programs have been announced and organisations in my community have already applied for funding under those areas. Those of us who mix widely in our communities will know that there are elements within our communities who are quite proud of their alcohol consumption on the previous weekend. There is considerable work for us to do as a community to change attitudes which actually take pride in drunkenness on a regular basis.
We have also committed $19.1 million to intervene earlier to assist young people and ensure that they assume personal responsibility for their binge drinking and $20 million to fund advertising that confronts young people with the costs and consequences of binge drinking. We have probably all seen the government’s ‘Don’t turn a night out into a nightmare’ campaign which has been screening recently. It is quite hard-hitting and gritty, and we hope it will have an impact on young people’s attitudes to binge drinking.
Of course, there is still more to do and, as things improve, we will no doubt be putting forward more policies to make a difference. But the measure in this amendment legislation will reduce the impact of one of the strategies of the alcohol industry that specifically targets young and inexperienced drinkers. And it is working. When we first considered closing the tax loophole, the modelling indicated that there would be a revenue flow of about $3.1 billion. That estimate has been revised down to $1.6 billion, which is attributable to consumer responses to the increased excise rate on RTDs and weaker forecasts of growth in the consumption of alcoholic beverages. When we first considered the loophole, we would have been pleased if we had achieved a reduction in the growth of alcopops. In fact, our modelling showed that we would achieve a reduction in the growth of alcopops. But we have actually received a reduction in sales. Those figures come from the Australian Taxation Office so I think they can be believed. If what the members opposite say is correct, and I do not think it is—that is, that the liquor industry disputes the figures from the tax office—I am sure there will be an interesting discussion. But I do not believe that is the case. The Australian Taxation Office figures show that there has been a reduction.
The measure is working. It is not the time to turn the clock back. It is time for this House to get behind this amendment legislation and close the loophole that was opened up in 2000, which has had the unintended consequences of making it possible for the liquor industry to exploit that loophole and develop products that are specifically targeted to young people and designed to increase the consumption of alcohol among young people. It was working; the closing of the loophole, though, has reversed this trend. It is time for this House to accept that and support this legislation.
In addressing the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009, I would like to start by taking up a few points that were made by the honourable member for Parramatta. I really feel that she is very confused. When she put forward her case, she came across as someone who is very confused. She started off by saying that the legislation addresses the abuse of alcohol. I would have to say that I think that is not the point of this legislation at all; we know it is all about a tax grab. The member then tried to infer that some members of the opposition are not concerned about binge drinking. That is absolute nonsense. There is not one person in this parliament or indeed in the wider community who would not be concerned about binge drinking. As the member pointed out, from her personal experience one of the more effective measures in addressing binge drinking starts at home—that is, parental guidance. To presume that this legislation will address this is nonsense; it does not. It is nothing more, or less, than a poorly targeted tax grab.
The member for Parramatta asked why people would want to get rid of having measured amounts of alcohol. I remind the honourable member that we are seeing substitution. What is the substitution? Part of the substitution is that people are switching to spirits and mixing their own drinks. As we know, when you mix your own drinks you do not necessarily mix them at the same strength every time. Indeed, you often mix them stronger. We keep hearing about ‘extremely sugary drinks’. But what is a Bundy and Coke? It is a sugary drink. You are saying to people that it is too expensive to buy Bundy in a premixed drink, where you know what the strength is, so grab a bottle of Bundy and some cans of Coke and mix it yourself. I would suggest to the honourable member that, as young people are telling her, that is what is happening. And, of course, there is very little control on the strength of the drinks. It would not be beyond the wit of anyone to realise that in some cases they are being mixed at a stronger level. Vodka and orange is another example, and the list goes on.
So when members of the government say this is closing a loophole, I think that is absolute nonsense. It is not closing any loophole. When they say the measure is working, that is nonsense. It is working well if you want to see an increase in beer sales, it is working well if you want to see an increase in straight spirit sales, it is working well if you want to see an increase in wine sales—and all of these are, of course, where the substitution is occurring. If members of the government seriously want to do something about the problems of binge drinking then this measure is clearly failing.
I do share the concerns about excess drinking by young people, but I do not support this legislation because it is not the way to solve it. It is poorly targeted. It is inconsistent legislation. It is poor policy. Clearly, this is nothing more than a tax grab. One year on, the government have been unable to provide any evidence that it has had any impact on binge drinking. In fact, independent advice going to the government flies in the face of their rhetoric; they have been told it is not working. A report to the government, updated this month, stated that overall levels of alcohol consumption and drinking patterns have not changed markedly over the past decade. That report was from the National Preventative Health Taskforce. The coalition will support sensible measures to reduce binge drinking but clearly this is not one of them.
Obviously there is a wide range of measures that could be brought in such as education; parental guidance, as I have already mentioned; law enforcement, where available; industry involvement; and rehab measures. In fact last year in the parliament I highlighted an example of what has been happening in Warrnambool in my electorate where a trial started in the nightclubs limiting access to high-alcohol content drinks after 1 am. After the trial had been going for a few weeks it was realised that it was so successful that it has now become a permanent measure. Those are the sorts of things that can be done and will work.
Let us now look at the minister’s second reading speech. She tried to make a number of points. She said:
… this measure—
that is, the measure in these bills—
… is backed by research, backed by health experts, and backed by the evidence.
I would suggest that there is no research backing what she is trying to do. Health experts are not saying this per se is the solution and clearly the evidence is not there. So after having imposed the tax for nearly a year, the government ought to have realised that this is nothing more than a tax grab and does not do anything. In her second reading speech the minister immediately went on to the issue of binge drinking, a separate issue and one that can be addressed in a number of other ways. If the government was serious about health and binge drinking, it would not be just going all out to get some more tax on this. In her second reading speech the minister also said that alcopops sales have slumped. That is not surprising—if you increase the tax by 70 per cent you would expect that to happen. Then she says:
Despite a smaller increase in full-strength spirits sales, overall spirits sales have fallen by almost eight per cent.
That is very convenient and very selective but it does not point out what has occurred with other forms of alcohol. I mentioned beer, which is generally the preferred drink of younger men and teenage boys—who are hopefully over the age of 18. As I say, the change to mixing similar drinks to those you can buy that have a measured amount of alcohol is fairly questionable, particularly if they are mixed at home.
Of course the government have been very embarrassed by the incompetence in the inaccuracy of the estimates of the revenue they were going to raise. When it was announced, there was going to be some $3 billion raised. Just a few months later when the bill came in it was down to just over half of that at $1.6 billion. What sort of advice is this government getting? Why can’t the minister at least get somewhere close on this? It is the sign of an incompetent minister.
Let us now look at some of the professional advice around on what the impacts of this measure might be. The Australian Institute of Health and Welfare is the first organisation I want to quote. When they appeared before the Senate inquiry they made a number of points. There has been some effort to try and sort of suggest there has been an increase in binge drinking. This has been part of the justification. We had the big announcement on a Sunday by the government saying, ‘We’re going to attack binge drinking.’ It was another one of those publicity stunts that we are getting used to do with this government. The Institute of Health and Welfare said:
… there has been virtually no change in the pattern of risky drinking over the period 2001-2007…
I think that blows away that myth. It went on to say:
… the dominant alcoholic drink preference for young males … has been regular strength beer…
The government’s National Preventative Health Taskforce noted a downward trend in risky drinking by young people 14 to 19 years old over the period 2001 to 2007. So the justification for these bills becomes even thinner. In The Lancet in August 2008 researchers from the National Drug and Alcohol Research Centre at the University of New South Wales surmised:
Although the Australian Government’s recent decision is likely to arrest the increased sales of premixed spirits—
well, that is fairly obvious—
it is unlikely to substantially reduce overall rates of usual or binge consumption.
So all the arguments being put up by government members just fall away. There is no evidence to back them. Access Economics have been commissioned to do a report looking at trends in alcohol related hospital admission by young people. What they found is that the data collected so far did not support claims the alcopop tax had reduced risky drinking by young people. They went on to say:
… hospital admissions for young people 12 to 24 for alcohol related diagnosis in May and June 2008 were higher than the same months in previous years …
That is after the tax had been increased on these drinks. The emergency department presentations by young people aged 12 to 24 were higher in May to August 2008. It is the same thing. Obviously this tax is not working. As I said, there was an overall increase for the months after the ready-to-drink tax relative to the months before. Also combined admissions and emergency department presentations for females were substantially higher than in previous years and also higher than the months pre the tax rise. So here we have the real evidence to show that this is, as we said at the beginning, nothing more than a tax grab. Access Economics did qualify that report because they said they need time to gather more data, but the trend is rather damning when you look at what the government claims to have been able to achieve and what is being done.
Next I want to look at what I think is a very interesting interview conducted with some of the Heywire winners who came to Canberra earlier this month. Many members had the opportunity to meet some very impressive young Australians who came from all around the country. In an interview for the ABC the question was put about binge drinking. The interviewer said that that minister, Nicola Roxon, was talking about the alcopops tax and saying it had worked in that it had collected less than they had budgeted. The interviewer asked:
But what do young Heywire winners think? They are just the targeted age group of 16 to 22 years of age.
The interviewer asked them:
Who here thinks that the—increasing the price of these mixed drinks has worked? Anyone?
[Group responds] No.
The interviewer then asked why. And the answer was:
Because when you put the tax up on the alcopops it’s not really the drink that people drink to binge drink anyway. It pushes them to drink boxed wine and straight spirits, which can potentially be more dangerous.
This is what young people, who actually know what is going on out there, are saying. The interviewer went on to ask this particular Heywire winner:
You are a singer in a pub in Launceston … So, do you see people curbing their drinking because of increased price?
Neve, the singer from Launceston, said:
No, not at all. Not at all.
And then there was widespread laughter. What that says is that the young people are laughing at what this government are claiming to do—which is not exactly a sign of good policy.
Further on in the interview, one of the winners of Heywire said:
I think the consensus amongst us yesterday was, while at the beginning of our conversation, that the tax had actually fuelled the binge drinking.
It has actually fuelled the binge drinking. That is what the young people are saying—it has fuelled the binge drinking. And this government claim that the reason for bringing this tax in is to reduce binge drinking. Clearly, it is not working; it is failing. That is why it is such bad legislation. The Heywire winner went on to say:
Because I know in my area it’s even got worse because people are just buying straight grog. So, if they got rid of the tax and just went back to Cruisers, they know how much they’re drinking and what they’re drinking.
Government members ought to take note of what young people are saying, because, clearly, this tax is not achieving what the government claim it is. It is nothing more than a disguised method of trying to raise revenue.
Maybe we should look at what some of the editorials in a couple of the newspapers have said—and they have been scathing of the minister. Earlier this month, on 6 February, the editorial in the Australian, headed ‘Policy on the rocks’, said:
The alcopop tax rise was a rort that wouldn’t work.
Pretty strong words. It goes on to say:
There was never anything to drink to in the 70 per cent tax increase on alcopops in the budget last year. It pushed prices up at a time when the Government was banging on about fighting inflation. It discriminated against drinks preferred by the politically powerless—young people and older workers who like pre-mixed spirits. And the way it was sold assumed we had all had a few too many and would believe anything—that the tax was a way of stopping binge drinking among the young, of encouraging teens and those in their 20s with a taste for potent sugar hits to drink less, that the $680 million in extra revenue over four years it would generate was entirely incidental.
This was a triple-distilled fib and the Government has now been caught.
Pretty strong words—and it is about time some members over there stopped carrying on with this nonsense of trying to pretend otherwise. The editorial went on to say:
The tax is now expected to generate only half the additional income originally anticipated—
because people are switching drinks. The editorial goes on to talk about what happened in New Zealand when they tried to do the same thing and found that it did not work. So we have not learnt from that. The editorial makes the point that it is nothing more than a ‘cynical stunt’. It concludes by saying:
The alcopop excise is policy snobbery—on the rocks.
Lovely words.
But let us look at another editorial. The editorial in the West Australian at the end of January is headed ‘Time for Roxon to admit that alcopops tax is not working’, and says:
The Federal Government has been caught out in its tax on alcopops. Either it did not think through the big increase in excise on pre-mixed spirit-based drinks, or it cynically chose to camouflage a common-or-garden tax slug as a health strategy.
They have probably summed it up and exposed this government policy for what it is: it is not a health measure—as has been clearly demonstrated by what young people are saying and what these editorials are saying. The editorial goes on to say:
There is evidence to suggest that the tax slug has not made a scrap of difference to the overall level of alcohol consumption amongst the group it targets and may even have caused it to increase.
It also points out:
… Health Minister Nicola Roxon says only that there is “strong evidence” to support its effectiveness, but she has failed to reveal it.
She has been caught out and exposed. I think members opposite should hang their heads in shame if they think that they are going to come into this chamber and carry on with this nonsense as to why they support this bill. It is not a health measure and it is not working.
I mentioned the Access Economics report. It talks about hospitalisation rates for alcohol related harm among 12- to 24-year-olds. Report author Lynne Pezulla was quoted as saying:
“If anything, hospitalisation rates of young people due to acute intoxication and harmful use of alcohol worsened in the months following the Government’s tax increase on ready-to-drink products.”
She went on to say how people were moving on to use rum and coke and other things. And what did the health minister do? She went back to some figures from the year 2000. Come on, Minister: the young people of 2000 have now grown up; we are talking about today. The minister is obviously desperately clutching for straws. She really has not a feather to fly with in her argument to support this tax increase. As a health minister, one should in fact question why she is even sponsoring it as a health measure.
I have no hesitation in saying that I will be voting against this legislation. I think it is poorly targeted. It is, as I say, nothing more than a tax grab. It is poor policy and there is some early evidence that shows that, rather than achieving what is claimed—to assist in reducing the amount of binge drinking amongst young people—it may well be that it is increasing the amount of binge drinking. I think the government has failed on all counts, and clearly this legislation should be opposed. If the government had any real concern about binge drinking, they would be looking to far more effective measures than trying to put legislation like this through.
It is with great pleasure and total commitment that I rise today to speak to the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009, which we have before us in this parliament. In doing so, I would like to emphasise—and I mean emphasise—the importance of this piece of legislation from a health perspective. So often, members on the other side of this House distort research information that relates to health measures, particularly so when it comes to drugs and alcohol. I will deal in some detail with the distortion that we have heard from previous speakers. This legislation will alter the taxation definition of beer in the Excise Tariff Amendment Act 1991 and the Customs Tariff Act 1995 and wine in A New Tax System (Wine Equalisation Tax) Act 1999 to ensure that beer and wine based products that attempt to mimic alcopops in relation to their taste are taxed as a spirits product.
I heard the previous speaker, as well as other speakers in this debate from the other side, quote figures, talk about the effectiveness of this legislation and say that it was about tax—that it was not a health matter. It showed just how out of touch they are and what little knowledge they actually have about health related matters. It also showed how selective they are when they are researching information for a speech. When the opposition sat on the government benches of this parliament, their approach to dealing with the epidemic in our society of binge drinking—the misuse of alcohol by young people—was to ignore it. It was seen as not being a problem. They were prepared to conduct inquiries into illicit drug use. They were prepared to conduct inquiries into numerous other issues. But they never looked at the effect—the harmful effect, I might add—of alcohol. It is very important to note at this point that alcohol is one of the major causes of chronic illness in our society. When the opposition were in government they did absolutely nothing to address this chronic issue. They argued that any problems with drugs in Australia related to illicit drugs.
The fact is that the figures do not hold up when you are looking at the use of alcohol and drugs. The data that I have here is from the National Drug Strategy Household Survey. This information indicated that along with smoking, the misuse of alcohol was a major health problem within our society. Over 80 per cent of the population consumed alcohol in the previous 12 months, with 11 per cent of males and six per cent of females drinking daily. In terms of risky behaviour in the long term, 10 per cent of males and nine per cent of females drank alcohol in a way that set up a risky pattern. In addition, 24 per cent of males and 17 per cent of females drank at least once a month in a manner that was high risk in the short term. In other words, that means that we have young people engaged in risky alcohol drinking behaviour—binge drinking. Those young people have their introduction to alcohol through alcopops. It is just a transition between a sweet soft drink and a sugary alcopop, and research supports that.
Alcohol use is also a major cause of drug or alcohol related deaths in Australia. There were 2,000 deaths in 1998—and I am sure that is now higher—among people under 64 years of age. It accounted for 28 per cent of all drug or alcohol deaths in this age group. Tobacco use is probably the highest cause of drug related deaths, followed by alcohol. All this can be compared with the around 1,000 deaths per year in Australia that are caused by illicit drugs. When the opposition sat on the government side of this parliament, they concentrated on illicit drugs. They did not concentrate on the biggest killer of people in Australia—an epidemic that is consuming our society.
Tax office figures for the first nine months of this year show that alcopops sales have dropped by 35 per cent compared to the previous year. That was far beyond the predictions that were made when this legislation was introduced. The legislation predicted a slower fall-off in use. However, alcopops sales have slumped, bringing overall spirits sales with them. Despite a small—and I emphasise small—increase in full-strength spirits sales, overall spirits sales have fallen by eight per cent. To listen to members on the other side of this House making their contribution to this debate, one could be excused for believing that sales of alcopops have declined marginally and that, instead of those, people are now buying large quantities of full-strength spirits. That is not true; the figures do not support that. This only goes to show that you can never believe what those on the other side of this House say.
The previous speaker, the member for Wannon, asked why this has been sponsored as a health measure. I have the answer for the member for Wannon. The Australian General Practice Network are a very authoritative body when it comes to health matters. In a letter to the Treasury in October last year they talked about the impact of tobacco and alcohol on the burden of disease on our society. They went into some detail, saying that harmful alcohol consumption was associated with 3.2 per cent of the total disease burden in 2003. It accounted for 9.7 per cent of the burden of mental illness in Australia. In 2004-05, $3.5 billion in lost productivity was related to alcohol use. In 2007 about one-third of persons aged 14 years or older put themselves at risk or high risk of alcohol related harm in the short term on at least one drinking occasion. What have the members on the other side of this parliament advocated? That we do absolutely nothing.
In the same period, 10.3 per cent of persons aged 14 years or over consumed alcohol in a way considered risky or a high risk to their health in the long term. The 2007 National Drug Strategy Household Survey reported that both daily and weekly smoking patterns were undesirable and that alcohol was a similar problem.
Australian evidence has shown that the excise taxes on products such as tobacco and alcohol curb consumption behaviours and can therefore be an effective public health intervention. Members on the other side of the House say this is a tax bill. The Australian General Practice Network say that excise taxes on products such as tobacco and alcohol curb consumption behaviours and can therefore be an effective public health intervention. That comes from one of the leading medical organisations in Australia. I think it really debunks what the member for Wannon said.
We know that members on the other side of this parliament are slaves to big business. We know that they get their marching orders on the position they should take on any piece of legislation from their friends in high places. They do not make decisions on legislation based on what is best for Australians. I find it very disturbing that speaker after speaker on the other side of the parliament has risen to state their opposition to this legislation and presented very flawed arguments based on partial evidence while ignoring evidence from public health workers, the Australian General Practice Network and information that can be obtained from looking at medical data. Those on the other side of the parliament need to decide why they are here. Are they here to serve big business or are they here to get good quality health outcomes for Australian people?
The National Preventative Health Taskforce, in a discussion paper, has proposed targets for Australia to become the healthiest country by 2020. The third target on its list is ‘reduce the prevalence of harmful drinking of alcohol for all Australians by 30 per cent’. That is what this legislation is about—reducing the prevalence of harmful consumption of alcohol. The paper deals in some detail with alcohol. It emphasises that alcohol is an intrinsic part of Australia’s culture, that 83 per cent of Australians are drinkers and that 1.4 million consume alcohol on a daily basis. I quoted 80 per cent earlier. This data is a little bit newer and shows that consumption of alcohol is increasing.
Consumption of alcohol accounts for 3.2 per cent of the total burden of disease and injury in our country, at an estimated health cost of $11 billion annually. What is the response of members on the other side of this House? Do nothing. Argue the case for the distillers. Do not do anything for the Australian people, do not put in place any strategy to address the problem and ignore advice from the Australian General Practice Network. They are ignoring the advice and evidence from overseas, where it has been found that the introduction of excise taxes is a very effective way to deal with reducing the consumption of alcohol. I might add that the National Preventative Health Taskforce discussion paper highlights a review of the taxation system to stimulate production and consumption of low-alcohol products and a removal of tax deductibility for advertising. Once again it is linking tax to the consumption of alcohol.
I come from Lake Macquarie in the Hunter. The front-page article in today’s Newcastle Herald is headlined ‘We’re punch drunk’, with the subheading ‘REVEALED: The appalling stats that confirm our city can’t hold its liquor’. The article details at some length the problems that are associated with binge drinking—problems that, to a large extent, are related to young people.
I am a member of the House of Representatives Standing Committee on Health and Ageing. This morning in that committee we had a briefing from Dr Gillian McIlwain and Professor Ross Homel, Foundation Professor of Criminology and Criminal Justice and Director of the Strategic Research Program in the Social and Behavioural Sciences at Griffith University. They came to talk to the committee about alcohol related violence in licensed places. This morning, prior to coming to this chamber, I was confronted with information on two fronts about the abuse of alcohol and the abuse of alcohol by young people. As a parliament, we can sit back and do nothing. We can ignore the advice of health experts and do nothing about addressing this issue. Or we can say we really want to address it; we really take it seriously.
In relation to the abuse of substances of any kind, we know that, after smoking, alcohol causes the second highest rate of health problems in our community. It is a big issue. We need to address the problem at the level at which people are being introduced to alcohol. People are introduced to alcohol through the subtle move from drinking soft drinks—sweet, sugary, non-alcoholic drinks—to drinking sweet, sugary drinks that are alcoholic. It is not an argument to say that people can monitor what they are drinking when they are drinking alcopops as opposed to spirits. Alcohol is abused by young people and cost is an important factor in that. I encourage members of this House to support this legislation, to move away from their friends in big business and to start thinking about the health of our young people and the Australian population. I encourage them to vote in favour of this legislation.
It is a privilege to rise today to oppose the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009. Let us be clear here today about what this government is seeking the parliament’s permission to do. The government is asking the parliament to validate a tariff—a new tax, an excise, whatever you want to call it—when we know clearly that the intentions of this measure have been a total and utter failure. We know that this is a complete policy failure.
We have had member after member on the government benches tell us today that this is all about the health of the Australian community, that these bills are somehow tied integrally to the health of Australians, to the consumption levels of alcohol and to health outcomes that the government is seeking to change or alter. But what is really going on is that this government is seeking to increase the excise, the tax, collected on one category of alcohol—ready-to-drink beverages. Those opposite contend that by increasing tax on one category of alcohol they will effectively reduce alcohol consumption in our society. Of course, we know that that is an absolute and utter farce of a contention. We know that that objective will not be achieved through these measures. In fact, all of the evidence that is presented to us by anybody who exists out there in the real world—the people who drink in the pubs, the people who deal with the youths who have consumed too much alcohol on a regular basis—corresponds with what common sense tells us about these measures. It tells us that young people, when faced with a choice between a newly high-taxed, expensive alcoholic product and a cheaper alcoholic product, will simply move from consuming the newly taxed product to the cheaper product. It is simple consumer behaviour.
Once again, this provides me with an opportunity to lecture this government and Labor Party members with a simple lesson in economics and the free market, which I know they are now suddenly very opposed to. When you tax one product heavily, you will decrease the consumption of that product. I have no doubt that they have examples and evidence of the decrease in the consumption of ready-to-drink beverages. But we have seen an increase in the consumption of spirits—straight spirits. We have seen an increase in the consumption of other forms of alcohol—beer and cheap wine.
Mr Deputy Speaker, if you were the person in this country responsible for the marketing of hipflasks, how would you come up with a policy that would dramatically increase the sale of hip flasks in Australia? With the best will between us in this place we would not find a way to increase the sale of hipflasks quite dramatically but under this government we have seen a soaring in the level of hipflask sales. That distortion has been created by these measures, which seek to tax one category of alcohol with no regard for the consequences. If this is a genuine health measure, there are many questions that need to be asked. Why would we validate a measure that is not achieving health outcomes?
Many of the members opposite in their speeches recently have focused on the taste of ready-to-drink drinks as if that is somehow some sort of compelling argument for us to validate an excise measure—whether the drinks are sweet or whether the drinks are sour. They seem to be obsessed with sweet-tasting drinks. Somehow we should tax sweetness as if it is bad and allow sour drinks because that is somehow going to bring about a better outcome. This is the level of debate that we are subjected to in this place. We understand on this side that this is purely a tax grab. This is purely a way of raising revenue. It is not designed to achieve a particular health outcome and, if members opposite want to stand on the fact that this is a health measure, then they had better acknowledge that this is not going to achieve in the real world the very benchmarks that they have set up for policy success in this area.
A question must be asked in relation to these bills: what is happening to the money that is being collected—allegedly for health measures, as Minister Roxon, the Minister for Health and Ageing, has said? Hundreds of millions of dollars have been collected. Ironically, this is nowhere near what the government projected. Initially I think it was $3.1 billion across the forward estimates, then $2 billion when the tax hike was first mooted and we now know that it will raise only about $1.6 billion on the forward estimates. Between $220 million and $345 million has already been collected with this tax binge that the government has embarked upon. Has anything between $220 million and $345 million been spent on health measures? We know that nothing like that has been spent on health measures. We know that the government has not embarked on a new era of attacking binge drinking—of meaningful policy initiatives that have been designed to send binge drinking on a downward spiral. We know they have spent a small amount—$53 million—on advertising and some other minor measures.
When I speak to the bodies that deal with youths who are affected by alcohol in my electorate and in greater Sydney, where I come from, they tell me a couple of things, and it is very important that we take note of the people who are on the ground and are dealing with these issues. If the government is serious about addressing binge drinking, it will have an ally in the opposition because we also seek to address the very serious problem of binge drinking, especially amongst our youth. But when the charities and the voluntary sector ask: ‘Are you discouraged? Have you stopped drinking because of the increase in your favourite ready-to-drink mix?’ the young people they talk to—the people who are affected—say: ‘Of course we haven’t. Of course we’re now drinking either straight spirits,’ or, ‘We have moved to wine or beer.’ Interestingly, the feedback that I have received is that they simply turn the advertisements down when they are watching the television. They do not listen to them.
Clearly, though the $53 million the government has already pumped so far into this has not achieved its objective, we know that alcohol consumption levels and hospitalisations have continued to increase since these measures for alcohol related matters were introduced. We know that every benchmark the minister and the government have set for the success of this policy is an abject and utter failure except for the collection of revenue. But I should also correct myself there. They thought they would collect $3 billion in the budget—$2 billion across the forward estimates—but we now know they will collect revenue of only $1.6 billion. It has been a failure not only as a health initiative but also as a tax initiative, and we understand that this is primarily a tax initiative.
You can go further afield and examine the attitudes of young Australians as to whether the government’s measures are doing what they set out to do. You can go onto Facebook and have a look at the serious and mounting opposition that comes from the young people who use that medium. It is young people primarily who are scattered across there. There is a group on Facebook called Aussies Against the Alcopop Tax Increase. It has more than 72,000 members now. Having run some Facebook sites, which I have on very important issues in north-west Sydney—including building a metro line—and having had those established for a year or more and having 1,000 members or so, I know that getting to 72,000 members is a very significant achievement. The people who have put together this group say to me they are overwhelmed with young people who are concerned about paying more for their favourite category of alcohol. That is not an indication that people want to continue to binge drink—we know that most people, most of society, behave responsibly with alcohol; most people can do the right thing in relation to drinking—but it tells us is that young people are awake to what the government is doing here. It is not seeking to genuinely lower the rates of alcohol consumption. Imagine if the government proposed a tax on beer. Why did they not propose a tax on beer if they were looking to lower alcohol consumption in Australia? We know that ready-to-drink drinks is a niche category. We know that it is not as common as beer and we know that, if the government proposed a tax on beer, they would face a serious and substantial backlash—as they should—from the Australian community.
I think the member for Dickson’s suggestion in relation to what should be done with this revenue that has already been collected—the $220 million to $345 million—is a good one. He is suggesting that, if this government is serious, all of that revenue ought not to go back to the companies that it has been taken from. The member for Shortland is quite wrong in saying that we are directed by the distillery council. The opposition have proposed that that money be spent on more initiatives and better initiatives and, indeed, be given to the sector that needs it the most—that is, the sector that deals with people who have alcohol problems and the effects of the consumption of too much alcohol.
If that money were spent in that way, that would be a meaningful outcome of these measures. But we know that this government is not looking to spend that money in this area; it wants to create this wedge, this dynamic of, ‘Well, the money will go back to the industry; therefore the parliament must pass this measure.’ We know that is a furphy. We can put in place legislation here that can send that money to where it is needed most, and if the government is serious about health measures then that is where that money should be spent.
If this government went into our community and said, ‘We’re imposing a new excise on one category of alcohol, and the purpose of that excise is the health of people suffering from alcohol abuse,’ and that were the government’s position—that it was the truth and that that is what that money was collected for—then that is what the money should be spent on. No government ought to have the right to single out an industry sector—to single out people—and to tax them unfairly in a way that does not produce the effect intended and does not result in the money ever being spent in the way it was intended. That has been tried before many times in the past. In fact, in Boston many years ago, people reacted to the unfair taxes that were imposed on particular categories of goods. Indeed, every industry sector in Australia ought to watch this issue very carefully. They ought to look at the government and think, ‘Our industry sector could be next.’ If the government is willing to single out one sector of an industry and heavily tax it with no real outcome, where clearly its objectives are not being met, then any industry sector could be the subject of the government’s next delight in or passion for taxation.
Indeed, we are facing one of the most serious economic circumstances of our time. We have heard that consumption is vital to our recovery. We have heard that handouts of cash to everybody to continue to spend are the order of the day and that they will somehow save us. Yet this government, at the same time it is giving, is seeking to take in the form of new taxes. It is seeking to take money out of the economy by taxing alcohol, it is seeking to take $250 from every student and it is seeking to tax more than it did before. That, I think, gives the lie to the idea that somehow consumption is our way out of economic problems.
If you look at some of the data that has been collected, you will see it provides us with a snapshot of what people are thinking about these measures. A Galaxy survey was conducted, asking Australians whether they thought the tax on ready-to-drink products was effective or whether it should be scrapped. It produced the following results. Only 12 per cent of people came forward and said, ‘We think this tax is effective; we think it will do what the government says it will do.’ Seventy-eight per cent thought it was ineffective. Does this pass the common-sense test? If you went into a pub and were told: ‘Here’s your 20 categories of alcohol that you can buy over the bar; we as a government are going to increase the tax on this one by 70 per cent, but we’re going to leave the taxation treatment the same on all of these other categories; therefore the price on that one category will go through the roof but the price of every single other category of alcohol will stay low,’ what do you think people would do? The common-sense test tells us that they will go for those other forms of alcohol and stop buying the highly taxed product, and that is exactly what is happening. Furthermore, the survey revealed that 77 per cent of people thought the tax should just be scrapped. I think that is a snapshot of community attitudes.
You will not get an argument in this place about the worthiness of tackling binge drinking or have a genuine debate about how we solve the issue of people who have problems with alcohol consumption. We know what these bills are really about; we know they are simply a tax grab for the bottom line of the budget. Singling out any industry sector for a false purpose is not something that we should ever seek to do. Indeed, that is why I, in particular, and the opposition will be opposing these measures.
We would support sensible measures to reduce binge drinking. I think we ought to listen to the people who know the most about these things. Why haven’t the experts in this field been brought to Canberra to discuss these matters—to discuss what can be done with this revenue and how it can best be spent? I get feedback from the very serious charitable and voluntary organisations in my own electorate. I know that they know how to address these problems. They are already in the field addressing these issues. They are having great success in that field, because that is what they do. But we are not listening to them; we are listening to a cash-strapped government. We are listening to a group of people who seem to think it is their right to tell people what to do every day of their lives—what to drink, what to eat, how to think and how to feel.
The Minister for Health and Ageing tends to come into this chamber and act as if it is her right to single out an industry sector and tax them heavily for a purpose when it does not achieve that objective. She seems to act as though it is her right when that industry sector are providing a legal product, employing Australians and simply doing what they are allowed to do by our market system. I do not accept that it is her right to single out people for this unfair treatment. If the government is serious about addressing health issues then there are ways of being serious about addressing them, but we have not seen them from this government. What we have seen are purely revenue and taxation measures designed to increase the bottom line of the budget.
Things such as education and law enforcement have been totally overlooked by members from the government benches who have addressed this question. Instead of treating the Distilled Spirits Industry Council as though they are criminals engaging in some form of underhand activity—instead of antagonising and attacking them—why wouldn’t you seek to work with the industry on solving this problem? Of course, we know the government have not taken that approach. They have taken the attitude that the industry is against them, that they are against the industry and that the government know best, which I always have a level of scepticism about. The government need to be taking measures on law enforcement, industry involvement, community engagement and rehabilitation.
This is clearly a policy failure in what it has set out to do in terms of health, and the maligning of this industry sector is something that I think is unedifying to watch, unnecessary and, indeed, a real stain on government in this country in general. In addressing both of these bills and why we are here today, I think it is also important that we do not overlook the fact that you cannot legislate for common sense. You cannot legislate to stop people from being stupid. You cannot legislate to stop people from binge drinking. All of these things have been tried before in human history, and all of them have failed. Attempts by government to legislate human behaviour usually end up producing an opposite set of effects or an unintended set of effects. Indeed, as I outlined earlier, if you want a good example of that then the increase in the sale of hipflasks, of straight spirits and of beer and wine is the unintended consequence of this tax and revenue measure. It may have produced a decline in one category which you have taxed—because whatever you tax you create a disincentive to buy—but why tax one category of alcohol and not others? It gives the lie to the stated reason of the government behind this policy measure.
We know that you cannot put a law into place that will stop people from behaving badly, but the reality is that most Australians behave responsibly with alcohol. It is a part of our culture. There are parts of that culture which need addressing. There are serious health implications in relation to the abuse of alcohol, and they do need addressing. We are here to say to the government: if you are genuine about pursuing health initiatives then pursue health initiatives. Do not pursue revenue measures that will not achieve a health objective. (Time expired)
I rise to support the two bills before the House. The Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 seeks to alter the rate of the excise duty in relation to other excisable beverages not exceeding 10 per cent alcohol by volume, commonly referred to as alcopops or ready-to-drink beverages. The bill will confirm, though legislation, the increase that occurred from 27 April 2008 for these types of alcoholic drinks. The rate of duty, as it appears in schedule 1 of the Excise Tariff Act 1921, will be increased from $39.36 to $66.67 per litre of alcohol content.
The second bill, the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009, will ensure that imports of such beverages as described will be taxed at the same rate, known as the excise equivalent customs duty rate. This also took effect from 27 April 2008, and this bill will legislate that increase. The Australian Taxation Office and the Australian Customs and Border Protection Service have been collecting excise and excise equivalent customs duty at the higher rate since 27 April 2008.
We have heard that the federal government is apparently singling out one industry and one section of the industry in taxing these alcopops. What all of the speakers on the other side have avoided—I would say intentionally—is the fact that these particular types of alcoholic beverages have been targeted to close a loophole that was created by the Howard government with the introduction of the goods and services tax. This is a responsibility that fell on their shoulders almost a decade ago—that is, to make sure that this hole did not arise—and they failed. They failed our young people. They failed to do anything to ensure that these types of damaging alcoholic beverages did not become more easily accessible to our young people.
So why are these two bills so important? We have heard about the binge drinking problem. When we talk about binge drinking, we know it has effects in two main areas. There are the health consequences that flow from binge drinking, but there are also the social consequences. These statistics are quite horrific when you think about it: in any given week approximately one 12- to 17-year-old in 10 is binge drinking or drinking at risky levels. In addition, between 1999 and 2005 the proportion of teenage girls aged 12 to 17 who chose ready-to-drink beverages as their preferred drink rose from 23 per cent to 48 per cent. That is a significant increase that has not been acknowledged by any speaker on the other side of this House during this debate.
In fact, the member for Mayo said that binge drinking has not suddenly become a problem; it has been a problem for a long time, going right back to when he was a teenager. He was making that comment to somehow excuse us from any need to do anything about it now, but the statistics speak very differently. The statistics show that since 2000 there have been significant increases in the consumption by and attraction to young people, especially young teenage girls, of these particular types of beverages. You do not just have to take the federal government’s word for this, of course. There are many organisations, both from the health area and from the social services area, that agree with the government on this. For example, the police want action on binge drinking. On 27 May 2008 the New South Wales Police Commissioner, Andrew Scipione, stated:
“Drinking habits have changed. What many young Australians are doing now is going out determined to get drunk, whatever the consequences.”
“There’s been a normalisation of binge drinking rather than an encouragement of sensible drinking and sadly it involves both men and women … Enough is enough and it’s time to change the culture.”
The Australian Drug Foundation, the Australian National Council on Drugs, former Liberal minister and former AMA president Dr John Herron, the Alcohol and Other Drugs Council of Australia and the Public Health Association of Australia supported this initiative. The Public Health Association of Australia CEO, Michael Moore, came out in November in relation to the government’s anti-binge drinking ads and said:
I hope this campaign is not attacked by the industry using the same sort of tactics of distorting facts and statistics that have been used by some representatives of the distilled spirits industry to protect their own profits.
There are many organisations out there who support this initiative—and let us not forget an independent report commissioned by the Howard government. It was written by David Collins and Helen Lapsley and entitled The costs of tobacco, alcohol and illicit drug abuse to Australian society in 2004-05. That report found that there would appear to be strong justification for the April 2008 increase in the Australian tax on premixed alcopops by 70 per cent. Alcohol excise taxes are capable of being designed explicitly to target the types of alcohol known to be the subject of abuse—for example, high-strength beer and alcopops. Studies show that young people are more influenced by the price of alcohol, so that increasing the tax rate on alcoholic drinks which are specifically targeted at the youth market is likely to be effective. This is from the independent report commissioned by the Howard government, but I do not remember hearing any of the speakers on the other side referring to that report today in this debate.
You would think that the statistics of the increase in the use of these beverages and their attraction for young people would alone see the government and the opposition being as one on this issue. In fact, you would hope that that would be the case, but of course it is not. You would hope that the government and the Distilled Spirits Industry Council would be one on this issue, but of course they are not. You would have to say that this is a case where they protest too much. The industry itself has come out and said that the tax that has been in effect since April 2008 has had no effect at all. It is not addressing binge drinking. Let us just consider the argument that the distilled spirits industry is putting up. This tax has been in for a number of months, more than adequate time for there to be proper analysis of the effects coming out of the use or reduction in use of these beverages and the sales of these beverages. You would have to question that if you actually accept the industry’s argument that this tax has had no effect since its introduction. Why would an industry such as this pour so much time, so many resources and so much money into lobbying members and campaigning against this tax if it is having no effect? If it is not affecting their revenue in any way because young people are either still buying alcopops at the same rate as they were prior to April 2008 or, alternatively, have switched to full spirits or other forms of alcohol in place of that—and, if you believe the speakers on the other side, young people are actually drinking more now than previously—then why is this industry up in arms? Their bottom line is revenue, making money for their shareholders and making sure their products sell. So, if this tax is having no effect or if people are turning to other alcohol and the problem is still occurring and the increases are still occurring in the sales of this alcohol—as we have heard from speakers on the other side today—why is this industry so determined to see this tax scrapped?
They are certainly resorting to some interesting tactics, may I say. They have had their mobile billboards, they have written many letters to members of parliament and they have sent media articles—there are lots of articles in the paper about whether or not this is working—but I have to make mention of a particular stunt that this industry pulled at the end of last year. This is an industry that is about responsible drinking and genuine debate, if you believe the member for Mitchell. Their idea of working with the federal members of parliament, particularly with me, on this issue and wanting to enter into genuine dialogue was to, without contacting me or my office, come into my office in parliament on a daily basis in the last sitting week of 2008, not seeking to talk to me or any staff, and to drop a bottle of alcohol at my front desk each day. That resulted in four bottles of alcohol being left in my office—which is over two litres of alcohol, none of which I asked for, nor was I asked whether I would like to keep it—all to make a point about binge drinking not being a problem and about how we should enter into genuine debate. On the first sitting day of this year—their staff were obviously busy dropping bottles around the place, so I could not get hold of them the week they dropped these around—one of my staff contacted the Distilled Spirits Industry Council of Australia and said: ‘We have four bottles of alcohol here that we don’t want. Ms D’Ath has specifically asked that they be returned to the industry council.’ The immediate response was, ‘Well, if the member doesn’t want them, tell her to pour them down the sink.’ I said, ‘No, I don’t want these; come and get them.’ They then said that it was not a priority for them but that they would organise it. Here we are in the third sitting week, almost four weeks since that phone call was made, and unfortunately the four bottles of alcohol are still sitting in my office. They are not too intent on coming back and entering into any dialogue with me, obviously.
We are being accused of attacking this industry, but we are not doing so without some reason, I would argue. When you look at what this industry has done since this tax was introduced you will see it has gone out of its way to try to find alternatives to get around the tax—‘malternatives’, as they have been called. It is absolutely shameful that this industry has done that. If the stunt of dropping these bottles around to me and saying, ‘Here is all this mixed alcohol that is not taxed,’ is to try to get me to see that a particular tax on alcopops is not having the effect that it should, I say to the industry as a personal perspective from me: if that is the case, I am more than happy to support fixing any loopholes the industry might find and, if there are these ‘malternatives’ that they say will be just as attractive to young people, I would certainly support fixing that problem.
The opposition have come in here today, unfortunately although not surprisingly, making comments about how the alcohol industry is a major employer and so we should not be forcing a tax on it that may affect its revenue. Again, if they are running the industry’s argument, they should be consistent. If the industry is saying, ‘This tax is having no effect,’ then it is not going to have an effect on revenue and it is not going to have an effect on jobs. So what are they crowing about? The fact is that they know that this tax has caused a reduction in alcopop use, and that is what it is intended to do.
But there has been an increase in spirit usage.
I have an interjection that it has increased full spirit usage.
Mr Baldwin interjecting
Order! The shadow minister will cease interjecting.
There has been an increase in the use of full spirits, but not to the same level as the decrease in the use of alcopops. So, overall, we have seen a reduction—and the other side does not want to acknowledge this—in the use of spirits.
We are being told by the member for Mayo that we should not have a wowser approach. I did not realise trying to address binge drinking was having a wowser approach. We have heard from the member for Mitchell about 75,000 young people on Facebook who are not concerned about the use or abuse of alcohol; they are concerned about paying more for alcohol. That gives me some heart because, if young people are concerned that their favourite drink is going to cost them more, they might be a little bit more hesitant to buy that drink now.
My local youth group has recently launched a ‘Be aware’ campaign. These young people developed their own materials to take out to educate young people, which included graphic footage of young people at parties involved in drug use and alcohol abuse. If young people themselves are developing programs to educate others about the abuse of alcohol, surely we have a responsibility to be doing the same. We have heard from the member for Mitchell that, when it comes to the ads, young people in his electorate say they just turn down the volume. What is their solution? We have heard that they do not support a tax and they do not support ads. They believe that the revenue should be spent on better initiatives and given to groups who deal with this problem. I do not disagree with ensuring that there is adequate funding going to groups who have to deal with the outcomes of binge drinking, and the government is doing that, but there was not one mention from the opposition of spending revenue towards any preventative programs—not one mention of it at all.
This government is tackling this issue with a holistic approach. We are not just introducing a tax on alcopops. We are committing $14.4 million for community-level initiatives to confront the culture of binge drinking in partnership with sporting and community organisations; we are spending $19.1 million to intervene earlier to assist young people and ensure that they assume personal responsibility; we are putting $20 million towards the advertising campaign ‘Don’t turn a night out into a nightmare’, confronting youths with the consequences of binge drinking; and we have $872 million in funding for preventative health, announced at COAG in November 2008, which will include new initiatives to tackle binge drinking. That is what this government is doing to tackle this issue, as opposed to what we are once again hearing from the other side.
The opposition are all in denial. If it is not climate change or the global economic crisis, it is binge drinking. These things are not happening, according to them, but are being overplayed and blown out of proportion. The opposition have a simple approach to just about everything: ‘Let’s sit back and wait and see if everything fixes itself, whether it is the economy, the climate or binge drinking.’ This government is not going to sit back. This government is committed to addressing this problem and to looking after our young people and doing everything we can to educate them and discourage them from being attracted to the types of beverages that are most damaging to young people. I call on those on the other side to support these bills.
I am pleased to speak today on the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009. It is important at the outset to reiterate that the coalition does not deny that there is a binge-drinking problem amongst some in society, and we are very concerned about those problems. The member for Petrie just mentioned the ad campaign ‘Don’t turn a night out into a nightmare’. I actually want to congratulate the government, because that is a good ad campaign and I think it does cut through to young people. The coalition is, however, opposed to these bills because they seek to validate a substantial increase imposed on one category of alcohol products: ready-to-drink beverages, RTDs or alcopops, as they are known.
The coalition is strongly of the view that the government’s ready-to-drink alcohol beverages tax increase is extremely unpopular and has failed on both social and economic grounds. The government has provided no credible evidence that it is working from a health perspective. It claims that it increased these taxes as a health measure—a measure aimed at cutting the rate of binge drinking, particularly among young women—but it is nothing more than a tax grab. It is a measure that was drawn up deep within the Ministry of Finance and Deregulation to boost the budget bottom line. On both health and tax counts it is a failure, and the bills before the House are purely about the tax impact. The increase in excise on RTDs of nearly 70 per cent, from $39.36 per litre of alcohol content to $66.67 per litre of alcohol content, will raise $1.6 billion across the forward estimates. That is less than the estimated $2 billion when the tax hike was first mooted and far less than the $3.1 billion estimated in the last budget. In fact, current estimates are that the government has collected somewhere between $220 million and $345 million with this tax binge. On the one hand it is an extraordinarily large sum of money; on the other hand it is not as much as the government expected, simply because the quantity of alcohol consumed in these drinks has gone down. The quantity of alcohol consumed in other drinks has gone up.
Ready-to-drinks are now to be taxed similarly to full-strength spirits rather than at the same rate as full-strength beer, which more appropriately reflects the alcohol content of RTDs. Let us look at some opinions within the Australian community, because our communities are keenly aware that the tax is not working. Recent editorial pieces express the widely held view that the RTD tax increase has been a failure and should be reversed. For example, I will quote from the editorial which appeared in the Australian on 6 February 2009, headed ‘Policy on the rocks’. It states that the government’s alcopops tax is:
… a triple-distilled fib and the Government has now been caught. Certainly, sales of mixed drinks have gone flat, with the liquor trade estimating a 42 per cent decline. The tax is now expected to generate only half the additional income originally anticipated. But there is also evidence that instead of cutting down, people have just switched drinks, taking up straight spirits instead.
The editorial in the West Australian on 24 January 2009 states:
The alcopop strategy has been unravelling since it was announced. It has been revealed as a ham-fisted attempt to cloak a heavy tax in the guise of a health message. If the Government has evidence of the tax’s effectiveness, it must produce it or accept that it is a failure.
The government cannot ignore headlines such as these: ‘Alcopops tax turns out a revenue fizzer’, ‘Alcopop sales down, spirits up’, ‘Young turn to spirits’, ‘Alcopop tax slug “failure”’ and, from an editorial in the Australian, ‘A lesson in spending—Consumers will defy central planners if it suits them’, which I think has some very strong messages for all governments.
Reports prepared by Access Economics for the Distilled Spirits Industry Council of Australia on trends in alcohol related hospital use by young people since introduction of the alcopop tax found that data collected so far did not support claims the alcopops tax had reduced risky drinking by young people. Hospital admissions for young people aged between 12 and 24 years per 100,000 population for alcohol related diagnoses in May and June 2008 were higher than in the same months in previous years. Emergency department presentations by 12- to 24-year-olds per 100,000 population for alcohol related causes were higher in May to August 2008 than in previous years. There was also an overall increase for the months after the RTD tax relative to the months before. Combined admissions and ED presentations for females were substantially higher than in previous years and also higher than in the months before the tax rise in 2008. Access Economics did say that the time frame was too short to draw firm conclusions, but it concludes that the tax may not have reduced alcohol consumption by young people, because they may have switched to other products. A switch potentially enabled them to buy more alcohol for the same budget than prior to the RTD tax.
There is a widespread consumer view that the RTD tax increase is opportunistic, unfair and ineffective. Let us look at a recently commissioned Galaxy poll which revealed that nearly 80 per cent of respondents believe that the tax increase is ineffective at addressing binge drinking. Further, nearly 80 per cent had the view that the tax should be scrapped in favour of a more comprehensive strategy to tackle binge drinking.
If we look briefly at the German experience, the German Federal Centre for Health Education in Cologne conducted research into teenage alcohol consumption in Germany over the period 2004 to 2007. In August 2004 legislation was enacted imposing a special tax levied exclusively on RTDs, the stated purpose of which was to introduce higher prices and reduce consumption. While total overall regular consumption of alcohol amongst teenagers aged 12 to 17 years decreased in the first year, 2004, consumption by this age group exceeded 2004 levels by 2007. Furthermore, an overall increase in consumption occurred despite the increased taxes and prices on RTDs and despite a significant decrease in the consumption of spirits based RTDs. The research found a significant overall increase in alcohol consumption for girls aged 16 to 17, which was reported to be primarily due to increased beer consumption. An additional trend of increased consumption was reported for males aged 16 to 17 over the three-year period. Overall, the quantity of alcohol consumed per capita amongst 12- to 17-year-olds increased over the period 2004 to 2007.
I use that experience to illustrate a trend, experienced elsewhere, which clearly is being closely followed in Australia. We can talk statistics, and people on either side of the House frequently bring their own statistics to support their own particular arguments—that is understood—but, as a local member, I contacted many of the liquor outlets in my electorate once this tax was introduced, and the change in behaviour and the speed with which that behaviour changed were remarkable and were reported by every single liquor outlet.
I think this is an irresponsible measure by the government, because we have seen from the emergency department statistics that it encourages young people of a certain age to drink more than is good for them, to write themselves off and to treat alcohol in a way that is very damaging to their health. But we know that that is going to happen anyway. We know that binge drinking is a problem regardless. The opposition has quoted the New South Wales Commissioner of Police, Andrew Scipione, who says the New South Wales Police Force have had enough. I know that they have had enough. If you talk to police at the front line after midnight in any of our major cities, they will tell you they have had enough. Binge drinking is an awful problem. The violence associated with it—and it is not just alcohol; it is clearly drugs as well—is not something we should be asking our police forces to deal with on a day-to-day basis. For goodness sake, it is all in the name of entertainment! After hearing the government’s quotes, my question is: are the New South Wales Police Force or any police force suggesting that the number of call-outs to fights in pubs and on the main streets of our towns has decreased after the introduction of this tax? I think the answer is no. It probably has not changed, and there may be a trend for it to increase anyway. But there just is not evidence that this tax is reducing binge drinking among young people.
The government has been confused and incompetent. The Minister for Health and Ageing blamed former Prime Minister John Howard for binge drinking. She criticised the member for Hinkler for displaying the Bundy bear in his office, as if that were somehow sinister and evil. She is desperate to make this about anything but the evidence and the tax. The Treasurer insists that the tax is to protect the surplus but the minister for health says it is to reduce female binge drinking. Can’t they get their stories right? If the tax is to fight under-age drinking, why was there no advice from the Department of Health and Ageing before the tax was introduced? Labor are confused. I do not think they know what they have taxed. They talk about all these brightly coloured sugary drinks and young women, but in fact three-quarters of premixed drinks are based on coca-cola and consumed by men over the age of 24. To me, there is something irrational and intensely irritating about this debate. From my perspective as a parent and a legislator, this is bad legislation. It raises a tax to tackle a social problem in a totally ineffective way.
Listening to many of the government speakers, I detect a bias against those who choose to drink this type of alcohol rather than other types of alcohol. It is as if on the one hand we have a smart, sophisticated demographic drinking fine wine in moderation, and then on the other hand we have young people binge drinking on sweet, sugary rubbish and unable to control themselves. It is not all about young people. We should not scoop them all up as one group. We certainly should target young females as being in serious danger of binge drinking. But, if indeed this group does have trouble working out and controlling its alcohol consumption—and there is no doubt that that happens from time to time—the question for this parliament is: is this the right way to tackle it? Clearly it is not.
I have gone straight to the horse’s mouth and spoken to young people from my electorate. I would like to read directly from comments made by one 18-year-old girl. She said:
When the alcopop tax was introduced, my friends and I switched to buying spirits and mixing our own drinks. Since then we and other young people, particularly girls, have developed and are developing a tolerance and liking of stronger drinks.
This can become a dangerous situation when everyone in a group is drinking, getting drunk and still deciding on their own neat alcohol quantity. Wouldn’t the government, and parents, prefer that what we drank could be measured?
People will drink if they want to drink, and the safe drinking culture that the government is apparently trying to harness is not being helped by this tax.
As I said, that was straight from the horse’s mouth. I have also spoken to some parents who are constituents in my electorate, and I want to read a couple of comments from them. One mother said:
I honestly believe that an alcopops tax won’t solve the problem of our young people binge-drinking. Education about the dangers of binge-drinking is more important and it should start early at home by parents and be reinforced by schools.
Unfortunately if kids want to drink they will always find a way, we as parents should be helping them by teaching them the responsible use of alcohol, not by thinking if we make it too expensive they won’t drink. That’s where education and schools can be vital tools to help curb the growing problem.
As the mother of three daughters I find that marketing targets young girls to the alcopops drinks. I’m not sure if taxing the drink will make any difference to their drinking habits—I’m sure they will just switch to another cheaper kind.
Another mother said:
When the price of alcopops increased, the initial reaction from my 19 year old daughter & friends was to buy a large bottle of spirits, and not enough coke etc—
to go with it—
They did not know what ratio was required with a mixer and their drinks were far too strong.
Now they are buying cheap casks of wine they call ‘goon’, and still drinking too much.
My young sons … drink beer so the alcopop tax did not affect their drinking style.
I think the only thing that occasionally slows down their drinking is persistent harping from their mother before they go out, reminding them of the perils of too much alcohol.
As I said, I have sought comment from the various liquor outlets in my electorate and, to a business, they say the same thing. But the most interesting thing I would like to report is that premixed drinks are not consumed by young people alone. I spoke to Premix King in Wodonga. Presumably Premix King specialises in selling premixed drinks, but it has reported that the sale of bottled spirits increased by 30 per cent after the introduction of the tax. Talking about the demographic that shops at Premix King, they said the 18- to 21-year-olds pop in for two hours on a Friday or Saturday night but most of the steady custom comes from people aged 25 and up. Ordinary people—tradies and working mums and dads—who often have limited income choose to drink ready-to-drink mixed spirits.
Retailers have also expressed their irritation by saying that they were not consulted about this increase. They could have given some quite valuable information to the government. But, then again, why would the government consult them—because all it wanted to do was raise extra money through the tax? With a case of Jim Beam bourbon and cola costing $80, people are not going to buy it. They are going to buy bottles of spirits for $28 at the cheaper end and maybe up to $30 or $35. With cruisers at $11.40 for four, people are not going to buy those either. They are going to go straight to the bottled spirits.
As I said, this debate infuriates me as a parent of three teenagers because it is irresponsible with regard to the health of our children. It is irresponsible for governments to bring something in and try and pretend it is a health issue when it really is not—it is really about raising revenue; and we have seen how much revenue it has raised. In the process, it is causing young people to slug from bottles of spirits and end up in the emergency departments of our hospitals. Something is going to have to give. I really hope that, when these bills get to the Senate for the second time, Independent senators will take action to prevent them being passed.
What the retailers are asking me is: what happens to all this extra tax, because it cannot really be paid back? At previous times when this sort of thing has happened the money has been put into a health fund. I would support that. I would support something along the lines of the government’s campaign, which has been very good, and measures which would target young people in schools and educate them—tell them how much is in a nip of alcohol, what it does to your body and how little you actually have to drink to pass out and for your system to close down because it has had too much. Sensible health measures targeted at our young people would be a good use for the tax that has been collected so far. I await the process in the other place and I look forward to these bills being soundly rejected by this parliament.
Contrary to the exhortations of the previous speaker, I hope that the Independent senators do not follow the opposition down this irresponsible path and that in fact they do vote with the government to pass the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009. I stand here to support this measure introduced for the second time by the Minister for Health and Ageing. The excise tariff amendment billhas a clear aim—that is, to level the playing field in alcoholic spirits taxation in Australia and in turn to discourage binge drinking of so-called alcopops among young people.
The new excise will see these ready-to-drink beverages taxed at a rate of $66.67 per litre of alcohol content, up from the previous $39.36. This brings the excise rate into line with that of a ‘straight’ bottle of spirits and away from the former ‘beer rate’ at which they were taxed. Those in opposition are saying that bringing the tax rates of ready-to-drink beverages into line with those of spirits by increasing that taxation rate could not possibly have any effect and is almost having a negative effect on the rates of drinking in Australia. Are they suggesting that we not tax alcohol at all—that if we make it as cheap as possible then somehow that is going to fix the problem? I think the evidence is that that is not the way to go and that in fact levelling out the treatment of these drinks to bring them into line with what they are—to tax them as a spirit, because in fact they are spirits—is a sensible and rational response to the evidence we have had in recent years about the increase in sales of these drinks.
As a result of this legislation all spirits will be charged at the same excise rate whether they come in a full bottle or are premixed with soft drink. There are scores of ready-to-drink alcohol products on the market. Some have an alcohol content of 3.5 per cent. Most of them, however, are in the five to seven percent range, and some push up to the 10 per cent alcohol content mark. What they do have in common is a tendency to disguise the taste of the alcohol with sugar, colouring and sweet flavours. These drinks, whether milk or soda based, lure in young drinkers with bright colours and labels. Others come with an ‘energy drink’ label and contain high levels of stimulants such as caffeine and taurine. This further masks the taste of the alcohol and can add to dangerous levels of alcohol consumption. Some of these alcopops pack a whopping two standard drinks in a small 250-millilitre bottle.
With these drinks so palatable for young people, and especially for young women, the government knows that it could not continue to leave an open loophole which allowed spirits to be marketed cheaply to young people. This was a loophole created by the former government in 2000 when they gave alcopops a tax break compared to traditional spirits. They opted to tax these sugar-laden drinks at the same rate as beer, giving the liquor companies this loophole to deliver spirits such as vodka and rum to teenagers more cheaply. The result of the former government’s mismanagement has been disastrous.
As the health minister has already explained, between the years 2000 and 2004 the proportion of female drinkers aged 15 to 17 who had consumed alcopops at their last drinking occasion increased from 14 per cent to 62 per cent. Sales of alcopops grew by 250 per cent since the year 2000. Yet those on the opposite side are telling us that people do not respond and that there is no change in habits or decision making as a result of changes in taxation. The changes that the Liberal Party brought in in 2000 saw an explosion in the sales of these ready-to-drink mixed drinks.
Those opposite have heard the statistics about binge drinking and alcopops for themselves, but they are still sceptical that we face a problem in Australia and that ready-to-drink products target the younger demographic of society. These are groups which typically have drinking patterns that put them at the most risk of harm, especially from these products marketed to them. Yet the opposition are continuing their denial of the binge-drinking problem. They say—along with the big alcohol companies—that sales of straight spirits shot up immediately in response to the tax increase introduced last year. This is a misleading point. Yes, there was an increase in straight spirit sales, but both the health minister and the Public Health Association of Australia have pointed out that in fact there was an overall reduction in the number of standard drinks sold. This included one million fewer standard drinks sold in the first month after the introduction of the tax. The latest numbers say that total spirit sales have fallen by eight per cent, which is beyond all expectations. It is exactly the result we were looking for and proves this government is on a clear path to tackle binge drinking in our community.
In their submission to the Senate Standing Committee on Community Affairs, the Public Health Association of Australia wrote in support of the government in this initiative. They wrote:
… the very early indications are that this approach is effective in reducing introduction to alcohol amongst young women and arresting the disproportionate growth in RTD sales.
… … …
Around one million standard drinks equivalent in one month is a significant reduction.
The Public Health Association of Australia have spoken out in support of the exercise. As they point out, their support is not based on a commercial interest but is simply with the view of improving the health of the population. Other groups, including the Australian Drug Foundation, the Australian National Council on Drugs and the Alcohol and Other Drugs Council of Australia have all spoken in support of the government’s measures.
The measure to increase the tax rate on these drinks is part of the overall National Binge Drinking Strategy from the Rudd government. The strategy includes: $14.4 million for community-level initiatives to confront the culture of binge drinking, particularly in sporting organisations; $19.1 million to intervene earlier to assist young people and ensure that they assume personal responsibility for their binge drinking; and $20 million for advertising that confronts young people with the costs and consequences of binge drinking. We have already seen that very confronting series of ads ‘Don’t turn a night out into a nightmare’.
At home in my electorate of Capricornia, binge drinking is as much a problem as it is in other parts of the country. Too often we read in the local paper on a Monday morning reports of an alcohol induced fight or a car crash after a weekend of drinking. Taking this step with the excise tariff amendment is just part of our approach. The government is also committed to tackling the problem in other ways. In Rockhampton, this has seen local community group Milbi Inc. granted $150,000 over two years with the aim of creating a greater level of awareness of the risks of alcohol and the alternatives to harmful drinking amongst Indigenous youth aged 12 to 24 years. The program is called Club 500 and it aims to access 500 Indigenous youth and their families to be members of a social development club that will deliver newsletters, health information and youth and family activities. This will provide a community based safety net for family and friends to help them become good role models for the children and young people around them. The program will feature posters, flyer marketing and video clips with anti-binge-drinking messages. I wish them every success.
I have also been in contact recently with John Fitzgerald, who is the preventions program officer with Rockhampton Alcohol, Tobacco and Other Drug Services. He sees firsthand lives that are on a road to ruin because of drug and alcohol abuse. He says that the alcopops tax is a good start and is looking forward to more long-term research data. John and his reference group met this week in Rockhampton to discuss binge drinking, and I am pleased to say that they are focused on harm minimisation, just as the Rudd government is. This has involved education programs for young people, making them aware that they can reduce their risk of harm by lowering their intake of alcohol. It also involves practical things for people when they are out drinking. In Rockhampton, one of the more notorious taxi ranks has been moved to a more central location and is now patrolled with full-time security, making it a much safer place during the night. Likewise, John informs me that there are plans for greater lighting in the CBD, an illuminated path of arrows directing patrons to the cab line and an increased security presence in the city.
John is also busy promoting a very worthwhile program called Good Sports, which is working with sporting clubs across the country to reduce alcohol and other drug problems, increase the viability of the sporting clubs and improve the range of sporting options available within our community. It is not about turning off the taps and removing the kegs from sporting clubs; rather, it is about responsible service of alcohol and making clubs more aware of their position as role models in our community. It helps create a positive community image for the club and secure its long-term future. Rather than there being fears about losing revenues, John says that many clubs have increased involvement due to greater family participation.
John is also involved in a program where Rockhampton will be one of three pilot cities that will showcase the ‘Putting Youth in the Picture’ initiative. This program is endorsed by the NRL and is aimed at keeping younger sportspeople on track, informed and out of trouble. It is an education program developed in regional Queensland to deal with issues confronting young people. John tells me it uses short films to show how young people can become involved in life-altering incidents as a result of poor decision making. The issues presented and discussed include sexual assault, a bar-room fight, use of illegal recreational drugs, binge drinking and underage drinking at a party featuring all these behaviours. It is an exciting program and I look forward to hearing more about it when it is launched in Rockhampton on 28 April this year.
These are just two examples of people working at the grassroots level in Rockhampton to educate young people about the dangers of excessive drinking, which makes me ask: why does the opposition want to make their job harder by defending a tax break for the spirits industry? All this legislation seeks to do is to tax a spirit as a spirit, because that is what is in those alcopop drinks. Companies should not be rewarded through the tax system for clever gimmicks that dress up spirits with packaging and labels that appeal to the underage market. As a government and as a community, we need to send a very clear message about excessive drinking and the dangers of the culture of binge drinking that has taken hold, especially amongst young people. This legislation is, of course, just one part of a larger strategy to combat problem drinking. There is also the $872 million that the Commonwealth government has put towards the National Preventative Health Partnership and, as I have just outlined, the $53.5 million for the National Binge Drinking Strategy, which is already seeing results and getting out there into the community.
That is our message to the community, and it is a consistent message. The opposition’s response is to give hundreds of millions of dollars back to the distillers and to continue the tax break that saw an explosion in the sales of alcopops after 2000. That fact cannot be ignored. The opposition’s position is sending the wrong message, and I think it is a slap in the face to those in the community attempting to moderate drinking amongst young people.
Whilst I have some sympathy with some of the comments made by the member for Capricornia—and I know that she is a parent, as I am—no parent can speak in this place on this bill without saying how concerned we all are about ensuring the safety of our children, particularly as they go through their teenage years but also as they go into their 20s and 30s. I guess a parent never stops worrying about their children. But in so speaking, and in opposing this Excise Tariff Amendment (2008 Measures No. 1) Bill 2008 and its cognate bill, at no stage are any members of the opposition abdicating that responsibility. Every father and mother worries when their daughters or sons go out at night, knowing that they will be drinking. As parents, my wife and I spent a great deal of time talking to our children in their teenage years—in those years before they started drinking. We also, of course, tried to set our own example in terms of drinking with moderation. I guess that is a challenge that we all set ourselves, and I think we all wish each other well on it. But this bill is not about ensuring the safe consumption of alcohol. This bill is just a tax.
Before leaving my experiences and moving to the context of this bill, I would like to convey a parent’s perspective on this. That is, quite simply, that if I have a choice between seeing my daughters go to a party with a sixpack of ready-to-drink premixed drinks or seeing them go with a bottle of coca-cola and a bottle of spirits then I know which I would prefer. In fact, I know which I actively encouraged. Just as my father actively encouraged me to drink beer rather than spirits, I encouraged them to drink a drink where they knew straightaway how much—as in the volume in the mixture—they were drinking. There is also the added advantage, particularly for those with a smaller frame, that it is difficult to consume a huge amount of pure alcohol if you drink these premixed drinks. It is much easier to pour half a glass of bourbon into a glass and then top it up with coke, thereby drinking three or four times the amount of alcohol in the same volume of fluid. So it was that perspective that annoyed me—and, quite frankly, frightened me—the most about this bill.
Having watched my daughters’ and their friends’ reactions to the huge jump in price of these premixed drinks, I know that there has been no decline in the consumption of alcohol as a result in that group of people. That is only one group of people, but I guess that if you cannot see for yourself then you will never see at all. What I see, on those rare occasions when I have to clean up after my daughters, is that the amount of alcohol being drunk has probably gone up—perhaps not by my girls but certainly by the boys in the group. We are told repeatedly how this legislation is targeted at young women, but the effect of it seems to be more on young men. I notice, when I clean away the empty cans and bottles in the morning, that there has been an increase in the volume of alcohol drunk.
I have noticed with some satisfaction—although I think it probably reflects the fact that they are now earning their own income—that my daughters are swinging back to RTDs and just paying the extra money. So they are just paying the tax. But at least as a parent I can rest at home knowing that they are not going to have a drink spiked or have some friend pour them a drink that is more spirit than soft drink. The member for Capricornia said that the aim of this legislation is to tax the contents of the can or the screw-top small bottle as a spirit because it is a spirit. I say to the member for Capricornia: I did grade 12 chemistry and I can assure her that the bottom line is that it is alcohol. Whether it comes from a spirit or from the fermentation of barley, it is alcohol that does the damage. A decision was made by our government to apply the excise to premixed drinks at the same rate as we applied it to beer, on the basis that both were being taxed on their alcohol content. To suggest that we have created a loophole and encouraged the growth of premixed drinks as a result shows, I think, the highly political nature of the way this government has approached this issue.
This whole legislation is a clear illustration of Labor’s preference for stunts over substance. From the very beginning, and under the guise of it being a health measure, this policy has been nothing more than a classic Labor high-taxing manoeuvre. It is a tax grab, pure and simple. Despite the Minister for Health and Ageing’s repeated attempts to dress it up as something else, it is nothing but a tax grab. Despite the mounting evidence that this measure will not have an impact on reducing binge drinking—which, from my experience, occurs more with young people drinking straight spirits than RTDs—this measure will have no impact on reducing binge drinking. This government has continued the charade, still trying in vain to make the case that this tax grab is a health measure. But the truth is that, one year on, this government has been unable to provide any evidence of its own that it is anything but a tax grab. The coalition does not dispute that binge drinking is a serious issue that must be addressed in society. As I said at the outset, no-one on this side of this House would dispute that for an instant. No-one on this side of this House is less committed to ending binge drinking than anyone over there. There is no monopoly on righteousness as a result of sitting on that side of the chamber. However, if there is no evidence that Labor’s tax grab on ready-to-drink products is going to have any impact on binge drinking then why are we persisting with it?
The Australian Institute of Health and Welfare told the first Senate inquiry that the drinking status has been stable for almost two decades. There has been a modest increase in the apparent consumption of RTDs over the last five years. The preference for RTDs has increased slightly from 2001 to 2007, particularly in the older age groups—that is, particularly amongst people who see the convenience, as I said, of taking a sixpack in the esky or having a couple of cans after work rather than having to go through the process of mixing and measuring, and quite often not measuring at all.
The trend amongst under-18-year-olds is not clear. There has been virtually no change in the pattern of risky drinking over the period 2001-07, including among younger Australians. The government’s National Preventative Health Taskforce technical report No. 3 noted a downward trend in risky drinking by young people in the 14- to 19-year-old category over the period 2001-07. It also noted that the greatest increase in RTD consumption was amongst males. There goes the young female drinker theory proposed by those on the other side!
Trends in youth drinking, as I said, were unclear. In the August 2008 edition of the Lancet, researchers from the National Drug and Alcohol Research Centre of the University of New South Wales stated that the Australian government’s recent decision is likely to arrest the increased sales of premixed drinks; it is unlikely to substantially reduce the overall rates of usual or binge consumption.
Access Economics’ report on trends in alcohol related hospital use by young people, prepared for the Distilled Spirits Industry Council of Australia, found that data collected so far did not support the claims that the alcopops tax had reduced risky drinking by young people. Access Economics said the time frame was too short to draw firm conclusions but stated:
The tax may not have reduced alcohol consumption by young people because—
they may have—
switched to other products.
I wish not to go over the same ground as previous speakers but to highlight what they said: there has certainly been a switch. In some cases it has been to spirits and in other cases it has been to wine. The switch potentially enabled those people to buy more alcohol for the same budget they had prior to the introduction of the RTD tax. The bottom line is that this tax has done nothing to lower the incidence of binge drinking. Instead, the evidence suggests it has only served the purpose of shifting young people’s drinking habits from ready-to-drink to straight spirits. That should strike fear into the heart of every parent. It should strike fear into the heart of every person who supports this tax. Reducing the amount of revenue and having no impact on the quantity of alcohol consumed is the net outcome. Therefore, as a tax measure and as a health measure, it has been a complete failure.
This proposal was released with the usual Rudd government fanfare on 26 April last year and, of course, given the tag ‘a war’—this time a war on binge drinking. The tax has been collected ever since. But, like most of the Prime Minister’s media-driven stunts, in the intervening months this measure has fallen victim to its own stunt-driven nature. The slug in excise on RTDs from $39.36 to $66.67 per litre of alcohol content will raise $1.6 billion across the forward estimates; however, this is a dramatic drop from the $3.1 billion in revenue estimated in the last budget.
One of the biggest flaws in this tax grab is the absence of real measures to address binge drinking. The government promised hundreds of millions of dollars would flow to preventive health measures, yet current estimates are that the government has collected somewhere between $220 million and $345 million through this tax and spent nothing like it in return.
I have in my electorate an extraordinarily committed young man called Adair Donaldson. He is a young solicitor who has come up with a meaningful program to address the dangers young people face when they drink or take illegal drugs. Adair has done an enormous amount of work and spent an enormous amount of his own money—tens of thousands of dollars—because he is so committed to this program. The Putting Youth in the Picture program has been launched almost entirely as a result of his efforts. This multifaceted campaign, which includes teenagers, schools, parents, sports groups and community leaders, is a fantastic example of how committed people are to solving the problem of binge drinking. There have been no media stunts. There have been no lies told. He has created a program that is directly targeted at the grassroots problem and has ensured that he gives teenagers and young people real examples and plenty of information to make their own decisions about alcohol consumption. It is described as a ‘brutally honest’ approach and it has already had success in connecting with youth, truly engaging young people on this issue and changing their attitudes to binge drinking. I have sat with Adair through several scenarios that he has had filmed and put on DVD, and it is chilling for me as a parent to watch them. Those of us with good memories will think back to our own youth. It would have been a great thing to have a program like this when I was a teenager.
We are dealing with a situation where we need to get this message out, and this program will certainly do it. It has attracted widespread interest in Queensland and also from major bodies such as the NRL and AFL players associations, who have engaged Adair in utilising this program. It also includes amongst its supporters local government associations and the PCYC. This is a real program focused on actually addressing the problem. It is working now, on the ground, in addressing binge drinking while the Rudd government continues to say, ‘Our programs will be starting soon.’ Again, I draw comparison between Adair’s program and the one which the member for Capricornia has described. Her program may be worthy but it is not widely implemented, and Adair’s program is already having an immediate effect.
When Adair came and saw me I suggested to him that he write to the Minister for Health and Ageing, which he did. Despite the fact that this program is already delivering benefits and would continue to do so with just a fraction of the funds that the Rudd government has claimed it will commit to preventative measures, it was not given a second thought. It is good enough to be adopted by football clubs—and I will not name them—in the NRL, some of whose players have been featured in the media from time to time for misbehaving, to say the least, as a result of alcohol consumption, but according to the minister for health the program is not good enough for her to take the time to look at it. If the Rudd government is serious about addressing the causes of binge drinking, it is programs like this that must be given support in place of a tax grab. If this government is serious about binge drinking, it will have to do more than just increase taxes. If the Rudd government is serious about reducing the incidence and impacts of binge drinking and is not just focused on generating headlines, it must incorporate a wide range of measures, including education, law enforcement, industry and community involvement and rehabilitation. Until it does that, serious questions remain about this bill, because the government has been unable to provide any evidence that it is anything other than an empty, tax-driven ploy that will have no impact on binge drinking.
Mr Deputy Speaker, as time will not permit me to read all of the contents of Putting Youth in the Picture, I ask permission to table that document. I urge those members who are seriously interested in this issue to take the time to read it and those members who want copies of further information, including the DVD, to contact me. I would be happy, in place of this tax grab, to do something meaningful to address the issue of binge drinking. As I have said all the way through this speech, the coalition does support sensible measures to reduce binge drinking, but this tax grab is not such a measure.
Leave granted.
I stand in this House to show my continued support for the protection, health and wellbeing of our young Australians by supporting the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009, because I know that many mums and dads around the country and in my own electorate of Franklin are concerned about the growing consumption of alcohol, particularly the ready-to-drinks, by young people in their local communities. What I hear from my constituents is how easy it is for young people to fall into the trap of binge drinking—how easy it is for them to go to a party and have the ready-to-drink beverages that to them are easy and fun to drink. But, sadly, you really only have to open a newspaper or turn on the TV to see the dire consequences associated with this alcohol consumption among young people.
It is with these views in mind that I support these amendments. They validate in legislation the increased rate of taxation for the ready-to-drinks—or alcopops, as they are commonly known—to correspond with that for spirits. This will increase the current taxation per litre of alcohol content, bringing the tax on the ready-to-drink beverages back to a rate equivalent to that on spirits. This is the fair thing to do. I was a bit curious that the member for Groom, who spoke earlier, seemed to imply that wine and beer are also alcohol and that therefore all alcohol should have the same tax. Why then do we tax spirits at a different level? He is actually shooting his own argument in the foot with his comments. It is really the logical approach that spirits—bottled or premixed—be taxed at the same rate. I do not understand how those opposite continue to argue that spirits should be taxed at the same rate as wine and beer, which is effectively what they are trying to argue. They created this loophole. The Rudd government cares about the health of our young people, and these amendments will close the Liberals’ loophole.
Why are those opposite so concerned, one might ask? I think it is because they do not seem really clear on this issue. We have heard from members opposite that they think binge drinking is a problem. If they were serious, they would not have sided with the alcohol distillers. In my view, they have really turned their back on young Australians. They do not really care about the health of our young people and they do not care that, since the year 2000, after their changes, RTD sales grew by 250 per cent. Instead, they became the public supporter of the alcohol distillers. You only have to listen to the speeches they have made in here today to see where they are getting a lot of their material from. They have consistently been obstructive on a range of measures. They continually put cheap political point-scoring ahead of looking after our young people. There does need to be a pragmatic, common-sense approach to dealing with binge drinking, and it requires more than one measure. We cannot turn our backs on these issues.
They seem to think that this growing problem in our society can be given little credence. Why don’t they support it? Perhaps it is because there are some people on that side of the House who seem a bit doubtful about it. Malcolm Turnbull, addressing the National Press Club on 22 September last year—2008—said, ‘One should never underestimate the enterprising ingenuity of the Australian drinker.’ This implies that you can do nothing about binge drinking—so why do anything? It is interesting to see the member for Warringah here in the chamber because, on 17 June last year, he said:
Trying to say that binge-drinking is happening nearly all the time, in ways which are a deadly threat to the youth and even to the adults of this country, is a beat-up, not to put too fine a point on it.
It is interesting that the member for Warringah thinks that, because there are many people on this side of the House that do not think that. It is not a beat-up. On 30 March, the member for North Sydney said: ‘I don’t think you should overplay it. Let’s not go over the top.’ Do they really seriously think this is not a problem? If they do think it is a problem, why will they not support this measure to do something about it?
I am a parent of a teenage daughter. I know what goes on. I know that these drinks are marketed to young children. There is no doubt about that. You just have to see how out of touch those opposite are. They are out of touch on a whole range of issues. They are out of touch that this is a serious issue and that it is affecting our young children. There is no doubt these bills will go a long way to assist in curbing the teenage drinking problem. They will help protect our children.
Figures released in 2008 by the National Coroners Information System revealed that at least 100 young people die each year with a blood alcohol level at or above 0.05. These figures are distressing. If you look at the figures between 2003 and 2006, there were 400 deaths—that is excluding Queensland and South Australia, because of the reporting systems—of teenagers and young Australians who died with alcohol in their systems. This is a very real problem. In my state of Tasmania, 32 people in the age group of 13 to 25 died—they had blood alcohol levels too high, and alcohol was a significant factor in their deaths. That is 32 Tasmanian families who lost a child. One death is too many; 402 young Australians is too many indeed. The report also identified that weekends were the peak time for deaths of such young people. Most fatal incidents occurred between 6 pm and 6 am on the Friday-Saturday and Saturday-Sunday evenings. This comes as no surprise, because it is about binge drinking. The most common cause of death, sadly, is road traffic injuries with the combination of alcohol and drugs. This is something that we on this side of the House really take seriously. I urge those on the other side to take it seriously too. It is a common problem amongst younger people in our society. It is real.
Closing the RTDs loophole is supported by community leaders, police and health experts alike. In any given week, one in 10 12- to 17-year-olds are binge drinking or drinking at risky levels. Almost 20,000 girls aged 12 to 15 drink daily or weekly. The number of young women aged 18 to 24 being admitted to hospital because of alcohol has doubled in eight years. In a year, more than three-quarters of a million Australians are physically abused by persons under the influence of alcohol. The annual societal cost of alcohol is estimated in Australia to be over $15 billion.
We know that RTDs are a problem. We know they are clearly targeted at and marketed for young people. We all know that wine and beer—particularly cheap wine—taste like alcohol. These RTDs do not—deliberately. They are sweet. They often taste like lolly water not alcohol. The alcohol taste is commonly disguised, and a lot can be consumed very quickly because of the sweet, light taste. Young people—inexperienced drinkers—can have a lot of alcohol in their systems very quickly. I know; I have seen it. They do not realise how much they have taken in. That is because the alcopop makers make these drinks in bright colours and give them groovy, hip names. They are deliberately marketing to young children and attracting young children to these alcoholic beverages. I know it works—as I said, I am a parent of a 15-year-old. I have seen it. I know young girls are consuming these RTDs in large numbers.
Between 2000 and 2004, the percentage of young female drinkers aged 15 to 17 who had consumed RTDs at their last drinking occasion increased from 14 per cent to a massive 62 per cent. These are 15- to 17-year-olds! That those opposite would think that that is not a problem and that we should not do anything about it just astounds me. For females drinking at very risky or high-risk levels in 2004, 78 per cent drank RTDs on their last drinking occasion. That figure has increased threefold since 2000. That is what we have really got before us: real happenings and real statistics about what alcohol is doing to our vulnerable young people. What those opposite should have done in the past was to side with these families who have kids, families who are deeply concerned about how easily Australian teenagers can purchase ready-to-drink beverages. If we are truly serious about looking after the health of our society, the health of young Australians, all of us should support these bills.
I mentioned earlier that a lot of health experts support these measures. The Australian Drug Foundation CEO, John Rogerson, said:
This tax fixes a problem started with the introduction of the GST and shows that the Government is serious about tackling alcohol problems in our community.
We have heard the minister quote former Liberal minister Dr John Herron, from the National Council on Drugs:
Utilising the taxation system is one of the most effective measures we have for reducing alcohol-related harm and problems for both individuals and communities.
The Alcohol and Other Drugs Council of Australia CEO said:
… this initiative clearly recognised the problems created by the excessive consumption of RTDs which were attractive to the youth market.
The Public Health Association president, Mike Daube, said:
There is now dramatic evidence showing that young women are out-drinking their male counterparts - and unfortunately many of them drink to get drunk …
We know that price is the most effective single measure in reducing alcohol consumption, especially by young people. This increase will make a real dent in one of our biggest current social problems.
These are not my words; these are experts’ words. These are health experts working in the drug and alcohol industry who believe this measure works. They are the experts; we are not. These views are in contrast to those of the RTD industry—and we all know their motivation—and clearly in contrast to the views of those opposite, who do not see a need to act and to support these measures.
We have recent Australian taxation figures drawn from the first nine months of this measure that show that the measure is working, because RTD sales have dropped by 35 per cent compared to the previous year. This outcome is a significant drop in sales, and it is well beyond what we predicted. When this measure was first introduced, the modelling predicted that it would slow the astronomical growth of RTDs—and that in itself would obviously have been great—but, in fact, RTD sales have slumped, and they have brought overall spirit sales with them. Despite a smaller increase in full-strength spirit sales, overall spirit sales have actually fallen across the board by almost eight per cent.
The industry have tried time and time again to confuse the issue. We saw this today with yet another report by the alcohol industry trying to justify their position, but I want to read a small quote from the Age today. It says:
… the report also warns against any definite conclusions on the effectiveness of the tax being drawn … because of limited data.
There is limited data in the Access Economics report, so it is saying, ‘Don’t rely on its conclusions.’
Why do we need to close this loophole? This is just one measure—there are other measures; we have heard members in this place talking about local programs—but this measure is part of a strategy. It is part of the National Binge Drinking Strategy, which this government announced in March 2008. The strategy includes $53.5 million to address binge drinking among young people. There is $14.4 million to invest in local community initiatives to confront the culture of binge drinking, particularly in sporting organisations. Six major sporting codes have signed up to a code of conduct. We heard the previous speaker, the member for Groom, talking about NRL teams and things. Surely these people are leading by example, and being involved in these programs is a good thing. There is $19.1 million to intervene earlier to assist young people, to ensure that they assume personal responsibility for their binge drinking. There is $20 million to fund advertising that confronts young people with the costs and consequences of binge drinking. We have all seen the ‘Don’t turn a night out into a nightmare’ campaign. It confronts young people with the dangers and the consequences of binge drinking. It is in your face. It is gritty. It is hard hitting. And the government are pleased that it is gritty and hard hitting because it needs to be, because these young people think they are bulletproof, and we need to shock them. We need to do something about this.
At COAG last year the Rudd government announced the single largest investment ever made by any Australian government in preventative health, to support a range of programs and interventions to reduce the impact of chronic illness on the community: $872 million. All of this is new money and supported by revenue from closing the RTDs loophole. It is a massive investment, but this story does not end. The national Preventative Health Taskforce is currently well down the track in developing a National Preventative Health Strategy, and alcohol is one of its highest priorities. We have heard from the other side that they want to see what measures we are undertaking. I am going through them—there are many. Emerging from that strategy will be further significant initiatives to tackle alcohol. The RTDs measure will raise $1.6 billion, somewhat less than the original estimate of around $3 billion at the last budget. But, put quite simply, this means that the measure has been working.
What these amendment bills do is to align the tax on ready-to-drink beverages back to the equivalent rate of spirits. This is part of the government’s overall National Binge Drinking Strategy—it is not just one measure; it is part of a whole strategy—to discourage binge drinking, particularly amongst our young people. These amendment bills support the government’s stance on caring for the health and wellbeing of young Australians. These amendment bills reverse the Liberal Party’s decision nine years ago, in 2000, to give the RTDs a tax break. This loophole needs to be closed.
It is clear that either those opposite think binge drinking is too big an issue to tackle or they do not think it is a problem at all amongst our young Australians. Binge drinking is not okay, and we need to do something about it. I am proud to be part of this Rudd Labor government, which has an overall strategy. We are getting on with the job of dealing with this problem. We must protect the health and wellbeing of our young people. We can do this by admitting there is a problem, we can do it by closing this loophole, and we can do it by listening to what the experts are saying. I call on those opposite to support this measure, and I commend these amendment bills to the House.
I rise to speak on the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009. There is no doubt that there are alcohol, binge drinking and alcohol related problems in Australia. I strongly support serious and sensible measures to counter binge drinking and broader issues with excessive alcohol consumption and, equally important, the issue of drug use. These measures include providing education and information, the support of families and young people, the support of communities, law enforcement, industry involvement and harm minimisation processes as well as rehabilitation measures.
Excessive alcohol consumption and binge drinking are not problems confined to young women or one specific age group; they are problems across age groups and for both male and female members of society. They are problems that require a comprehensive approach, not just a 70 per cent tax on one specific alcohol product range.
The government introduced what has become known as their now infamous alcopops tax, the tax on ready-to-drink alcoholic beverages. The Senate Standing Committee on Community Affairs has acknowledged that this bill is a direct tax measure by recommending that an examination of alcohol taxation—which of course includes measures in this bill—be included in the comprehensive review of the tax system currently underway.
The government sought to promote this taxation and revenue-raising measure as a health measure. However, we know that there was no consultation with the Minister for Health and Ageing or the Department of Health and Ageing prior to the introduction of this tax. If this were a genuine health measure aimed at excessive consumption of alcohol and binge drinking, the department would have had a very strong and direct involvement in the process. The health department would have included a suite of measures accompanying that measure, to assist in managing the diversity of health and social problems that go with the excessive consumption of alcohol, and there would have been consideration of all forms and categories of alcohol, not just the ready-to-drink beverages.
A comprehensive strategy is required to deal with what is a complex health, social and economic problem. How many young women did the minister ask whether this tax would stop them binge drinking or simply encourage them to switch to other forms of alcohol products with higher alcohol contents? I have an email from a young lady who said that the reduction in alcopops consumption and curbing binge drinking were, in her mind, two separate things. She said:
To really know if it is really curbing binge drinking that would take months of research into the reduction in brawls and fights outside clubs and pubs, the reduction in hospital related alcohol abuse, ambulance related alcohol abuse, and police and bouncer survey’s of women.
She went on to talk about the substitution of total spirits compared with RTDs, and she said essentially that it was much easier for young women who were drunk to have more uncontrolled and unmeasurable amounts if they were using spirits as opposed to RTDs.
I would be very interested to hear an analysis of the evaluation, research and supporting data on all forms of comparative alcohol consumption undertaken by the government, both prior to and since the introduction of the tax. Has there been a switch from ready-to-drink beverages to another form of more potent product or beverage and has this tax effectively driven consumers to a full-strength substitute? Has there been an increase in drug use as a substitution? What changes have occurred in the retailing of full-strength spirits since the introduction of this tax? What alternative products have entered the market to bypass the tax and what impacts are they having on binge drinking and young people? These are just some of the evaluation methods necessary to support the purported health benefits of the tax. This evidence is only one part of the wider excessive alcohol consumption problem. The government must provide supporting evidence that this tax has decreased levels of risky drinking across all alcohol products on the market and that RTDs are not simply a substitution for other alcohol products, spirits or indeed other substances altogether.
Early reports from an ACNielsen survey from May 2008 showed massive increases in the sales of full-strength spirits. According to an Australian newspaper report on 17 May, this tax measure emanated from a Department of Finance and Deregulation budget submission, explained in the terms of closing a tax ‘loophole’, and was reinforced by a Treasury statement that it had all the data it needed by talking to Customs and the ATO, not the health department. This clearly defines the alcopops bill as a tax issue. The government also claimed that increasing these taxes was a measure aimed at cutting the rate of binge drinking, particularly among young women. We have also seen measures applied to that. To date, the government has not provided firm evidence that this tax has had an impact on binge drinking across all forms of alcohol.
The Australian Institute of Health and Welfare said at the first RTD Senate inquiry that the increased availability of ready-to-drink beverages does not appear to have directly contributed to an increase in risky alcohol consumption. It also noted that there was no clear trend in preference for RTDs among under-18-year-old females, and there appeared to have been a decrease in the proportion of drinking at risky or high risk levels. Worth noting is the August 2008 edition of the Lancet, in which researchers from the National Drug and Alcohol Research Centre at the University of New South Wales, who were supportive of the tax rise said:
Although the Australian Government’s recent decision is likely to arrest the increased sales of premixed spirits —it is unlikely to substantially reduce the overall rates of usual or binge consumption.
The Wine Research Institute says binge drinking could be less of a problem if wines were produced with a lower alcohol content. Research manager of the wine biosciences group, Dr Paul Chambers, said that lowering alcohol content would be a more effective counter to binge drinking than tax increases.
There is no doubt that excessive alcohol consumption and binge drinking are both very serious problems and are not just confined to young people. There is also no doubt that the abuse of alcohol is a significant social, health and economic issue in Australia. For young people specifically, teenage years are a time of experimentation as well as various forms of risk taking. Young people drink for many reasons: sometimes it is seen as a way to build confidence, in other instances it is because their mates drink, and sometimes it is just to be part of the crowd. Some like to feel as though they are an adult by drinking and others just think it is part and parcel of having fun. Teenage years are also often a time of uncertainty, experimentation and change.
A 2002 Australian school students alcohol and drug survey found that, by the age of 14 years, approximately 90 per cent of students surveyed had tried alcohol, and 12- to 17-year-old students surveyed said that parents were their most common supplier of alcohol—a fact that is often overlooked,. In fact, it was the No. 1 issue identified by high school leaders as part of a youth forum I held last year in my electorate. The 15- to 17-year-olds were extremely annoyed and concerned that the age of binge drinkers was getting younger and younger. They spoke of 12- to 14-year-olds who regularly, in their words, ‘wrote themselves off’. As they said to me, so often the ‘coolest’ kid at the party was seen by some to be the drunkest kid at the party. This group reflected the same findings in the national survey—that it was their parents, friends and sometimes older siblings who supplied the alcohol most often. The most common venues for drinking were at home, at parties and at a friend’s home.
However, one of the most telling factors in that 2002 survey was that the older students said that the most common types of alcohol they drank were actually non-pre-mixed spirits. The younger students were more likely to drink wine, low-alcohol beer and champagne although the dominant drink for young males was beer. And, in Western Australia, this was in spite of liquor licensing laws prohibiting access to and sales of alcohol to people under 18 years of age, as well as laws prohibiting drinking alcohol on the street and buying alcohol for underage people.
There is no doubt that the challenge for so many parents and communities is to keep our young people safe during their teenage years—to not only help them to find the balance of responsible and safe drinking and social behaviour but also make sure that they all come home safe and well from whatever it is they have been doing. How many parents watch their children leave home for a night out with friends and then sit waiting and praying just to hear them come home again? So many parents wait for that precious phone call—the one that says, ‘Come and pick me up,’ when the evening’s plans do not work out or get out of control. It is sometimes the best phone call a parent can receive—even when that is at two o’clock in the morning. No parent wants to see the police officer on their doorstep. Many parents worry about their children drink-driving or being in a vehicle with a driver who is affected by alcohol. Most parents are very aware of their duty of care and responsibility for not only their own children but also their children’s friends who visit the family home. In Western Australia, alcohol is a major contributing cause of hospitalisation and death among young people. One of the toughest jobs for parents can often be that of simply communicating with their teenage children about a range of issues. Being patient, calm, understanding and sometimes non-judgmental can often be the biggest challenge of all.
The economic costs of alcohol abuse are very high. A 2008 report from the Department of Health Western Australia, Impact of alcohol on the population of Western Australia, found that hospitalisation costs associated with alcohol were more than $33 million in 2006—excluding the costs of emergency department presentations. There are also the social costs associated with alcohol abuse in the at-risk and trauma areas: the fractured families and domestic violence, the assaults, road deaths and injuries, the child abuse, the drowning deaths and the female and male suicides—just to name some.
One way of finding out whether this tax measure has decreased binge drinking or alcohol consumption in young women is to ask them. Teenagers were asked this question on ABC Radio 666 in Canberra on 12 February. In response to the question of whether increasing the price of alcopops had worked, the unequivocal answer was no. Neve Breen of Launceston said:
When you put the tax up on the Alco pops it’s not really the drink that people drink to binge drink anyway. It pushes them to drink boxed wine and straight spirits.
Jemima Buckman of Narrabri was asked:
Jemima … are the kids drinking any less?
She answered:
What I find is they … buy … just straight spirits.
One finding of an Access Economics report on trends in alcohol consumption since the introduction of the alcopops tax, in relation to young people switching to other products, was that ‘a switch potentially enabled them to buy more alcohol for the same budget than prior to the RTD tax’.
As suggested previously by the member for Bradfield, the manufacturers of distilled spirits and ready to drink beverages do not want this tax returned to them. The $200 million to $300 million should be placed into a fund independently administered to support education about alcohol, and prevention of, treatment for and rehabilitation from alcohol abuse as part of a comprehensive national alcohol strategy—a strategy that encompasses parents, families, individuals and communities right across Australia.
I do not support this legislation.
I rise to speak on the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009, also known as the ‘alcopops legislation’. We have heard a wide-ranging debate on the reasons why this legislation is either good legislation, in the sense that it will curb the drinking habits, patterns or culture of anybody who has access to alcopops or alcohol generally, or not good legislation and why it may or may not work. But what we should consider in this debate is that governments need to take a wide-ranging approach. They need to look at all the facts and all the detail, and then they need to actually act in these areas. There is a great difference between what this government has done and is doing in terms of alcohol consumption and the abuse of alcohol, and what the opposition did when in government. There is also a stark difference between what the opposition talk about and the reality of what they did not do when they were in government. That is the real question that needs to be on the table today when we discuss these two bills in relation to alcohol.
This government is committed to finding ways to change the culture of binge drinking and, more specifically, to try and tackle that issue in relation to young people—young women in particular. But it should not be isolated to these two areas because it needs to be understood that alcohol abuse more broadly and binge drinking in particular are great problems for the community at large. We have heard a lot of comments about the impact that it has on families, communities and individuals, and I will make some further comments about that.
This legislation introduces measures, as part of this government’s National Binge Drinking Strategy, to discourage binge drinking, particularly among young people. We do not just talk about that. We actually commit funding to that goal, that outcome, that end—funding such as $14.4 million for community-level initiatives to confront the culture of binge drinking—and we also use sporting organisations and community based organisations where they have a direct link to young people and an influence over them. There are opportunities out there to change those behaviours and that culture.
I note with some interest that opposition members refer either to a range of surveys or radio polling which ask young people whether or not this has had any impact on them in changing their behaviour. The opposition seems to be saying that it has made no difference at all and in the end young people will just go and drink something else instead. I would say to the opposition that they have misunderstood what those young people might be saying. What I believe young people are saying is that they actually do want help in different ways, they do want some assistance. Yes, they might make some particular buying decisions when it comes to price—but that is a good thing. Isn’t that what we are trying to achieve? We want to change the behaviour of young people either to drink less or to understand that certain types of drinks are worse for them, in the sense that the alcohol can be masked so that they may not be so aware of the amount of alcohol they are consuming compared to other drinks. In the end, those surveys go to the heart of what should be understood about this debate—that is, that the government is having an impact, and I think a positive impact, in trying to curb some of the worst parts of binge drinking.
Our commitment does not end just there, though. Our commitment goes on further, into intervention. We have committed another $19.1 million to intervene to assist young people. We want to assist them. We want to ensure that they assume personal responsibility for their own behaviours and the way that behaviour affects other people. That is an important part of trying to get young people to take action for themselves, to be a part of their own practices and of what happens within their own groups. Part of any strategy that aims to do that needs to have some strong messages delivered in ways that young people can access. That is why we are also committing $20 million for advertising that particularly confronts young people with the costs and the consequences of binge-drinking behaviours. We have seen successes in campaigns in other areas. In the area of drink driving we have seen it in road fatalities. You can have a positive impact by having confronting advertising campaigns that really drive home some of the key issues, so I am very pleased to see that we as a government are committing funding to make some positive impacts. What we are trying to do is not only help young people specifically in terms of the alcopop excise but also deal with this issue of binge drinking in Australian culture.
It is of no surprise to anybody that Australian culture does have embedded within it a certain attitude to and behaviour associated with drinking alcohol on many, many different occasions. That in itself I do not see as a problem. Responsible alcohol consumption is part of life. It is part of the things that we do to celebrate, to commiserate, to commemorate—to just live our lives, enjoy ourselves and have a particular lifestyle. But it is when that behaviour becomes a problem for others or for a particular individual that it becomes a problem for government, in the sense that it is the taxpayer that ends up picking up the bill. The taxpayer picks up the social costs, the health costs, the hospitalisation costs, the road trauma costs—all of the costs associated with the worst effects, the worst impacts, of people who abuse alcohol—and we see that nowhere more prevalent than in abuse of alcohol by young people. Young people need to understand that. Although they often pay a high price themselves they need to understand that there is a cost beyond that—the cost of hospitalisation, the cost of doctors and the time they spend, the social cost of what it can do to families, such as family break-up with a whole range of associated issues. I am confident that, as part of the package that we have on the table, we have some serious money to try to deal with some of the excesses.
On the more technical issue of what this bill does, should there be more tax on this particular product? This seems to be at the core of questions being asked, particularly by members of the opposition. In the end, what this bill does is realign properly the rate of excise on premixed drinks, which was an anomaly created under the previous government during the Howard era. The lower rate of excise for premixed spirits that was introduced by the former government was associated directly with a 250 per cent increase in sales of ready-to-drink products. It is pretty clear that, from the point where the previous government made a tax change to make it cheaper for those particular products, there was a massive spike. The problem with the spike in those particular products is how they are marketed, how they are delivered, how they are consumed and the impact they have on people. Unlike other products where you can clearly identify the alcohol through smell, colour and taste, the problem with alcopops is that they are almost a soft drink. That is what they smell like, that is what they look like and that is what they taste like—and there is no question that that is a deliberate marketing strategy by the industry.
I can understand that the industry is trying to promote a product, but if the industry wants to promote a product that contains alcohol then it must do so within a bound set of rules and it must do so responsibly. It must do so in a manner which is ethical. While there is nothing morally wrong or unethical about sweet flavoured alcopop type drinks, what is wrong is deliberate marketing campaigns to particularly target young people through certain sporting facilities or through other marketing methods that deliberately aim at one particular class of person, one category of people in the community, with a drink where you cannot really tell whether you are drinking alcohol or not. People do not really know, and may not know until it is too late, exactly just what it is they are consuming and the impact it is having on them. The industry needs to do a little bit of soul-searching and maybe look a little bit closer at the way they produce, market and develop these products. Of course, if they do not then that is where government has a role to play.
That is what we are doing here today. It is the responsibility of the government to curb those excesses and to ensure that people are safe. It does not mean that you cannot buy these products. It just means there will be a higher cost associated with those products, and that high cost will be reflected in a number of ways. The outcome, that higher cost—the tax revenue to government—will fund the campaigns I mentioned earlier. That is where that extra revenue to government will be going. We will be trying to address those excesses and the problems in the community that are created by abuse of alcohol generally but particularly with RTDs.
Along with the changes made by the previous government and the associated 250 per cent increase in sales of RTDs, we know that in 2004 62 per cent of female drinkers aged between 15 and 17 reported that they were drinking more RTDs. In 2000, the figure was only 14 per cent. Again, there is a marked leap in the number of people who particularly started to consume these products once they realised the lower cost. I think we can clearly identify that price does have an impact on who buys it and how much of it they buy. There will always be replacements. That is something that you can never get away from, but we must curb consumption of those particular drinks by young people. Older people might have a better comprehension of this and a better measure of the amount they are drinking. The issue is with younger people who may not be able to tell the difference. I think the industry needs to pay more attention in this area.
In any given week, the reality is that one in 10 12- to 17-year-olds are binge drinking, and they are doing it to a level of high risk. That data is from the 2005 Australian secondary students alcohol and drug survey. This high level of alcohol consumption has led to very alarming levels of hospitalisation. The number of young women aged between 18 and 24 being hospitalised because of alcohol consumption has doubled in the last eight years. There is something happening in the community in the way that people are abusing alcohol, particularly young women and very young adolescents. But it does not just end there because there is an ugly side to binge drinking—that is, violence. The level of violence associated with binge drinking hurts the whole Australian community and the Australian economy. A recent estimate of the social cost of the misuse of alcohol is a staggering figure—$15 billion per year. That is a credible measure and it is from Collins and Lapsley’s work on the cost of tobacco, alcohol and illicit drug abuse to Australian society. Alcohol abuse on its own costs the economy $15 billion a year—a massive cost to every single Australian and every single taxpayer. Anything that a government can do ought to be supported. Anything that a government can do to curb those excesses and spend more money on education, particularly for young people, I think is a good thing.
If only the opposition could come into this place with a coherent argument about why we should not do this, apart from just saying, ‘It’s not working as well as maybe we’d hoped,’ or, ‘It has not quite had the impact,’ or, ‘People still drink.’ We have heard that people are just drinking something else. Of course, some of that is right. People are going to perhaps drink something else or perhaps keep drinking. That is not the point of what we are trying to achieve with this. Where I think we are having success is in reducing the level of consumption of ready-to-drink products, particularly among young people. We have attempted to get this message across loud and clear to the community, and I think that has been achieved. I think that message to curb those excesses is out there and it has been heard by the community.
Not only is it a fact that we are fixing an anomaly created by the previous government with its tax break on alcohol camouflaged as a fizzy type sweet drink—the loophole which led to a 250 per cent increase in the sale of those ready-to-drink products; we are also trying to reduce the number of young people who are binge drinking. The number of young people binge drinking is very high, and we have heard about this from other speakers. Of females who drink at risky and high levels, 78 per cent actually reported that they drank alcopops on their last drinking occasion in 2004—an increase from only 21 per cent in 2000.
Dr John Herron, former Liberal minister and former AMA president, and a member of the Australian National Council on Drugs, wrote to the Prime Minister on 13 May 2008 and said:
I am writing on behalf of the Australian National Council on Drugs … to congratulate your government—
the Rudd government—
on the recent announcements regarding alcohol, particularly the public personal support you are providing for the encouraging work undertaken by the Minister for Health and the Parliamentary Secretary for Health.
He goes on to say:
Utilising the taxation system is one of the most effective measures we have for reducing alcohol related harm and problems for both individuals and communities.
I think that is a resounding endorsement of a step in the right direction. For those listening to this debate, industry people and perhaps young people, I think a number of messages need to be taken from this. One is that we all need to take responsibility for alcohol consumption, alcohol abuse and binge drinking. It has a high cost on the community, taxpayers, individuals and families. This cannot be brushed aside with simplistic arguments which say that this or that will not work and that people will just drink some other product. That is too simplistic. We have fixed the loophole and we have realigned the proper application of tax in relation to particular alcohol products.
Making it more difficult for particular organisations to promote, market and even produce products which are less and less identifiable as alcohol is a good thing. We need to make sure that the industry takes up its responsibilities. No-one is trying to stop them from selling alcohol or particular products, but the taxing regime needs to be right. We are absolutely on the right path on this and industry needs to be responsible for the way it markets, promotes and produces these products. Nobody is trying to tell them not to produce them but rather to do it in a proper way. It was all a little bit too clever and half cute the way that they produced a beer under the definition of beer in the tax act to circumvent the excise tariffs that are applied under these regulations.
That is not the intent nor should it be the attitude of the industry to get around what this parliament is trying to achieve. That is not how this ought to work and it is not how it is going to work. There are many good reasons we have heard in this debate as to why we need to curb the worst of abuses. I am very supportive of what we are trying to do. I, like everybody else in this place and in the community, am very supportive of people having the freedom to consume and buy and do whatever they want, but within the bounds of responsibility. Be responsible. The industry needs to be responsible. Do not make it a cost for someone else. Do not make it a cost for taxpayers, a bill for them to pick up after you have made mistakes in relation to alcohol abuse. I want to commend both these bills to the House and support the work that is being carried out by the Minister for Health and Ageing in this area.
I believe I would hold the record in this place, full or empty, for the longest period of experience in the retailing of alcohol. And when it comes to youth, I might remind the member for Oxley to hang around for a minute so I can correct some of the statements he made. I purchased a half share in my first freehold hotel when I was six months younger than the then legal age to drink, 21 years of age. These two pieces of legislation, the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009, are fraudulent if their stated intention is to reduce the consumption of alcohol amongst the young or the elderly and to have some beneficial health effects in the process. It does not work. It has never worked and we know the purpose of this particular issue. It is bad public policy. Governments have the right to impose taxes and it is not a bad idea that they do not promise during an election campaign not do it but then go ahead and do it, but they think they have found an excuse for the purpose.
The excuse on this occasion is we are going to tax you because it is good for you. That has progressively happened to cigarettes over the years. I remember when you used to get change out of a dollar for cigarettes. Today they are probably up around $10 for the same size pack. But that is not what reduced consumption. What reduced consumption was the bans that apply on just about every public area today even out on the footpath surrounding air terminals, et cetera. I do not object to that. Fortunately, I never took up the habit of smoking although most of the kids around me did. Might I add, my mother started at 13 and finished at 73 and would often say that she would not walk a yard to buy alcohol but she would walk a mile to buy a packet of cigarettes. That is the addiction that comes from that particular substance.
But if this government is fair dinkum about preventing or reducing the consumption of alcohol, it should take steps to reduce the consumption of alcohol. It is not my personal belief, but they might go back to the age of 21 as the approved drinking age. If you genuinely feel it in your heart, go out there and try that on all the 18-year-olds to whom Gough Whitlam gave the vote. Try that one. If you are genuinely interested in the cheapest alcohol available for alcoholics you would do something about the tax on cask wine and you might take note of the lives that that particular product kills. Those who are truly alcoholic do not bother about alcopops because they are five per cent alcohol. It takes an awful lot of them to get drunk. You have to consume a huge amount of moisture in the process and our body has some limits on that as it does on the over-consumption of alcohol typically with the young. They get violently sick because the body says, ‘You have had enough of that. You’d better get rid of it.’ The media and others take great pleasure in photographing some young person at some open-air function being sick in the nearest flowerpot as some evidence of binge drinking. Young people can get to that state of ill health or uncomfortable health. Their stomach will rebel after a very limited number of drinks. We become immune to that as we age and maybe overconsume.
For the information of the member for Oxley, who has departed as quickly as he could go, it is a myth that the previous government created a loophole. They did not. They set about to close the loophole. But, as the member for Oxley has admitted, as soon as you start to fiddle with the tax rates on alcohol and you do not have a standard rate—which I admit our government were never able to resolve—people just change the mix. The early alcopops, as they have come to be known, were all based on wine based spirits. Why was that? Because in my living memory in this parliament there was no tax and no excise on wine. There was originally a sales tax which was totally unrelated to the alcohol content. If there were anything other than a cash grab in this legislation, today we would be debating an ad valorem tax on alcohol—in other words, the more in the bottle the higher the tax. That is the test and that is what the kids discovered. You start to add an additional cost to a can of Coke with five per cent alcoholic content and they turn around and go and buy the 45 per cent stuff and then add their own mixer. I can tell you they are much more generous with the alcoholic drink than they are with the mixer.
So why would you do that? Why would you think that a single increase in tax on a single alcoholic product would alter the drinking patterns of the young, the middle-aged or the old? Of course, when it came particularly to rum and coke, it was very quickly established that it was youngish males, if you like—those in their late 20s—who were the main drinkers of that product. It was a convenience that they could also have achieved by buying a sixpack of coke and a bottle, or a half-bottle, of rum. But they chose it the other way, and the mix was known.
Most of the persons of reasonably mature age in this parliament would never have drunk anything but seven per cent beer, and nobody ever thought that was binge drinking. But then, in what I thought was a very weak attempt to try and justify a tax grab for every other possible reason, the member for Oxley referred to ‘violence’. The main reason I have entered this debate is to talk about violence, about why violence has now become a major issue associated with drinking establishments and about why this government does not even want to talk about it—I am talking about drugs and, more particularly, those that are sometimes labelled ‘recreational drugs’. They are so ‘recreational’ that we have a new demographic entering high-care aged persons homes. They are 50 years old, and they have fried their brains with cannabis or, of course, the new phenomenon of amphetamines that, apparently, can be made in a kitchen with very little effort.
Tragically, the other day, a young woman of 18 set off to the pub or to the club having taken an amphetamine before her mother drove her to the establishment. She had two more with her to keep her going during the night, and, very unfortunately in one regard, under the new regimes in Western Australia—our new government thinks drugs are bad—the police entered the premises to check who had drugs. They had some sniffer dogs with them—and I want to talk further about that—and, when they walked in and the girl saw them, she unfortunately swallowed the other two tablets in fright and died. She could have drunk alcopops all night and she might have been a sick little girl, but she would be living today.
I do not believe that alcohol has the same degree of addictiveness or that, for that matter, the body is able to keep absorbing amphetamines to the same degree as it is able to keep absorbing alcohol. But, as you force the cost of alcohol up, those amphetamines get relatively cheaper and cheaper. Why doesn’t this government have any genuine concern about these drugs in the same way that they do about alcohol? Because they cannot tax it, and because the police force throughout Australia really finds it all a bit too hard! There is no corruption known to me in the police force associated with alcohol, but there is sure plenty of it associated with so-called ‘recreational drugs’. I have spoken in this place about the outrage of the Australian Football League, the attitude they had to tolerating elite sportsmen’s use of these drugs and the tragedies that that has brought upon us.
I know about violence from 30 years managing and owning big hotels as well as smaller ones, with all sorts of customer bases, and from having to deal with people who were drunk. Towards the end of that period, and prior to coming to this place, I began suddenly to deal with a new group of people—people who were violent and who not only would not leave when they were asked to but would try to kill you. The evidence of the deaths arising from this form of violence is a matter of record. It took me a while to understand that they had a horrible mix in their body. They had come to the place having taken, or had taken during the time they were present, a so-called ‘recreational drug’ and had consumed alcohol. There was an article published some years ago in, I think, one of the major dailies in Sydney, and I read it on a plane. It featured a woman who had just come out of jail. The cause of her internment was that she had attacked an old lady in an airport toilet in order to get at the old lady’s handbag to get the money to buy more drugs—she was addicted to that point. Of course, she was giving this interview, so she must have had some celebrity status, and she said to the journalist, ‘I could not believe I would do to that lady what I did.’ That is the point I am making: when drugs are involved, all of the normal human constraints are lost. As I said, the deleterious effect is that you can end up in a nursing home at 50 by the consumption of those drugs. I can take you where some of those people are in my electorate.
So this is what we are talking about. We have a government defending their ‘smart’ move to get a bit more revenue by focusing on an issue promoted particularly by the police forces of Australia when they should be focusing on drugs. I mentioned earlier one of the ‘big nights out’ or whatever it was. In Western Australia—we have a television junkie over there as police commissioner—we had fully televised coverage of the police at a train station where young people were getting off a train for the purpose of going to this function. The sniffer dogs were taking their part, and, of those they apprehended, there were about 10 per cent in possession of drugs. No doubt some had them for their own consumption and others had them to sell at the function. I thought, ‘You beauty!’ Then I understand that before the bigger event, which was on the other day, they did not do it. And why was that so? Because they have not got any sniffer dogs! The dogs in the TV show were borrowed from Customs, who, I would think, would be very concerned about lending dogs out to anyone—if only for the reason that, over time, people would know when they were not available to Customs. That is just an invitation to import drugs and do these other sorts of things.
There is an issue regarding this amount of money, and putting advertisements on television telling kids not to drink is great for the television company but of very little use in reducing the amount of consumption. In fact, I could give you a couple of examples of where advertising has sometimes drawn attention to the product rather than discouraging its use. Usually every parent tells their young people not to drink too much. I did not take any notice, and I bet most others do not. The reality is that the money has now been collected under the bill—a bill which I do not agree with and hope is lost—to the full extent of the 12 months available under the customs legislation for the government to raise the tax without getting the permission of this parliament. Why could the government not have tested the parliament a month or so into its effect? Then, if the bill were to be lost, they would not have to work out what they will do with this money.
If the government were to come back into this House with a very specific bill to the effect that they would use the money to finance a special task force of police units around Australia—with their sniffer dogs and other methods, including drug testing, in the same way that we test for alcohol through random breath testing et cetera—to go into nightclubs for the purpose of arresting people in possession of these drugs, be they AFL footballers or otherwise, then, whatever the view of my party, I would vote for it. After 30 years of experience in retailing alcohol in hotels, I know that drugs are the big problem. I also know that, when you have a variety of taxes and excises imposed on alcohol, the industry will always find a way to market a product using alcohol produced by the least taxed form. An example is low-alcohol beer. The Swan brewery was selling one per cent alcohol beer and made that product by boiling the alcohol off. That alcohol, which is then a raw product, can be inserted into an alcopop which can then be claimed to be a product of low-alcohol beer and taxed accordingly.
In the wine industry we have this hang-up about the fact that their business is built around cask wine, which they frequently import from Chile. They fight against an ad valorem tax on alcohol when they produce high-quality wine, which is what they should be producing. However, of course, the tax does not apply to exports. If they had a flat tax, the incentive would be to produce higher quality wine and not rubbish for alcoholics, particularly those in the Indigenous population. That is the cheap form of alcohol. If the government has a genuine concern for the health of people, why did it not increase the tax on that? Oh no, that is a bit difficult. This one looked easy, and they thought they were going to grab a lot of revenue. But even the revenue has not come up to expectations. History says that a tax of a more specially applied nature will not reduce the consumption of alcohol. In fact, there is every chance that it has increased consumption, because the young have gone and purchased large bottles of 45 per cent alcohol and they are making their own mixes, and that is stupid—and stupidity is the greatest insult that I can deliver in this place.
It was bad public policy, it has not achieved its intended outcomes and it broke an election promise. The real challenge amongst the young is amphetamines and associated recreational drugs, and I never hear a word about them. I never hear the Minister for Health and Ageing, in her rantings on this subject, say one thing about drugs. They are where the violence comes from, and we should be prepared to confront it—and confront it in the places where people consume it. We will never stop some, but if you went into a major nightclub, locked the doors and said, ‘Okay, all line up,’—or, for that matter, had a policeman with a sniffer dog standing outside the door as they sought entry—and you got every kid who had one tablet, put them in the paddy wagon to the police station and rang their parents and said, ‘Come and get them,’ then that would be a positive measure. For those who were clearly proved to be retailing or selling these drugs, I do not think 10 years is too long a penalty, and I would build a special jail for them out in the Simpson Desert. It is a dreadful attack on young people, and I have not seen a scrap of evidence since this government has been in office that it has any interest in it whatsoever. I put that down to the simple fact that you cannot tax it.
I rise to speak in support of the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009. In the year 2000 the Liberal Howard government, for reasons best known to itself—and we can only speculate as to what those reasons were—introduced a loophole, a tax concession, if you like, for alcopops, otherwise known as ready-to-drink spirit based alcoholic products. It worked in the following way. Up until that point, spirits based products had an excise tariff of $66.66 per litre of alcohol content applied to them. But, in relation to pre-mixed drinks, that figure was reduced to $39.36 per litre of alcohol content. It had this effect: you could go out and buy a bottle of bourbon and you could buy a bottle of Coke and you could mix the drink yourself to get a drink of bourbon and Coke. You could also go out and buy a premixed can of bourbon and Coke in the same quantities and with the same measure, and what would happen is that those two drinks, which were in essence precisely the same, would have completely different tax regimes applying to them. Indeed, you would be drinking the premixed drink at half the tax rate of the drink you mixed yourself. As I say, why that occurred is best known to the government of the day, but that it occurred was a very dangerous exercise in public policy, in the context of what has evolved as a significant binge-drinking problem in this country.
One in ten 12- to 17-year-olds are now drinking at levels which are defined as being risky. Twenty thousand girls in this country between the ages of 12 and 15 are reportedly drinking daily or weekly. The number of young women between the ages of 18 and 24 who are admitted to hospital for alcohol related reasons has doubled in the last eight years. The Australian Institute of Health and Welfare reports that the proportion of treatment episodes for which alcohol is the main drug responsible for people between the ages of 10 and 19 being treated has risen from 15 per cent to 23 per cent in the past five years. Of course, drinking in that way has an enormous adverse impact on a person’s health, but it also has an impact on the health of others and on the health of the society in which we live. Three-quarters of a million Australians are physically abused every year by people who are under the influence of alcohol. The social cost to our nation of alcohol misuse has been estimated at $15 billion a year. Only last year the New South Wales Police Commissioner, Andrew Scipione, said:
… something like about 70 per cent of every police engagement with a member of the community in the streets of NSW has alcohol as a factor.
Against that backdrop, why a government would seek to provide a tax concession for alcopops beggars belief. But that is what they did. It particularly beggars belief when you consider that alcopops are a product designed specifically for and targeted specifically at young people. They are the people who drink alcopops. Alcopops are designed with bright colours. They are designed to taste sweet to disguise the alcohol in the product. By any measure, if what was sought by this tax concession was to increase the consumption of alcopops then it works. It works spectacularly, because the sales of alcopops increased by 250 per cent since the year 2000. The percentage of girls between the ages of 15 and 17 who reported that an alcopop was the last alcoholic drink that they had consumed rose from 14 per cent in the year 2000, before the tax break was introduced, to 62 per cent in 2004. For girls in the same cohort who were described as drinking in a risky manner, the percentage who indicated that an alcopop was the last alcoholic drink that they had consumed in 2004 was 78 per cent. That figure rose threefold after the year 2000.
This is an issue of enormous concern for the people in my electorate of Geelong, and indeed I spoke about it in this place on 16 September last year. For me, there is something of an interesting story to the speech I made in this place in relation to binge drinking among young people. At the time, I had working in my office a young work experience student, Sumeyra Eren, from Matthew Flinders Girls Secondary College in Geelong, a member of that exact cohort—a girl between the ages of 15 and 17. The task I set her during her week of work experience was to prepare a speech for me which I would make in this place. She could prepare that speech on any topic that she chose, but the one that she chose was this: binge drinking amongst young people. For young people in this country—for young people in Geelong—binge drinking is a huge issue. In the speech that she prepared she talked about a party that had occurred at Tettenhall Ridge in Belmont in Geelong on 31 August last year. It was arranged through MySpace and MSN and saw, in the middle of the night, 200 drunk and disorderly young people milling around in the streets, throwing bottles and cans and being raucous in what was a quiet suburb.
Alcohol fuelled violence has been a key issue within the CBD in Geelong over the past few years and indeed was behind a measure that this government took to the last election. That measure, which we have introduced since being elected to government, was a $300,000 commitment to improving the safety of the Geelong CBD. An interesting community response to the issue of binge drinking and the lack of safety which it was creating in the centre of Geelong has been taken up by the local paper, the Geelong Advertiser, and the Geelong Football Club—in particular its captain, Tom Harley. Those organisations have come up with the Just Think campaign, a campaign very much aimed at young people. It is not intended to be a wowser campaign and it is not intended to tell people that they cannot drink, but what it does seek to do is to say to those people who are about to drink that they should ‘just think’ when they start consuming alcohol. They should think about what their drinking does to themselves, about what their drinking does to their families, about what their drinking does to their friends, about what their drinking does to their community and about what their drinking does to their health. It has been a spectacularly successful campaign within the community of Geelong. It has received the support of the Premier of Victoria, Mr John Brumby; it has received support from the then Victoria Police Chief Commissioner Christine Nixon; and it receives support in this place during question time from the Minister for Health and Ageing, Nicola Roxon. Indeed, the Geelong Advertiser, being a News Ltd paper, has spread this campaign to other News Ltd papers around Australia, and the Cairns Post has taken up this campaign and is running it within that city.
What is very clear when it comes to the issue of binge drinking and how we tackle this problem is that money counts. When you are talking about young people and binge drinking, you are talking about a group of people who do not have money readily available to them who are very sensitive to the price—
Order! It being 2 pm, the debate is interrupted in accordance with standing order 97. The debate may be resumed at a later hour and the member will have leave to continue speaking when the debate is resumed.
My question is addressed to the Prime Minister. I refer to Pacific Brands laying off 1,850 Australian workers who have been making shoes, clothes and homewares. I refer to the Prime Minister’s claim that his December clash splash would create 75,000 jobs and to the Treasurer’s claim a few weeks ago that the cash from the cash splash was spent on ‘socks and jocks and polo shirts’. Prime Minister, how does your socks and jocks led recovery look now, and how many more workers will lose their jobs because of your economic incompetence?
When it comes to the announcement today by Pacific Brands, the response from all members of this House should be one of extreme disappointment at the decision. Furthermore, reflecting on the fact that this is devastating and distressing news for the workers concerned, we understand from advice to the government that full entitlements will be paid. Under the TCF Structural Adjustment Program, affected workers will be immediately eligible for intensive support and customised assistance. Pacific Brands’ decision is bad news for the TCF sector and it is bad news for the economy. I understand that the Minister for Innovation, Industry, Science and Research had been informed by the Chairman of Pacific Brands that there was nothing the government could do to reverse the decision by the company. That was the position put to the government by the Chairman of Pacific Brands, I am advised.
The key challenge that we face in dealing with the impact of the global economic recession on Australian manufacturing and across the broad economy is ensuring that what we do through nation building, investment in schools and investment in support of consumers and families doing it tough is lift overall demand in this economy at a time when the private sector is in retreat. That is what underpins the government’s nation-building plan for the future. As the government has said repeatedly, there are no silver bullets in this. However, the challenge is this: either to reduce the impact of the global economic recession on Australia or to simply do nothing. Our strategy as a government is outlined in our nation-building plan for the future, an economic strategy to see Australia through the crisis. The alternative recommended by those opposite is to sit on our hands and do nothing.
My question is to the Minister for Families, Housing, Community Services and Indigenous Affairs. What support is the government giving to workers and their families and to businesses affected by the bushfires?
I thank the member for Ballarat for her question. I know right now she is extremely concerned and is providing considerable support to her communities back home as they face these terrible bushfires. We are all aware that many small businesses and farms are the backbone of all of these communities that have been affected by the fires. So many of these businesses have been destroyed, so there are now many families with mortgages to pay that no longer have jobs. So, as well as the disaster payments, the government is providing additional financial assistance to support people who have lost their livelihoods. The Income Recovery Subsidy provides payments equivalent to the maximum rate of Newstart over 13 weeks. So far, payments totalling more than $641,000 have been made to 1,660 people.
I will share a story about just one of those people with the House. One of them is a tradesman who lost his work ute and all of his tools in the fire. He contacted Centrelink. He was understandably very distressed. He did not know how he was going to get his business up and running again. The Centrelink officer told him that he was eligible for the Income Recovery Subsidy and probably the disaster payment as well. The Centrelink officer put him in touch with Red Cross. The next day when he called back his subsidy payment was in his account, along with the disaster payment. The Red Cross had connected him with someone who was helping him replace his tools and his ute. He was very appreciative of the support of the Centrelink staff.
The Income Recovery Subsidy also extends to those who are not at their usual jobs. These people might be out lending a hand in fighting the fires or they might be helping people who are trying to recover from the fires. The Income Recovery Subsidy can also be paid to them.
I would also like to inform the House that today I approved the extension of the Income Recovery Subsidy to people in north-western Queensland, who have been struggling in the face of the floods caused by Tropical Cyclone Charlotte. These are important measures that the government is putting in place to make sure that people who are trying to get back on their feet and trying to get their businesses up and running can do so with the maximum level of support.
My question is to the Treasurer. I refer the Treasurer to his numerous statements in January this year that the $10 billion cash splash had:
… a very significant impact on spending on the basics of life … such as socks and jocks …
Today Pacific Brands, the manufacturer of Bonds, Holeproof, Clarks, Hush Puppies, King Gee and Hard Yakka, sacked 1,850 Australian workers in Cessnock, Wentworthville, West End, Nunawading, Coolaroo and Bellambi. Does the Treasurer now regret claiming his $10 billion Christmas cash splash would create 75,000 jobs when all we are seeing are more job losses?
It is certainly a sad day when we see so many job losses. There is no doubt about that. The reason the government are so emphatic about our Economic Security Strategy, delivered last October, and our Nation Building and Jobs Plan is precisely to support jobs in the Australian community. One can only imagine how much worse it might be if we had not acted last October.
Opposition members interjecting—
It is almost as if you can hear the glee in their voices, so they can score a cheap political point about such a serious matter. It is the case that the Economic Security Strategy will support 75,000 jobs and what we know is how much worse our situation would be if those opposite were currently on this side of the House. The Economic Security Strategy—
Opposition members interjecting—
Mr Speaker, this is a very serious matter. The Economic Security Strategy that we brought down last October was estimated to lift growth by between one-half of one per cent and one per cent and to support up to 75,000 jobs. That is the modelling from the Treasury. Our Nation Building and Jobs Plan is estimated to lift growth by around half a per cent in 2008-09 and by between three-quarters of one per cent and one per cent in 2009-10. We have to think about it like this: we are in the middle of a global recession. We have seen the sharpest contraction in the global economy in our lifetimes, and that is delivering a very significant shock to the Australian economy and a substantial reduction in demand. It is causing higher unemployment. We pointed directly to this in February when we delivered our Nation Building and Jobs Plan, because we said that our No. 1 priority was to support employment in the Australian community.
Who opposed that plan? All those over there opposed that plan. Effectively, when they came into this House and voted against the Nation Building and Jobs Plan, they voted for higher unemployment. Their approach is to sit on their hands and do nothing. Let us just take our Nation Building and Jobs Plan, which will support the employment of up to 90,000 people. If the Leader of the Opposition were the leader on this side of the House, there would be 90,000 more people unemployed in Australia. That is the truth of it, because these plans are designed to support employment in the Australian community precisely at a time when the global recession is imposing a very sharp contraction on this economy. This government are determined to act, and act we have. We have acted with some force and we have acted with power—when those on the other side of the House have simply sat on their hands and scored cheap political points. They should be condemned for that.
I inform the House that we have present in the gallery this afternoon, accompanied by the new Ambassador and Head of Delegation of the European Commission to Australia and New Zealand, Mr David Daly, members of a delegation from the European Parliament. On behalf of the House I extend a very warm welcome to the members.
Hear, hear!
My question is to the Minister for Ageing. How is the government continuing to support older people affected by the Victorian bushfires?
I thank the member for Chisholm for her question. I note her deep concern in relation to this matter. Could I start by expressing my condolences to all the people affected by this terrible tragedy—a tragedy that has shocked and saddened our nation. As part of the emergency procedures during the Victorian bushfires, eight nursing homes and hostels, with more than 300 residents, were evacuated. I take this opportunity to commend the staff and volunteers who assisted with these evacuations. In response to the devastating bushfires in Victoria, the Australian government has undertaken many practical measures to help older people affected by the bushfires.
Today I have advised the Victorian Minister for Community Services, Lisa Neville, that the federal government is providing up to $500,000 for extra home and community care services for older people in the bushfire affected areas. This means they can get help in their homes and with services such as Meals on Wheels, personal care or community transport. In total, we are providing up to $1.5 million to cover the costs of emergency nursing home care and of replacing necessary items burnt in the bushfires—such as motorised wheelchairs and walking frames—and personal care items lost by older Australians in the bushfires.
In addition, we have also removed the requirement for aged-care assessments for older people affected by the fires. This is a one-off measure that has fast-tracked aged care for older Victorians needing emergency respite care. This means cutting through the red tape to get nursing home places for them immediately. So far, 18 older Australians from the bushfire areas have been provided with respite care in nursing homes. They can stay in the nursing homes until they are able to make longer term arrangements for their accommodation, or they may decide to remain in the nursing home on a permanent basis. This is about providing practical help to those older Australians who have suffered and lost so much in these tragic bushfires.
My question is to the Prime Minister. I refer again to Pacific Brands laying off 1,850 Australian workers, many of them in regional Australia. Is the Prime Minister now going to create 77,000 jobs from his stimulus package to make up for the 1,850 that have been lost by Pacific Brands?
The challenges presented to the Australian economy and to workers and their families by the global economic recession are reaching right across our country. Our responsibility as a government, through the parliament, is to engage in proper investment in infrastructure and support for families, which reduce the impact on the economy and jobs overall. That is why the government has done what it has done. We do not apologise for it. It is the right course of action to have embarked upon, first of all, support for families, pensioners and first home buyers in the approach that we took at the end of last year.
I would say to the Leader of the National Party, who asked the question: did you vote for that package at the end of last year? I thought the Leader of the National Party, following the lead from the Leader of the Liberal Party last year on the question of the Economic Security Strategy, which contained $4.8 billion worth of payments to pensioners and, on top of that, some $1.2 billion in allocations to first home buyers, supported the package. My recollection is that the Nationals stated their support for it—that is, the package last year. I understand further that they then voted for it. But then they engaged in what is called the Liberal Party three-step: firstly, support it; secondly, seek to undermine it; and, thirdly, oppose it when the political opportunity presents itself. That is actually called the Liberal Party three-step, which is now the National Party three-step. That is what they said last year, and now they seek to distance themselves from the fact that they voted for that package last year. I simply make that a point of record in this place.
This year the government’s nation building plan, as we know, was voted down on three occasions by those opposite and their counterparts in the Senate. The government succeeded in obtaining the passage of that plan through the parliament. The whole objective is this: through this investment in infrastructure and support for families, to reduce the impact of the global economic recession on Australian workers and families. The difference is very plain in this place. What we have is a Liberal Party and a National Party who are seeking to take political advantage of the global economic recession. We have, of course, the Leader of the Liberal National Party in Queensland saying that the global economic recession is ‘peripheral’ to the state of Queensland. I find that remarkable. Look at the impact on Queensland revenues of the collapse that is occurring in mining exports around the world. Royalty revenues, including coal revenues, will fall by around $1.5 billion—from $3.5 billion in 2008-09 to around $2 billion in 2009-10—and there will be other impacts on the revenue as well. And the Leader of the Liberal National Party in Queensland says that this impact on budget caused by the global economic recession is peripheral! I assume that the Liberal and National parties in this place agree with him. Is that correct?
Mr Speaker, on a point of order: the Prime Minister was asked a question about the 1,850 Australians losing their jobs, not for his analysis of the Queensland election.
The member for North Sydney will resume his seat. There is no point of order. The Prime Minister has the call.
For the benefit of the honourable member, a number of those jobs have been lost in Queensland as well. The point I make to the honourable member is that the global economic crisis is directly impacting on Queensland and every state in the country, and for anyone leading the Liberal National Party to say that that effect on local jobs in Queensland is peripheral shows how out of touch the Liberal National Party has become.
What is the difference here? You have a government embarked on an economic strategy to see Australia through this global economic crisis, and you have the Liberal and National parties embarked on a political strategy to take political advantage of the global crisis. That is the difference. We stand by our strategy; you continue to prosecute yours.
My question is to the Prime Minister. Will the Prime Minister outline recent global and domestic economic developments and the government’s response?
I thank the honourable member for her question because it reminds us of the global economic forces which are at work in Australia and across the various states of Australia as well. Before the Leader of the National Party interjects, I again draw his attention to something he has not yet responded to: do you support the remarks by Mr Springborg that the global financial crisis is peripheral to the state economy of Queensland? Do you support that? For the record, the Leader of the National Party and the Leader of the Liberal Party in this House are silent and refuse to endorse the remarks by the Leader of the Liberal National Party in Queensland.
When it comes to the ingredients of the global economic crisis, there has been further data released in the last 24 hours of which honourable members should be apprised. US stocks fell this week to their lowest level since 1996. This has erased 12 years of stock market gains. Furthermore, if you look at the US confidence indicators, the US Conference Board’s index of consumer confidence fell to its lowest level since data began in 1967. Of course, economic data continues to unfold from Europe as well. Industrial orders in the Euro area fell 5.2 per cent from November and 22 per cent on the year earlier. German business confidence fell dramatically in figures released overnight. The IFO Institute, in Munich, said its business survey had fallen to 82.6, from 83 in January, making for the worst reading since 1982.
These clear pieces of global economic data from the No. 1 economy in the world and the No. 3 economy in the world are of direct relevance to what happens in this economy as well. They are of direct relevance also to what happens in the Queensland economy. Therefore, the challenge facing the House is the strategy which we are prepared to embark upon in this country to reduce the impact of these global economic forces. Our response in this country is clear: when it comes to fiscal stimulus, that which we have announced, against that which has been embraced in other countries, is in fact relatively small. Look, for example, at the United States and President Obama’s fiscal stimulus package of 6.9 per cent of GDP, or $787 billion. I quote Fed chairman Bernanke, who said:
To break the adverse feedback loop, it is essential that we continue to complement fiscal stimulus with strong government action to stabilise financial institutions and financial markets.
A combination of fiscal stimulus through budget action on the one hand and continued action to stabilise financial markets on the other is the way all governments around the world at present are seeking to deal with this problem, which has been visited upon our shores as well. What we know for sure is this: more jobs will be lost in Australia if no action is taken by government to support growth and to support jobs in the economy. That is an absolute, clear-cut fact. There again I return to the clear contrast between the two of us, government and opposition. You either have an economic strategy, as the government does, to see Australia through this global economic crisis—that is our approach—or the alternative, from the Liberal and National parties, which is a political strategy to seek to take political advantage of this global crisis. It is almost as if each time job losses are announced in this country you can hear the champagne corks pop in the Liberal and National parties’ party room.
My question is to the Minister for Defence. Minister, when did you first become aware of the problems regarding SAS salaries? How was that issue brought to your attention?
I thank the member for Paterson for his question. One of the great privileges enjoyed by any Minister for Defence is the opportunity to move amongst, to speak with and to mix with the men and women of the Australian Defence Force. I can tell the House that I exercise that privilege on a regular basis. One group I regularly move amongst is those who serve in our SAS—those who regularly put their lives on the line for our country. I see them at their bases; and, by the way, I visited Campbell Barracks just five days after this issue was first revealed last year to check on members of the regiment and to secure feedback from them. I also see them on exercises. I eat with them. I even have a beer with them.
No-one knows them better than I and no-one has a higher appreciation of what they do for their country. As minister, I will not allow them to be disadvantaged. When I first learned of the implications of the tribunal’s decision in October last year during Senate estimates I took immediate action. I directed the Chief of the Defence Force and the Chief of Army to put an immediate stop on any recovery action—a recovery action which was immediately implemented and has remained in place up until this day. I also instructed them to immediately do whatever it takes to correct this problem. I said earlier in the week that that solution came much more slowly than I would have liked. What we did need, of course, was a solution that was legally robust—one which was permanent and did not, in its rush, simply create more problems for those affected.
Opposition members interjecting—
Order! The question has been asked and is being responded to. The House will listen in silence.
This question was thoroughly examined during Senate estimates this morning, and I welcome that examination. I am pleased that senior people in uniform, including the Chief of the Defence Force and the Chief of Army, were able to give what I thought were very adequate answers and a fuller explanation—they had more time than I have here to explain the situation. Additionally I am pleased that Senator Johnston—to his credit I should say—has now acknowledged that the situation is being progressed in a positive way. I will quote Senator Johnston from Senate estimates when he said: ‘Now, can I thank you, General’—that is Lieutenant General Gillespie—‘for the way you’ve answered my questions today. I am satisfied that things are moving ahead positively. I have what I need for my satisfaction that these men will be looked after properly.’ I guaranteed those affected that they would not be financially disadvantaged. They will not be. They are not. The problem has been solved.
My question is to the Treasurer. Will the Treasurer outline for the House the consequences for the economy if we underestimate the threat posed to jobs and growth by the global recession?
I thank the member for Flynn for his question. I know that working families in Flynn are feeling the full heat of this global recession. It is impacting in his community, and I acknowledge the very strong representations that he is making on behalf of working families in the electorate of Flynn. Australia is battling a global recession, and it is felt particularly savagely in a community like Gladstone and the wider area of Central Queensland. The impacts are there and they are immediate. What do they flow from? They flow directly from a global recession.
We can see what has occurred in the United States, which has shed something like half a million jobs per month in the past three months. Job losses of this magnitude are unprecedented in the 70-year history of the data series in the United States. We have seen a rapid deterioration around the world. Not only did the US economy contract by one per cent in the December quarter—its worst performance since 1982—the Euro and UK economies contracted by 1.5 per cent, the sharpest quarterly contractions in that area since the early 1980s, and Japan contracted by a staggering three per cent in the December quarter, the largest contraction since 1974. Also, in recent days, we have seen contractions in Taiwan and Thailand, 6.1 per cent; Korea, 5.6 per cent; and Singapore, 4.5 per cent. And it is likely that growth in China, which has been the powerhouse of the global economy in recent years, could grind to a halt in the December quarter.
That is sobering news for this country, because it describes the sharpest synchronised downturn in the global economy in our lifetimes. At the moment, something like seven of our top 10 major trading partners are already in recession. Of course, this has very serious impacts on our economy. It will wipe around $60 billion from the value of our exports this year alone. It will mean that jobs are lost in the Australian economy—such as we have seen today with Pacific Brands. We on this side of the House understand how serious the global recession is and how important it is to act and to support economic growth and jobs. The IMF and most respected economists the world over have the view that it is important that governments take decisive action to stimulate the economy—and, of course, that is precisely what we have done.
In the middle of all of this global carnage, it simply beggars belief that anybody could underestimate the size, nature and power of this challenge, but it is far worse when it comes from people who should know better and are supposed to exercise economic leadership in this place—and, of course, that is the opposition. The Leader of the Opposition said last year that the global financial crisis, which has turned into a global recession, was ‘overhyped’. The shadow Treasurer said it was all manufactured, and I quote: ‘They are trying to manufacture, you know, a crisis’—as if all of these events were not happening then and have not accelerated in recent times. Anybody who was watching Senate estimates today could see how the Liberal and National parties do not understand the nature of the challenge that we face. They simply do not understand it.
Of course, there is someone else who comes from the school of economics that those opposite come from, which says, ‘Do nothing; let people go to the wall; just make a political point.’ As the Prime Minister said before, the Leader of the Opposition in Queensland, Mr Springborg, said that the global financial crisis and recession is ‘only peripheral to what is happening in Queensland’. I tell you what: it is not peripheral in Gladstone. The member for Flynn knows that. It is not peripheral right up the Queensland coast. It is not peripheral in the great mining towns of Queensland. And it is not peripheral in the urban centres of Queensland. The transmission channel of this global recession goes straight to the traded goods sector and straight into those parts of the country that have been participating in the mining boom, which has now unwound. It has unwound and we are now living with the consequences.
What is it with these people—the Leader of the Opposition, the shadow Treasurer and the Leader of the Opposition in Queensland? They are three peas in a pod all living in a fantasy world of economic denial. These are serious times, and my message to the shadow Treasurer is pretty simple: do your homework; do some hard work; come up with some alternative policy; put up some positive alternative; and give up the pointscoring. The unemployed of this country deserve far better.
Mr Haase interjecting
The member for Kalgoorlie will withdraw.
Here we go again, Mr Speaker. He is a dud, but if it suits the House I withdraw.
The member for Kalgoorlie will withdraw from the House for one hour under standing order 94(a).
Thank you for the opportunity, Mr Speaker.
The member for Kalgoorlie then left the chamber.
Mr Speaker, as a matter of courtesy, I was going to call your attention to the presence in the gallery of another treasurer, whom I thought you may have welcomed to this House. Maybe he has left in disgust.
My question is to the Minister for Defence. I refer the minister to his guarantee to this House four months ago that he would fix the problem with SAS salaries. Is the minister aware that, as recently as four weeks ago, due to debt recovery action by the government, a serving SAS soldier received zero dollars in his pay packet and has been unable to make his home loan payments?
I thank the member for her question. I am not aware of the particular case, although I have noticed that Senate Johnston has been bandying around a piece of paper—unwilling, by the way, to share it with me. So I invite the member to table it, so that I can, if possible—
Opposition members interjecting—
Order! The Minister for Defence has the call.
I know that the names in the document have been blanked out—and I know that from Senate estimates—so there is not a privacy issue. It would be helpful, because, as I said, last October I immediately directed the CDF and the Chief of Army to put an immediate stop on any recovery action—a stop that has been in place up until this time. It could be that recovery for some other reason was taking place. If the opposition want to share the information with me, I will be happy to assist in any way that I can. Defence recovers debts for various reasons, and I am advised that, given the stop, this is not likely to be a case where someone has been affected by the implementation of the DFRT’s decision.
My question is to the Minister for Employment and Workplace Relations. Will the Deputy Prime Minister outline to the House what the government is doing in response to job losses?
I thank the member for her question. I know that she is deeply concerned about this issue and, like me and other members in this parliament, she would have been very, very disappointed to hear today the news from Pacific Brands and to see that 1,850 workers around the country, through no fault of their own, are losing their jobs.
What we can do, faced with the global financial crisis and global recession bearing down on our economy, is take decisive action to do three things. Firstly, we can stabilise financial markets—action that the government have taken. Secondly, we can act to stimulate the economy, which is what the government did through our Economic Security Strategy, through our Nation Building and Jobs Plan and through our investment in infrastructure, including our investments in local infrastructure through local governments. As part of the Nation Building and Jobs Plan, we have made a historic and unprecedented investment in schools right around the country in order to bring those schools into the 21st century and to provide the standards that Australians want for their children when they are being educated. At the same time we have taken the opportunity to support jobs right around the nation in the communities in which those schools are located.
The third thing government can do is give a helping hand to those who find themselves redundant in these difficult days, as the global financial crisis and the global recession bear down on the Australian economy. The government have announced in recent days a number of practical measures that we believe will make a difference for some Australians in these circumstances. Most particularly, we announced new incentive payments. For those apprentices who find themselves without a job, having part way completed their apprenticeship, there are new incentive payments to assist them to get an opportunity with a new employer or a group training organisation in order to complete their apprenticeship. There are also new resources available to registered training organisations to help out-of-trade apprentices complete their apprenticeships. Then yesterday, with the Prime Minister and the Minister for Employment Participation, we announced new investments in giving a helping hand to Australians who are made redundant, including a nearly $300 million investment in personalised and intensive assistance for those Australians who are made redundant, and an investment in 10,000 new training places for redundant workers. This brings to a total of 711,000 the productivity places available to help people skill and reskill. They can find opportunities in those parts of the economy that still need skilled labour and, when the economy moves into growth, we will not see the same cycle that we have seen in the past where, in economic downturn, skilling and training slows and then, when the economy grows, the lack of skilled labour itself becomes a capacity constraint and prevents the economy growing as quickly as it otherwise could.
For the individuals involved, most particularly the 1,850 workers who heard this difficult news today about Pacific Brands, we understand that they would be feeling hurt and distressed. Obviously, we will be there with the personalised and intensive assistance to work with them. We have been very clear that there will be other days on which we hear this kind of distressing news—the news that we heard today—as the global financial crisis and global recession bear down on our economy. But the government will continue to take decisive action as necessary to support those individuals and to cushion our economy against the full effects of the global financial crisis and global recession.
Order! Before giving the call to the member for Fadden, under great pressure from a number of quarters within the chamber—and I cannot believe that I am about to do this as a Fitzroy and Brisbane Lions supporter—I inform the House that we have present in the gallery this afternoon Ronald Dale Barassi, a great Australian Rules footballer and a fine and respected Australian citizen. On behalf of the House, I extend to him a very warm welcome. He will not remember this, but many moons ago he lived for a short while in Regent, the suburb that I grew up in. Welcome.
Honourable members—Hear, hear!
Honourable members interjecting—
Order! The northern suburbs have to get something out of this!
My question is to the Minister for Defence. Minister, how much money has been deducted from the pay packets of SAS soldiers by way of debt recovery since August 2008? Has the minister personally met with any serving members of the SAS who have had their salaries reduced and been hit with debt notices? If so, when did these meetings take place?
I thank the member for his question. Not surprisingly, the issue of special forces pay was the key topic in Senate estimates this morning. The member asks a very detailed question—the same question that was asked by Senator Johnston of senior military leaders at great length this morning. Senior military leaders, including the Chief of the Defence Force and the Chief of Army, answered those questions, including in great detail—
Opposition members interjecting—
Order! The question has been asked. The minister is responding.
I share with the House the words of Senator Johnston following those answers.
Mr Speaker, I rise on a point of order. The Westminster system requires a minister to be accountable to the parliament in question time.
What is the point of order?
He has been asked a question and he should at least attempt to answer it.
The member for Sturt will resume his seat. He knows that he can approach the dispatch box and raise a point of order. The point of order is relevance. The minister is responding to the question. The minister has the call.
Given that those opposite were obviously not listening very well earlier on, I will repeat Senator Johnston’s quote—
Opposition members interjecting—
Order!
Greg’s grinning!
The member for Cowan is warned!
After extensive grilling in Senate estimates, Senator Johnston said: ‘Now, can I thank you, General’—that is General Gillespie, Chief of Army—‘for the way you’ve answered my questions today.’
Mr Speaker, I rise on a point of order on relevance. Men in harm’s way have had their pay deducted. How much—
The member for Fadden will resume his seat. The minister is responding to the question. The minister has the call.
Senator Johnston said: ‘Now, can I thank you, General, for the way that you’ve answered my questions today. I am satisfied that things are moving ahead positively. I have what I need for the—for my satisfaction—’
Mr Speaker, I rise on a point of order. It is about relevance. The minister was asked what he personally—
The member will resume her seat. She has raised her point of order on relevance. I have indicated, by giving the call to the minister, that he is responding to the question. The minister has the call. I am listening carefully to the response.
Senator Johnston said: ‘I am satisfied that things are moving ahead positively. I have what I need for the—for my satisfaction that these men will be looked after properly.’
Mr Speaker, I rise on a point of order.
The member for Aston will resume his seat. The minister has the call.
The shadow minister responsible has publicly said, in estimates, that he is satisfied with the progress of this issue, having grilled senior military people on this issue. They say the buck stops with me, and it certainly does, and it does with every minister in my position. Indeed, I was advised by Army today that the government has found itself in this situation in the past. I am advised that in 2006 Defence worked to resolve a longstanding issue that resulted from a Defence Force Remuneration Tribunal determination—very familiar—where 5,500 then-serving soldiers and up to 20,000 ex-soldiers had potentially been overpaid. I am advised the issue was a potential overpayment for trade pay—
Opposition members interjecting—
You just don’t get it, do you?
The minister will ignore the interjections.
I am advised the issue was the potential overpayment for trade pay, as soldiers had not completed the required training.
Mr Speaker, I rise on a point of order.
The member for Menzies will resume his seat. I am listening closely.
Mr Speaker, standing orders require you to hear my point of order.
The member will resume his seat. The minister has the call. The minister will commence the conclusion of his answer.
I have done three things: an immediate stop on the recovery process, a Chief of Army directive, which has now—
Opposition members interjecting—
18 February, which has now extinguished all debts. No member of the ADF now has a debt as a result of the implementation of the rem tribunal’s decision. There is one other thing I have done. I have ensured that this will not happen in the future by making sure that all qualifications in the future are granted formally and by ensuring that we make the appropriate investment in our ICT systems. If the former government had done that back in 2006, we would not be having this debate today.
My question is to the Minister for Employment Participation. How is the government working with private sector and community organisations to implement additional measures to assist retrenched workers?
I thank the member for Forde for his question and for his ongoing interest in looking after job seekers and those workers who might find themselves redundant in the months ahead. Mr Speaker, as you know, being made redundant is one of the worst experiences that can confront any worker. I remember when my father was made redundant. I remember when, as I became a new member of parliament, thousands of workers in my electorate were made redundant as a result of the collapse of Ansett. I do recall those days in 2001, dealing with thousands of workers who did not have sufficient assistance to find their way back into the workforce. But can I say that, through a $300 million package announced yesterday, the government has acted to provide ordinary Australian workers with access to additional support and training to gain skills and to regain employment as quickly as possible.
In stark contrast with those opposite, who seem to have no idea how to tackle the global financial crisis and no idea how to attend to the needs of job seekers in this country, the Rudd government is working in partnership with business groups, unions, church and welfare organisations and, of course, employment service providers to develop this significant package of support and training measures to assist newly redundant workers. We have put together a package of the best ideas and put them into action quickly to support newly redundant workers and we will deliver this package through collaboration with industry.
I do not know who the opposition are talking to these days, but can I say that the business groups have come out and warmly welcomed the announcement made yesterday by the Prime Minister, the Deputy Prime Minister and me. The Business Council of Australia, through its CEO, Katie Lahey, yesterday welcomed the announcement of immediate assistance for workers. Ms Lahey said:
We need to limit the effect of the downturn on individuals and the economy in order to position Australia more strongly for recovery. Measures to reduce the time an employee spends out of the workforce will be vital in achieving this.
ACCI responded to the initiative in the following way:
The announcement will help the newly unemployed bounce back into the job market.
Better matching newly retrenched workers with available jobs will also help the business community retain workforce skills and add to economic efficiency.
The third employer body that responded yesterday was the Ai Group, which indicated:
There is no doubt that pressures are growing on employment and the additional investment in employment services is ‘spot on’.
The Ai Group said that these initiatives are spot on and that they are sensible and very necessary in the current uncertain economic climate. These initiatives have been widely welcomed by employer groups, the ACTU, community groups, churches, employment providers and others because this package is intervening early to assist job seekers—to assist those people in this country who are made redundant through no fault of their own. We know that quickly connecting people with employment services and referring them to training in areas of skill need will provide better opportunities for these workers to find work in the near future. It will help newly redundant workers get back into the workforce to maintain and boost their skills, and indeed this is critical. That is why the government has acted decisively in relation to this matter. We continue to make decisions in the national interest, in the interests of business and in the interests of Australian workers and their families.
My question is addressed to the Minister for Defence. I refer the minister to his failure to answer a very straightforward question from the member for Fadden. I give him the opportunity to answer it now. I ask the minister: how much money has been deducted from the pay packets of SAS soldiers by way of debt recovery since August 2008? Has the minister personally met with any serving members of the SAS who have had their salaries reduced and been hit with debt notices and, if so, when did those meetings take place?
I cannot give the figure, because Defence cannot give it to me. I can give honourable members of the opposition a figure, though. I referred to an earlier incident when they were in government.
Mr Speaker, I raise a point of order on relevance. You were very generous on relevance when he previously did not answer the question. He should now restrict himself to relevant matters.
The Leader of the Opposition will resume his seat. The minister will respond to the question.
On that occasion the amount of money the government of the day was seeking to recover was $9 million. Indeed, that $9 million was booked—
Mr Robert interjecting
The minister will resume his seat. I warn the member for Fadden because on this occasion he is only denying the member for Sturt the call.
Mr Speaker, on the issue of relevance: the minister was asked a very specific question about meetings that he held and deductions taken from the salaries of SAS soldiers. He is now talking about other matters not to do with the question, which tries the patience of the opposition as you would understand.
The minister will relate his material to the question.
I will, Mr Speaker. In the 2004-05 financial statements, that $9 million was booked as revenue.
Opposition members interjecting—
Order! The minister will resume his seat.
Hear, hear!
You should really contain your excitement, member for North Sydney. I have great difficulty in judging the relevance of a response that I cannot hear, so I think that those on my left should sit in silence so I can listen to the response of the Minister for Defence. The Minister for Defence will relate his material to the answer.
That was $9 million booked as revenue, a decision which was reversed in the 2005-06 statements.
by leave—The Minister for Defence is putting the soldiers in the front line while he puts their families on the breadline. I move:
That this House censures the Minister for Defence for:
The SAS is in the front line in the battle against terror. They are in the front line fighting the Taliban in Afghanistan and we have a minister here who knows nothing about their affairs. Twice he was asked how much their pay had been docked. He said he did not know. It is bad enough that he did not know, but the worst part of it is he does not care. He has put those soldiers on the front line and their families have received payslips with nothing at all—soldiers on the front line, families on the breadline.
How can we ask these men to put themselves in harm’s way? How can we ask them to fight the most ruthless enemy when we have such an incompetent defence minister, a man who is indifferent to the hardship their families are suffering as he wanders lost through a maze of excuses? Excuses do not pay the mortgage. They do not pay for the groceries. Excuses may serve to protect this incompetent minister for a few more months from the wrath of the Prime Minister but they do not defend the integrity of the obligation all of us owe to our armed forces. There is no greater or more solemn obligation for an Australian government than to do everything in its power to safeguard the welfare of those we ask to serve us in war, in our uniform, under our flag in the most difficult and dangerous conditions one could ever imagine.
What we have seen revealed in this House is an incomprehensible saga of bungling and incompetence which for almost a year has seen these elite forces let down by an extraordinary, unprecedented example of ministerial ineptitude and incompetence. The Australian people are asking today: how could the families of our men fighting in Afghanistan, taking on the most dangerous, most ruthless enemy in the world in the front line in the battle against terrorism open their pay packets and find there is nothing in them? How could it be that their wives and children back at home could be left to fret and worry over whether this pay debacle could leave them unable to pay their mortgages, in danger of being thrown out of their own homes? This is a national disgrace. It is a scandal and what is most scandalous of all is that this minister comes into the House this week and will accept no responsibility at all for a fiasco that has occurred entirely under his watch.
We had the incredible spectacle just a moment ago when, on the second occasion the minister was asked how much had been deducted from their pay, he finally said, ‘I don’t know.’ He said that he had no idea. He did not know how much had been deducted from their pay; then he started to provide figures of some deductions that had occurred years ago. Who does he think he is? A military historian or the Minister for Defence? We need a Minister for Defence who knows what is going on today. Our soldiers in Afghanistan need a Minister for Defence who they know stands behind them as securely, loyally, devotedly and courageously as we are asking them to stand in the line of battle against the Taliban in Afghanistan.
He has betrayed our soldiers with his incompetence. He is a minister who promised more than four months ago that this problem would be fixed. But, unbelievably, he has not fixed it—not by a long way. We are not talking here about pay anomalies involving 20,000 people. We are talking about a relatively small number of men upon whose shoulders the heaviest responsibilities have been placed—placed by us, the people of Australia and its government. We put those responsibilities on them—to stand firm in the face of terror—and we have a minister who has let them down. It is just a small number of men. A competent bookkeeper—a competent minister, indeed—could have sorted this out in a few hours, as could even this minister if he had shown the slightest energy or willpower. He could have sat down with the records, worked out who had been paid and who had not been paid and sorted it out himself. We are talking about dozens, not hundreds, of people. We are talking about a relatively small number of men. But what has he done? He has dithered and he has dissembled. He has blamed it on computers. He has blamed it on his own department. He has blamed it on everybody but himself.
We perhaps saw the most contemptible example of the minister’s readiness to blame everybody but himself today, when, so desperate to wriggle out of this scandal, he twice—not once—tried to use a courtesy in the Senate extended by the shadow minister for defence, Senator Johnston, to our men in uniform as a fig leaf to hide behind. I can tell you that Senator Johnston’s appraisal of this minister’s competence is the same as that of everybody on this side of the House and that of every Australian.
This debacle arose after a ruling by the Defence Force Remuneration Tribunal in May last year, which reconfigured the terms and conditions under which some classifications of SAS soldiers would receive their pay entitlements. The change in arrangements was backdated to the previous August, in effect retrospectively revising their pay entitlements. This is not a case of mistaken payments where somebody suddenly finds millions of dollars dropped into their bank account or where the wrong address is given and suddenly they find all this money that they know has got nothing to do with them. These are men who were being paid in a way which the Army thought was appropriate at the time and which they thought and believed was appropriate at the time. They had no reason to believe they were being overpaid at all. I have very real doubts whether the Army properly, legally—certainly morally—should be docking their pay or questioning their pay at all.
The opposition raised this scandal at a Senate estimates hearing on 22 October—that is, more than four months ago. On the same day, this incompetent defence minister stood in this House and pleaded ignorance of the issues raised but then guaranteed to the Australian people that he would fix the problem immediately. He said, ‘I can guarantee to the House that this problem will be fixed.’ That is what he said, standing opposite me. The Prime Minister sat beside him at the dispatch box as he delivered that pledge. By rights, if the Prime Minister cared as much about the welfare of our soldiers as he should—if he really cared about supporting our soldiers as he should—he would have been apoplectic about this outrageous dereliction of responsibility. He would have taken this incompetent defence minister back to his office and demanded in no uncertain terms that the problem be fixed and fixed immediately. By rights, he should have also called in the Chief of the ADF to insist the problem be fixed immediately—no ifs, no buts, no more excuses.
I say again: the families of these brave men cannot eat this incompetence and these excuses. They cannot pay the mortgage with this incompetence and these excuses. These men need to be rewarded, they need to be paid and they need a government that stands behind them, a government that does not throw everything aside into a sea of excuses—‘Oh, it’s all too hard.’ You cannot throw the fighting men of Australia into the too-hard basket, Minister. You threw them into the front line of battle; then you sent their families onto the breadline by sending them a pay packet with a big zero in it. That is what this minister sent them.
True to his style, the Prime Minister shirks the hard decisions—and he shirked this one too. He sought to assure the House yesterday that he had taken a keen interest in bringing an end to this fiasco. But when exactly did the Prime Minister discover his sense of urgency about this appalling state of affairs? There was a moment that demanded resolute, principled leadership.
I remember when John Howard was Prime Minister. People would raise issues with him and, when he explained that there were challenges associated with resolving them, people would look him in the eye and say, ‘You’re the Prime Minister: fix it,’ and John Howard always set out to fix it. Everyone on this side of the House knows that, if the Prime Minister were John Howard, this issue would have been fixed immediately. There would have been a speedy resolution, a speedy announcement and it would have been fixed. Instead, we have a Prime Minister who does not care. Instead, the Prime Minister has gone missing in action on the men we send into action.
We send our soldiers into harm’s way to take on this challenge of terrorism, to take on the most dangerous enemies in the world, and the government is so indifferent, so unconcerned, that the minister will stand up in October and say, ‘I will fix the problem,’ and in January payslips are received with nothing on them: nothing to pay for the mortgage, for the rent, for groceries—nothing. That is what they got. We talk in this House all the time about the gratitude of the nation to our men in uniform. We talk about the thanks of a grateful nation. Well, the SAS can say to this minister, ‘Thanks for nothing.’ That is what they got from him: nothing at all. More than four months after guaranteeing he would fix this problem the Minister for Defence has delivered nothing. His promise to fix the issue has not been fulfilled, and we know from the testimony of the Defence chiefs in estimates today that this promised resolution cannot and will not be fulfilled until May at the earliest. They have to wait until May. And the minister tries now to excuse himself and to seek absolution because the mess that he has presided over will be resolved at some point in the future. That is not good enough.
The fact is that a minister who has let down our fighting men once will let them down again. Our soldiers know about loyalty. They know about character. A minister who does not have the character to fix this problem immediately, who does not have the character to fix this problem when he said it would be fixed, will not have the character to stand by them again. Our men in uniform know that the only reason anything is being done is that the opposition has raised this matter again and again in this parliament. Let us be quite clear: the minister said, on 22 October, that he would fix it. Yet the directive that the Army issued to resolve the issue, so he claims, is dated 18 February. Is there anybody here, is there any soldier in Australia or serving us abroad, who does not understand that the only reason this directive was issued was because the minister knew he was going to be called to account by the opposition in this House for his incompetence? That is the measure of this minister: incompetent, slovenly, lazy and careless about the best that Australia can offer, the best that Australia can put into the field against the worst, the most dangerous and the most ferocious enemy. He sends them onto the front line. Soldiers on the front line, families on the breadline—that is the defence policy of this minister.
More than a year after these decisions to reconfigure the pay scales and allowances of the SAS were made, the problem remains unresolved. Why should our elite troops in the battle line have to be worrying about whether their families back home can make mortgage payments? Why should they suffer the distress and anxiety of receiving a payslip with nothing on it? Why should they be issued with debt notifications of tens of thousands of dollars, not due to an accidental overpayment as the government would have us believe—that would be bad enough—but through the retrospective stripping of those soldiers of their full pay entitlements?
It is only now, after the opposition has brought to light further evidence of the ongoing hardship and distress of these soldiers and their families that we finally get a commitment that no financial disadvantage will be suffered. Only now do we get a promise that when the time finally comes that all of this is tidied up, none of those families affected will be asked to repay the debt. But what we do not get, a year after this debacle began to affect our fighting men and their families, is immediate and unconditional action to waive all penalties imposed and debts incurred through this fiasco—not in April, not in May, but today. All we have from the minister is a form of weasel words designed not to fix the problem but to rescue his job. The only jobs package he is interested in is his own job. It is too little too late. It is much too late. The damage has been done. The trust has been betrayed.
We know that this incompetence is so great that the Prime Minister can have no confidence in a minister who blames everybody but himself—a Minister for Defence so cowardly that he will not take responsibility for any element of this fiasco. The one consistency we have had from this minister is that it was not him. He will not take the blame for anything. He asks our soldiers to stand in the front line, to stand up against the shells and missiles of the enemy, but he will not stand up for anything. He passes the buck. He passes the blame around as generously as he is stingy with dollars for our soldiers. He gives our soldiers nothing in their pay packets. Imagine that, Mr Speaker! Just reflect on that.
I ask all Australians to reflect on the character of a Minister for Defence who can say on 22 October that this problem would be fixed and in January dock all of the pay of one of our finest fighting men so there is nothing on the payslip—nothing. Talk about the thanks of a grateful nation! There is no thanks from this minister. The minister should have fixed this long ago. We all know that. He said he would, but he has not. The problem will continue and drag on for months. It is an outrageous dereliction, an abandonment of duty by a minister of the Crown. This minister, if he were honourable, would resign today and not trouble the Prime Minister. And if he will not do the right thing, if he will not accept responsibility for his incompetence, if he will not be prepared to say that he got it wrong—that he has failed and that he is too incompetent and slovenly to have this job—then the Prime Minister must act and sack him.
Is the motion seconded?
I second the motion and reserve my right to speak.
This is a very serious issue, and I have to say that it is absolutely correct for the opposition to pursue it. If we were in opposition and I thought that our special forces soldiers were being underpaid or somehow unfairly treated or that a recovery action was taking place unfairly, I would be pursuing it as well. What disappoints me about the debate is that it seems to have descended into a debate about who is more supportive of our troops: is that side of politics more supportive of our troops or is this side of politics more supportive of our troops? I was always hopeful that that would not become a debate in this place. This is one issue that should rise above politics. We should always collectively endeavour to ensure that there is a bipartisan spirit so that when our troops are in theatre they know that all parliamentarians are behind them in every way and that they are not going to be the subject of political debate in this place.
In addition to that, I said earlier by way of answering a question that I do know these people well. I do not know them as well as I would like to know them—I do not claim to know everything about them—but I do know the Special Air Service Regiment well. They are a very tight family which maintains a very tight circle of trust. It is unusual for us to be having any form of debate about their operations or even their conditions of service, because they are a group of people who like to resolve things within.
Mrs Mirabella interjecting
The member for Indi is warned!
It is disappointing that we have spent a number of days this week in this place talking about their internal issues. I know that they would be disappointed by that. There is no doubt in my mind that they would be disappointed that this series of events has caused them to be part of public debate in this country. I do not criticise the SAS soldier—I assume it was at an SAS soldier; Senator Johnston says it was an SAS soldier who came to him—for going to Senator Johnston. In fact, in a sense I thank him for going to Senator Johnston, because that made me aware of this problem earlier than I probably would have been. But I have to say that it would have been far more responsible for Senator Johnston to have come to me, instead of making a hero of himself in Senate estimates, and raised the issue with me to enable me to fix the problem.
This did not have to be a public debate. I know that Senator Johnston wanted his five minutes in the sunshine, a bit of publicity, because we do not hear all that much of him. I do not hear him talking about the white paper process, and I do not hear him talking much about Afghanistan, our most important deployment where our men are in danger on a daily basis. I put in place a reform program never before seen in defence in this country but there was not a word out of Senator Johnston. I would be very happy for Senator Johnston to criticise what I am doing in defence, because I am making some pretty tough decisions to ensure that we have less fat and less inefficiency and that all our money is going where it really counts—to the very people we are talking about today: the men on the front line putting their lives on the line for their country on a daily basis.
However, Senator Johnston does not want to talk about the appropriate use of force in the international framework, our strategic outlook or how we should respond as a country both in force structure terms and in capability terms. He does not talk about whether we need a balanced or a weighted force. He does not talk about how much capability we should have in Navy or Air Force compared with Army. We are not having that debate in this place because Senator Johnston has nothing to say—
Mr Baldwin interjecting
Nor has the member for Paterson, I would suggest, who goes around the country presenting himself as the shadow minister for defence. He must send Senator Johnston absolutely mad, presenting himself as the shadow minister for defence on a regular basis. It is not surprising that he seeks to fill the vacuum left by Senator Johnston’s inactivity. It would have been a much more responsible act if Senator Johnston had come into my office and said: ‘Mate, I think we have a problem with our special forces soldiers and, mate, you and I both know we do not want this to be a public issue. We do not want the personal issues confronting our special forces soldiers aired as part of the public debate.’ If Senator Johnston had done so, I would have welcomed him to my office with open arms, got straight on to the phone to the Chief of the Defence Force and said: ‘Angus, this must be fixed and fixed now. This is unacceptable.’
Ms Marino interjecting
Order! Member for Forrest!
But Senator Johnston chose not to do that. Senator Johnston chose to walk into Senate estimates, make a star of himself for five minutes and grab himself a headline or two.
Ms Marino interjecting
The member for Forrest is warned!
Let us go back to what took place here. Senator Johnston went into Senate estimates and, for the first time, the Chief of Army, the Chief of the Defence Force and I—all distressed—learned for the first time that the payroll system was deducting from the pay of special forces soldiers large amounts of money, in some cases money they rightfully believed they deserved. So what did I do? That day I called the Chief of the Defence Force or the Chief of Army—to be honest, I am not sure which now—and said, ‘We must stop this recovery action now and you guys must do whatever it takes to immediately fix this thing.’ The stop on the recovery action is still in place to this day, although it is not absolutely necessary because from 18 February the Chief of Army’s directive has completely waived or extinguished those debts.
Mr Baldwin interjecting
Order! The member for Paterson is warned.
No special forces soldier in this country has a debt against his name because of the way in which Defence has implemented the Defence Force Remuneration Tribunal’s decision—end of story. That is not to say that there is not some work to do. There is some work still to be done—in particular, making sure that they requalify for those allowances which now will be part of their more general remuneration. I remind the House that it was the special forces soldiers themselves who sought to have the allowances folded into their remuneration. Why? Firstly, it was administratively messy to have all these allowances. Secondly, by aggregating those allowances and merging them into their remuneration, there was the benefit of extra superannuation benefits. Indeed, the special forces soldiers asked in their submission that the matter be dealt with retrospectively so that the benefit would be enhanced.
The Leader of the Opposition says I still have not fixed the problem and that the problem is not going to be remedied until May of this year. He cries foul and says that this is an outrageous thing for our special forces soldiers to have cast upon them. The Leader of the Opposition can seek to have that amended, if he likes, but the whole idea of it going out to May is to allow our special forces soldiers who do not have the formal qualifications to secure them. If we called game over today, we would be back here next week. Notwithstanding booking $9 million of revenue into its bottom line back in, I think, 2004-05, the former government, of which the opposition leader was a member, did nothing to fix the informal nature of the qualifications and made no investment in the ICT system which has contributed so significantly to this problem. The Leader of the Opposition really needs to do his homework.
Unfortunately, I have not come in here with a written speech like he has. He must have known something was happening. But you would have thought, given the opposition propose to have so much expertise on this matter, that the person writing the speech in the office of the Leader of the Opposition might have seen that the idea behind the remediation program running until May is to make sure special forces soldiers have the opportunity to remediate the situation and gain the formal qualifications they need. That is a system that should have been put in place right back when his government sought to recover some $9 million from some 5,500 soldiers some time ago. They come in here and cry that the buck stops with me. Well, I am happy for the buck to stop with me. Again, this problem, by way of the Chief of Army’s directive, has now been fixed. No special forces soldier has a debt against their name.
I want to answer the question I did not get the chance to answer in question time, because the Leader of the Opposition, as obviously planned by his tactics committee this morning, decided to shut me down to move a censure motion before I had the opportunity to finish my answer.
Opposition members interjecting—
Order! This is a serious matter. Do you want to hear it or not?
The question was: have I had any conversations with SAS soldiers about this issue? The answer is no.
Mr Anthony Smith interjecting
Order! The member for Casey is warned.
Five days after this problem became apparent—that is, after the parliament rose—I made my way to Western Australia to Campbell Barracks, Swanbourne. Why did I go to Swanbourne? I went to speak personally with members of the regiment about this issue to get to the bottom of it, not just to listen to what the chiefs were telling me but to go and see the boys and find out what was going on. I had an afternoon tea with members of the regiment and, as I always do, I asked: is there anything more we can do for you? Is there anything we are not doing well? Are you getting all the training, capability and protection you need? What about this pay issue they are telling me about? No-one raised it with me—I am serious.
David Johnston did!
The member for Sturt is warned.
No-one raised the issue with me. I said: ‘I am concerned about the issue. If you have concerns, please make contact with me.’ As always, I gave them a business card of my ADC, which is the usual process for military people to make contact with their minister.
My office advises that we did have one woman ring my office complaining about an overpayment. Unfortunately, she was unprepared—and I think that is understandable given the political nature of this issue now—to give us her name, number or situation. She just wanted my office to know that there was a problem. I appreciate her having done that because it reinforced in my mind that we still have problems. You have to understand that the stop on the recovery action had been put in place. So why was this woman having problems? Unfortunately, she did not leave her details but, as I said during question time, Defence recovers money from the men and women of the Defence Force, including the Special Air Service Regiment, all the time for all sorts of different reasons. The Special Air Service Regiment often ask to have their pay delivered in advance. If they are going overseas and they want their wives to be cashed up, they are paid in advance. When they come back, their pay stops until they catch up. Sometimes they come back from deployment and the system—their system, which I am determined to fix—does not acknowledge that they are home, would you believe, and they continue to get the tax-free deployment allowance for weeks, if not months. Defence legally and appropriately recovers the money.
Members of the opposition need to be careful when they throw up these examples of recovery. They could potentially be about the remuneration tribunal’s decision or they could potentially be about something completely different. Senator Johnston, in Senate estimates today, thanked the generals. He said: ‘Thank you. You have explained the situation. We are satisfied now that our people are going to be taken care of.’ But the Leader of the Opposition seems to be on a completely different track. Why? Because he still sees a political opportunity. (Time expired)
This minister is guilty. This minister is guilty of gross incompetence. He is guilty of failing the most basic test of ministerial responsibility and accountability. He is guilty of failing to protect the wages and conditions of our soldiers, of failing to protect the welfare of the wives and the children of our serving soldiers, of undermining confidence in the leadership of the armed forces and of undermining the morale of SAS soldiers who are currently serving in Afghanistan.
We have heard some pathetic and lame excuses from the Minister for Defence as to why he has not been able to fix an appalling problem with the pay packets of a number of serving SAS soldiers. This has been going on since May 2008. No more of these excuses, Minister, as you walk out of the House. No more excuses about a computer glitch. No more blaming the computer. No more saying that no-one told you, that the Department of Defence is incompetent, that the dog ate your homework or that Senator Johnston has not told you. We heard the minister say today that he blames Senator Johnston for not bringing this matter to his attention earlier. It is now up to the opposition to tell the minister what is going on in his department! Is the minister telling the soldiers of Australia that, if they have got a problem in defence, they have to wait for the opposition to raise it in Senate estimates before the minister even understands what is going on in his own department? ‘Oh, Senator Johnston didn’t tell me!’ says the minister. That is a disgrace. The minister is guilty of the grossest incompetence in this regard.
Today, Minister, the buck stops here. Today the buck stops with the minister. This minister’s incompetence and inaction are causing enormous financial and emotional harm to our soldiers and their families. He has done nothing to fix the problem. Do you know when this came to the minister’s attention? At Senate estimates four months ago, and then last Monday, when it was on the front page of the Canberra Times. He had done nothing until it ran on the front page of the Canberra Times, and now we are told it will not be fixed until May 2009. That is 12 months from the time that these problems first arose.
The minister gave a guarantee last October to this House. He gave a guarantee—I assumed a solemn guarantee—to this House that he would fix the problem. He turned up in my electorate of Curtin at the Campbell Barracks just five days later and told the West Australian newspaper that the SAS were not concerned about this. He said:
Look I don’t think there’s any real sense of concern amongst members of the regiment.
These are people who are having their pay docked! He went on to say—and I’d listen to this—on 27 October:
The government addressed the recovery payments issue as soon as we learned of it.
Minister, you have not addressed this problem. You learned about it on 22 October, and today there are still soldiers who are receiving zero in their pay packets. The minister said—
Table it.
It is a transcript from thewest.com.au. I am happy to table it. The minister went on to say:
I think I’ll find them pretty relaxed
Government members interjecting—
I will table a transcript of thewest.com.au of 27 October 2008. Address the problem, Minister. The troops are relaxed, Minister. Have you any idea of what has been going on? Members, I will read to you an email I received on 10 February, four months after the minister said he would address the problem. This is from a constituent, Minister. It is from the wife of a long-serving SAS soldier, the mother of their five children, and this is what she had to say about the minister’s handling of this problem. She said:
As you are the local member I feel it imperative to contact you immediately due to the urgency of the situation—
this was 10 February this year—
I am writing to you to express my concern about the depth and gravity of this situation. This has been raised with the Minister for Defence, the Director-General of Personnel and the commanding officer of the regiment.
She went on to say:
For us personally, as a family, we are facing financial ruin.
This is the wife of a serving SAS soldier, Minister.
We have had no time to prepare an alternative solution to the problem or have my husband retrained or apply for an exemption. We have a large mortgage and five children. We are effectively a single-income family and will not be able to afford to pay school fees, meet our mortgage repayments or put food on the table.
This wife of a serving soldier went on to say, on 10 February:
The anguish, heartache and stress that this is causing to my husband, myself and, more importantly, my children, is disgusting. My husband has served in combat roles as an SASR trooper in Afghanistan and Iraq and various other theatres on numerous occasions. He believes strongly in what he is doing. He is ready to lay down his life for the good of this country and its political ideals. We as a family have sacrificed a lot to support him, including many, many months spent apart in the course of the last decade or more. It takes its toll on us as a family unit, and now to be told that this sacrifice effectively counts for nothing is a total outrage and a personal affront to my husband, myself, our family and all the people who serve in a similar position to him.
Minister, she asked for your help. The SAS have been asking for your help, and you have done nothing.
Four days after receiving this email, I met with this woman, I met with the husband of this woman and I met with serving SAS soldiers and their families. As soon as I could get out of Canberra, as soon as the parliamentary sitting was over, I went back to Perth and met with them on Saturday, 14 February. They told me, Minister, how you had been treating them. They told me of their frustration at the way they were treated over many, many months. They told me how they had rung the minister’s office to inform the minister personally of the hardship and the trauma that they were facing. One soldier told me that he has been battling this pay dispute since last July. Time and time again, he was told it would be fixed. Time and time again, his salary was docked for a retrospective debt arising from the tribunal determination. That was a debt of more than $30,000—and he disputes it. I spoke to this soldier on 14 February. The last straw for this soldier was to receive a pay slip on 22 January this year showing he had received no pay. The debt recovery action took all of his pay. He got zero pay on 22 January.
One of these soldiers that the minister said would be pretty relaxed about all of this, one of these soldiers that the minister said showed no concerns, was at this meeting on 14 February. I asked this soldier how he felt about the way he had been treated. He said he was too upset to tell me. He feared he would be disciplined. He feared that he would lose his job. So he said, ‘I’ll write it down for you.’ This was a serving SAS soldier who was so traumatised by this that he could not tell me and he wrote it down. Let me tell you what he said. This is a man who has served in Afghanistan and Iraq. He wrote a list, in dot points, as to how this had affected him:
His partner rang the minister’s office—
I agree with him on that. Who is running the show, Minister?—
The Department of Defence is making money out of this. He finished with this line:
Minister, this is as a result of the tribunal determination. The minister has failed to exercise the fundamental duty of care that he owes to all members of our defence forces. In this case, his incompetence and his failures are all the more acute and all the more appalling because they have impacted on the lives of the serving soldiers of the SAS, who have been serving overseas on active duty, including in Afghanistan and Iraq. We know what the government thinks of the defence forces. We all read that report in June last year about keeping the Chief of the Defence Force waiting outside the Prime Minister’s office for hours. We know the regard that this government has for members of the Defence Force! The minister says it was in October last year that he first heard from Senator Johnston that the salaries of SAS soldiers were being cut and they were being hit with retrospective debts of tens of thousands of dollars. Minister, that is an extraordinary admission. That in itself is reason for you to resign. If you do not know what is going on in your department, you should go. It was raised in Senate estimates, and the minister said that Senator Johnston is to blame because he did not bring it to his attention earlier.
We heard today from the chiefs of the armed forces that it has been a problem since May 2008. What has the minister been doing since May 2008 when the determination was handed down? Minister, the words ‘retrospective’, ‘pay’ and ‘soldiers’ should have rung alarm bells in your office. Retrospective debts were being raised for SAS soldiers from May 2008, and you did not even know about it. Today the Chief of Army said the problem first arose in May 2008. In the following month, when it was raised at Senate estimates, salaries were cut by 40 per cent. Salary deductions were backdated to August 2007. Debts were raised in the soldiers’ names. There was no transition period. Bang! Overnight, the soldiers were hit with debts of $30,000 to $60,000 and they saw large deductions from their pay packets for these so-called debts.
Just imagine the impact that this has had on the morale of soldiers who are putting their lives on the line for their country. We have heard assurances from the defence chiefs today that these soldiers have had assurances before. What they need is for the minister to take control, to fix the problem and to stop blaming everyone else for his inaction. The minister was forced to concede yesterday on Perth radio that the buck stopped with him. How very noble of him! He said, ‘The buck stops with me but the computer system is going to take a long time to fix.’ He could not even accept that it was his responsibility; he blamed the computer system. It is not about computers, Minister; it is about a woman with her five children, the wife of a serving member of the SAS, who is worried at night that she cannot get the money to put food on the table and pay the school fees. Her husband, serving in Afghanistan, cannot get a night’s sleep. He is worried sick about his family.
The minister has no idea what is going on in his own portfolio. He has been asleep at the wheel. The soldiers I met on 14 February told me that what keeps them going when they are in the field, what keeps them going when they are away from their families, is an assurance that this government will care for them. This government has failed. This minister must go.
What an absolute act of fabricated political foolery. What a joke. Let us be very clear about this: the opposition have no interest in bipartisan support for Australian Defence Force personnel, men or women. Let us be very clear: they are trying to make cheap political points out of an issue which is extremely important to SAS soldiers and their families—an issue which is being addressed by this government. Let us assume just for a moment that you were serious about supporting Australian Defence Force personnel and their families—I suspect that you may actually not be quite accurate in that determination. I have a very strong recollection of the use and abuse of the Australian Defence Force by the opposition when they were in government. I well recall ‘children overboard’. I well recall a Senate estimates committee with Admiral Barrie giving evidence about the way in which the Defence Force were being used politically by the now opposition when they were in government.
Now we see this shameful piece of political theatre this afternoon. Why is this a shameful piece of political theatre? Let us be very clear about this. The minister has taken decisive action. In October the Minister for Defence, on learning of this issue, instructed that debt recovery action should cease. The Chief of Army then directed that all debt recovery action would cease from 13 November. Since that time, the Army has been conducting a thorough audit to find out how many people have been affected. There are a couple of important things to note here. Not only did the minister take that action but also, when this was raised in Senate estimates, we took the opposition seriously. In fact on 23 October Senator Johnston, the shadow minister for defence, wrote to me in relation to this issue.
Dr Jensen interjecting
The member for Tangney is warned.
I responded to him on 11 November. This letter outlined the action which had been taken by the Chief of Army. On 13 November Senator Johnston was briefed by me and my Chief of Staff on the SAS pay issue. A further letter updating Senator Johnston on the issue was sent by me to him on 22 December last year. We had taken the view that we should seek to cooperate with Senator Johnston to make sure that no person was disadvantaged by this process. So we took the view—I took the view and the minister took the view—that what we should seek to do was to engage with Senator Johnston as a matter of trust. We went on the basis of goodwill. The letter of 22 December outlined action taken to freeze all debts with no further debt recovery action to be taken.
Senator Johnston was again briefed, at my direction, on 4 February by senior defence personnel with advisers from my office and the office of the Minister for Defence. At this point Senator Johnston was further informed that a second audit was taking place to cover off all special forces members who may have been affected by the determination. He was also advised again that no debt recovery action was taking place at that time. So we have kept him informed, we have engaged with him and we have made sure he is constantly briefed. We committed to further briefing Senator Johnston on this issue at the completion of the review, which he was told about, which is taking place now and will be completed at the end of April this year. He was told about it on 4 February and he agreed that he would be briefed by us at the end of April after that audit had taken place. So not only did we say in good faith to Senator Johnston, ‘We understand there is an issue,’ but also, ‘We want you to be involved and understand that we appreciate the help you are giving us by giving information to us, and we want to have a dialogue with you over this matter.’ Incidentally, I have had two casual conversations with Senator Johnston in between those meetings—both times, I might say, early in the morning in the gymnasium—and both times I indicated to him that we were further progressing the issue.
During the briefing—and this is symptomatic of what the opposition is on about here—Senator Johnston read from a document that contained information about the circumstances of an individual SAS soldier or soldiers, including one member who apparently, according to Senator Johnston, owed $50,000. We asked Senator Johnston if he would mind deleting all the personal details from that document and providing us with a copy of it so we could investigate it—investigate its authenticity to ensure that it was a result of the DFRT decision. His staff said that, yes, they would make that document available. Have we seen it? No. The document was never made available.
Member for Curtin, you say you have a pay slip which tells us that a soldier received no pay. I invite you to delete all the personal references on that pay slip and make the pay slip available to us right now. Can you please give me a copy of that pay slip? If you are serious about this, you will have no difficulty at all in providing us—the Prime Minister, the Minister for Defence and me—a copy of that pay slip. Delete all personal references. But I am sure we will get the same answer we got from Senator Johnston. We said to Senator Johnston, ‘Delete all the personal references which relate to this issue of the $50,000 worth of debt and give us the document.’ On both occasions they have refused to do it. What does that tell you about what those opposite are doing here? This is not about trying to get to the bottom of the problem—which, we understand, is a grave problem; it is a grave issue—or about trying to resolve the outstanding issues for the SASR; this is about trying to score cheap political points.
How is it incompetent or inappropriate for the Minister for Defence to instruct, from the very first, that all debt recovery against special forces members cease? Was that the right thing for the minister to do? It was absolutely the right thing for the minister to do. How can it be incompetent for the minister to direct the Chief of Army to fix the issues immediately? Was that incompetent? No, it is precisely what the minister should have done—and, acting properly, he did it. How is it incompetent to ensure that the opposition is kept abreast of the work that is being done to resolve the issue ever since it was raised with us? How is that incompetent? We have done precisely what we should have done. We have engaged with the Chief of Army and the Chief of the Defence Force and said, ‘This problem must be fixed.’ We have told them that we want no more debt recovery. We have said that no person will be out of pocket as a result of this issue. But, instead of taking us at our word and saying, ‘We will sit down around the table when we have a particular instance that needs addressing,’ what have those opposite done? They have used it as a cheap political stunt.
I remember ‘children overboard’. Who else remembers ‘children overboard’ and how they used and abused the Australian Navy? I recall that vividly. The reason I recall it vividly is that at that time, as you will recall, there were a number of photographs which came into the public domain about the children overboard. There were 130 photographs. How do I know that there were 130 of them? I know because I leaked them. They were given to me and I released them. Those photographs demonstrated very clearly that we were being told lies about the Australian Navy and lies about the children overboard—and they were being used and abused as a result. But that was not the only time. Remember when Tampa arrived at Christmas Island? What did they do then? They used and abused the Australian Defence Force for their own base political purposes yet again. Let us be very clear about this: we are concerned and committed to resolving this issue.
What about wheat for weapons?
And I am reminded of wheat for weapons. Let us be very clear: no-one in this place could have done more or been clearer in their concern or taken the issue more seriously than our defence minister and the Prime Minister. Let me repeat what the minister has repeated so often in this House: no soldier will be financially disadvantaged by the process of implementing this determination. Their cheap posturing and stunts—using our brave soldiers for political ends—should shame all of those opposite. I again ask the member for Curtin: when you were briefed by this SAS member and his wife—
Not one.
Not one? More than one?
Weren’t you listening?
Did you bother making a representation to the Minister for Defence to highlight to him the issues that were raised in the meeting? No, you did not, because what you are about is a cheap political stunt. If a constituent came to me with a particular issue relating to a portfolio matter and an issue emanated out of that discussion, as a responsible local member—or a responsible deputy leader of the opposition or a responsible shadow minister—I would have alerted the minister to the problem. This is a serious issue. We now know what this is all about. It is not about trying to find a resolution to the issue; it is about trying to make cheap political points. And I noted that, during the course of his address, the Leader of the Opposition focused solely on the two cameras opposite him. He was not trying to focus on the House and to have a communication with us—again demonstrating the cheap political stunt that he is on about.
Let us understand this: the defence minister’s instruction to cease debt recovery remains in place. To deal with this problem in the short term, the Chief of Army issued a directive dated 18 February in relation to the determination that (1) any member who had a debt recorded against them will no longer have this debt; (2) any member who had repaid any debt will have that money reimbursed; and (3) any member who has been receiving reduced salary will have that money paid back. Army will also recognise the reality that, in many cases, special forces soldiers already meet the required qualifications due to the special operations training and on-the-job training.
Let me make it very clear to members opposite and to those who might be listening to this debate that there is no lack of intent on the government’s behalf to resolve this issue as quickly as possible. I go back to my point: we briefed Senator Johnston early in February about the next steps and about the audit that was taking place, to make sure that we got it right. Senator Johnston was okay with that—that was terrific. But what do we hear in the last week? We hear that it is no longer appropriate for us to deal properly with these families and it is no longer appropriate for us to try to seek a proper audit to make sure no-one is out of pocket and no-one is being disadvantaged. Let there be no doubt: this censure motion is a fabricated, political stunt. The Minister for Defence has acted decisively. The minister has acted properly. The minister is clearly in control of his portfolio. (Time expired)
Question put:
That the motion (Mr Turnbull’s) be agreed to.
Mr Speaker, I ask that further questions be placed on the Notice Paper.
Mr Speaker, I wish to make a personal explanation.
Does the member claim to have been misrepresented?
Yes, I do.
Please proceed.
I refer to remarks by Senator Abetz and the member for Flinders alleging that I improperly disclosed market-sensitive information favouring private groups prior to my decision on 5 January to approve six and withhold three Gunns modules. I want to put on the record that my action in advising some stakeholders confidentially of decisions I made in relation to the Gunns pulp mill in the hour before I announced it publicly was in no way improper. I want to observe that it is the common practice of good governments who value transparency in decision making and effective communication with the public to directly and confidentially inform key stakeholders of imminent government decisions in which they have a particular interest, and—
Mr Speaker, I rise on a point of order. I am sure you are going to bring the minister to a close, because he only needs to point out where he has been misrepresented, not debate the matter.
I understand that the minister is coming to a close.
I am happy to oblige the Manager of Opposition Business, and I note that there was no significant drop in the price of Gunns shares prior to the public announcement of my decision on 5 January this year.
Mr Speaker, I wish to make a personal explanation.
Does the member claim to have been misrepresented?
Yes.
Please proceed.
On the front page of today’s Townsville Bulletin, the editor, Peter Gleeson, wrote a fronter about the Townsville cruise ship terminal, in which he said:
The LNP, the city council and Federal Liberal MP Peter Lindsay oppose the development and cruise ship terminal.
I have never opposed the cruise ship terminal. It is wrong. In fact, I have gone further and sought Defence money for that terminal.
Mr Speaker, I wish to make a personal explanation.
Does the minister claim to have been misrepresented?
I do.
Please proceed.
Yesterday there were a number of media reports, all of them inaccurate and many of them internally inconsistent, that alleged details of discussions I had allegedly had with various people on the proposed M4 East motorway. Depending upon the report, these people included the former New South Wales ALP Branch General Secretary Karl Bitar, the former New South Wales Minister for Roads Eric Roozendaal and the former New South Wales Premier Morris Iemma. The reports alleged that, based upon opinion polling, I had not supported the extension of the M4 motorway and associated roads. None of these reports provided any evidence or sources to corroborate these allegations. These claims are not true. The government made a commitment of $300 million to progress the M4 East, a commitment that I was consulted on by the then shadow minister for transport and now Minister for Resources and Energy. This commitment has been fulfilled by the inclusion of this amount in the draft Memorandum of Understanding for the Nation-Building Program, which has been presented to the New South Wales government for agreement. Any further commitment from the Commonwealth will be subject to the independent advice of Infrastructure Australia.
I present the Auditor-General’s Audit report No. 23 of 2008-09 entitled Performance audit: management of the Collins-class operations sustainment: Department of Defence.
Ordered that the report be made a parliamentary paper.
A document is presented as listed in the schedule circulated to honourable members. Details of the document will be recorded in the
I have received a letter from the honourable member for Goldstein proposing that a definite matter of public importance be submitted to the House for discussion, namely:
The failure of the Government to act decisively on its infrastructure commitments.
I call upon those members who approve of the proposed discussion to rise in their places. The member for Goldstein not being present—
Government members interjecting—
Your leader told us he was cutting it off, you fools!
Order! The member for Sturt is not assisting.
Honourable members—He’s here!
At the time, the member was not here. Members will resume their seats. The matter is concluded in that, at the time people were asked to rise in their places to support the proposition, the member for Goldstein was not here. We have moved on.
Government members interjecting—
Order! Those on my right should not get too excited.
Bill returned from Main Committee without amendment, appropriation message having been reported; certified copy of the bill presented.
Ordered that this bill be considered immediately.
Bill agreed to.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Bill returned from Main Committee without amendment, appropriation message having been reported; certified copy of the bill presented.
Ordered that this bill be considered immediately.
Bill agreed to.
by leave—I move:
That this bill be now read a third time.
I do appreciate the House allowing me to speak in this third reading debate. I spoke on this legislation yesterday in the Main Committee and expressed some concerns about particular aspects of it, including a $14 million allocation for a national advertising campaign relating to the promotion of the Carbon Pollution Reduction Scheme. There is a lot to be played out with regard to the Carbon Pollution Reduction Scheme. As anyone who follows public policy closely will recognise every day when they read the newspapers, there are a range of opinions on the proposed scheme that we are waiting to have presented to this House. I certainly look forward to having the Carbon Pollution Reduction Scheme come before this parliament. I do think it will be an important debate for this chamber and the Senate to consider.
In light of that, I think there are grounds on which not to support the Appropriation Bill (No. 3) 2008-2009 and the Appropriation Bill (No. 4) 2008-2009 and the allocation of $14 million for a national advertising campaign to promote this scheme either at the same time as the parliamentary and public policy debates are occurring or, of more concern, prior to those debates taking place.
There were also some issues raised in the Main Committee with regard to inconsistencies in the narrative on climate change that is contained in the appropriation bills. Without entering into debate again, I would encourage anyone who has a particular interest in this matter to feel free to read the speech. The reason I speak in this third reading debate is to flag the issues addressed in the speech in the Main Committee and to ask the Senate to consider those issues in detail when they look at this legislation.
The other issue of significance, not related to climate change, which is contained within this bill—a significant appropriation bill; I heard today that it is an appropriation of around $3 billion, and a non-budget appropriation, so out of the budget cycle—is the allocation of funding for financial regulators to improve prudential management within Australia. The figure, off the top of my head, is about $25 million. The issues that I raised last night, which I hope the Senate can consider, relate to the untold story of public sector losses and, as an extension of that, taxpayer losses over the last 18 months in the build-up to this significant global environmental ‘crisis’. It is the untold story of the position we are in. In a lot of ways this has been positioned as a private sector crisis and an international private sector crisis. However, there are outstanding questions that I do think we as federal parliamentarians and as the executive should take a lead in addressing through the three tiers of government and through the various semistatutory and non-statutory organisations. On the front page of the Sydney Morning Herald today there is an article about the G8 universities complaining about their exposure to various losses, which are in effect losses of taxpayers’ money. Therefore, we need to go through the process of establishing the accountability trail. How much exactly has been lost in the public sector and who is accountable?
For example, a council in my electorate on the mid-North Coast has $25 million, or a quarter of its investments, exposed to questionable CDOs. It argues the case that it was done completely within investment guidelines given to it by the New South Wales Treasury Corporation. There are other stories, such as one of a similar council in WA with $80 million of exposure. The stories are endless with regard to just how much taxpayers’ money is exposed or has been lost in the current economic conditions. It is not to rake over coals but to place value and weight on taxpayers’ money and to put in place for the future some strict prudential rules within the public sector as well as within the private sector. Either people have been in breach within the public sector and deserve to be held to account or, in many ways of more concern, they have not been in breach and we have some structural issues that we need to deal with in this country in protecting taxpayers’ money.
I flag this for the Senate to consider as this bill heads up to the other place, because within this appropriation bill there are some substantial funding allocations that in the early weeks of the return of the parliament might not have been given the review by the non-executive members of this chamber that this appropriation bill deserves. It is for this reason that I spoke last night in the main chamber and want to have my voice recorded against this bill. I highlight that there are many good aspects of this bill. The organ donor awareness and the prevocational GP places are excellent work by government. However, there are aspects of this which deserve public debate, deserve the scrutiny of the Senate and hopefully more people within this chamber and within the public policy arena and, I would hope, also review by the executive.
Some of the issues within this legislation, even in the quick moving times of two or three months ago when this bill was introduced, may even be up for question now. The one that springs to mind is a $28 million allocation for the Aussie pavilion at World Expo 2010. In light of the times, if we move forward to 2010, there will be a lot of people hurting domestically, international economies will be on the back end of 18 months of spanking and the message being sent to the domestic and international markets might want to be reconsidered as a slightly different one to a $28 million spend for a pavilion for a period of six months. For these reasons I want to have my voice recorded against this bill. By all means others, such as members of the coalition, can consider joining me. Hopefully the Senate will also consider taking on board some of these comments when they are considering this legislation in a short time.
I have put the question that the bill be read a third time. I think the ayes have it.
The noes have it.
I have to hear two voices for there to be a division. I can only hear one voice and I imagine the honourable member would like his objection to the bill to be recorded in the proceedings of the parliament.
Question agreed to, Mr Oakeshott dissenting.
Bill read a third time.
Bill returned from Main Committee with amendments, appropriation message having been reported; certified copy of the bill and schedule of amendments presented.
Ordered that this bill be considered immediately.
Main Committee’s amendments—
(1) Clause 2, page 1 (lines 7 to 9), omit the clause, substitute:
2 Commencement
(1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.
Commencement information | ||
Column 1 | Column 2 | Column 3 |
Provision(s) | Commencement | Date/ Details |
1. Sections 1 to 3 and anything in this Act not elsewhere covered by this table | The day on which this Act receives the Royal Assent. | |
2. Schedules 1 to 4 | The day on which this Act receives the Royal Assent. | |
3. Schedule 5, Part 1, Division 1 | 29 January 2009. | 29 January 2009 |
4. Schedule 5, item 4 | 1 July 2011. However, if item 99 of Schedule 3 to the Tax Laws Amendment (2009 Measures No. 1) Act 2009 commences before 1 July 2011, the provision(s) do not commence at all. | |
5. Schedule 5, items 5 and 6 | 1 July 2011. | 1 July 2011 |
6. Schedule 5, Part 2 | The day on which this Act receives the Royal Assent. | |
7. Schedule 5, Part 3 | 29 January 2009. | 29 January 2009 |
Note: This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.
(2) Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act.
(2) Page 27 (after line 5), at the end of the Bill, add:
Schedule 5—Victorian bushfires and North Queensland floods
Part 1—Ex-gratia Income Recovery Subsidy Assistance
Division 1—Main amendments
Income Tax Assessment Act 1936
1 Subsection 159J(6) (after paragraph (b) of the definition of separate net income)
Insert:
(ba) does not include an ex-gratia payment from the Commonwealth known as Income Recovery Subsidy for the Victorian bushfires of January and February 2009; and
(bb) does not include an ex-gratia payment from the Commonwealth known as Income Recovery Subsidy for the North Queensland floods of January and February 2009; and
Income Tax Assessment Act 1997
2 Section 11-15 (table item headed “welfare”)
Before:
maintenance payment | 51-30 and 51-50 |
Insert:
Income Recovery Subsidy for the North Queensland floods of January and February 2009 .................. | 51-30 |
Income Recovery Subsidy for the Victorian bushfires of January and February 2009 ................................ | 51-30 |
3 Section 51-30 (at the end of the table)
Add:
5.2 | an individual in receipt of an ex-gratia payment from the Commonwealth known as Income Recovery Subsidy for the Victorian bushfires of January and February 2009 | the payment | the payment must be claimed: (a) after 28 January 2009; and (b) before 13 May 2009 |
5.3 | an individual in receipt of an ex-gratia payment from the Commonwealth known as Income Recovery Subsidy for the North Queensland floods of January and February 2009 | the payment | the payment must be claimed: (a) after 30 January 2009; and (b) before 13 May 2009 |
Division 2—Sunsetting on 1 July 2011
Income Tax Assessment Act 1936
4 Subsection 159J(6) (paragraphs (ba) and (bb) of the definition of separate net income)
Repeal the paragraphs.
Income Tax Assessment Act 1997
5 Section 11-15 (table item headed “welfare”)
Omit:
Income Recovery Subsidy for the North Queensland floods of January and February 2009 | 51-30 |
Income Recovery Subsidy for the Victorian bushfires of January and February 2009 | 51-30 |
6 Section 51-30 (table items 5.2 and 5.3)
Repeal the items.
Part 2—Gifts
Income Tax Assessment Act 1997
7 Subsection 30-45(1) (table item 4.1.5)
Repeal the table item, substitute:
4.1.5 | a public fund (including a public fund established and maintained by a public benevolent institution): (a) that is established for charitable purposes; and (b) that is established and maintained solely for providing money for the relief (including relief by way of assistance to re-establish a community) of people in Australia in distress as a result of a disaster to which subsection 30-45A(1) or 30-46(1) applies | see sections 30-45A and 30-46 |
8 Subsection 30-45(2) (at the end of the table)
Add:
4.2.41 | 2009 Victorian Bushfire Appeal Trust Account (established under section 19 of the Financial Management Act 1994 of Victoria) | the gift must be made: (a) after 7 February 2009; and (b) before 6 February 2014 |
9 After section 30-45
Insert:
30-45A Australian disaster relief funds—declarations by Minister
(1) For the purposes of item 4.1.5 of the table in subsection 30-45(1), an event is a disaster to which this subsection applies if the Minister has declared it to be a disaster. The Minister may do so if satisfied that:
(a) it developed rapidly; and
(b) it resulted in the death, serious injury or other physical suffering of a large number of people, or in widespread damage to property or the natural environment.
(2) The Minister’s declaration of an event as a disaster:
(a) must be in writing; and
(b) must specify the day (or the first day) of the event; and
(c) must be published on the internet or by another method determined by the Minister.
(3) The Minister’s declaration of an event as a disaster is not a legislative instrument.
(4) You can deduct a gift that you make to a public fund covered by item 4.1.5 of the table in subsection 30-45(1), in relation to a disaster to which subsection (1) of this section applies, only within the 2 years beginning on the day specified in the declaration as the day (or the first day) of the event for which the fund is to provide relief.
Note: Public funds under item 4.1.5 of the table in subsection 30-45(1) are for disaster relief of people in Australia. Public funds may also be established for disaster relief of people in other countries. See items 9.1.1 (which is not limited to disaster relief) and 9.1.2 of the table in section 30-80.
10 Section 30-46 (heading)
Repeal the heading, substitute:
30-46 Australian disaster relief funds—declarations under State and Territory law
11 At the end of subsection 30-46(1)
Add:
; and (d) subsection 30-45A(1) does not apply to it.
12 Subsection 30-46(2)
After “subsection 30-45(1)”, insert “, in relation to a disaster to which subsection (1) of this section applies,”.
13 Section 30-315 (before table item 1AA)
Insert:
1A | 2009 Victorian Bushfire Appeal Trust Account | item 4.2.41 |
Part 3—Application
14 Application of amendments
(1) The amendments made by Division 1 of Part 1 of this Schedule apply in relation to the 2008-09 income year.
(2) The amendments made by Part 2 of this Schedule apply in relation to:
(a) the 2008-09 income year; and
(b) later income years.
The question is that the amendments be agreed to.
Question agreed to.
Bill, as amended, agreed to.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
The Speaker has received advice from the Chief Opposition Whip that he has nominated Mr Briggs to be a member of the Standing Committee on Economics in place of Ms J Bishop.
by leave—I move:
That Ms J. Bishop be discharged from the Standing Committee on Economics and that, in her place, Mr Briggs be appointed a member of the committee.
Question agreed to.
Message from the Governor-General reported informing the House of assent to the bill.
Debate resumed.
I rise to speak in support of the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009. The excise tariff bill increases the rate of excise in the Excise Tariff Act 1921 that applies to other excisable beverages not exceeding 10 per cent by volume of alcohol, commonly referred to as ready-to-drink beverages or alcopops, from $39.36 per litre of alcohol content to $66.67 per litre of alcohol content with effect on and from 27 April 2008. The amendments also increase the excise equivalent duty on the relevant imported equivalents of these products in the Customs Tariff Act 1995 to the same rate.
In 2004-05 the estimated social costs of alcohol abuse in Australia were over $15 billion. Those were estimated costs and that was five years ago. I would expect that today the costs would be much higher, with alcohol abuse featuring prominently in a number of areas: homelessness; domestic violence; marriage break-ups; general violence at nightclubs, front bars and other social venues; sporting events, amongst spectators, with many venues now banning alcohol consumption; child abuse and sexual assault cases; and motor vehicle accidents, where we hear, over and over again, that alcohol was a contributing factor. Alcohol abuse also featured highly in relation to the social problems in Indigenous communities and the need for government intervention in the Northern Territory. One has only to pick up today’s Age to see the headline on the front page ‘Judge’s plea for new Northern Territory booze curbs: alcohol crisis beyond comprehension’. There is substantial and overwhelming evidence that alcohol causes so much social grief.
The impact of alcopops drinks is most notable amongst young people, with binge drinking now a major social problem. It is a problem frequently referred to as an epidemic, with the alcopops industry admitting that their sales have increased by 250 per cent since 2000. When the measures in this legislation were introduced by the Rudd government, I asked a number of people who were associated with drug prevention programs in the Makin electorate—people such as Jo Baxter from Drug Free Australia—about alcohol abuse amongst young people. There was a universal response from all the people I spoke to that alcohol abuse amongst young people was the issue they were all most concerned about and that they supported this legislation. These are people who have to personally deal with alcohol abuse cases. They see the problem firsthand and speak from experience.
As the Minister for Health and Ageing outlined in her second reading speech on this legislation, there is widespread support for this measure from across a diverse sector of society that has expertise and credibility on this issue, yet the coalition continues to oppose this bill. In the face of overwhelming evidence, one has to ask why. One can only conclude that the opposition wants to protect the interests of the big distillers.
In my view, raising the alcopops tax achieves three important objectives. Firstly, it closes a loophole created by the previous government and now being exploited by the big distillers. Secondly, it increases the cost of alcopops drinks, with the intended objective of reducing consumption of those drinks—an objective that is working, with tax office figures showing that, in the first nine months since the increased costs came into effect, alcopops sales have dropped by 35 per cent, when compared with the previous year. Thirdly, people consuming those drinks will, rightly, make a greater contribution towards the social costs of the matters that I referred to earlier as being borne by society and related to alcohol abuse.
Given the opposition’s stance on this issue, one can only conclude that the loophole that they created in the original legislation was deliberate. If it was not then logically they should support the legislation. Or have they simply succumbed to the pressure from the large distillers? The large distillers have themselves embarked on a major campaign to convince us that the alcopops legislation will not have the desired effect. I am sure all MPs have received the distillers’ many publications refuting the effects of this legislation. The sales figures, however, speak for themselves. Clearly, the government’s strategy is working. If the strategy was not working, the distillers would not be concerned and would not be spending large sums of money campaigning against this measure.
We are dealing with an issue that can have a devastating effect on the lives of young people. It is a serious issue and to trivialise it as simply a tax-raising measure, as the opposition and the large distillers are doing, is a sad reflection of their lack of concern for young people. Alcohol destroys lives, and young people are particularly at risk. We know that young people are the main consumers of ready-to-drink products. I do not believe there is any disagreement about that.
This legislation was referred to the Senate Standing Committee on Community Affairs on 15 May 2008, and the committee’s report was presented to the Senate in June 2008. The Senate committee looked into this matter after a number of issues that opposition members say they are concerned about had already been put on the table. I point out that it was not government members who had the majority numbers in that committee; there were members from all parties. In fact, whilst it is true that the coalition members prepared a dissenting report, it was not just government members who put forward the recommendations of the final report. Firstly, I note that the Senate committee supported the recommendation to introduce the excise increase on alcopops. Secondly, I note some of the expert comments in submissions made to the Senate inquiry with respect to the effects of alcohol on young people. I want to quote a number of comments in the committee report. The National Health and Medical Research Council noted:
… both young people under 18 years of age and young adults up to the age of 25 continue to be greater risk takers than older adults, but still have poorly developed decision-making skills, which are reflected in the high levels of injuries sustained in these groups. Alcohol affects brain development in young people thus drinking, particularly ‘binge-drinking’, at any time before brain development is complete (which is not until around 25 years of age) may adversely affect later brain function.
It went on:
The Australian Medical Association … noted that excess alcohol consumption is ‘an issue of public health significance leading to an unacceptably high level of sickness and social disruption’. They added that the drinking behaviour of teenagers and adolescents was of particular concern as:
The report on the prevention of substance abuse, risk and harm in Australia by the Ministerial Council on Drug Strategy found:
Alcohol causes the deaths and hospitalisation of slightly more children and young people than do all the illicit drugs combined and many more than tobacco … In other words, alcohol alone causes more hospitalisation and deaths of young people than all of the other illicit drugs put together.
The report also states:
These deaths are almost invariably caused by either intentional or unintentional injuries.
The Royal Australasian College of Physicians told the committee:
Young people are particularly vulnerable to the harmful effects of alcohol because of the combination of inexperience of drinking, and the frequent combination of high-risk drinking with high-risk activity and potential accidental injury.
The committee report noted:
Emeritus Professor Ian Webster of the Alcohol Education and Rehabilitation Foundation (AER) advised the Committee that evidence showed the earlier young people started drinking, the more likely they were to have ‘continuing problems around alcohol and other drugs and to have subsequent mental health problems and that this in itself justified concern about RTDs and young people in general’.
The report went on to state:
Research conducted by the National Drug Research Institute (NDRI) showed that alcohol was a major contributing cause of death and hospitalisation for young people, with the majority of alcohol related harms caused by episodes of drinking to intoxication. It revealed that—
and these are some of the critical, stark and frightening statistics—
That is the extent of the alcohol problem amongst young people. It is a serious issue, and those figures speak for themselves.
So I come into this place and ask the question: why do opposition members say that they share the government’s concern about binge drinking yet oppose this legislation? Firstly, I say this to them: the statistics that I have just read out were available to them some years ago—in the years that they were in government. They had those facts and figures. If they share the government’s concern about binge drinking, what did they do about it? They did absolutely nothing. It might be fair to say that they were not aware of the problem, but the figures were produced in reports that were made available when they were well in government. They had plenty of time to act before they were turfed out of government, but they did nothing, so, when they come in here and say that they share the concern about binge drinking, their actions speak for themselves. They will be judged on their actions, not their words.
Secondly, I say to the opposition: if they want to come in here and oppose this legislation, they should not rely on information which is flawed and which has been provided by the big distillers. It is the big distillers who have a vested interest in preventing this legislation from going through. If you want to come in here and put up opposing arguments, at least use independent material, not that provided by the very beneficiaries of the situation as it currently stands. Thirdly, I go back to the question of the loophole and say this to them: I have not heard one single member of the opposition come into this chamber and say whether they believe that there is a loophole or not. They avoid that question. Let them answer the question: is there a loophole there? If there is then it would seem to me that, if for no other reason whatsoever than to close the loophole, they should be supporting this legislation. It is good legislation and I commend it to the House.
It is with pleasure that I join the debate on the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009. On 26 April last year the government gazetted increases to the rate of excise and excise equivalent customs duty applying on selected beverages from $39.36 to $66.67 per litre of alcohol content. It is worth noting that the Australian Taxation Office and the Australian Customs and Border Protection Service have been collecting the excise and excise equivalent customs duty at the higher rate since 27 April 2008. I note that the Minister for Health and Ageing, in her second reading speech, commented:
No-one who reads the newspaper or watches television can be unaware of the problems caused by binge drinking. Community leaders, police and health experts alike agree that action needs to be taken.
I say from the outset that I believe that the minister is well intentioned in her attempts to address the plague of binge drinking and the associated violence. I say that most genuinely; I believe the minister is very concerned by the escalation in violence that we have seen on our streets. A lot of that has been related to the overindulgence in alcohol. What I do say, though, is that the stated objective of this legislation, which is to reduce the incidence of binge drinking and the associated violence, although well intended, has been misguided. The previous speaker just claimed that the strategy is working because sales of ready-to-drink alcohol products have dropped. But that is a flawed argument when the strategy is meant to curb binge drinking. Not one shred of evidence has been presented that in the period of the last 10 months there has been any success at all in terms of reducing the incidence of binge drinking in our community.
The success of this strategy should be measured in terms of less violence on our streets, fewer hospitalisations of drunks or less binge drinking amongst young people—not purely by whether the sales of any drink products have dropped. I will make the point further on that I believe that a lot of the problem is that people being involved in the excessive drinking of alcohol is more of a cultural issue. They are simply substituting one product for another and continuing to overindulge, and the increase in the alcopops tax is really just a tax-grab masquerading as a health initiative. Unfortunately, we have not seen any evidence to suggest that the alcopops tax has resulted in improved social behaviour, particularly in relation to young people and the incidence of binge drinking. There has not been a shred of evidence to suggest that this has actually occurred. People are still getting drunk, they are still causing the same level of mayhem in our community and they are unfortunately using different forms of alcohol. Even worse, I fear many are resorting to illicit drugs—in particular, amphetamines.
Doubts were expressed from day one as to whether this excise increase would actually work and, as I said, the government has no proof thus far that it has been effective. In introducing this legislation, the minister has attempted to address what I think everyone on all sides of this House would agree is a particularly important issue in our community. But it is an issue which is very difficult to address, and it is not going to be resolved by simply increasing the tax on one product. I fear that there is a drinking culture deeply embedded in Australian society. I am no wowser by any stretch of the imagination. I enjoy a drink—in fact, there are occasions when I enjoy several drinks. Some of them are ready-to-drink products and some are red wine or beer. But I think that I am fairly typical of a lot of people in our community in saying that the imposition of a tax on one particular form of alcohol, increasing the cost, will result in substitution. I have seen it amongst many of my colleagues, friends and family members. Instead of reducing their alcohol consumption, they have simply substituted one form with another.
Drinking is a cultural issue in Australia, and one of the areas that the government and our society need to tackle with far more enthusiasm is the leadership provided by our role models in the community. If we are serious about addressing cultural binge drinking, we have to start addressing it at a much more public level. I refer, particularly, to some of the buffoons that you see on our various football shows. In Victoria it is the AFL Footy Show and in New South Wales and Queensland it is the rugby league Footy Show. I have seen many occasions on which public drunkenness is actually celebrated on these shows. I have seen reporters associated with the shows attending awards nights intoxicated, and they think it is a heck of a joke to be interviewing someone else who is suitably inebriated. If we are serious about addressing the issue of binge drinking, we will need to start tackling these issues in a far more aggressive manner and make it very clear that there is a standard of behaviour that we expect from our community leaders and that our sportspeople are among those.
We need to lead by example, not just at that level but also on the home front. These are far more difficult issues than simply increasing a tax. No-one is prepared to talk in any great detail about the example we ourselves set in our own homes. Much of the attitude children develop towards alcohol is learnt on the home front, and if we as parents continually rely on alcohol to have a good time it certainly reflects on our children. These are some of the more difficult issues that the government is going to need to at least discuss and consider in its approach to binge drinking, and they go way beyond simply addressing the issue of the alcopops tax.
One of the areas that concern me greatly in regional communities is that we are not offering our young people enough alternatives to attend functions or be involved in community activities which do not involve alcohol. We have a cohort of people—probably aged about 13 to 18—in our community who are faced with a situation where there are very few options of entertainment or activities which do not involve some level of alcohol. Most community groups and sporting organisations are in a situation where they rely on sales of alcohol to fund their organisations. On the one hand, government—not just this government but many governments—refuses to fund sporting organisations to the full extent that is required for them to improve their facilities and run their organisations but, on the other hand, we tell them they must be involved in the responsible service of alcohol. It is a catch-22 situation for the sporting clubs. They need to make a quid and they choose to make it at the bar because that is the most likely place they are going to make it. Government suggests that they are doing something wrong in doing that but is not prepared to come to the party and help fund their activities. It is a state and federal government issue and it is something that is going to require a more coordinated effort in the months and years ahead. It is inevitable that the sporting clubs, whether they be football clubs, cricket clubs or surf-lifesaving clubs, will encourage greater alcohol sales because it is in their interests to maintain the activities of their clubs.
My other concern with alcopops, as I said earlier, is the issue of substitution. The first time I received feedback after this legislation was announced was when I was right in the middle of the Gippsland by-election campaign. I was in one of the shopping centres in one of my towns and a mother came up to me and said that she had caught her son and three of his mates at a party. They were taking mouthfuls of bourbon from a bottle and then taking a bit of Coke with it, saying that they were mixing their own drinks. It may be a funny story but, on reflection, it indicates that these young people had just substituted their previous product—they used to buy a bourbon and Coke type drink—with just mixing their own drinks in their mouths. They were young men, 17- to 18-year-old teenagers, and pretty unsophisticated in terms of their knowledge of alcohol and what they were doing. Certainly there was no measured shot of alcohol involved. It concerns me that what we have seen is simply a replacement.
Unfortunately there is a culture of binge drinking where people drink to harmful levels. At the start of a night—at the start of a party, an occasion or whatever it might be—it is the deliberate intent of these people to get wasted. This is not about which type of alcohol they prefer. They will find the cheapest type of alcohol they can get and they will simply substitute it. While the minister’s attempts to address binge drinking are certainly well intended, I do not believe that the tax increase is actually having any result at all out there in the community. There has not been a shred of evidence presented to the House in the subsequent 10 months that there has been any reduction in the level of violence or the incidence of binge drinking in our community. If we are not prepared to accept the fact that there is a culture out there of people who will just simply substitute whatever product they can get their hands on—the cheaper the better—then we are really missing the point in trying to address this issue at its root cause.
Targeting the ready-to-drink products alone has been particularly unscientific in that regard, and I do not believe it is going to achieve the stated health aims. Common sense indicates to me that people within the community will simply substitute one brand of alcohol for another. I give the example of a club on the South Coast of New South Wales, which I attended prior to the Christmas break, where a bottle of bourbon and Coke was $9. That would be about the cost of three pots or middies—I am not sure what you call them in New South Wales. People were simply not buying that particular product but transferring their choice of alcohol to something else. The concern for me—although I do not have any evidence to support my concern—is that, by pricing these products at these sorts of levels, you may end up encouraging young people to experiment with illicit drugs. I would much prefer that, when my children get to the legal age for consuming alcohol, they consume alcohol which has been produced within strict health guidelines, in comparison to sampling amphetamines which have been cooked up in some criminal’s kitchen or other establishment. It is a real issue for us that ready-to-drink products are being priced at such a level that people may find it more attractive to purchase ecstasy and other types of amphetamines.
When the shadow spokesman spoke earlier this morning, he clearly highlighted that the opposition’s position on this legislation is based on the fact that it is simply bad policy. It is irresponsible of those opposite to suggest that they somehow have a mortgage on empathy with our community or concern in our community in relation to the issue of overindulging in alcohol and the associated violence. It reflects poorly on this chamber if we are always slinging arrows backwards and forwards at each other, when I do believe that there is genuine goodwill on both sides of the House in relation to curbing the incidence of binge drinking and the associated violence that goes with it. If this were a genuine health measure—and I take up this point from the opposition health spokesman—why did it emanate from the finance ministries in the first place and not from the health department? I fear this is more about being a tax grab than anything to do with actually improving health outcomes.
At different times during this debate we have talked about research. Today in the Financial Review there was a report about research by Access Economics—and I acknowledge that the research was commissioned by the Distilled Spirits Industry Council of Australia—which showed ‘that there had been little or no change in the impact of high-risk drinking by young people since the introduction of the increased tax on ready-to-drink products’. It quotes the Access Economics director and health economist, Lynne Pezullo:
If anything, hospitalisation rates of young people due to acute intoxication and harmful use of alcohol worsened in the months following the government’s tax increase.
I do not make that point with any great relish, but it is basically saying that our incidence of alcohol abuse and associated violence—young people placing themselves in harm’s way—has actually increased over the past 10 months. There is no joy in quoting that information from Access Economics. It proves the point that slaying this dragon will be hard and will require more than simply increasing a tax. An article in the Australian also quotes Ms Pezullo as saying:
The analysis showed young people who moved away from the premixed drinks, such as vodka and lemonade or rum and Coke, to other alcohol could end up buying more standard drinks for $20 than before they switched.
That is my genuine fear—that we are simply going to be in a position where young people substitute products and go on their merry way overindulging in alcoholic products.
A question that has been raised in this whole debate is: if the bill is defeated, what will happen to the money raised? I believe hundreds of millions of dollars—in the vicinity of more than $220 million and perhaps up to $345 million—has been raised from this tax grab over the past 10 months. I believe it should be directed to some real programs to curb binge-drinking problems. I hope that, if the bill is defeated, that money can be directly hypothecated back to anti-binge-drinking initiatives—more than just advertising programs, although I do freely acknowledge that that is a good start.
In the contribution to the debate of the Minister for Health and Ageing, she referred to the National Binge Drinking Strategy. The strategy includes $53.5 million, of which $14.4 million is for the community-level initiatives which I referred to before in terms of the culture of binge drinking, $19.1 million is to intervene earlier to assist young people to assume personal responsibility for their binge drinking and $20 million is for an advertising campaign. Each of those in their own right has a great deal of merit, but it is only $53.5 million and we have already supposedly raised in excess of $200 million over the past 10 months from this tax grab.
One of the things I would like to refer to in relation to the National Binge Drinking Strategy is the $14.4 million to invest in community-level initiatives. This highlights the need for sporting codes to be involved. We have the situation in regional areas—and I assume that it pretty much occurs in suburban areas as well—where young men and women interact with adults from a very early age. We have a smaller population base—we need our teenage boys, for example, playing in senior footy teams and we have young girls playing in adult netball teams. They are exposed to the culture of sporting clubs—football, cricket, netball, tennis and even lawn bowls—and alcohol can play a very important part in the whole culture of clubs. I believe that supporting young people through early interaction with adults and giving them an understanding that you can enjoy alcohol responsibly is something that we should aspire to. I do not believe that we are doing anything even near enough in that particular area. I accept that the National Binge Drinking Strategy is doing some work with sporting clubs but I believe we have a long way to go in that regard, particularly in regional areas, where it is such a focus of community activity. We have a real opportunity to show our young people how they can enjoy themselves in that environment without overindulging.
I believe there is a misunderstanding about what is actually happening out there in the community in terms of the impact of this type of tax. The government is basically failing to understand the mentality of some of these binge drinkers. We all acknowledge that there is potential for self-harm and incidents of violence associated with overindulging in alcohol, but simply increasing the tax on one product is not ever going to address the bigger issues that I have already referred to. It is not going to be easy, and I do not envy the minister her task in this regard—neither do I pretend to have solutions at my fingertips, but I think that simply increasing the tax and declaring a war on binge drinking is not going to be the answer.
I am very keen to work with the government in good faith to help reduce the incidence of binge drinking in our community and the violence which is associated with it. It is going to take a lot more than a tax grab, and it is going to take a lot more than simply, to gain a media headline, nice words about declaring war. This is a war that needs to be won very much at a grassroots level: house by house, street by street, town by town and city by city. People are concerned across the spectrum of political life, and our communities are concerned about the incidence of binge drinking and the level of associated violence. We all accept that action is needed, but there are genuine doubts and concerns on my side of the House that the alcopops tax is not the silver bullet which has been presented to us. It is going to take a lot more than simply a tax hike on one alcohol product. Action is going to be needed in advertising and education, which I understand is underway. We need to lead by example in our homes as responsible adults. We need to demand better standards from our television shows and our sporting stars and celebrities. And we need to fund programs to rehabilitate and help those with a drinking problem.
We also need to be supporting those community and sporting clubs I referred to earlier. I will give you a classic example. In the small country town where I live, Lakes Entrance, we organise an annual New Year’s Eve fireworks display. New Year’s Eve in coastal towns of Victoria has been synonymous with a fight night in the past. It has been a night where people have wandered the streets, getting drunk, causing trouble and then waiting for the fireworks at midnight. That has been the typical experience of some of the coastal towns in Victoria. About eight years ago I was involved with my local business and tourism association and we made the decision that we would try to reclaim New Year’s Eve as a family night, so we decided to run an alcohol-free event. We would have a family fireworks display at 9.30 pm and another at midnight. I think this was actually one of the first times that this was done in Australia—to have a 9.30 pm fireworks display to encourage family groups back to the foreshore to enjoy what should have been a night of family entertainment. By making that evening alcohol free we hoped to encourage more family groups to get involved.
The point I would like to make is that we were very successful in organising that event. The police supported us, our local business community supported us and our local council supported us. We have been running that event for the last seven years. The rate of arrests in our community has plummeted. For the last two years we had no arrests whatsoever and we had two the year before that, so it has been very successful in that regard. We have not been able to secure any funding from the state and federal governments to support us in that endeavour on an ongoing basis, so our community raises about $50,000 or $60,000 a year. We do not get any support from the state and federal governments to run an alcohol-free event, a family event, on New Year’s Eve. I make this point more just to emphasise that if we are going to be preaching to our young people about the possibilities of enjoying themselves in an alcohol-free environment, without the temptation to binge drink, we need to put the money up to support the community groups and sporting clubs I mentioned before in their endeavours in that regard. I hasten to add that we have received occasional funding from the Victorian state government after a major flood event. It was more of an economic stimulus that was provided for our town as a one-off payment, but we have not been able to secure any ongoing funding for that type of activity.
This is a complex issue. There are severe social and economic impacts which we are all aware of, but there is a huge human toll involved. I urge the government to continue to pursue this very serious issue, but I just caution that it is going to take a lot more than a tax grab. I assure the government that the National Binge Drinking Strategy is a positive step, but I think that much more needs to be done in relation to excessive drinking.
I rise today to support the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009. I must admit that I was a bit confused while listening to the contributions from members opposite. The member for Gippsland made some useful contributions to the debate today, but he was having a bit of a bob each way, being a good backbencher.
Does that mean that you are a bad backbencher?
One minute he was saying that the government is just about alcopops tax and that this is just about raiding taxes and the next he was talking about the National Binge Drinking Strategy. That is something that has been introduced by the Rudd government. We have got an overall strategy to tackle binge drinking and this legislation is just a little part of that strategy, but it is a very important part of that strategy.
The member for North Sydney, the shadow Treasurer was interjecting before. The position the opposition are taking is synonymous with positions they are taking on a whole range of different issues. The position the opposition are taking demonstrates how out of touch they are. They are out of touch with the mums and dads, grandparents and young people out there who are really concerned about binge drinking. They want a government to take action. They want a government that has a national strategy to combat binge drinking, a government that will take measures that may be unpopular to special interests in the community but which are the right things to do, and that is what this legislation is about. It is the right thing to do. But the opposition are so out of touch with mums and dads, community leaders, local police and health professionals that they are opposing this legislation in the same way that they opposed the stimulus package and in the same way they will, in the end, oppose our climate change policy. They are out of touch with the general community. They are a rabble over there. This legislation is just another example of their response to us. We are taking proper measures to tackle this very serious issue.
These amendments are very important amendments that will change the way that alcopops are taxed. They will effectively enable alcopops to be taxed at the same rate as spirits. Why should alcopops get a tax break? Why should a drink that is targeted at young people get a tax break? That is what this debate is about. The member for North Sydney, the member for Gippsland and the shadow health spokesman want to give a tax break to alcopops that are targeted at young people. That is why they are out of touch and that is why they are not supported by the mums and dads of this country.
This legislation is only part of an overall measure, as I have said. We have committed—and the Prime Minister did that in March last year—to a National Binge Drinking Strategy that will invest in community level initiatives to confront the culture of binge drinking, particularly in sporting organisations. The member for Gippsland rightly nominated sporting organisations. We need to do more work there. That is what the Prime Minister did and that is what the Minister for Sport did last year in terms of the national strategy—they engaged with sporting codes and leaders in those codes.
This legislation also has measures to assist young people, to ensure that they assume personal responsibility and face up to binge drinking and the impacts that it has in their local communities. Importantly, if we are going to change the culture in this country, we need to get out there and run advertising campaigns. That is what we are doing as part of this National Binge Drinking Strategy. When I was a young bloke—and that is a few years ago now—a lot of people used to drink and drive. Drinking and driving was culturally acceptable, but it is not today. There were fantastic advertising campaigns and fantastic educational campaigns that changed the culture of drinking and driving. We are committed to changing the culture of binge drinking in this country. These measures are just part of an overall strategy, but they are a very important part.
There really is a serious problem. In any given week, approximately one in ten 12- to 17-year-olds is binge drinking or drinking at a risky level. Almost 20,000 girls aged 12 to 15 drink daily or weekly. That is a very, very sad statistic. The number of young women aged 18 to 24 being admitted to hospital because of alcohol has doubled in the last eight years. It is eight years since the Liberal Party changed this excise exemption and gave alcopops a tax break.
Every year, more than three-quarters of a million Australians are physically abused by a person under the influence of alcohol. This is a real problem all across the nation, but it is particularly a problem in my own electorate of Leichhardt, in my own town of Cairns. There are regular newspaper articles about people having their jaws broken or being abused in the street. That reflects the disappointing culture that we have in this nation of binge drinking. That culture starts with young people—and that starts with the influence young people get from older people. But it starts with young people taking that culture on and responding inappropriately when they drink alcohol.
What this tax exemption and the lack of an overall strategy to combat this culture have done is to allow that culture to continue, and we are not prepared to allow that. This legislation makes the drinks that young people—young men, and young women in particular—drink, and which they drink because they are designed to be attractive to them, more expensive.
We know that there are social and economic costs to this drinking culture. The annual social cost in Australia is estimated to be $15 billion. But there are greater economic costs to it as well. People do not go to work. People are injured. The impact on the tourism industry in my local community of inappropriate behaviour is something that is being readily discussed now, because there is real concern about the misuse of alcohol and associated violence in the community tarnishing the name of Cairns as a tourism destination internationally. That is an issue that we are talking about in our local community; it is a real issue, and alcohol plays a part in it. To tackle that, we need to make sure that we are tackling it with our young people and changing the culture nationally.
As I have said, alcopops are targeted at young people and particularly young women. We are not prepared to put up with that. The evidence shows that industry sales have grown by 250 per cent since 2000. Between 2000 and 2004, the percentage of female drinkers aged 15 to 17 who had consumed alcopops on their last drinking occasion increased from 14 to 62 per cent. I repeat: since the changes, the number of young women drinking alcopops on their last occasion of drinking increased from 14 to 62 per cent—and those opposite say that there is not a problem here! For females drinking at risky and high-risk levels in 2004, 78 per cent drank alcopops on their last drinking occasion. That figure had increased threefold since 2000. Those opposite should hang their heads in shame for opposing these measures.
Independent expert advice—commissioned by the former government, the Howard government, which did nothing about this—by Collins and Lapsley has also backed the government’s approach to this. Their report says:
… alcohol excise taxes are capable of being designed explicitly to target the types of alcohol known to be the subject of abuse (for example, high strength beer and alcopops) …
… … …
For example, studies show that young people are more influenced by the price of alcohol so that increasing the tax rate on alcoholic drinks which are specifically targeted at the youth market … is likely to be effective.
They go on to say that, as a result:
There would appear to be strong justification for the April 2008 increase in the Australian tax on pre-mixed drinks—
alcopops—
by 70 per cent.
ATO figures similarly support our arguments. ATO figures drawn from the first nine months of the measure’s introduction show that sales have dropped by 35 per cent compared to the previous year. This goes beyond the government’s predictions when the measure was introduced that growth would merely slow. In fact, alcopop sales have slumped, bringing overall spirit sales with them. Despite a small increase in full-strength spirit sales, overall spirit sales have fallen by almost eight per cent. So you have to take this evidence—that of the Australian Taxation Office showing that overall alcohol sales have dropped by eight per cent and that of a study by independent experts commissioned by the former Howard government—and weigh it up against what we keep hearing from the opposition, which is about an Access Economics report commissioned by the alcohol industry. That is their evidence: a report commissioned by the alcohol industry. Our evidence is from independent experts and from the Australian Taxation Office.
They should also listen to a range of other experts. We have been backed by the Australian Drug Foundation CEO, John Rogerson. We have been backed by the Alcohol and Other Drugs Council of Australia CEO, David Templeman. We have been backed by the Public Health Association of Australia President, Mike Daube. You would think that the opposition would listen to these experts. But we have also been backed by some of them. For instance, the Australian National Council on Drugs Chairman, Dr John Herron—someone well known to many on the other side of the chamber, I am sure; a former minister and AMA president—wrote to the Prime Minister in support of these measures and said that they were worth while.
The fact is that the government are very much in touch on this issue. We are in touch with the mums and dads, with the police and with community leaders all across this country, because they want action on binge drinking. They want a government with a national strategy, but they also want a government that is prepared to make alcopops more expensive to dissuade young people, particularly young women, from taking them up. And that is why we will support this legislation and that is why we are driving it through.
Finally, my other real concern—and we have heard the weasel words from the opposition on this issue—is that if we do not get this legislation through, there will be hundreds of millions of dollars going back to the alcohol industry. That money will not be able to be diverted to the national binge-drinking campaign, as the member for Gippsland might have suggested. Those opposite will be giving this money back to the alcohol industry, and that is a shame. So I support this legislation. The community supports it. It is supported by the police and supported by health workers. I beg you, please, to support this legislation.
It is a great pleasure to participate in this debate on the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009, especially as the member for the city of Bundaberg.
Rum, rum, rum!
And I note the honourable member for Bonner in the House today, who is also a Bundy girl from way back.
Is she! How do you know her drinking habits?
You’d be surprised, Minister. The coalition is opposed to these bills, which seek to validate a substantial tax increase on one category of alcohol products: ready-to-drink beverages. The government claims it increased these taxes as a health measure—a measure aimed at cutting the rate of binge drinking, particularly amongst young women. The coalition certainly does not deny that there is binge drinking in some sectors of our society. We are as concerned about that problem as anyone else is. But this policy is quite transparently a tax grab designed to boost the bottom line of the budget, allegedly to protect young women. In other words, the smoke and mirrors trick is the young women. On both health and tax counts it is a failure.
I do not promote binge drinking—in fact, quite the opposite. I have always promoted responsible drinking and, despite some of the muck that has been thrown at me at the past in this chamber, there is already ample evidence that RTDs deliver a measured quantity of alcohol. When you get a Bundy and cola, a scotch and dry or whatever it may be, you know exactly what you are drinking. You know you can have a can or two drinks of a particular one and that is your limit. From a road safety perspective, that is a very sensible way to drink. For example, a can of XXXX Gold has an alcohol-by-volume reading of 3.5 per cent, but the grey label Bundy, or the mid Bundy as some call it, also has 3.5 per cent. Why should one be taxed at $0.36 and the other at $0.90? What is fair about that? Let us take one standard drink—not a can—and this time compare not the half strength but the full strength. A full-strength beer has an excise rating of $0.39. One standard drink of Bundy and Coke is $0.88. Where is the equity in that? Why is one form of alcohol any more dangerous to the person, be it a young person or an old person, a motorist or nonmotorist or any other? And where are the hundreds of millions of dollars that Minister Roxon said would flow to preventative health measures?
My colleagues on the other side have been talking about this today. Let me enlighten them. Instead of the government spending a paltry $53 million on a National Binge Drinking Strategy—that is $40 million for community initiatives, $19 million to assist young drinkers and $20 million for anti-binge advertising—what we find is that these measures are funded through the existing resources of the government, and there is no further indication of how much of the alcopops’ revenue has been or will be provided to this preventative measure. So if they are fair dinkum, of the $22 million-odd how much has flowed into this system? I do not want to be too cynical, but perhaps all this money was meant to pour into the health coffers that were never intended to materialise. This is just an example of how spin has become more important to the government than real substance.
I have often spoken in this House about the contribution of Bundaberg Rum to my community and to this country. It is important to me—as I said, I come from the city of Bundaberg—but it is also important to the wider Australian community, to say nothing of its significant corporate contribution to national sporting events. Bundaberg Rum has been in Bundaberg for 120 years. It is an important adjunct to the sugar industry. It is a great employer—a particularly good employer—a great tourist operator, a great ambassador for Australia and a great sponsor for the local community in supporting events as well. Bundaberg Rum’s parent company, Diageo, has invested $24 million in the Bundaberg distillery, which includes the construction of a modern multimedia tourism centre which draws around 80,000 tourists a year. That is an enormous part of the Bundaberg tourism profile and its economy—not just the economy of Bundaberg but of the entire Wide Bay region and Queensland.
The Bundy bear was made a Queensland heritage icon in 2004. So should the heritage trust of Queensland be lambasted for allegedly supporting binge drinking, as I was in this place? You all know that I was said to have a full-size bear in my office and that the minister was shocked. It was a poster for the tourist centre; it had been in my window for several years. (A) how could it be shocking? and (b) it certainly was not a life-size bear—and what is more I have never supported binge drinking. I quote my good friend and colleague in state politics in Queensland Anna Bligh, who said:
I think Queenslanders and Australians love their Bundy and they love their Bundy Bear.
Frankly, I do not think the Bundy bear is about to lose favour with Queenslanders and Australians. Leave the bear alone! On just one thing in the state election I agree with the Premier—just the one.
Again I ask: is this new tax regime more a health measure or a tax grab? And, from a local perspective, why should Bundy drinkers—because they are the major ones—be singled out for this additional tax? The Australian newspaper reported on 17 May 2008 that the excise increase first emerged in a finance department budget submission couched in terms of closing a tax loophole, which it never was. As Christian Kerr said:
Was the alcopops tax motivated by concerns about the health of teenage girls or the health of the budget surplus?
That question remains today because the government simply cannot supply any hard evidence that the tax has had an impact on levels of harmful drinking.
The bills before the House are about the tax impact. The 69 per cent increase in excise on RTDs—that is, from $39.36 a litre to $66.67 a litre—will raise $1.6 billion across the forward estimates. But this increase of 69 per cent is a massive tax grab, especially coming from a government that claimed we would have no new taxes. The budget estimated revenues originally at $3.1 billion, but, as I said, it is now down to $1.6 billion. Clearly, it has failed both as a health measure and as a tax matter. The minister said sheepishly that the revenue was—and I will quote for members of the opposition—‘somewhat less’. Minister, try halved.
One questions not only the government’s intentions but also the quality of its advice. For example, on a Treasury minute on 14 May 2008, the very day after the budget, Treasury said of relative rates of alcohol consumption:
RTDs have different patterns of cross-price elasticy being complements to some products (eg a reduction in RTD consumption may also be reflected in a reduction in beer consumption) …
Wow! How they ever got to that conclusion I will never know. The quote goes on:
… and a substitute for other products. On balance the cross-price elasticity estimates are assured to be zero.
However, this advice was proven unreliable and in its Mid-Year Economic and Fiscal Outlook Treasury was forced to admit that there has been substitution into spirits and beer—in other words, the government’s basic rationale was faulty. But still they deny it, even in the face of advice from their own agency. Let me quote MYEFO’s admission that the RTD sales have fallen with the excise rate increase. It says this:
… was partly offset by a substitution towards domestically produced and imported spirits and other excisable alcoholic beverages.
In other words, people were drinking more full-strength spirits and, in addition to that, other excisable alcoholic averages—wine and beer, no doubt. I draw the members’ attention to that last phrase ‘other excisable beverages’. In that statement, they let the cat out of the bag, at least in part. Despite the fact that we cannot get the beer and wine figures since 27 April, it is clear there has been a move towards beer consumption. That has been kept very quiet in this debate. There has not been a word, I think, from either side of the chamber—there might have been a few words from our side but nothing from the other side. But, again, you get caught out. In its quarterly trading update to 31 December 2008, released on 19 February, only a week and a half ago, Lion Nathan reported:
Australian beer market remains robust with a growth rate of 2.3 per cent for the quarter.
So beer went up in that quarter. Better still: Foster’s Group reported that, for the first six months of the current financial year, their beer sales had increased three per cent. More interestingly, for January, the beer figure has shown an increase of eight per cent. In other words, the problem has shifted from one mode of alcohol to another. There has been a shift in drinking modes, but so far the government has presented no evidence that there has been a net decrease.
When you have inconsistent taxing, more particularly, excise applications, you will always get distortion and drinkers moving from one mode to another. The kids will tip a bit out of a bottle of Coke and fill it up with full-strength spirit or they will drink beer because they find the RTDs too dear.
Back in 2000, at the time of the introduction of the A New Tax System—and I say this proudly—I was one of those who fought for alcoholic beverages to be taxed on alcohol content, not the type of alcohol. There is no logic in that whatsoever. I am not against the wine industry having special concessions to protect its development; let me make that quite clear. But, in broad terms, one form of alcohol should not be taxed at a different rate from another.
The tax system at that time was grossly unfair and worked against some types of premixed drinks because it was based on the source of the alcohol rather than the amount of alcohol being consumed. The motivation was not as the member for Corio said in his address this morning but rather to remove a loophole which allowed the development of designer drinks, which are the real alcopops—and I am not talking about Bundy and whisky and others—which had a non-spirit base and, broadly, to bring RTDs in line with canned and stubbies of beer with which they competed. Why should you have one rate for beer and another one for an RTD? At that time I fought for fairer treatment of premixed drinks for three reasons: firstly, because the original law was archaic and unfair; secondly, it worked against the interests of our own distillery in Bundaberg and its potential in the Australian market; and, finally, because premixed drinks are a known, measured quantity of alcohol and are a more responsible way to drink.
Many speakers have said today that the government’s increased taxation on RTDs has driven people away from alcohol in a measured form to either cheaper products on the one hand or splashing random quantities of full-strength spirit into mixers on the other. I have a piece of interesting history I will share which I am sure the minister at the table, the Minister for Defence Science and Personnel, and my two colleagues opposite will be very interested in. Back in 2004 Labor floated this very idea and, let me tell you, the people and workers of Bundaberg delivered a message loud and clear, ‘No way, no how.’ In fact, the outcry at that time forced the Labor Party to deny it had even considered a tax hike on premixed drinks. We actually had the documents, but they denied it emphatically. The now Minister for Resources and Energy and Minister for Tourism, Martin Ferguson, said that the concern was ‘unnecessary’ and was reported in the Australian as saying that a tax hike of premixed spirits would be ‘unfair’.
I recall convening a meeting at that time which involved local community leaders, tourism stakeholders as well as members of the Distilled Spirits Industry Council of Australia and representatives of Diageo, the parent company of Bundaberg Rum, to thrash out what Labor’s policy would mean for our town and its industry. That meeting and the public outcry forced the hand of then Labor leader, Mark Latham, who clearly thought Bundaberg would accept this passively. He was dead wrong. When Bundaberg fights back, it fights back hard and that is something Labor need to learn—and I suspect they are going to need to learn it again in the forthcoming state election.
Now we face a Labor government intent on resuscitating the tax in a cynical grab for money. Minister Roxon makes much of the fact that RTD sales have dropped 35 per cent since the excise went up, but she has not admitted to any great extent that the sales of full-strength spirits have increased nor, as I said earlier, about the beer consumption. Anecdotally, bottle shop attendants will tell you that RTD sales have plummeted, with young Australians preferring straight spirits and a couple of litres of Coke to go with it. One survey by Roy Morgan reported that in the period June to September last year cider sales went up 249 per cent. That is a big increase. This government was warned that that is exactly what would happen—there would be a mode shift in drinking habits.
The minister has also complained about companies trying to avoid tax by making RTDs based on beer or wine. She has been caught again—as I said before—by the inanity of her own argument. If you are going to have a cheaper excise on other forms of alcohol, people are going to move to make alcopops from that source of product. Again, the government was warned that this would happen and, faced with these cold, hard facts, the minister tried to claim that the industry’s reaction is a sign that the tax is working. That is a very long bow—and I am not talking about Strongbow either.
Even some of the groups who support the government’s action acknowledge that they certainly do not know whether young drinkers have simply switched to higher strength alcohol products or not. When it gets down to the short strokes, the minister has hidden behind the smokescreen of allegedly protecting young female drinkers. But if we take, for example, the 14- to 19-year-old group—and I am sure colleagues would acknowledge that on the face of it this is about the middle of the most vulnerable group of the lot—we find that they represent only 0.5 per cent of the Australian population and one per cent of the total female population of this country. I just make the point here that, if it is as small as that and if it is as easily recognised as members in the government have said in their speeches today—I think the member for Leichhardt cited 20,000 people; they may not have been the same denominators but were roughly in that same group—why do we not target them? Why do we not target them with education and responsible drinking regimes instead of using them as some sort of stalking horse for the government to pick up more revenue through tax?
I would like to conclude with three very interesting facts—referring again to that 14- to 19-year-old age group. Members opposite who have been peddling this stuff all day might like to know this figure: there was a 27 per cent reduction in risky and high-risk drinking in this group in the period 2001-07. The second fact is that—contrary to the impression the minister gives all over Australia—the biggest consumers of RTDs are males over 24. Finally, three-quarters of all RTDs are dark spirit based products, like Bundy and cola, whisky and cola, and bourbon and cola. These are quality distilled products, preferred by males—hardly synonymous with ‘alcopops’. But then, as I said before, the government’s actions are a tax grab. They are about spin, not about substance.
I am very pleased to rise to support the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 because, unlike the opposition, we in this government take the issue of binge drinking incredibly seriously. This government has made it a priority to address this serious issue in our community. Even if the opposition does not seem to think it is a serious issue, there are many people in our community who think it is. I think some of the statistics speak for themselves. The following points illustrate just what a serious issue this is. Four Australians under the age of 25 die due to alcohol related injures in an average week. On average, one in four hospitalisations of people aged 15 to 25 happens because of alcohol. Seventy Australians under the age of 25 will be hospitalised due to alcohol caused assaults in an average week.
In addition to these statistics about the physical impact of binge drinking, there are also unintended psychological consequences of binge drinking. One in two Australians aged 15 to 17 who get drunk will do something they regret. Doing something you might regret when you have had a bit too much to drink could be something silly with no long-lasting consequence but it also could be something that can lead to long-lasting anxiety, long-lasting depression and long-lasting negative self-esteem. In my previous work as a psychologist, I met a number of young people who engaged in binge drinking on a regular basis and who were also suffering from depression and anxiety. It is a bit of a chicken-and-egg issue. Does binge drinking come first or do depression and anxiety come first? In some ways, it did not really matter to the people that I was seeing. Whether or not the depression and anxiety came first or whether it was the binge drinking, the continual binge drinking was exacerbating their mental health problems. More importantly, this binge drinking was impeding their recovery back to full mental health.
It was not just me who noticed the negative impact that binge drinking is having on our young people. There are many people working in our community, on the front line, who recognise this as an issue—whether it is police, ambulance officers, emergency workers, hospital staff or GPs. And it is not just people on the front line. Within my own community, there have been many groups, including the Aldinga men’s breakfast group, who have indicated to me that this is a concern of theirs. Many people who have raised this issue with me have indicated that they are not against drinking alcohol. These have been people within my own constituency, and we have a large wine-growing area there, McLaren Vale. There are many people in this area who are not against drinking alcohol but who have indicated that binge drinking is causing significant violence in our community. There are some specific occasions when the community comes together to look at how it might tackle the issue of binge drinking. A lot of people are saying that they do not have a problem with drinking in moderation; it is the culture of binge drinking and violence that they are very concerned about.
It is not just those who work on the front line who are concerned. Parents and our general community are recognising the dangers and social concerns of teenage binge drinking. However, one of the few groups that are not concerned are the opposition. For example, the member for Warringah said on 3AW on 17 June that concern for binge drinking was just a beat-up, and the member for North Sydney indicated that he thought that concerns about binge drinking were over the top. This really is an example of just how out of touch the Liberal Party is when we have parents and community members and workers on the front line, such as doctors and emergency workers, all saying: ‘Binge drinking is a concern. This is affecting our community.’ Yet the opposition are so out of touch that they do not think it is a very serious issue.
In response to this serious social and health issue, it has been this government, unlike the previous government, that has taken up this issue. The Rudd government has begun to implement the federal government’s National Binge Drinking Strategy. This strategy comprises a range of different measures, including $20 million to fund an advertising campaign that confronts young people with the costs and consequences of binge drinking. Members may have seen these ads on TV with the theme ‘Don’t turn a night out into a nightmare’. I have certainly had comments about them from people in my community, and I have also seen them myself, and I do believe that these ads achieve what they aim to—that is, they raise awareness about some of the very negative consequences that can happen after a night of binge drinking.
In addition to this measure, the government has provided $19.1 million to intervene earlier to assist young people to ensure that they assume personal responsibility for their binge drinking and $14.4 million to invest in community level initiatives to tackle this problem. The government has moved swiftly on this. The first round of these community grants was announced on the 17 November, with 19 local communities receiving federal government support to really look at grassroots programs to help tackle binge drinking by young people. It is important to empower local communities to deliver local solutions to these problems. There are often specific circumstances within each community and it is often people on the ground who know best how they might deliver these solutions.
The measure that we are debating today is one of the other measures that we have developed to reduce the incidence of binge drinking—that is, closing the tax loophole for alcopops that was created by the Liberal Party in 2000. Alcopops are targeted at young people and underage drinkers, using bright colours and sweet flavours that disguise the taste of alcohol so that young people can drink more alcohol faster. If anyone is left under any illusion about this, I want to highlight to the House one type of alcopop that I find very concerning. Recently I saw an alcopop that was in a tube that looked like a tube of toothpaste, and it was filled with some sort of red vodka drink. The packaging for the alcohol is basically such that you open the tube and squeeze it, consuming about 1.4 standard drinks of vodka in three seconds. If anyone is under any illusion that the packaging of these alcopops is not designed to attract young drinkers then certainly I would point to this alcopop as something that has left me in no doubt that these products can only promote excessive levels of drinking.
It is clear that the tax break given to alcopops by the Liberal Party gave these types of drinks encouragement in the marketplace. Since 2000 the sale of alcopops has increased by 250 per cent. Why would the Liberal Party give a tax break to these beverages? Why should a postmixed vodka and lemonade be subject to a different tax to a premixed vodka and lemonade? I am unable to comprehend that. Why shouldn’t all vodka drinks be treated the same? Instead, the Liberal Party decided not to compare apples with apples and rather to have a vodka drink—or Bundaberg drink or whatever the case might be—treated differently, depending on the way it was packaged.
In closing this loophole we are ensuring that all spirits, bottled or premixed, will be taxed at the same rate. In this debate many on the other side and also distillers have suggested that increasing the tax for alcopops will not reduce consumption and that people will just choose a different type of spirit. However, the ATO’s figures suggest something quite different, and this has not been mentioned by opposition members in this debate. Figures show that, for the first nine months, alcopop sales have dropped by 35 per cent compared to the previous year, contrary to what the members on the other side have said. They would have us believe that drinkers have just started drinking full-strength spirits. However, overall spirit sales have fallen by eight per cent, clearly showing that this measure is working.
While the opposition when in government sat there and did nothing about binge drinking, we are tackling the alcopops issue and we are tackling a National Binge Drinking Strategy. That is at the forefront of our approaches to ensure that we protect our young people. We are concerned about their health and we will do our best to ensure that our young people live happy and healthy lives. I commend the bill to the House.
I was interested, when listening to the end of the member for Kingston’s address, to hear her starting to cite some figures dealing with the quantum of tax that is being collected on spirits alone without mentioning cheap wine, for instance, or a whole variety of other things which can be substitute drinks. I think that is very relevant to this debate on the imposition of a new tax by the Labor Party which in the budget papers was going to raise them $3.1 billion. I think it is most interesting to go back to the budget papers of May, bearing in mind that this initiative was announced on 27 April 2008. They state:
The Government has increased the excise and excise-equivalent customs duty on ‘other excisable beverages not exceeding 10 per cent alcohol by volume’ to the same rate as for full strength spirits, on and from 27 April 2008. This measure has an ongoing gain to revenue which is estimated to be $3.1 billion from 27 April 2008 …
I think it is very interesting that the revised figure is $1.6 billion that the initiative will collect. That immediately suggests to me that fewer alcopops were bought and that the people who were previously drinking those drinks simply did not give up taking substances which would give them the sufficient high which they were striving to get. It suggests to me that they have selected one or another of a range of things that are available. Firstly, there is the very easily cited example that they would move to buying full bottles of spirits and Coke, or whatever goes with the alcohol. Instead of having a measured dose of alcohol, as occurs in the alcopops, it would be more likely that there would be a much larger dose of alcohol than would have been the case if they had been drinking alcopops.
The previous speaker, and many speakers on the government side, have neglected to mention what I think is the elephant in the room—that illicit drugs represent another alternative. When we look at the coverage of the phenomenon of so-called binge drinking, we see an increase in violence. One of the things that have become very obvious is that violence becomes very much more pronounced among those who start taking drugs such as ice. Violence becomes a very serious and significant addition to the behaviour of people when they are under the influence of such drugs.
We see a lot of reports in the papers which say that a person has been seen to be intoxicated, and there is a presumption that it must be alcohol. This has been the case with drink driving over the years, but we did take action with regard to that and we did introduce limits on the amount of alcohol that could be consumed before driving, but there has been a reluctance by governments to introduce proper testing for illicit drugs of people who are driving, yet in Victoria they have started a program and are starting to measure outcomes. I think the results are worth putting into this debate. Information from Arrive Alive, which is a joint initiative of VicRoads and the Victorian Department of Justice, says:
Drink driving is a major community issue, but so is drug driving.
In 2003, 28 per cent of drivers killed had a blood alcohol content of 0.05 or more. In the same year, 31 per cent of drivers killed tested positive to drugs other than alcohol.
In 2008, they say:
Drink driving contributes to around 20 per cent to 30 per cent of driver deaths on Victoria’s roads each year. Drug driving, where one or more illicit drugs are present, is found in approximately 40 per cent of driver deaths.
In other words, the incidence of people dying with alcohol in the bloodstream has gone down but the number of people who have died because they had illicit drugs in their bloodstream has gone up. Going back to the report that I did whilst I was Chair of the then House of Representatives Standing Committee on Family and Human Services called The winnable war on drugs: the impact of illicit drug use on families, it became quite clear that the use of illicit drugs is undercounted within our society and there is this accent that says that we must concentrate on alcohol.
All along we in the opposition have said that this new tax on alcopops was just a drive to get $3.1 billion more in tax. We said it was part of the $19 billion of new taxes that were in the budget. I think that has been borne out very much by the minority report of senators in the inquiry which was carried out by the Senate Standing Committee on Community Affairs. Evidence from the Australian Institute of Health and Welfare noted that there had been virtually no change in the pattern of risky drinking over the period from 2001 to 2007, including among young Australians. Yet those figures that I just gave on deaths in Victoria show that there is an increase in the use of illicit drugs.
You do not have to be very smart to work out that young people may find that alcopops, which have now risen so dramatically in cost, could be replaced by a less expensive pill which will last all night. Then there are the incidents where young people take illicit drugs—usually amphetamines of some description—and wash them down with alcohol. The problem is this: the government has chosen to defend what is simply a tax grab by dressing it up as an earnest health issue which needs addressing. Nobody would say that we do not want to lessen the amount of binge drinking that happens. But we also have to be far wiser and acknowledge that the problems with young people and what is known as binge drinking can so often be far more than that and can involve drug use as well. Yet, with the harm minimisation policies which are pursued, we see that Australia has now become the highest user of illicit drugs per capita in the OECD.
The harm minimisers have been in charge for 20 years, and they have failed. But they have always placed the stress on the need to deal with alcohol and never the need to deal with drugs. I think this debate gives us the opportunity to seriously go back through the research and look at the figures that are staring people in the face. If you are concerned about addiction in young people, to whatever substance, and about the increasing violence in society then you must address the drug problem.
The minister is going to provide a total of about $86 million worth of advertising and programs designed to combat binge drinking, yet nowhere do I see in the health portfolio a continuance of the programs that were initiated when we were in government to warn young people about what drug use does to you. You need only to look at the cover of the report that we did on this to see what a few short years of drug taking can do to the appearance and life expectancy of a young person. This is something that should be made known.
In supporting the opposition’s position on this legislation to increase tax and to have a tax grab, I think that we should look further than what the minister has had to say by way of trying to defend the hole in the budget. The estimated revenue from alcopops has already been revised downwards to $1.6 billion. That shows there has been a move away from this product but on to something else. We really do need to address the problem of illicit drugs and what they do not only to individuals but to families and the people who are around them.
The Federal Police have developed a harm index whereby they can show that, for every gram of illicit drugs they take off the streets, there are enormous savings to the Australian people in a whole variety of ways. There is a saving on policing, there is a saving on health issues and there is a saving that results from behaviours that are prevented from happening because the drugs did not get into the bodies of the people who would otherwise have used them.
Returning to the question of the tax, I think the evidence given to the Senate inquiry by the Australian Institute of Health and Welfare showed that there had not been, up until the introduction of the tax, an increase in young people’s binge drinking. In fact, the figures show that there has been a lessening of it. But figures now coming out of Victoria show that there is an increase in the use of drugs in the Australian community—and that needs to be addressed.
But this legislation is a new tax on alcopops; it is precisely that. It is a new tax which is not attached to a health initiative at all; it is merely a $3.1 billion tax grab. Of course, with the government’s decision to spend $42 billion of taxpayers’ money on the so-called stimulus, the minister is no doubt desperate to try to salvage what is left of the $3.1 billion—that is, the $1.6 billion—to somehow make a lesser hole in the budget figures. But that is not a good reason to support a tax. It is a bad tax. The opposition is opposed to the introduction of new taxes, particularly at this time.
in reply—I would like to take the opportunity to thank the many members who have taken part in the debate on the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 and the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009. Whilst there is a fair amount of difference between the different sides of the House on this, there is certainly a strong theme running through all of the speeches. Despite some of the earlier comments from the previous shadow minister for health, denying that binge drinking is a problem, I think the new shadow minister and some of his colleagues who have spoken on this have indicated their concern that binge drinking and the abuse of alcohol is an issue that we must grapple with. Obviously, we have in the bill before us a measure which we in the government believe can be part of the solution. We hope that the opposition will reconsider their position and see this as part of an important solution to an important problem.
I explained in my second reading speech the excise and customs tariff proposals, published on 26 April 2008, to increase the rate of excise and excise equivalent customs duty applying to such beverages from $39.36 to $66.67 per litre of alcohol content. I tabled these proposals in the House of Representatives on 13 May. The tax office and the Australian Customs Office have been collecting excise and excise equivalent customs duty at that higher rate since 27 April 2008. Of course, the data from the collection is one of the key issues that need to be considered by the opposition, and by the Senate when this matter comes before them in a number of weeks. The measure is designed to close a loophole which was created by the previous, Liberal government in 2000, when they reduced the rate of excise applying to alcopops. The government has increased the rate of excise because of concern about the increase in alcopop consumption. The data from 2000 was quite astounding, and we believe the lower rate of excise played a role in encouraging binge drinking.
I should flag for the benefit of the House that, at the conclusion of the debate, I am also going to introduce amendments to this legislation to ensure that the so-called ‘malternative’ products, which undermine these rate changes, do not enter the market. To do this, these amendments alter the taxation definition of ‘beer’ in the Excise Tariff Act and ‘beer and wine’ in the Customs Tariff Act. Changes in the definition of ‘wine’ in the A New Tax System (Wine Equalisation) Tax Regulations 2000 will also follow as part of these changes.
Today, as I acknowledged, the member for Dickson, the shadow minister for health, said that the Liberals do share the community’s and the government’s concerns about alcohol issues and that he would support sensible policies to tackle binge drinking. As I said at the beginning, I welcome this change of tack from the opposition. It is a change of position, as the former health minister and the former shadow minister for health have both been on the record a number of times denying this is a problem. Mr Hockey, now the shadow Treasurer, said on 30 March:
… I don’t think you should overplay it—
referring to the binge-drinking crisis—
… let’s not go over the top.
Tony Abbott, the former health minister, said in June last year, ‘Trying to say that binge drinking is happening nearly all the time in ways which are a deadly threat to the youth and even the adults of this country is a beat-up.’ So I welcome the opposition’s recognition at last that there is a binge-drinking problem in our community; but I do say to the current shadow minister that if the coalition genuinely believe this then there is one very simple thing they can do today to show it—that is, vote to support the passage of the bill that is currently before the House.
I see that the shadow minister has also been calling today for revenue collected through this measure to be directed towards health and education. I think it is no coincidence that this is what the distillers now claim they want, but their strategy is pretty much as obvious as it is insidious: they want to cut their losses with past profits and revert to the alcopops cash cow in the future. I think the shadow minister jumping on this bandwagon does show just how confused the Liberal Party’s position is, and maybe that is because with the new shadow minister there is a change in position and it has not had time to run its course.
Our very clear advice—and I know that the shadow minister would be distressed if he thought that he had got the position wrong—is that if this measure is voted down then the money must be refunded to the distillers. The member for Dickson has been out and about today saying, ‘We don’t want to see this money go back to the distillers; we want it to go into health and education.’ The only way you can ensure that happens, Member for Dickson, is to ensure that the Liberal Party votes for this bill today and in the Senate. That way we can ensure that money is invested in health and education measures. If the Liberal Party vote against it, we will have no choice but to refund that money to the distillers.
I am happy to provide more detailed advice to the member for Dickson if he doubts that, but I am sure he would be well aware that that is the position and that the only way his now-expressed desire for money to be put into health and education can be achieved is for him to ensure the Liberal Party vote for this measure. The opposition can, as I say, either vote against this and give the money back to their newest best buddies the distillers or they can vote with the government and boost health spending on important initiatives. We have already said that, if the law is passed, we will spend a huge proportion of this money on preventive health.
The member for Dickson made a number of claims, both in his speech and in comments more recently, that include many distortions and half-truths that have been bandied about during the course of this debate. Let me go through these one by one. Firstly, the opposition has said that not enough is being spent to tackle binge drinking. I can of course remind the House that our $53 billion binge-drinking strategy includes a number of very important measures. There is $14.4 million for community-level initiatives to confront the culture of binge drinking, in partnership with sporting and community organisations; $19.1 million to intervene earlier to assist young people and ensure that they assume personal responsibility—the very sorts of education measures that it sounded like the member for Dickson was encouraging us to invest in today; and $20 million on an advertising campaign, ‘Don’t turn a night out into a nightmare’, confronting youth with the consequences of binge drinking.
The shadow minister has described this expenditure as ‘meagre’, but interestingly this ‘meagre’ $53 million is $53 million more than the coalition spent on this issue. I think it would be a perfectly responsible position for the opposition to take if they offered to support this measure and wanted to encourage more investment in those sorts of projects. But instead they are voting against this measure and criticising investments that we are making that are significantly more than what the previous government did. Of course, that is not all the government is doing; far from it. In addition to the $53 million binge-drinking strategy, the government announced last year $872 million in new funding for preventive health as part of the COAG agreement. This is the biggest ever investment in preventive health; it is a very large amount of money. It includes new initiatives which will tackle binge drinking. Alcohol, tobacco and obesity are the key targets of that spending, and obviously a significant chunk of that will have an impact on the ways that we might tackle binge drinking.
When the alcopops measure was announced last year, the government made it clear that a significant portion of the revenue would go towards preventive health measures. I said at the time that this change would see the single biggest investment ever by a Commonwealth government in preventive health measures, and at COAG last November that is exactly what the Rudd government delivered on this commitment. The revenue from the alcopops measure is expected to be under $1½ billion. This investment is over half of the total revenue that is collected. This may be an important thing for the shadow minister to acknowledge given that he has called for more investment in these areas.
Secondly, the shadow minister says there is no firm evidence for this measure. That is blatantly untrue. Let me first of all quote from research commissioned under the Howard government. The report by David Collins and Helen Lapsley titled The avoidable costs of alcohol abuse in Australia and the potential benefits of effective policies to reduce the social costs of alcohol deals with a whole range of issues, from the impact on families to the impact on employment and the impact on our hospitals. The report states—and of course I am just quoting a section of it:
There would appear to be strong justification for the April 2008 increase in the Australian tax on pre-mixed drinks … by 70 per cent.
… … …
… alcohol excise taxes are capable of being designed explicitly to target the types of alcohol known to be the subject of abuse (for example, high strength beer and alcopops)
… … …
For example, studies show that young people are more influenced by the price of alcohol so that increasing the tax rate on alcoholic drinks which are specifically targeted at the youth market … is likely to be effective.
Let me also cite for the House the data which shows this measure is working. Since this bill was introduced we have had some even more up-to-date data. This has been provided previously to the House, but let me just go over that again because the member for Dickson seems not to be fully aware of that. The Australian Taxation Office clearance figures show that for the period May to June 2009 total spirit clearances decreased by 7.9 per cent compared to the same period in 2007-08 and compared to solid growth in the previous three years. This figure comes from a 34.6 per cent decrease in alcopops clearances.
So, when the member opposite asks whether there is any evidence that this measure is working, it should be noted that the clearest evidence is in the sales data, which shows a 34.6 per cent decrease in alcopops clearances. It is true that there has been some substitution, and there is a 17 per cent increase in full-strength spirit clearances over that period. When you combine those figures, given that the base is obviously different for the amount of alcopops sold and the amount of spirits sold, the combined decrease in spirits is 7.9 per cent. That is a huge decrease in the amount of alcohol that is being purchased and the clearest measure of why this measure is being effective—and, of course, the clearest reason that the industry is fighting so hard against it. This is a much better result than the government had forecast. At the time of the budget, it was forecast that the measure would merely slow the growth in alcopop sales. We thought that was a conservative and responsible approach to take. Happily, the measure has been even more effective. I have said publicly—probably to the misgivings of the Treasurer—that as the health minister I would be delighted if this measure were so effective that we collected no tax from it. But I do not think that that is likely to be the case. To see this dramatic reduction is the clearest evidence—and uncontested evidence—that this measure is working.
No-one has ever said—and the government does not contend—that any single measure will, of itself, solve the problem. We know that this is a problem that has been growing in our society for more than a decade. But, as part of a comprehensive package, this measure certainly can. We do not pretend that we have all the answers, and we have made it quite clear that we are prepared to work with members of the opposition or senators who are interested in ensuring that our comprehensive package deals with the range of issues that they believe it should. The very reason that we set up our National Preventative Health Taskforce is so they can look at what comprehensive, multipronged approach is required to ensure that our strategies will work. That is what we are doing with our $53 million National Binge Drinking Strategy—and the $872 million of COAG money—and we will of course consider the recommendations of the task force when they are provided to us in the middle of this year.
In this summing-up speech I am keen to make sure that some of the relatively outrageous claims of others made in this debate are all properly answered. The shadow minister referred to the Access Economics report which was out today—a report which was, of course, paid for by the people who make alcopops. It is clear from even a cursory read of this that the report is seriously flawed and it really is a deliberate attempt by the industry to manipulate debate. Unfortunately, this is not the first time that they have used reports and statistics to do this. One only needs to open the report—as I am sure the shadow minister has—to see that the authors themselves conclude that ‘firm conclusions were not able to be drawn at this stage’, a point that the member for Groom made earlier today in the House.
The report admits that the period of study is too short to be meaningful, that there are gaps in the data, that the figures may change and that the opposite evidence, from more reputable sources, is far more frightening and shows that alcohol related hospital admissions rose rapidly after the Liberals’ decision to give alcopop producers a tax break. I think that in this House both the shadow minister and I would probably be able to agree that this trend is very worrying. The truth is that it is not possible to detect from the data—any of the data that is relied on by Access Economics or others—or for any hospital to give any information about, what type of alcohol a person is presenting with. We have not been able to—and I do not think one can—assume that a single measure will be able to turn around a very wide social problem, but we do think that this measure has had an impact. What we can look at, for example, is the Australia New Zealand Journal of Public Health, which found that between 1999-2000—the period when the original change from the previous government was introduced—and 2005-06 the number of young women admitted to hospitals because of alcohol abuse more than doubled. So we are talking about a large increase—from a small number, but it is, I know, a worrying trend for any parliamentarian or any parent to see.
The report paid for by the distillers uses data over an incredibly short period of time, which it admits makes it unsuitable to base firm conclusions on. It uses hospital data of dubious quality. As the report itself points out:
… there is no agreed national approach to collection of diagnosis codes and demographic information for ED patients.
I might say, for the benefit of the shadow minister and other members in the House who are interested, that more rigorous national reporting is one of the issues that we got the states to sign on to in our COAG agreement last year. These are very serious problems, and it would help all of us in health debates if we had better data. But we do not currently and we should not pretend and misuse it in circumstances where it is just not able to be used to draw conclusions. The report uses just one diagnosis code for most of its data, excluding others and distorting the statistics. It does not show any causation between the government’s actions and the effects it alleges to show. The report also ignores the tax office figures on alcohol consumption—figures which are uncontested.
This is the sort of material that the opposition are relying on to support their arguments. I think it gives them a credibility problem. I think we have seen from the comments by the member for Dickson today that the opposition are a little bit uncertain on where they now stand on this. The question for the opposition—the answer to which we will no doubt see in how they choose to vote, given that this debate is now concluding—is whether or not they support action to tackle binge drinking. If they do support action to tackle binge drinking, they should be voting with the government—they should be on this side of the House backing the bill and encouraging us to spend more money on health and education to tackle this social problem.
This measure is working. It is backed by research, it is backed by health experts and it is backed by the evidence. It will enable us to make significant investments in preventing and tackling alcohol abuse. It should be supported. If it is not supported, it will be the Liberal Party that is forcing us to return hundreds of millions of dollars to distillers—the very people who are out there trying to hook young people on their products.
Question put:
That this bill be now read a second time.
Bill read a second time.
Bill—by leave—taken as a whole.
I present a supplementary explanatory memorandum to this bill and to the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009 and seek leave of the House to move government amendments (1) to (4), as circulated, together.
Leave granted.
I move government amendments (1) to (4):
(1) Clause 2, page 1 (lines 7 and 8), omit the clause, substitute:
2 Commencement
(1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.
Commencement information | ||
Column 1 | Column 2 | Column 3 |
Provision(s) | Commencement | Date/Details |
1. Sections 1 to 3 and anything in this Act not elsewhere covered by this table | The day on which this Act receives the Royal Assent. | |
2. Schedule 1 | 27 April 2008. | 27 April 2008 |
3. Schedule 2 | At the same time as Schedule 2 to the Customs Tariff Amendment (2009 Measures No. 1) Act 2009 commences. |
Note: This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.
(2) Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act.
(2) Schedule 1, heading, page 3 (line 2), omit “Excise Tariff Act 1921”, substitute “Ready-to-drink beverages”.
(3) Schedule 1, page 3 (before line 4), before item 1, insert:
Excise Tariff Act 1921
(4) Page 3 (after line 8), at the end of the Bill, add:
Schedule 2—Beer
Excise Tariff Act 1921
1 Schedule (definition of Beer)
Repeal the definition, substitute:
beer means a brewed beverage that:
(a) is the product of the yeast fermentation of an aqueous extract, being predominantly an aqueous extract of cereals:
(i) whether the cereals are malted or unmalted; and
(ii) whether or not the aqueous extract contains other sources of carbohydrates; and
(b) contains:
(i) hops, or extracts of hops, such that the beverage has international bitterness units of not less than 4.0; or
(ii) other bitters such that the beverage has a bitterness comparable to that of a beverage mentioned in subparagraph (i); and
(c) contains not more than 4.0% by weight of sugars; and
(d) has not had added to it, at any time, artificial sweetener; and
(e) may have had added to it, at any time, other substances, including flavours, but only if, in the case of substances that contain alcohol (other than spirit distilled from beer), the alcohol did not add more than 0.5% to the total volume of the final beverage; and
(f) may have had added to it, at any time, spirit distilled from beer, but only if that spirit did not add more than 0.5% to the total volume of the final beverage; and
(g) contains more than 1.15% by volume of alcohol.
2 Schedule (the definitions)
Insert:
sugar means:
(a) monosaccharide; or
(b) disaccharide.
3 Application
The amendments of the Excise Tariff Act 1921 made by this Schedule apply in relation to beverages manufactured or produced on or after the commencement of this item.
These supplementary amendments to the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 alter the definition of ‘beer’ for taxation purposes. The amendments are aimed at ensuring that beer products that attempt to mimic spirit based products in relation to their taste are taxed as a spirit based product—that is, at the higher tax rate.
The need for moving these amendments is a sign of how desperate the industry has become to target sugary, colourful drinks at teenagers, which is simply unacceptable. Today we are introducing these amendments to crack down on these ruthless alcopops producers. The tax office has already decided that some products, known as ‘malternatives’, will be treated as alcopops. A recently released tax office interpretive decision clarified that to meet the current definition of ‘beer’ a beverage must have sufficient quantities of hops or extracts or other bitters to satisfy the bitterness requirement. These amendments will formalise this for all ‘malternatives’ and prevent the development of new beer and wine based products that are simply trying to get around the law.
These changes will go further and, by being forward looking, seek to prevent the development of new beer based products that attempt to overcome the current definition. These amendments will achieve this goal by changing the definition of ‘beer’ to set a combination of minimum limits on bitterness and maximum limits on sugar content that must be present in the final beverage. As part of the sugar requirement, artificial sweeteners will not be permitted to be added to beer. The proposed revised definition of ‘beer’ is sufficiently robust to allow innovation in the beer-making process by allowing additional ingredients, including small amounts of alcohol from a non-beer source, to be added during the brewing process. Such changes are expected to allow domestic brewers to better compete with international brewers by providing opportunities to produce new beer flavours within the new requirements concerning bitterness and sugar content.
These amendments have been designed to ensure that conventional beer products are treated as beer for tax purposes. Complementary changes will be made to the Customs Tariff Act 1995 so that imported beer is subject to the same definition of ‘beer’ for taxation purposes. Additionally, these amendments are part of a package of measures that also include changes to the ‘wine’ definition so that wine based products that attempt to mimic spirit based products in taste are taxed at a higher rate. These changes to the definition of ‘wine’ will be made in amendments to the A New Tax System (Wine Equalisation Tax) Regulations 2000 and the Customs Tariff Act 1995.
In the same way that we are dealing with beer based products, we will ensure that wine based products that attempt to mimic spirit based products in taste are taxed at the higher rate that applies to RTDs. These amendments are designed not to have any significant impact on conventional wine products. While only a very few wine products may be affected, the industry supports these changes.
No-one seriously disputes that alcopops are targeted at young people, who often have limited experience of alcohol and who may not recognise the effect alcohol is having on them, as its taste is disguised. We are serious about the binge-drinking crisis and we believe it is important for us to protect young people from the seemingly endless ingenuity of distillers, who will try to market their product to young people and get around each and every change that is made to the tax system.
We are determined that we will develop a multipronged strategy. Our binge-drinking strategy is already part of that. Our COAG preventive health initiative is another important part of it. Experts ranging from health professionals to police agree that binge drinking is a problem, and this measure is part of our overall comprehensive strategy to deal with this problem. If the opposition is seriously interested in helping address the binge-drinking problem, it should put its interest in this bill and support it ahead of its loyalty to distillers. That would be putting the health of our young people first.
Full details of the amendments are contained in the supplementary explanatory memorandum. It might assist the House to know that, although the government consulted with domestic brewers and winemakers to ensure that these new definitions had no unintended consequences, as a result of a briefing that my office and the Treasurer’s office provided to the shadow minister, I understand that a request has been made that we also seek the views of importers, which we are happy to do. If any unintended consequences are brought to our attention, we will make any further amendments to the legislation that are necessary. I understand that will assist the passage of these amendments through the House and I thank the shadow minister for that constructive contribution. (Time expired)
Firstly, can I thank the minister for her undertaking. At about 4.30 this afternoon the Treasury and an officer from the minister’s office were kind enough to provide us with a briefing on these amendments. I understand that with many of these Treasury initiated bills there can be unintended consequences because there is not enough time for consultation, either because legislation has been rushed into the House or because people are not easily identified or contactable. So I appreciate the minister’s undertaking in that regard. It would be unfortunate if, in the government’s rush to introduce these amendments, people were caught up in those arrangements. If importers or domestic producers who have not been consulted had products which were captured by this new definition, that would be unfortunate. As the government has said, and as the minister conveyed in her speech a few moments ago, it will undertake to address those anomalies and exclude those people should there be an unintended capture of those people.
The point that really needs to be made as part of this debate—and it is reflected by these amendments, which are being rushed in at the eleventh hour—is that this is a bill that the health department had no involvement in to start with. This was a bill that was initiated by Treasury and by Finance. It was a revenue-raising measure. It was never a health measure. The fact that the government has been forced to rush in these amendments to amend the definitions of beer and wine reflects the fact that this was never a measure designed to address binge drinking. The coalition, as I have said on a number of occasions and as I say publicly again today, do consider the issue of binge drinking to be a major concern that we want to address but we want to address it properly and not through the stunts that have been conducted by this government over the last 12 months.
It is important to note that when this government initially identified this change, this tax-grab measure, in April last year they identified about $2 billion in extra tax revenues. By the time the bill came before us as part of the TLAB process, it went up to about $3 billion. They have since revised that to about $1.6 billion. Despite the fact that this minister says that this is about a health measure and that a drop-off in consumption has taken place, I would ask the minister: does the drop in consumption in particular reflect a drop in high-risk consumption patterns? Further, since the last National Drug Strategy Household Survey in 2007—in the period between that and today—have there been any studies conducted by the government, by the minister’s department or by any third party that she is aware of into the levels of high-risk alcohol consumption by certain groups of Australians? I ask her to table that advice so as to properly inform the House on this matter.
A drop in consumption in and of itself does not reflect a drop in dangerous or undesirable drinking patterns or binge drinking, particularly by the target audience—those of teenage years. There has certainly been a displacement effect and there has been an increase in the number of young teenagers, young adults, who have presented to emergency departments around the country since the introduction of this tax bill. That is because this was never designed to address the issue of binge drinking. So there has been a displacement. Young people are not buying as many RTDs and neither are other people in that market segment. Before this tax was introduced, mature-age people—people in their 20s, 30s, 40s or 50s—who went to a party or a nightclub who did not want to have their drinks mixed drank premixed drinks, either in bottles or in cans. They did that for a number of reasons and the majority of them drank responsibly.
My question to the minister is: can the government provide advice to this House that the money has to be repatriated? The advice we have received from the Parliamentary Library is that the government is not obliged to repatriate the money to the industry. The minister must table legal advice on which she relies, because it is in stark contrast to all of the advice we have received. If she does not have the guts to do that then she should put on the record the legal advice she has received and confirm here and now, without misleading the House, that the position that she spoke of before stands. This is bad policy. It is a tax grab, a tax binge, and it is not about addressing binge drinking. (Time expired)
I am not going to detain the House by going back and forth over old ground with the shadow minister. I am happy to address some of the new issues that he has raised. Firstly, he seems to suggest that, by introducing amendments today, we are rushing some procedure through—that we have been forced to do this because of our rush to change the laws. The sad truth is we have been forced to do this because of the surprisingly low levels to which the distillers are prepared to stoop to get around legislation that has been introduced and tabled—the proposals have been in effect since April last year—and is now before the House and will be before the Senate in the coming weeks.
We saw a very quick response from the industry, who oppose this measure. I understand why they do: it massively affects their products. We do not apologise for that. We understand why they disagree with us. We do not understand why the opposition necessarily lines up with them, but that is another matter. They have gone to extraordinary levels to get around the measures in this bill, and we are not prepared to stand by and watch laws that we intend to pass be made a mockery of by the industry, who were prepared to distort products, to go to all lengths to remove the taste of beer or wine, to turn the products into sugary, colourful drinks for teenagers and to continue to promote them to the under-age market.
As I said in other comments that I have made today, I welcome the fact that the new shadow minister does at least acknowledge that this is a problem. He does, and that is a change. I welcome that and I think it is a sign for us that we can work on something together. But unfortunately it does not make it easier.
You are misrepresenting the position!
Not true!
For the benefit of those who are interjecting, you might want to remind yourselves by going back and having a look at the previous shadow minister’s comments and the previous health minister’s comments quite denying that a binge-drinking problem even exists. I know why you guys do not like this—because you voted against it. But unfortunately that is all on the record. It is there.
There is only one of those opposite who has come to see me about this issue and has taken an interest, because he has at a local level been very heavily involved in promoting anti-binge-drinking strategies. I see he is sitting in the House today, but I will not embarrass him by naming him. I am sorry if, when the Liberal Party’s position is clearly described by us, it causes some offence to those opposite who have taken a personal interest in this in their electorate.
The official position of the Liberal Party is what we will happily attack. If the new shadow minister is really interested in binge drinking, then have this measure passed and make sure that investments that the government has now committed to—and more that we want to commit to—are able to be supported by this measure. It is a very easy option to follow.
I do not fully understand the shadow minister’s comments—but I am happy to take it on notice to re-read them—but he seems to be implying that the revisions downward reflect something untoward. What they clearly reflect, which is not in dispute, is that consumption of these products has reduced. What is very difficult to be able to tell—and I agree with this—is who is consuming less, because these products are not legal for teenagers to buy. We know other people must be buying those products for them. It is very difficult for us in a short time frame to be able to identify those trends. The shadow minister would be aware that the household surveys and others have a very long lag time. So I am not standing here pretending to the House that we have a lot of the answers to some of the questions that the shadow minister has raised. What we do have is very clear evidence of a significant reduction in alcopop sales, and that means people who are consuming them are consuming less.
The shadow minister also asked some questions about hospitalisations, even though he is on the record today and in the media as acknowledging that the data that has been released by Access Economics really does not allow a conclusion to be drawn in either direction. He also said the jury is still out on whether these measures are having an impact on young people. I am happy to assure the minister that the advice that we have received is that, if this measure is not passed, the money must be returned to the distillers.
Why don’t you table the advice?
I do not intend to table the advice. That was not the habit of the previous government. We have already provided the shadow minister with briefings. We are happy to continue to do that. There is no particular reason that information cannot be made available. (Time expired)
I thank the minister for the comments that she has made in response to some of the questions that I posed, but I ask the minister the following questions. Has the reduction of alcopop sales resulted in a lowering of binge drinking? If so, where is the evidence to support that? Does the government suggest that the reduction in sales of alcopops has only been to that part of the market which includes young people—say, under the age of 21—or does the minister accept that a large drop in the sales of alcopops has been to an older demographic? I also re-put to the minister the question in relation to consumption patterns. I ask the minister the following question. Sales levels do not equal consumption patterns and, in particular, high-risk consumption patterns. Since the last National Drug Strategy Household Survey in 2007, have there been any other studies by the government, by the minister’s department or by any third party that she is aware of into the levels of high-risk alcohol consumption by certain groups of Australians? If the government had to return the money that has already been collected—on the advice that the minister has given to the House—how, practically, would that money be returned to consumers? What advice has the minister received about how that money would be distributed otherwise?
The shadow minister can repeat the same questions time and time again. I will answer those that I have the information available for today, as I was doing. I will not answer those that I do not have the information available for today. I am quite happy to take those on notice. I do not think that the former Assistant Treasurer, the shadow minister for health, would be able to point to a single example, at least in the time I have been in this parliament, where the previous government ever tabled any legal advice. I do not know for sure, but perhaps the other minister at the table would be able to assure me. I do not even recall them tabling any advice from their departments about anything. I certainly do not recall them being very generous in providing briefings to us, although I see that the member for Berowra is here and he did occasionally provide me some briefings on things, but only very occasionally.
Don’t drop me in too much!
That is right—I do not want to do you any harm of course by suggesting that you provided us with that information. What is clear is that people are hoping to deduce too much from a particular measure. It is not possible when you look at sales data to immediately link that sales data with the age of the purchaser, unless you want us to somehow require every single retailer to record the age of the particular person purchasing the product and to get them to come back and report who drank them. It is just not possible. A number of the questions that the shadow minister is asking cannot be answered. What I think is absolutely clear is that, considering these products are specifically marketed to young people, if you have a significant drop in alcopops sales then a large number of young people will be affected by that. That does not mean that it is a cure for everything.
Has it stopped binge drinking?
It does not matter how loudly the shadow minister yells. This measure will not achieve every solution to binge drinking or the problems of alcohol abuse in the country, nor did we claim it would. What it does is have an impact on sales. It provides us with a significant amount of money and more than half of that has now been committed to preventative health measures. If the opposition want to vote against those measures, they will stand condemned for that and they will stand condemned if they have hundreds of millions of dollars being returned to distillers, which is what our advice is. I am happy to continue with discussions, and no doubt there will be further discussions when this legislation moves to the other place. But I think those are the only questions that can be answered here today. I am happy to provide further information to the shadow health minister if that becomes available.
It is amazing, to say the least, that this health minister has not been able to point to one shred of evidence that this measure has resulted in any reduction in binge drinking at all. This health minister knows that, instead of consuming alcopops, many of these young people have now moved on to harder spirits. They have moved on to mixing their own spirits, so they, particularly young women, face the risk of spiked drinks. In this debate the government have put themselves in a position where they have not offered one shred of evidence that the collection of $1.6 billion will help one young person in reducing binge-drinking behaviour. That is an astounding claim by this minister, who has dodged this question at every turn as part of this debate over the last 12 months.
The department have been asked questions at Senate estimates and, under direction from the minister and her office, they have refused to provide even the most basic of details. It is a sad indictment of the government, because this bill was only ever set up to run a media cycle through the weekend. This measure was announced so that they could get a run in the Sunday papers and so that this minister would have something to talk about on the Sunday program in April last year. This has never been about binge drinking and addressing the very valid concerns that Australians have about binge drinking.
Today, for the first time, the health minister has confessed that she cannot give a commitment that even one young adult has benefited as a result of this particular measure. That is a disgraceful position. There are thousands of Australian parents, thousands of grandparents and thousands of people who have a concern about teenage children—about young adults—who are binge drinking and drinking inappropriately, and they thought that this Prime Minister and this government actually had a genuine concern about that problem. In recognising today for the first time in this place that this is all about raising revenue and not about addressing the very genuine concerns of those Australians, we feel this health minister should stand condemned.
Mr Adams interjecting
This is the last opportunity for this minister—she has a couple of minutes to do it—to stand at the dispatch box as part of this debate, come up with the evidence and say to Australians, ‘There’s been a drop in the number of RTDs purchased by consumers.’ Stand at the dispatch box, Minister, and have the guts to say to Australians, ‘This is how this measure is turning binge drinking in the right direction’—that is, a downward trend.
There is no evidence that the minister has been able to provide as part of this debate that shows that binge drinking has been addressed through this bill. That is why the coalition will stand against it, and that is why the coalition stands in favour of education, rehabilitation, law enforcement and all those other programs that we will be able to provide with the $300 million plus once this bill is defeated in the Senate. We will ensure that that money is diverted into programs which will help address the binge-drinking problem in this country, instead of running off on some sort of media exercise like this health minister and this Prime Minister have been engaged in. It is a damning indictment of the management of health at a federal level. It underscores what I have said from day one of observing this health minister—that is, her mentor remains Reba Meagher in New South Wales. This is Reba Roxon and she is modelling the health system at a federal level on the Labor New South Wales government, which is a disgrace. It is why we get outcomes like this, which are driven by media results and not by health outcomes. We want to see patient outcomes where people are delivered good health policy. The government are standing in the way of that. The government need to provide right here, right now, at the last opportunity, just one bit of evidence to support the bill before the House. If they do not, they should stand condemned.
Before I call the Minister for Health and Ageing I remind all honourable members, including the honourable member for Lyons, that it is disorderly to interject from outside your allocated seat.
I will not sit here in the parliament and be verballed by a shadow minister who sat on this side of the House for 11 years and was part of a government that did nothing about this problem—not a single thing. The shadow minister has asked for one piece of evidence, and that piece of evidence is absolutely plain as day; he just does not want to use it. That piece of evidence shows that alcopop sales have decreased by more than a third—34.6 per cent—relative to before this measure was introduced in April last year. You asked for one piece of evidence. That is one clear, incontestable piece of evidence.
Mr Dutton interjecting
The shadow minister can rant and rave as much as he likes. He can yell out. He can try to yell over the top of me. It will not disprove the evidence that shows that sales have decreased by a third. That is the evidence that is important. It is clear. It is much more successful than it was ever predicted to be by the government. We are happy about that, but we are going to make sure that we pursue this measure.
What I have to say to the shadow minister, who was part of a government which did absolutely nothing about this issue, is that the money is not his to allocate. He is not the government. He is also, as it turns out, not even a participant in this debate. He does not want to support this measure and talk with us about how the money might be spent. The opposition have refused from day one to be part of this solution. They cannot pretend otherwise, and the words that the shadow minister used reveal it all: ‘We will be able to provide $300 million for education and rehabilitation programs,’ because, somehow or other, the distillers—which I admit the opposition have been close to in this debate—are going to hand it over to the shadow minister to distribute to whichever health and education fund he thinks is worthwhile. Shadow Minister, that is not what is going to happen. What is going to happen if this bill is defeated is that $300-odd million will go back into the pockets of distillers, who will no doubt use it to advertise their products to more young people. The Liberal Party will be responsible for that happening, and that is what will be on their head.
I do not enter this debate with any spirit of vindictiveness, but it would not be a surprise to honourable members that this is a matter of seminal interest to me and my electorate. Probably the longest standing distilling company in this country is situated in Bundaberg and has been there for 120 years. It is an adjunct to the sugar industry. It employs a lot of people. It has a magnificent tourist centre that attracts 80,000 tourists a year. It has a quality product. It is one of the best corporate supporters of sport in this country and, on top of that, it has a responsible drinking policy.
The Minister for Health and Ageing has made the claim in this debate that her measures have reduced the consumption of alcopops by about a third. Of course, that is true. If you put 2½ times the excise on a certain product, you will achieve a result of lower consumption of that product. But what you have not demonstrated for us in this debate is what those young people who you claim were drinking alcopops have substituted for them. You have not established that. You have not been able to refute that people are putting full-strength spirits into bottles of Coke and cans of ginger ale, or whatever it might be, and drinking probably a much more dangerous cocktail. That is another aspect of it that is quite important.
The other thing that I find appalling is that we have a mentality in this country that pretty much goes back to the days of the Rum Rebellion and the British Navy, in that there has been a totally illogical prejudice that somehow people who drink spirits—who drink rum or whisky—are toffs and therefore they can be taxed at a higher level. I suppose it gained a lot of traction in the days of the Rum Rebellion and in the British Navy, where whisky and rum became a commodity that was almost a currency. But we live in an enlightened time. No-one should be able to tell any citizen of this country, young or old, vulnerable or otherwise, that they cannot drink alcohol of a particular strength.
How is it that alcohol derived from spirits should be taxed at a different rate to beer or wine? What logic drives that? Why is it that if I have a half-strength can of XXXX Gold, which has 3.5 per cent alcohol by volume, I am a better citizen than I would be if I had the Bundaberg Gold grey label mixture of Bundy and Coke, which is also 3.5 per cent? Am I any more vulnerable? Is a young person drinking beer at the same rate as that any less vulnerable? You have to be logical about this thing, and what this bill does is take us back to the old ways. Let people pay their excise according to the alcohol they consume.
Having said that, I am not in any way attacking the wine industry. I recognise that there will always need to be certain incentives for the wine industry. I have wineries in my electorate, and I was a supporter of the cellar door amendments. But, please, on these basic matters, let us get back to a bit of fairness and equity. If you have evidence, Minister—and we have all asked you this today—tell us where the people who have been abusing alcopops have gone, because I can tell you, from my experience, that they have not stopped drinking. They have moved from one mode of alcohol to another. If you look at the bare figures for the last quarter in the case of Lion Nathan and in the last half-year in the case of Fosters, you will find that beer consumption is rising rapidly. So you would want to be quite sure that you are not replacing one form of alcohol abuse in young people with another. (Time expired)
I will be brief. I know members are keen for this debate to finish and there is one more set of amendments that need to be moved for the complementary bill, but I want to briefly comment on the issues raised by the member for Hinkler, who I know had a particular interest in this issue and who has the privilege to represent a company that has a significant history in Australia and a particular place in the heart of the member for Hinkler and probably many other members in this House.
I say to the member for Hinkler that the company whose issues he is raising here today is perfectly placed to answer a number of the questions that he has raised about substitution, because Bundaberg Rum is one of the companies that produce both premixed products and straight products. If, as he and many of those opposite are suggesting, this measure has simply moved people from drinking premixed products to drinking the straight products, I do not think Bundaberg Rum would be complaining about it, because their profits would be exactly the same. The reason that they are upset and the reason they quite rightly go to see their local member of parliament is that this has reduced the overall consumption of spirits. The decrease in alcopop sales is 34.6 per cent and the increase in full strength spirits is 17 per cent. The combined impact—remembering that they are working from a different base—is a reduction of 7.9 per cent in spirit sales. That is a big impact on any producer, and I am sure that Bundaberg Rum and others are feeling that. But if what some of the members opposite are saying is right—that this measure has just moved people from a premixed product to a straight product—Bundaberg Rum would be as happy as Larry. So I think that we really can put that issue to rest, and no doubt the business in your electorate can satisfy you on that.
I take the point that has been raised—and of course there is a much broader debate about it—about the history of how alcohol taxation is different across so many different products. But remember this is closing a loophole to ensure that spirits are all taxed consistently, and that is why the government is determined to press ahead with this measure.
I rise to speak on the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 at this time because of the matters raised by the Minister for Health and Ageing in this closing part of the debate and her assertions that those on this side of the House in some way do not think that this is a serious problem. I think that is a terrible slur to put on those on this side of the House. I do not have any distilleries in my electorate but I do have a lot of parents. I do have a lot of teenage kids, and we do have a very serious problem with this in my electorate of Cook. If we go down to Cronulla Mall on a Friday or Saturday night, we see this problem and we see the wreckage of it on Saturday and Sunday mornings. But what the minister and the government do not seem to understand is this: you cannot parade around in this place and pretend there are silver-bullet solutions to this problem, as they have portrayed with this tax. They have come out with a tax and said, ‘If we tax alcopops, we’re going to solve binge drinking.’ One of the things that will actually come from this bill—which is a dud bill—being defeated in this place and in the Senate is that somehow, at the end of the day, some serious funds might go back into education, because, contrary to what the minister says, it was made very clear by the industry that they had no interest in these funds coming back to them, no interest at all. These funds, they have pledged—and they said this back in August—will go back into education programs. They have no interest in taking these funds.
What the minister is trying to do here is to wedge the Senate and the coalition. She wants to stand here and say to those in the other chamber and in this chamber, ‘If you don’t do this, if you do not support this measure, then the sun will not come up tomorrow on efforts to solve binge drinking, and all will be lost.’ But the truth is that she will not come into this place and table the advice upon which she is basing her claim that the money cannot go back to other measures. She cannot do that. She will not come in and stump up and back up the claim that she is threatening members and senators with—that if we do not pass this tax then somehow the money is going to go out there to promote drinking to young kids, as opposed to going to education programs. I challenge the minister and call her bluff: put this advice on the table so members in this House and senators in the other house can be absolutely crystal clear on the furphy she is putting out there in this debate. It is a furphy, it is a bluff and it is a very poor attempt at a wedge. My message, particularly to senators—but I am sure that members in this place will agree—is that we will not be bluffed. We will not be bluffed by the government on this issue. This is a very significant problem and it requires some very significant responses.
In our shire we have a thing called the fridge-to-fridge party and it is a very disturbing thing to see. Those fridge-to-fridge parties have been happening ever since this measure started. They have not changed. There has been no evidence of any change in the binge-drinking behaviour in my electorate since this ‘silver bullet’ was brought into this place. I will tell you what this fridge-to-fridge thing is, because this is what we have to address. Kids get together and go from house to house and from fridge to fridge, and they ride around on bikes with no helmets and carry on like clowns. One of these days one of these kids is going to get killed. The government is pretending that this measure is going to solve that problem, but it is not. You are pretending that you are addressing this problem and you are not addressing the problem.
Mr Adams interjecting
I warn the honourable member for Lyons.
Why don’t you put your taxes back in your pocket and come up with some serious measures to deal with binge drinking, rather than lecturing those on this side of the House about your great moral intentions. You cannot put a plan together that will seriously address this problem.
Mr Adams interjecting
Dr Emerson interjecting
The honourable member for Lyons will stop interjecting, as will the minister for small business.
What the people in my electorate want to know is: how are you going to encourage and equip parents to deal with the problems of binge drinking in their own homes? You want to pretend that the government can solve this problem with taxes. The government have to work with communities, with families, with sporting organisations—with people right across this country—and your answer is to bring in a tax. Your answer with the tax was to see virtually all the money raised in that tax sit in consolidated revenue to pay for the debt binge of this government. That is what the government are committed to—debt. They are on a debt binge that we are unlikely to ever see the end of. We need to see measures come into this House which actually address the problems the government are pretending they will address. This tax is not a silver bullet. The money, if it is rejected, will get to places where it should get to and in much greater quantities than the government’s bill was ever going to deliver.
Mr Adams interjecting
Would the honourable member for Lyons please sit down. I am putting the question.
I am seeking the call.
I have not given you the call. The honourable member for Lyons will remove himself from the chamber under standing order 94.
The member for Lyons then left the chamber.
Question agreed to.
Bill, as amended, agreed to.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Debate resumed.
Question put:
That this bill be now read a second time.
Bill read a second time.
Bill—by leave—taken as a whole.
by leave—I move government amendments (1) to (5):
(1) Clause 2, page 1 (lines 7 and 8), omit the clause, substitute:
2 Commencement
(1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.
Commencement information | ||
Column 1 | Column 2 | Column 3 |
Provision(s) | Commencement | Date/Details |
1. Sections 1 to 3 and anything in this Act not elsewhere covered by this table | The day on which this Act receives the Royal Assent. | |
2. Schedule 1 | 27 April 2008. | 27 April 2008 |
3. Schedule 2 | The latest of: (a) the day after this Act receives the Royal Assent; and (b) the day after the Excise Tariff Amendment (2009 Measures No. 1) Act 2009 receives the Royal Assent; and (c) 1 July 2009. However, the provision(s) do not commence at all if the event mentioned in paragraph (b) does not occur. | |
4. Schedule 3 | The later of: (a) the day after this Act receives the Royal Assent; and (b) 1 July 2009. |
Note: This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.
(2) Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act.
(2) Schedule 1, heading, page 3 (line 2), omit “Customs Tariff Act 1995”, substitute “Ready-to-drink beverages”.
(3) Schedule 1, page 3 (before line 4), before item 1, insert:
Customs Tariff Act 1995
(4) Page 8 (after line 19), at the end of the Bill, add:
Schedule 2—Beer
Customs Tariff Act 1995
1 Subsection 19(1) (table items dealing with Customs subheadings 2203.00.31 and 2203.00.39)
Repeal the items.
2 Subsection 19(1) (after table item dealing with Customs subheading 2203.00.79)
Insert:
2203.00.91 | 2 |
2203.00.99 | 3.2 |
3 Schedule 3 (Chapter 22, Additional Notes 9 and 10)
Repeal the Additional Notes, substitute:
9.- For the purposes of 2203.00.6, 2203.00.7, 2206.00.7 and 2206.00.8, “beer” is a brewed beverage that:
(a) is the product of the yeast fermentation of an aqueous extract, being predominantly an aqueous extract of cereals:
(i) whether the cereals are malted or unmalted; and
(ii) whether or not the aqueous extract contains other sources of carbohydrates; and
(b) contains:
(i) hops, or extracts of hops, such that the beverage has international bitterness units of not less than 4.0; or
(ii) other bitters such that the beverage has a bitterness comparable to that of a beverage mentioned in subparagraph (i); and
(c) contains not more than 4.0% by weight of sugars; and
(d) has not had added to it, at any time, artificial sweetener; and
(e) may have had added to it, at any time, other substances, including flavours, but only if, in the case of substances that contain alcohol (other than spirit distilled from beer), the alcohol did not add more than 0.5% to the total volume of the final beverage; and
(f) may have had added to it, at any time, spirit distilled from beer, but only if that spirit did not add more than 0.5% to the total volume of the final beverage.
10.- For the purposes of paragraph (c) of Additional Note 9, “sugar” means:
(a) monosaccharide; or
(b) disaccharide.
4 Schedule 3 (subheadings 2203.00.3 to 2203.00.39)
Repeal the subheadings.
5 Schedule 3 (subheading 2203.00.6, the description of goods in column 2)
After “Other”, insert “beer, as defined in Additional Note 9 to this Chapter”.
6 Schedule 3 (subheading 2203.00.7, the description of goods in column 2)
After “Other”, insert “beer, as defined in Additional Note 9 to this Chapter”.
7 Schedule 3 (after subheading 2203.00.79)
Insert:
2203.00.9 | ---Other: | |
2203.00.91 | ----Having an alcoholic strength by volume exceeding 1.15% vol, but not exceeding 10% vol | $69.16/L of alcohol NZ/PG/FI/ DC/LDC/ SG: $69.16/L of alcohol |
2203.00.99 | ----Other | $69.16/L of alcohol NZ/PG/FI/ DC/LDC/ SG: $69.16/L of alcohol |
8 Schedule 3 (subheading 2206.00.7, the description of goods in column 2)
After “Beer,”, insert “as defined in Additional Note 9 to this Chapter,”.
9 Schedule 3 (subheading 2206.00.8, the description of goods in column 2)
After “Beer,”, insert “as defined in Additional Note 9 to this Chapter,”.
10 Schedule 5 (table items 1 and 2)
Repeal the items.
11 Schedule 5 (after table item 8)
Insert:
8A | 2203.00.91 | $69.16/L of alcohol |
8B | 2203.00.99 | $69.16/L of alcohol |
12 Schedule 6 (table items 4 and 5)
Repeal the items.
13 Schedule 6 (after table item 11)
Insert:
11A | 2203.00.91 | $69.16/L of alcohol |
11B | 2203.00.99 | $69.16/L of alcohol |
14 Schedule 7 (table items 3 and 4)
Repeal the items.
15 Schedule 7 (after table item 10)
Insert:
10A | 2203.00.91 | $69.16/L of alcohol |
10B | 2203.00.99 | $69.16/L of alcohol |
16 Application
The amendments of the Customs Tariff Act 1995 made by this Schedule apply in relation to:
(a) goods imported into Australia on or after the commencement of this Schedule; or
(b) goods imported into Australia before the commencement of this Schedule, where the time for working out the rate of import duty on the goods had not occurred before that commencement.
(5) Page 8 (after line 19), at the end of the Bill (after proposed Schedule 2), add:
Schedule 3—Grape wine products
Customs Tariff Act 1995
1 Subsection 19(1) (after table item dealing with Customs subheading 2205.90.90)
Insert:
2206.00.13 | 2 |
2206.00.14 | 3.2 |
2206.00.21 | 2 |
2206.00.22 | 3.2 |
2206.00.23 | 2 |
2206.00.24 | 3.2 |
2 Schedule 3 (Chapter 22, Additional Note 4)
Repeal the Additional Note, substitute:
4.- For the purposes of this Chapter, “grape wine product” is a grape wine-based beverage that:
(a) has not had added to it, at any time, the flavour of any alcoholic beverage (other than wine) (whether the flavour is natural or artificial); and
(b) if the beverage has had added to it ethyl alcohol used in preparing vegetable extracts, as mentioned in subparagraph (b)(ii) of Additional Note 4B—complies with the following requirements:
(i) the ethyl alcohol must only be used to extract flavours from vegetable matter;
(ii) the ethyl alcohol must be essential to the extraction process;
(iii) the ethyl alcohol must not add more than one percentage point to the alcoholic strength by volume of the beverage.
4A.- For the purposes of paragraph (a) of Additional Note 4, “wine” means:
(a) grape wine, as defined in Additional Note 3; or
(b) cider or perry, as defined in Additional Note 5; or
(c) fruit or vegetable wine, as defined in Additional Note 6; or
(d) mead, as defined in Additional Note 7; or
(e) sake, as defined in Additional Note 8.
4B.- For the purposes of this Chapter, “grape wine-based beverage” is a beverage that:
(a) is not grape wine, but contains at least 700 ml of grape wine per litre; and
(b) has not had added to it, at any time, any ethyl alcohol from any other source, except:
(i) grape spirit; or
(ii) alcohol used in preparing vegetable extracts (including spices, herbs and grasses); and
(c) has an alcoholic strength by volume of at least 8% vol but not exceeding 22% vol.
3 Schedule 3 (after heading 2206)
Insert:
2206.00.1 | ---Grape wine-based beverages: (a) that are goods of neither 2205 nor 2206.00.2; and (b) that include a flavour mentioned in paragraph (a) of Additional Note 4 to this Chapter: | |
2206.00.13 | ----Having an alcoholic strength by volume not exceeding 10% vol | $69.16/L of alcohol NZ/PG/FI/ DC/LDC/ SG: $69.16/L of alcohol |
2206.00.14 | ----Having an alcoholic strength by volume exceeding 10% vol | $69.16/L of alcohol NZ/PG/FI/ DC/LDC/ SG: $69.16/L of alcohol |
2206.00.2 | ---Grape wine-based beverages: (a) that are not goods of 2205; and (b) to which subparagraph (b)(ii) of Additional Note 4B to this Chapter applies; and (c) that do not comply with the requirements set out in paragraph (b) of Additional Note 4 to this Chapter: | |
2206.00.21 | ----Containing goods which, if imported separately, would be classified in 2207, having an alcoholic strength by volume not exceeding 10% vol | 5%, and $69.16/L of alcohol DCS:4%, and $69.16/L of alcohol DCT:5%, and $69.16/L of alcohol NZ/PG/FI/DC/LDC/SG:$69.16/L of alcohol |
2206.00.22 | ----Containing goods which, if imported separately, would be classified in 2207, having an alcoholic strength by volume exceeding 10% vol | 5%, and $69.16/L of alcohol DCS:4%, and $69.16/L of alcohol DCT:5%, and $69.16/L of alcohol NZ/PG/FI/DC/LDC/SG:$69.16/L of alcohol |
2206.00.23 | ----Containing goods which, if imported separately, would be classified in 2208, having an alcoholic strength by volume not exceeding 10% vol | 5%, and $69.16/L of alcohol DCS:3%, and $69.16/L of alcohol NZ/PG/FI/DC/LDC/SG:$69.16/L of alcohol |
2206.00.24 | ----Containing goods which, if imported separately, would be classified in 2208, having an alcoholic strength by volume exceeding 10% vol | 5%, and $69.16/L of alcohol DCS:3%, and $69.16/L of alcohol NZ/PG/FI/DC/LDC/SG:$69.16/L of alcohol |
4 Schedule 5 (after table item 20)
Insert:
20A | 2206.00.13 | $69.16/L of alcohol |
20B | 2206.00.14 | $69.16/L of alcohol |
20C | 2206.00.21 | $69.16/L of alcohol |
20D | 2206.00.22 | $69.16/L of alcohol |
20E | 2206.00.23 | $69.16/L of alcohol |
20F | 2206.00.24 | $69.16/L of alcohol |
5 Schedule 6 (after table item 23)
Insert:
23A | 2206.00.13 | $69.16/L of alcohol |
23B | 2206.00.14 | $69.16/L of alcohol |
23C | 2206.00.21 | $69.16/L of alcohol |
23D | 2206.00.22 | $69.16/L of alcohol |
23E | 2206.00.23 | $69.16/L of alcohol |
23F | 2206.00.24 | $69.16/L of alcohol |
6 Schedule 7 (after table item 22)
Insert:
22A | 2206.00.13 | $69.16/L of alcohol |
22B | 2206.00.14 | $69.16/L of alcohol |
22C | 2206.00.21 | $69.16/L of alcohol |
22D | 2206.00.22 | $69.16/L of alcohol |
22E | 2206.00.23 | $69.16/L of alcohol |
22F | 2206.00.24 | $69.16/L of alcohol |
7 Application
The amendments of the Customs Tariff Act 1995 made by this Schedule apply in relation to:
(a) goods imported into Australia on or after the commencement of this Schedule; or
(b) goods imported into Australia before the commencement of this Schedule, where the time for working out the rate of import duty on the goods had not occurred before that commencement.
These supplementary amendments to the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009 alter the definition of ‘beer’ for taxation purposes and complement changes made to the Excise Tariff Act 1921 and changes made to the definition of ‘grape wine products’ in A New Tax System (Wine Equalisation Tax) Regulations 2000 so that imported beer and wine are subject to the same definition for taxation purposes. Full details of the amendments are contained in the supplementary explanatory memorandum.
Question agreed to.
Bill, as amended, agreed to.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Order! It being approximately 7.30 pm, I propose the question:
That the House do now adjourn.
On Monday night in this House, I was honoured to be named the Jeans for Genes Day Genie Member of Parliament for 2008 by the National Campaign Manager for Jeans for Genes, Julijana Trifunovic. I also take this time to acknowledge the other 55 MPs who worked so hard on Jeans for Genes Day to raise money for a good cause.
I once read a book called Six Degrees of Separation by John Guare. The prevalence of genetic disease in children hits at a rate of around one in 20 children, so it does not take much for every individual to either know someone with a genetic disorder or to know someone who knows someone with a genetic disorder. But what is key and critical is that the money that is raised by Jeans for Genes Day does make a difference. They have made some incredible advances through the years by supporting the scientists at the Children’s Medical Research Institute. The key and critical part of all this is that they are actually trying to cure the diseases or prevent the diseases before they occur in our children. That is perhaps the most important issue. This is a proactive measure that we are raising money for in an attempt to prevent children from growing up with these genetic diseases.
On 1 August last year, my team and I had the pleasure of driving some 150 kilometres up to Forster, on the New South Wales mid-North Coast, to join other local community members in a fundraising extravaganza on Jeans for Genes Day 2008. I appreciate the support of Bunnings Forster, who provided an outstanding facility, their outdoor barbecue area, where we set up a sausage sizzle. We cooked up a storm and sold over 200 sausage sandwiches for the kids. We were successful on the day, raising over $1,000 for a great cause. The atmosphere on the day was good. In fact, we received a lot of donations. When we ran out of products to sell, people were happy to make a contribution. I also had the support of Woolworths Forster, Baker’s Delight and Stockland Forster, which helped make the day the great success that it was.
I would also like to thank and make special mention of the people who assisted, including Michael Kreutz; the Mayor of Great Lakes, Jan McWilliams; Ross Presgrave; Lloyd Moffat, who sweated it out on a very hot day cooking all the sausages; Judy Wilkinson; my staff members Ben Gibson, Michelle Mexon and Michelle Moffatt; and Gary Hoson, who put the whole day together. We had so much fun that we are planning to do it all again next year. But next time we will do it on a Saturday rather than on a Friday—though Jeans for Genes Day is a Friday—because on the Saturday we will have more people we can sell sausage sandwiches to and raise even more money. I know the competition between MPs will be tight next year to become the parliamentary ‘genie’ of the year, but I am determined to win it.
Last week, I had an exceptional morning tea with a very wonderful couple. On 4 March, which is next Wednesday, Ken and Wilma McMillan will have been married for 70 years. Ken was 18 years of age and Wilma was 16 years of age when they formed a relationship which has lasted so long. In all of my time as the member for Paterson, on only one other occasion have I had the pleasure of sending a congratulatory message to a couple who have been married for 70 years. It is an amazing milestone to achieve, and I congratulate them.
Ken and Wilma are a beacon of light and an inspiration of hope for couples in the 21st century. What they share is an exceptional bond that has stood the test of time and has seen their relationship build from strength to strength with every year they have shared together. I congratulate them on reaching such a significant milestone and wish them every happiness for their future together. I asked Wilma what the secret to such a long marriage was. She said, ‘We’ve had a strong marriage because we believe in each other and we have trust in one another.’ With a chuckle, Ken agreed to this conclusion and added, ‘Well, to begin with, you have to be able to live long enough to reach the milestone, and then it’s a matter of sharing and not expecting too much.’ I wish them a very long and healthy life, and I look forward to joining them at future wedding anniversaries.
Mr Speaker, I thank you for the opportunity to speak in the House tonight. I want to speak a little about the upcoming Queensland state election. I am a born and bred proud Queenslander. My home town, the wonderful city of Gladstone, is in Central Queensland. My home town of Gladstone, my electorate of Flynn, my state of Queensland and Australia generally, as we all know, are facing the worst financial crisis to hit our shores since the Great Depression. In the face of insurmountable and overwhelming evidence supporting this fact, I was absolutely floored—in fact, stunned—to read on the ABC News website, in an article posted on Tuesday, 24 February 2009, comments attributable to the bloke who wants to lead my proud state as Premier of Queensland from the next election and beyond, the Liberal National Party Leader of the Opposition, Lawrence Springborg. I will quote from the article:
Liberal National Party Leader Lawrence Springborg says the global financial crisis is a side issue for Queensland.
Mr Springborg is quoted as saying:
“With regards to this global financial crisis, it is again the triumph of salesmanship over substance in Queensland, where the Government is trying to align an issue which is external, which is only peripheral to what is happening in Queensland.”
The Leader of the Opposition in Queensland does not have a clue about what is happening in the Queensland economy. He is completely out of touch, and he wants to lead my state of Queensland. Mr Springborg might want to tell all the workers in Queensland who have lost their jobs recently that the global financial crisis is a side issue for Queensland. He might want to come and tell my workers in Flynn, the hundreds and hundreds who have lost their jobs recently, that the global financial crisis is a side issue for them. He might want to come and tell my small business operators who are suffering in Flynn that the global financial crisis is a side issue for Queensland and for them. He might want to come and tell all my Rio Tinto workers in Flynn, at Yarwun 2 and RG, at smelters and elsewhere, that the global financial crisis is a side issue for them and for Queensland. These are good, hardworking men and women of my electorate who are terrified of losing their jobs. These are men and women whom I grew up with, went to school with, played football with and have lived with. He should come and tell all of those proud people what he thinks—that is, that the global financial crisis is only peripheral and a side issue for them and for Queensland. If Mr Springborg does not have a clue about the economy himself, I suggest that he pick up the phone and ring Kevin Rudd, Wayne Swan and other proud federal Labor Queensland members and find out what is really happening in Queensland.
The global financial crisis is not, as Mr Springborg would have it, an external issue for the mums and dads in my electorate of Flynn who have lost their jobs and are now struggling to put food on the table. It is not an external issue for the kids who are losing their jobs and who will become our modern day lost generation. This is real, Mr Springborg; the global financial crisis is very real and you should be ashamed of your comments made recently.
A global financial crisis denier like Lawrence Springborg is bad for Gladstone, bad for Flynn, bad for Queensland and bad for Australia. A few months ago Lawrence Springborg said Queensland should not be on a war footing to combat the global financial crisis. Again on ABC radio yesterday Mr Springborg said the crisis was external to Queensland and only peripheral to Queensland’s economic position. Well, I will tell you this, Lawrence: it is not external to families in Gladstone; it is not peripheral to kids who have lost their jobs or to families where their sole breadwinner is out of work. Lawrence Springborg is a global financial crisis denier who is not up to the task of running the state of Queensland.
Tonight I would like to raise the issue of the persecution of the practitioners of the Baha’i Faith and other religious minorities by the government of the Islamic Republic of Iran. On this occasion I would like to speak about the particular persecution of the Baha’is. There are over 300,000 followers of the Baha’i Faith within Iran, and this religion actually began some 150 years ago within the borders of that country. When we talk about current day Iran, it is worth noting the persecution of the Baha’is has occurred continually over the entire existence of the religion. Its followers have regularly been made scapegoats for the failures of the Iranian government and the Iranian economy. Since the establishment of Israel, and with the presence of the Baha’i Universal House of Justice in Haifa, the Iranian persecution of the Baha’is has been characterised by allegations that they are supporters of Israel and the West, as well as being responsible for the economic woes of Iran.
It is widely believed that, since the rise of President Mahmoud Ahmadinejad, the persecution of the Baha’is has intensified. Although I believe that the majority of the persecution of Baha’is relates to scapegoating for the regime’s persistent failures, it cannot be ignored that the Islamic religion and its authorities struggle with a monotheistic religion that came into being after the establishment of the Islamic religion. The problem for the Islamic leadership group in Iran is that, while other Abrahamic religions such as Christianity and Judaism may be disregarded as outdated precursors, the Baha’i Faith is a religion that actually relegates Mohammed to the position of a divine messenger only, rather than the final messenger. This represents a significant challenge to the Islamic religion for the leadership in Iran.
The reason I am raising the issue of persecution is that last year the seven main leaders of the Baha’i Faith in Iran were arrested. In March 2008 Mrs Mahvash Sabet was arrested. In May 2008 Mrs Fariba Kamalabadi, Mr Jamaloddin Khanjani, Mr Afif Naemi, Mr Saeid Rezaie, Mr Behrouz Tavakkoli and Mr Vahid Tizfahm were arrested. The charges accused these five men and two women of espionage for Israel, insulting religious sanctity and propaganda against the republic. It is my firm view that these charges have no validity, and they are inconsistent with the teachings of the Baha’i Faith in any case.
I have already written to the Ambassador of the Islamic Republic of Iran to inform him of my view that the arrests were wrong and that the treatment of these people whilst in custody has been unfair, unreasonable and inhumane. I have asked for the charges to be dropped and, if they are not dropped, for a fair and open trial to be conducted in front of international media. I am greatly concerned about the history of persecution of not only the practitioners of the Baha’i Faith but also other religious and minority groups in Iran. I believe that the actions of the government of Iran demonstrate a renewed period of religious and political intolerance.
We should also note that there are a further 30 Baha’is in jail and another 80 currently on bail who face trial. I have been informed that the 80 on bail were required to surrender documents relating to the ownership of land and the licences of their businesses. Clearly, the government of Iran intends that Baha’i property rights can now easily be forfeited to the government. The obligation to surrender their assets in this way is unjust and can easily be perceived as further persecution, targeting of minority groups and religious intolerance. I have also raised this matter with the Minister for Foreign Affairs, and I look forward to seeing a response to the situation. I know that the issue of Iranian government persecution of Baha’is has a long history of being raised in this place. I am the first member for Cowan to raise it but I know that many members of this current parliament have raised the issue in the past.
Iran faces an election this year. I believe that as President Mahmoud Ahmadinejad seeks to shore up his position the blaming and persecution of Baha’is will continue to be a political tactic. A number of followers of the Baha’i Faith live in the electorate of Cowan, and I thank them for bringing this matter to my attention. This issue is about persecution. It is about the withdrawal of the right to freely practise religion, it is about religious intolerance and it is about the extreme practice of politics. These seven Baha’is are on trial for their lives. It should never have come to that. I will finish by saying that Australia should once again send a clear message to the government of Iran that this sort of injustice has no place in a modern world and no justification in any religion.
During the month of February the International Cycle Speedway Federation held its 2009 world championships in South Australia. Events were held at the Salisbury, Lefevre, Murraylands and Findon cycle speedway tracks. The main event, the World Cycle Speedway World Cup, was held on Saturday, 21 February at the Salisbury Cycle Speedway Track. Riders from the USA, England, Ireland, Wales, Scotland, Poland and Australia competed for the world cup.
On the day, the member for Wakefield and I attended the championships, which included the women’s international, the junior world cup and the men’s open class world cup. The women’s event was won by Nikki Kinross of Australia, the junior event was won by the Australian team, and for the first time ever the Australian team won the men’s open class world cup—finishing just ahead of the favourites, Poland. It was an incredibly intense competition with some sensational performances and plenty of thrills and spills. Notably, the events were all free admission to the community, and not surprisingly a huge crowd turned out to watch the world cup events.
I take this opportunity to congratulate all of the riders who, at the completion of the racing, like true sportspeople, celebrated each other’s performances. I congratulate all of the winners, in particular the winners of the senior world cup—the Australian riders Daniel Pudney, Cody Chadwick, Cameron Crisp and Robert Fitzpatrick. They did our country proud.
Cycle speedway racing is not a mainstream sport and therefore receives little public recognition. It is, however, a sport that is all-inclusive, providing opportunities for men and women right through from tiny tots to older members of the community. Because it is not a mainstream sport in Australia, the local clubs in South Australia are very much dependent on the efforts of volunteers. For some years I have been associated with the Salisbury Cycle Speedway Club, having been introduced to the sport by club stalwarts Trevor and Chris Dutton, and I can speak with personal knowledge about the work of the management committee, the officials, the volunteers and the families who sustain that club. Their organisational skills ensured that the running of the world championship events went like clockwork. It was testimony to both their hard work and their professionalism.
The Salisbury Cycle Speedway is not located in an affluent community, but what the club lacks in finances is more than offset by the richness of the spirit of the volunteers and families who have sustained the club for over 50 years. In doing so, they have enabled over the years thousands of young people to participate in a healthy recreational activity that just about every young person likes to do, whilst at the same time teaching young people better bike-riding skills. I congratulate them for all of their efforts.
On another matter, on Thursday, 19 February the member for Maribyrnong, the Parliamentary Secretary for Disabilities and Children’s Services, visited the adjoining electorates of Makin and Wakefield. The parliamentary secretary attended a community forum held at the Tyndale Christian College, which was attended by around 150 members of the community, where he listened to the concerns raised and, where he could, provided government responses to those issues. It is clear to me from the range of issues raised at the forum that addressing the needs of people with disability should be a priority for all governments. Disability issues affect one in five Australians, with flow-on effects to other family members. For many of these people, life can be incredibly tough for the duration of their life. There is a huge amount of work to do, and the problems have been ignored for too long.
During that day we also visited the Elizabeth Special School, the Modbury Special School and Golden Grove High School and met with Mike Potter, the Principal of Tyndale Christian School. I thank and congratulate all of these schools for the extraordinary work that they are doing in assisting children with serious disability issues. We ended the day by attending a church service hosted by Reverend Joan Riley at the Ingle Farm Anglican Church. This was a unique service. It is held every week, specifically meeting the spiritual needs of people, young and old, who have disabilities. It is their service and they run it. It was a memorable experience to be part of the service, and Reverend Joan Riley should be acknowledged and thanked for facilitating it.
Finally, I personally thank the parliamentary secretary for disabilities. His presence at the forum, his meeting with the schools, his meeting with other community groups and his presence at the church service were very much appreciated by all of the people who were able to meet with him. In particular, they were most impressed by his commitment to and knowledge of the issues and the determination he has to address all of the matters that were raised with him.
I had not intended to eulogise the late Peter Howson, former member for Fawkner and Casey and first Commonwealth minister for Aboriginal affairs, because he had been so well commemorated by others, particularly the member for Higgins, but I find that his hand has reached out from beyond the grave. Over the weekend I belatedly read the January/February issue of Quadrant magazine, which contained an excellent, if provocative, article by the late member for Fawkner and Casey. It was a good summary of his critique of the last 30 years of Indigenous policy making—a critique which he had institutionalised in the Bennelong Society, which he co-founded with Gary Johns, and which has found at least partial support in the work of Noel Pearson, Warren Mundine, Marcia Langton and Wesley Aird.
Essentially, Peter Howson regarded the fate of Aboriginal peoples since the 1960s as a tragedy—a tragedy borne of sentimentality and largely misguided guilt. Up till then, he said, Aboriginal people, through education and employment, were gradually becoming full participants in modern Australia. Since then, he said, Aboriginal people had in many instances regressed into a separatist subculture marked by poor school attendance, high unemployment and high levels of domestic violence, with appalling consequences for their health and wellbeing. The essential problem, said Howson, was the view that Aboriginal people were different and should develop separately from the wider Australian community—a kind of benevolent apartheid based on a romantic conception of Aboriginal culture, notwithstanding that it had irrevocably changed in the wake of British settlement. I believe that Australia has been well served by Peter Howson in the parliament and also in his post-parliamentary life, where he used his status as a former minister to lend authority to a critique that was both shrewd and necessary.
It seems to me that Australia will best honour Aboriginal people and best acknowledge their place as the first inhabitants by extending to them the usual rights and responsibilities of Australians, in particular the responsibility to make a living or at least to seek work and make a significant contribution to their local community. In this regard, the Northern Territory intervention, with its emphasis on law enforcement and obligation keeping, should not be regarded as some kind of temporary interruption but as the overdue establishment of a measure of normalcy in places that were, in many instances, out of control.
In his final Quadrant piece, Peter Howson describes the now near universal practice of acknowledging country as a form of ‘self-abasement’. I should say that there are many circumstances in which it is quite fitting and entirely appropriate for this to happen, but it can easily in some circumstances become a self-affirming ritual for the right-thinking. If we are to acknowledge the original owners, why not also acknowledge all who have contributed to contemporary Australian society, starting with the Old Testament prophets? The best way to acknowledge Aboriginal people, for instance in this place, might not be through a traditional welcome but more through the presence of Aboriginal members of parliament in this chamber and in the Senate. In his final Quadrant piece, Peter Howson, I have to say, called on me to continue the struggle against the misguided policies of the Whitlam generation. I accept that challenge from the late member for Fawkner and Casey and hope that his spirit will not find me wanting.
Today I want to put on record my appreciation of a life that was tragically lost on Black Saturday. I do not mean to single out this one individual as somebody more noteworthy than the others of the 210 who have died, but he was a member of my constituency and I had the sad privilege of attending his funeral. Whilst I knew this constituent to wave to and say hello to, I did not know him well, and I feel that I have missed out on knowing a terrific human being—a great man whose loss will be felt by many. Indeed, many in this place knew Dr Ken Rowe. I want to give my appreciation to the member for Bradfield, who came and spoke so eloquently at Ken’s funeral, and to the Minister for Families, Housing, Community Services and Indigenous Affairs, who was also there on the day.
Dr Ken Rowe was an extraordinary human being—a great community leader; a phenomenal educationalist; a terrific father, husband and brother; and an all-round beaut bloke. He was very involved in the local community and will be sadly missed by the small but very active community at the Wattle Park Chalet in my electorate. Indeed, he was spoken of very lovingly as one of those characters whom everybody knew. His typical goodbye usually ended with, ‘How’s your love life?’ He was one of those larger-than-life characters whom I think we will all sadly miss.
Ken’s great contribution to our community was through his work as an educationalist. Ken was fervently of the view that education needed to be grounded in basic research and methodology. He railed against many things. He was admonished by many in his industry for being a bit too much of a straight talker, and he often sparked controversy, especially with his position on literacy and for speaking out against ‘postmodern claptrap’. He believed that quantitative methods should inform how we teach and how we instil education in our younger generation. Quantitative methods, quality teaching and the teaching of phonetics were among Dr Rowe’s passions. He was also a great researcher and expert on the differences between single-sex and co-educational education and schools, and he made a great contribution to the parliamentary inquiry in this place on the education of boys. He probably had a great life experience of that, having had three sons.
Ken Rowe’s last position was as a senior researcher with the Australian Council for Educational Research. He was also Principal Research Fellow and Associate Professor in the Centre for Applied Educational Research at the University of Melbourne and Senior Research Officer in the Victorian Department of Education. He was experienced as a teacher and principal in Victoria. Indeed, just about every principal I spoke to recently in Victoria knew him, having previously been to one of his lectures or read one of his papers. He was a visiting research fellow in the Netherlands, London and Canada. Ken’s substantive and methodological research interests included: ‘authentic’ educational and psychological assessment; multilevel, ‘value-added’ performance indicators and benchmarking; teacher and school effectiveness; and the differential gender effects in the context of teaching and learning at schools.
Ken was at his holiday home in Marysville—a place that he dearly loved—on Black Saturday. He said that it was a wilderness that many people did not know. He said it was a paradise on earth, and he spent many hours there researching and writing. Indeed, Ken often said it was a place that he wanted to die in. I do not think that he wanted to die in the tragic circumstances in which he did.
Ken leaves behind his phenomenal wife, Kathy Rowe, who is an outstanding contributor to our community as well through her work as a paediatrician. He leaves behind his sons, David, Andrew and Iain, and his grandchildren. He leaves behind a community who mourn his loss. I am terribly sorry that I did not get to know him better. One of the interesting things that I found out on the day of his funeral was that he was also a Vietnam vet—something he never spoke about. So he gave so much to this community.
We all will miss him, most particularly his family and those who worked with him. If it is not too unparliamentary, I thought it was great that at the end of the day he was often admonished for being a bit irreverent. When, in one of the last things he did, he talked about education in the media, his administrator said to him that saying ‘pissing in the wind’ about educational research was probably not the way to go about getting his message across. But that was the sort of character he was, and we will miss him greatly.
I want to take the opportunity of talking on two points in the couple of minutes that I have left. One is to endorse the remarks of the shadow minister for families, housing, community services and Indigenous affairs, the Hon. Tony Abbott, in relation to trying to encourage more Indigenous Australians to seek a life of service to our country through politics. I want to place on record that, of course, the first Indigenous Australian to come into this parliament was from Queensland. A great man, Senator Neville Bonner served Queensland and the Liberal Party with distinction. He considered his service in the parliament to be a great honour, and I certainly want to encourage all Australians who have a love of this country—not just those with an Indigenous background but indeed those from all walks of life and all backgrounds—to consider serving our country through coming into parliament. It is a great honour, and I know that it would be considered a privilege as well.
Queenslanders go to the polls very soon. I know that all Queenslanders living in the electorates of Mount Ommaney, Indooroopilly, Moggill and Mount Coot-tha—which fall within the federal seat of Ryan—will know very well that they have a very important decision to make regarding not only their future but the futures of their families and other Queenslanders. This Queensland government is bereft of ideas. It is bereft of vision. Bar two years of the Borbidge government, the Labor Party has been in power in Queensland for nearly 20 years, and we have all kinds of problems in Queensland. We know that the AAA rating of the Queensland government has now fallen over the cliff. It is time for a new era of competent government. It is time for a new era of stable government. It is time for a new era of Queensland leaders in George Street, Brisbane. I encourage all Queenslanders to place their faith in the leadership of Lawrence Springborg and his new team of LNP candidates, because they will deliver for Queensland what the current Premier, Anna Bligh, is failing miserably to do. It is time for a new generation of leaders and public servants in the life of politics in Queensland, and I know that all the candidates in Mount Ommaney, Indooroopilly, Mount Coot-tha and Moggill will certainly be working very hard to show that they have the credentials, the energy and the enthusiasm to serve their respective electorates. Certainly, I know that my colleagues here in the parliament will be doing all we can to remind them of the disastrous—
Order! It being 8.00 pm, the debate is interrupted.
The following notice was given:
to move—
That, in accordance with the provisions of the Public Works Committee Act 1969, the following proposed work be referred to the Parliamentary Standing Committee on Public Works for consideration and report: RAAF Base Edinburgh Redevelopment Stage 2, South Australia.
Imparja is allegedly a free-to-air satellite television service, one of a number of providers that make up the remote area broadcast service, better known as RABS. Imparja is predominantly beamed over Northern Australia and part of its service is in support of the domestic tourism industry. It is also relied upon by travellers who do not have access to the usual UHF and VHF signals.
With the current global economic downturn our domestic tourism industry is being seen as a vital economic component that can help to keep the wolves at bay. The domestic tourism industry in Northern Australia is comprised of road tourists. They are often referred to as the grey nomads, but more and more young people and their families are opting to take touring holidays in Australia. Families are the future for the industry. They are also the biggest camping group. This is only good news for an economy under threat.
In September last year Imparja decided to no longer provide access to satellite service to those viewers located outside the normal UHF and VHF reception areas. This decision means that the road tourists who relied on bulletins and information through Imparja do not have a viable alternative. During a fact-finding tour last year as the shadow spokesperson on road tourism, the importance of real-time information for road travellers especially in remote areas was made apparent to me. In early December of last year Imparja television announced that it would once again continue to offer its service to those viewers who are in an out-of-area reception area and travellers, albeit with a $55 fee. For those in an out-of-area reception area a one-off fee of $55 is payable and for those travelling around Australia a yearly fee of $55 is payable. To receive the service only new viewers in out-of-area reception areas are liable for this fee. However, all viewers who are travellers are liable for the yearly fee of $55.
Imparja television is supposed to be a free-to-air television channel and so by definition should actually be free of charge. I have two concerns at this state of affairs. Firstly, why is there a charge on a supposed free-to-air service? Secondly, given the government’s interest at stimulating our local economy to the tune of a possible $200 billion debt, why has this antistimulatory measure been allowed to go unchecked? The government must intervene to absorb this contradictory and counterproductive fee for those travelling Australians who I know from my own experiences rely so heavily on Imparja television and other satellite service stations.
Imparja threatens to open the door to charges for free services across the board. The minister cannot wash his hands by throwing the blame to commercial considerations. I am naturally worried that once the dust settles this practice may be adopted by other free-to-air television stations around Australia. The government must ensure that free-to-air television is actually free and absorb this unacceptable fee for a number of very good reasons.
I rise today to congratulate the terrific children who have been given the responsibility of being a school captain or holding a leadership role at the 49 primary and secondary schools in my electorate. Last week I was privileged to be invited to speak at special assemblies at two of these schools where I presented leadership badges and a certificate to each leader at these schools. On Monday I was at Maralinga Primary School in Noble Park with the principal, Peter Gray. It was a pleasure to meet the two new school captains, Rebecka Taseska and Hayden Bolin, who will no doubt display all the important virtues required of leaders in their final year of primary education.
I was also happy to replace Maralinga Primary School’s well-used flag and present the school with a new national flag to fly proudly in their playground. It was great to see so many parents present on a Monday morning to watch their children receive their leadership badges. Maralinga is a small school but one which possesses a big place in the hearts of the Noble Park community. Their assemblies need to be held outdoors and the principal, Peter Gray, spoke to me about his hope that they will be able to build a hall out of the $15 billion schools component of the Rudd government’s Nation Building and Jobs Plan. I hope so too because education is extremely important to us—these kids deserve the best.
Carrum Primary School has just commenced a $4 million rebuilding project funded by the state government. I was there on Thursday morning with Principal Alana O’Neil and a number of teachers, including Marcus Mulcahy, to present more than 20 leadership badges and certificates to students. They certainly have a large leadership group at Carrum Primary School who will no doubt help out the very dedicated teaching staff at the school. Carrum Primary has four school captains, in the areas of environment, sport, art and German, and it was great to meet Alayna Hansen, Jake Kelly, Hayley James and Lachlan Morris, who will be ably deputised for by Stephanie Davies, Chelsea Turner, Niki Onurlu and Ari Breitkreuz respectively.
It was wonderful to see both these school communities encouraging children to become leaders not just in their schools but in the wider community and to see parents and teachers fostering the children in these roles. I know that the state member for Carrum, Jenny Lindell, has had a great part to play in the development of Carrum Primary School and has particularly made sure that the very large rebuilding program—it is a complete rebuilding of the school—takes place this year. It is hoped that the rebuilding will be able to be completed by the end of this year or early next year. (Time expired)
I rise to welcome the news that the research laboratories within the Flinders Centre for Innovation in Cancer will be known as the Livestrong Cancer Research Centre after the foundation created by Lance Armstrong and with his support and agreement. At the age of 25, Lance Armstrong was already one of the world’s greatest cyclists. However, on 2 October 1996 Lance was diagnosed with advanced testicular cancer which had spread to his abdomen, lungs and brain. His book It’s Not About the Bike is a very powerful testament to his personal journey. Lance Armstrong has declared himself not a cancer victim but a cancer survivor. In one of the greatest comebacks of all time, Lance won the Tour de France in 1999 and subsequently won six more—seven consecutive Tours de France.
It is no exaggeration that Lance Armstrong’s surviving cancer has been an inspiration for millions, so it was particularly exciting that Lance made his second comeback in the Tour Down Under. I wish to congratulate the race director, Mike Turtur, and everyone involved with inviting Lance and encouraging him to compete. This year’s Tour Down Under was a tremendous success. It injected $39 million into the South Australian economy, more than double the amount last year. Total attendance was up 38 per cent, with 760,000 people attending, and total visitor numbers were 42½ thousand—again, more than double what they were in 2008. There is no doubt that the presence of Lance Armstrong was a huge factor in this. With my family, I was able to go to a street party in King William Road attended by 30,000 to 40,000 people and to trek over Willunga Hill so that I and my family—the children—could see Lance climbing Willunga Hill twice. With my wife I attended the Legends Dinner, which honoured Lance Armstrong, Cadel Evans and Shane Kelly.
So it is particularly exciting that now, in my electorate, the Flinders Centre for Innovation in Cancer will have research laboratories known as the Livestrong Cancer Research Centre. In 2007 I was able to announce that the Howard government would provide $10 million towards the construction of this centre. This is just another step along the way to seeing this dream realised for the Flinders Medical Centre, Flinders University and the Southern Adelaide Health Service. I would like to congratulate Professor Graeme Young, Dr Rhys Williams, Ms Deborah Heithersay and Mr Alan Young for their leadership on this project. I also thank Lance Armstrong for giving the name of his foundation, Livestrong, to the cancer research centre.
I rise today to pay tribute to the life of Victoria Yeboah, who, until the middle of last year, was a resident of Gladesville in my electorate of Bennelong. On 17 December last year, Victoria lost her long battle with cancer. Victoria Yeboah was born into the royal family at the Kwenyako community in Ghana, West Africa on 24 March 1975. In this community, the matriarchal magic of the queen was not the substance of ancient myth but a very powerful reality. The tribal elders guarded this in ceremonial and sacrificial ways involving human blood. Under her mother’s influence, Victoria converted to Christianity. This was an introduction that changed the course of Victoria’s life, the lives of her children and the community into which she was born.
After one of her sisters and husband were murdered, Victoria took flight and left behind the traditions so at odds with her Christian values. In 2003, Victoria became a refugee, and her journey across Africa to Australia is crowded with the assistance of strangers and the pain of struggle. Victoria found herself at the Asylum Seekers Centre in Sydney and later made a home at St Michaels in Baulkham Hills. During this time, Victoria met Camilla Galwey and an extraordinary friendship began. In 2005, Victoria was first diagnosed with cancer. Camilla, her great friend, helped care for Victoria’s youngest child, baby Davie, and the miracles of Victoria’s journey took another turn. The Sacred Heart Church community in Mosman in Sydney rallied together and provided Victoria with all the support that they could muster. Through the dedicated work of Advocate Immigration, Victoria was granted a special humanitarian visa in 2006. With the support of the group, Victoria was able to locate her four other children and another sister left behind in Ghana. The migration of Victoria’s children was made possible by many people, but particularly Jamie Henderson, Karen Middleton and Advocate Immigration.
I had the pleasure of meeting Victoria when she required assistance with her children’s migration during her time in my electorate. The large and the small miracles which occurred all around her are extraordinary examples of individual and community compassion. I had the honour of presenting Victoria and her children with Australian citizenship in September of last year. Needless to say, she was not well. It was a great pleasure to share the joy of their reunion with all of the children and the joy of shared citizenship. A prouder and more grateful recipient I have yet to meet.
Victoria had the wonderful ability to touch the hearts of everyone she met. She had a talent for friendship, a gentle wisdom, quiet strength and an insatiable hunger for knowledge. Her determination for change made her brave beyond compare. As five little pieces of Victoria Yeboah grow in safety into Australian citizens, I marvel at the gift that she has left across two continents. (Time expired)
I rise this morning to speak about something that is of particular importance to not only my rural electorate of Indi, in north-east Victoria, but also all rural, regional and outer metropolitan areas: health and the review that is currently being conducted into the RRAMA classifications—the rural, regional and metropolitan area classifications. I called on Prime Minister Rudd and the Minister for Health and Ageing to ensure that this review into the rezoning of rural areas will not rob rural and regional areas of their particular status that allows them to attract doctors, nurses and other professionals by providing subsidies as an incentive to go to those particular rural and regional zoned areas. We all know that health is not only an important part of the infrastructure for particular towns or regions; it is essential. It is a basic need. It is far more difficult to attract a specialist or a GP to a particular country town than it is to attract them to a particular suburb in inner or middle Melbourne, Sydney or other capital city. We all know that, and that is why the previous government had a very proud record of ensuring that the problem was solved not with rhetoric but with real dollars on the table. This classification system allowed areas to be classified according to need and thus be given proportionately more subsidies to be able to attract those doctors.
We have heard from the Rural Doctors Association who have warned us that if there are deleterious changes to the rezoning system we will see an exodus of current doctors, a decrease of incentives for young doctors and young specialists to train in the bush and, obviously, possible closures of a lot of small regional hospitals. It is hard enough as it is, even with many of the incentives introduced by the previous government, which I had great satisfaction in joining with many of my rural and regional colleagues in lobbying for, to attract and provide incentives under the current system, let alone with any other changes. I will oppose, and the coalition will oppose, any changes that decrease the number of doctors and nurses in rural and regional areas. It is telling that, at a time when we have an ageing population and we have these concerns, nothing in the $42 billion package is directed to health, particularly to rural and regional health.
I rise to acknowledge the outstanding work of the Penrith City Sub Branch of the National Servicemen’s Association of Australia. I have the great honour of being the patron of the sub-branch. The nashos hold a special place in the history of the Australian defence forces. They are the 290,000 young men who were called up to undertake national service in the Army, the Navy and the Air Force in the period between 1951 and 1972.
Between 1951 and 1957, all 18-year-old men were called up for national service, undertaking an intensive training regime in the Citizens Military Forces. Between 1957 and 1959, the numbers of men called up were reduced, and a quota system based on birth dates was introduced. Many of the nashos called up between 1951 and 1959 enlisted in the regular forces and saw active service in Korea and Malaya. National service was suspended in 1959, but, following Australia’s military commitment to the Vietnam War, it was reinstated in 1965 and continued until Australia’s withdrawal from Vietnam in 1972. In this period, young men were called up under a ballot system similar to that which was introduced in 1957. Many of those nashos called up between 1965 and 1972 served in overseas theatres of war, with around 200 dying in Vietnam.
It is a stain on the fabric of our national story that many of our servicemen, including our nashos, returned home to a less than welcoming Australian public, with many people, regrettably, taking out their anger over the politics of the Vietnam War on those who risked their lives in service to their country. Whilst decisions to commit Australian troops to battle will always—and, in a strong democracy, should always—be a legitimate matter of rigorous public debate, we must never again allow differences of opinion over a decision to send Australian troops to war to prevent us from recognising the sacrifices and honouring the contributions of those who have gone to war in defence of our freedoms and our values. Thankfully, the nashos are now properly recognised for their dedication and commitment to the defence of Australia, and, in 2001, the Anniversary of National Service 1951-1972 Medal was introduced.
The Penrith City Sub Branch of the nashos are a vibrant group, who, for the last seven years, have been a source of support and strength for their members. In particular, I would like to acknowledge the contributions of President Harry Moorfoot, Secretary John Taylor and Treasurer Tom Kelly.
Earlier this month, I attended the third anniversary of the laying of the national servicemen’s memorial at Victoria Park in St Marys. I was honoured to stand with the nashos of the Penrith sub-branch that day and recognise their important contribution. The motto of the National Servicemen’s Association is ‘Proud to be a nasho’. I would like to say that we, as those who have benefited from their service to our country, are proud of our nashos, and I am proud to be the patron of a wonderful group of dedicated and patriotic Australians. (Time expired)
I call the member for Cowan. You’re pushing it!
On previous occasions in parliament I have spoken about the need to increase personal responsibility. Today I would like to make mention of a Cowan community organisation that is in every way an example of community strength and whose members believe in personal responsibility. I speak of the longest-running police ranger unit in Western Australia, the Ballajura Police Rangers, based at Ballajura Community College and operating since 1995. The Ballajura Police Rangers are an award-winning unit—award-winning as a ranger unit and for being a positive influence on our community. Collectively they won the best drill competition for ranger units in Western Australia in 2006, they were the best unit of rangers in 2007 and they won the Rotary Club of Perth community service award in 2008. Recognition has been won for their assistance in cleaning up on Rottnest Island, for assistance at the Malaga wildlife refuge, for fundraising for the Friends of the Bibbulmun Track and for fundraising for the Princess Margaret Hospital for children.
Each week will see 40 to 50 of the college students taking part in drill, first aid, leadership activities, community service, navigation and bushcraft. The unit is run on a volunteer basis, and I would like to acknowledge the work of those dedicated adults: firstly, Raymond Roberts, the unit coordinator and a teacher at the school. Raymond has filled that role since 1995. He is a recipient of the WA state government’s Cadets Western Australia Long Service Medal, and he is the author of current WA police rangers training manuals. It is through Raymond’s work that ranger skills across Western Australia have been recognised for credit in year 11 and year 12 subjects. I also acknowledge Senior Constable Grant O’Neil, an instructor since 2001; Alyssa Dawes and Joanna Waroczyk, both teachers and in their first year as instructors; Ross McMullan, a former ranger senior sergeant, twice awarded unit ranger of the year, who graduated from the college in 2004 and is in his fourth year as an instructor; Aimee Retallack, a former ranger sergeant who graduated in 2006 and is in her third year as an instructor; and Courtney Hunt, a former senior ranger who graduated in 2007 and is in her second year as an instructor. The training instructors are Alan ‘AJ’ Davies, twice awarded unit ranger of the year and named state ranger of the year in 2007, who graduated last year; Shanae Spencer, a former senior ranger and unit ranger of the year in 2008; Cory Crew, a former senior ranger; and Michael Drayton, a former senior ranger. I would also like to congratulate 2009 ranger sergeant Ismail Ziba. Ismail is a year 12 student and in his fifth year of being a ranger.
Last time I was down at the college, a week ago, I saw that the rangers had just finished their evening parade. They were very well dressed in dark blue polo shirts, with instructors in a white version. They looked smart, and it was clear that they held great pride in their unit and what they were doing. As I said at the outset, I believe in community strength and personal responsibility. Through excellent organisations such as the Ballajura Police Rangers, led by dedicated and committed leaders and filled with enthusiastic and community focused young people, we are right to believe in a stronger and more positive community. (Time expired)
I call the Parliamentary Secretary for Disabilities and Children’s Services. You would all be in trouble if I actually applied the time rule.
I wish to draw the chamber’s attention to an ongoing problem with the coverage of disability services in Australia. There continue to be wide areas of disparity and inequity in the availability of care and support for people who suffer or have sustained a catastrophic injury. Each year approximately 800 Australians are catastrophically injured to the extent that they require lifetime care and support. Predominantly—more than 95 per cent—they are people who sustain traumatic spinal cord or brain injury. This catastrophe impacts not only on the lives of the injured but on the lives of their families, who are often left to care for them. As a brain injury manifests itself in combinations of physical, cognitive and behavioural impairments, the challenges and sacrifices confronting families—in some cases, ageing parents—can be immense.
The causes of injuries can be covered by some of the state and territory compulsory accident compensation and liability insurance systems, which cover motor vehicle, workplace, recreational and sporting accidents; medical incidents; and assault. There are inconsistencies, however. The states absolutely do the best they can with the systems that have grown over time, but there are inconsistencies in benefit structures and arrangements between schemes and across jurisdictions, resulting in some of the 800 people being injured every year having appropriate lifetime care and support services, others being awarded multimillion dollar common-law lump-sum compensation payments, but others receiving nothing. Some of the injury types are also significantly under-represented in government funded schemes, and hence many miss out on care through the welfare system. Others double dip into welfare when their lump-sum compensation is exhausted.
In essence, we have a problem and a challenge in this country: that the nature of the injury is not what determines the adequacy of care—it is the manner in which the injury is incurred. I do believe that this nation has very good standards of workers compensation for people injured at work, and systems that are nearly as good for motor vehicle compensation. However, with some other injuries—which are all too common, be they sporting or recreational injuries, injuries to victims of assault or, indeed, injuries arising out of medical procedures—there are too many people who, although they incur the same injuries as people in those earlier categories, because of the manner in which they have incurred the injury, actually do not receive the same care. I believe that this is an appropriate matter to be addressed in a coordinated way across all of the states, and I do hope that in the future we are able to develop a proposition which sees us improving the standard of care for all people, based on the nature of their injury and not on the manner in which they incurred their injury.
I rise to condemn the actions of the National Australia Bank in placing all of Warley Hospital’s assets on Phillip Island up for sale on a forced basis. Warley Hospital had a proud, 90-year tradition of being supported and funded by, and of serving, the people of Phillip Island and those who visit the island. That hospital had a bright future. Sadly, it was forced to close a year ago, following the decision of the incoming Rudd government not to match the Howard government’s $2.5 million rescue and recovery plan for Warley Hospital. We have previously discussed that decision. I believe that that was a tragic error of judgment and a mean-spirited act by the new government which condemned the island to the loss of a vital community facility. However, the assets remained. The island is committed to ensuring a healthy future for its people, with a locally owned, locally managed, locally run hospital service committed to the people of Phillip Island.
Sadly, the National Australia Bank has moved to sell all assets, and the advice I have is that it has placed the entire assets of Warley Hospital on the market, when only a portion of those assets would be needed to be sold to cover outstanding debts. The National Australia Bank, I am advised, has been the banker for Warley Hospital since 1926. What I think is extraordinary is that the bank has taken these actions; it is destroying these assets, and it is doing so in a way which risks their value and which takes funds out of the community and makes it much harder for the community to have an independent hospital owned by the community. I clearly, absolutely, categorically condemn the actions of the National Australia Bank. They should rethink their actions. They should be part of a future for the Warley Hospital. This is community vandalism. If, in any way, ACCV has been a party to forcing this sale, then they should be condemned unequivocally.
What we need now for Phillip Island is twofold: the federal government must step in and provide the money which was pledged by the previous government to Phillip Island, to the support of hospital and emergency services and to an independent, stand-alone facility for Phillip Island, and, in addition, the National Australia Bank should stop, desist, apologise and work with the Warley Hospital board for a Warley Hospital future for Phillip Island.
The New South Wales RTA, in conjunction with Cricket New South Wales, ran a competition in late 2008 inviting cricket teams to submit entries comprising photos and a slogan of no more than 25 words which disapproved of speeding—part of their ‘Pinkie’ campaign. Revesby Workers B Grade (1) team won the competition, with first prize being a Twenty20 match at the Sydney Cricket Ground against the RTA SpeedBlitz Blues. ‘Don’t be a fool and speed like a tool, save the speed for the game, nobody gives a full toss about people who speed’ was the successful slogan.
The match took place on a fine and sunny day at the SCG on Wednesday, 4 February. In excess of 100 spectators were there to support the players. The players were taken on a tour of the SCG and out on the field to examine the pitch and meet curator Tom Parker who has a son playing mini cricket with the Workers. On returning to their dressing room, New South Wales Captain Simon Katich came to introduce himself. He had flown in from the Allan Border Medal awards ceremony, held in Melbourne the previous night.
The Speedblitz Blues players came out to meet the other players and there were short speeches. It was an exceptional experience for the team, which was led by captain for the day, Jason Tomkins, who was the motivator in submitting the winning entry for the competition run by the RTA and Cricket New South Wales. The Speedblitz Blues got 5 for 262, with the Revesby Workers Club 4 for 119. They were never expected to win, but it was a great experience for the side. Wicket takers for the Workers were J Tomkins, 1 for 36, C Jurgeit 1 for 23, and M Benham 3 for 40. The main scorers for the workers club were M Benham, 21; B Dippert, 25; M Hibbert, 32 not out; and J Tomkins, 24 not out. It was a great day for everyone. I congratulate everyone who was involved with it.
Order! In accordance with standing order 193 the time for constituency statements has concluded. I thank the member for his adherence to the time rules; I am very impressed!
I would like to welcome to the Main Committee today participants in the inter parliamentary study program. I warmly welcome you and thank you for coming and visiting our small chamber and for sitting through the entertainment that is members’ statements. Thank you very much and all the best with your participation in the course.
Hear, hear!
Debate resumed from 24 February, on motion by Mr Tanner:
That this bill be now read a second time.
Before debate is resumed on this bill, I remind the committee that it has been agreed that a general debate be allowed covering this bill and Appropriation Bill (No. 4) 2008-2009. I call the honourable member for Lyons.
A number of issues are contained in Appropriation Bill (No. 3) 2008-2009. The bill looks at various changes in funding for a range of programs that require changes since they were first announced, including amendments to names and amounts allocated. My interest is with the superclinics in the health sector, which may be the key to commencing the changes needed in health delivery in Australia. Additional funding is being allocated amounting to $33 million to provide up front capital grants and recurrent funding for the establishment of 31 GP superclinics around Australia and to provide incentive payments to GPs and allied health providers to relocate to those clinics. So far, one of those has been allocated in the seat of Lyons in my electorate in the growing town of Sorell in south-east Tasmania.
We all know that there is a shortage of doctors in Australia. We also all know that doctors prefer to be based in the cities rather than in regional areas and that ways to attract them out of the cities usually only work for a limited time. So we have to resort to recruiting from overseas. According to one of the doctors in Lyons, Oatlands GP Dr Robert Simpson, there is a shortage of 1,500 doctors and 5,400 nurses in regional and rural Australia. Why is this so? Well, according to a well put together article in the Tasmanian Examiner, isolation, financial incentives and family issues are just some of the factors that make medical jobs in rural areas hard to swallow. Danielle Blewett has been putting in time searching out health statistics, as she knows that Tasmanians are not getting the best out of their health system. According to Danielle, in rural Tasmania there are 180 general practitioners, of which 35 per cent are overseas trained. They come mainly from Nigeria, India and Sri Lanka. Let me say, they are most welcome. They stay for a minimum of two years. In the past we have had overseas trained doctors mainly from the UK and South Africa, and they have often migrated rather than just come for a few years. There were 26,212 GPs and other medical practitioners billing Medicare in Australia in 2007-08. There were 18,613 GPs and others working full time in Australia.
Compared with their metropolitan counterparts, GPs in rural and remote areas spend more of their time working in local hospitals, for which they are not paid through Medicare. These are real barriers to the recruitment of Australian doctors to work in rural areas. The most likely person to consider rural placement is someone near retirement who wants to work part time, an overseas doctor, or locums who want to work for no more than a few months as a relief to keep their hand in or get close to the beach.
The shortages are causing huge problems. These doctors, who are still in rural areas and have been for many years, are concerned about succession planning. Janelle quoted the case of the doctor in Tasmania—in Lilydale, which is just north of Launceston—who has been in her practice for 25 years. She is concerned that, once she retires, her town would no longer have a full-time GP and, even if they moved closer to Launceston, they would not be able to get into a doctor as most have closed their books to new patients—a very common theme in Tasmania. We can only try and fill vacancies through overseas doctors, many of whom do not have complete grasp of the English language and are not used for the sorts of cases presented. Another local doctor who has been there for some time is also concerned that rural doctors are still operating their practices in an old-fashioned way, where they are responsible for all the paperwork required for the practice as well as employment and other ordinary day-to-day office procedures—record-keeping and running the business. Today’s doctors seem to want to walk into a job and just deal with patients, deal with the health issues and not have to keep the records and be on call 24/7. He is not assisting recruiting in country areas—the old-fashioned doctors approach.
One of my old doctors, a city doctor in Hobart, complained that he could not get a partner because they did not want to do the paperwork that he did. They just wanted to do the medical work, but nothing in the way of pen pushing. So, the problem is that the delivery of health services is changing, but somehow the funding models, Medicare and doctors’ training is not. In two of my small towns a succession plan is being developed to ensure that the area has doctors in the future as there are doctors on the verge of retirement. Suggestions are being made now as to how to deal with this dilemma, which is a quite sensible approach that is not being done in many areas that I can see. Dr Simpson from Oatlands asks why we cannot see a move from the urban based practices to form alliances with rural practices to broaden the depth of experience of their staff. It seems a very good idea, so we are starting to broaden out the opportunities for doctors to work in those rural and regional areas.
Difficulties face country towns where private practices are operating public hospitals. It is noted that not many doctors, town or country, want to set up in private practice these days as it reduces their options to move further down the track. The Tasmanian Farmers and Graziers Association has also pointed out that the crisis of finding doctors is further exaggerated by changes to the rules applying to overseas doctors wanting to work in Australia. They must now pass the Australian Medical Council’s examination before they arrive here, whereas in the past they had been able to sit the exam while working here. I have had my differences with the Australian Medical Council on that issue. I understand that this might be a response to some of the difficulties caused by the entrance of some doctors of dubious training, but it does not help to put more barriers in the way. It has considerably slowed down the number of overseas applications.
The development of centres that put together a number of health professionals—doctors, nurse practitioners and practising nurses along with other services—all organised by a single office makes a lot of sense. All the paperwork and all the business can be done in one corporate centre. That is behind the idea of the superclinics, which are being developed around Australia at the moment. Getting all these services together and modernising their work environments has got to be an attractive prospect for prospective doctors looking for work sites. There needs to be backup, proper rosters, simple hospital referrals, community transport to get patients to hospital quickly when needed and access to referrals to specialists et cetera. Community transport is vital in this area, especially for the aged. This means getting services together—something that has been resisted for some time. It really needs doctors working together to achieve a common goal. Working in teams in a community similar to the way hospitals are set up seems to be a logical approach for the future, but so far it has been unachievable.
I am very keen to see our superclinic up and running at Sorell. I want to see how the model works and I want to encourage others to apply for similar types of developments. I have had some other developments in my electorate of Lyons. I know the member for Hume, who is sitting opposite, would have experienced similar difficulties with doctors in his electorate, a rural electorate in New South Wales. In the St Helens area, the GP and allied health workers have come together. They are situated in a new building. I think it cost about $1.2 million—about $400,000 of federal money and the rest from loan funds. GP North, the local division of GPs, backed that, and now we have an extremely good centre where health professionals are very happy to work and practise medicine. They also have a very good home situation for training doctors who have access to the internet and modern communications. That is certainly the way forward.
It was in the old days that a suburban house that would have accommodated a family was converted into doctors’ rooms. I have several of these old places in my area that are falling to pieces and are unpainted. They are a very unpleasant workplace for anybody. If you ask a young doctor or an overseas trained doctor to go to that sort of site to practise medicine and look after the health needs of the community, I can understand why they say they are not interested in doing that. We need to make sure we are modernising health services. The new model of service delivery for rural and regional Australia has to be provided in a bigger centre where all the health professionals are together and can share their experiences, and where they have a decent workplace in which to deliver primary health services.
In the New Norfolk area, Commonwealth money will help renew and expand the GP centre, which will hopefully work along the same lines as the one at St Helens. The people of the Derwent Valley deserve no less and also of course all those who live in areas off that valley. The Derwent Valley is the big catchment area for the Derwent River, which of course opens out into Storm Bay at Hobart.
This is the way forward. The present government is endeavouring to go down that track. It is putting money into superclinics, which are certainly going to be the way forward. I do not see why we cannot renew health delivery for primary health care in a positive way through these sorts of centres. I can see that it will be much easier to deliver preventive health and preventive health programs in rural and regional areas with these sorts of centres, where we have access to health professionals working together where they can discuss and work out programs, and which the federal government will most probably be funding into the future.
I am very pleased to be able to speak on this appropriation legislation and I commend the legislation to the House.
I rise to speak on Appropriation Bill (No. 3) 2008-2009 and Appropriation Bill (No. 4) 2008-2009. I would like to start by stating the obvious, that Australia, as we all know, is not immune to the global financial crisis and neither are the people living in my electorate. Over the course of the last few months, like all of us, I have been asked questions about the global financial crisis—questions about its cause, questions about its duration and, above all, questions about its effects. Although discussions about answers to these questions will continue, what is critical and pertinent is how we as the government respond. This government has responded very swiftly and decisively to the impact of the global financial crisis, aiming at every point to protect the Australian economy and the Australian community.
Our first response was, of course, through the first stimulus package, the Economic Security Strategy, which came into effect on 8 December 2008. This was a package that saw $4.9 billion go towards assisting pensioners. There is no-one in this House that would not be fully aware of the hardship that our pensioner community has sustained, and none more so than my pensioners in my electorate. I can tell the House that my pensioner groups were very clear about their struggle to make ends meet. I therefore challenge anyone to suggest that this $4.9 billion package, which involves giving single pensioners a lump sum of $1,400 and coupled pensioners a lump sum of $2,100, was a waste of taxpayers’ money. The extension of the First Home Owner Grant scheme to help those wanting to purchase their first home has been enthusiastically welcomed by many in my electorate who otherwise would have remained unable to enter the housing market. As the Minister for Housing said in question time yesterday, this initiative has already yielded encouraging results with nearly 30,000 Australians having taken up the first home buyers grant. Volumes of sales in my electorate of Calwell, and specifically in the suburb of Craigieburn, have gone up by 25 to 30 per cent.
The Rudd government will also invest $187 million to create 56,000 additional training places, an initiative aimed at doubling the Productivity Places Program so that we can strengthen productivity and protect the Australian economy. This takes the government’s total investment in training places to more than $400 million since April 2008. This particular measure will be of immense benefit to those in my electorate who need assistance with entry into the workforce either for the first time or following some retraining. The people in my electorate are very worried about the security of their jobs. They are worried about their ability to meet their mortgage commitments and to meet the demands of their family budgets.
People in my electorate come from a very diverse social and economic background. Calwell, as I have said many times before in this House, is home to a high number of families, to sole parents, to low-income earners, to single income earners, to carers, to age pensioners and to people on disability pensions. My electorate is also home to many tradespeople and low-skilled employees, and we rely heavily on the manufacturing sector for jobs. We have seen far too many jobs lost in Calwell over the last 18 months, particularly in the automotive and textile industries.
It saddens me to inform the House that this morning I heard that Pacific Brands—the manufacturer of Bonds, King Gee, Holeproof, Yakka, Sheridan and Dunlop Volleys—announced the closure of its clothing manufacturing facilities in Australia, with the intention to shift to global sourcing. A total of 1,850 jobs, including 1,206 direct manufacturing jobs, will be lost nationally. In my electorate, in Coolaroo, Broadmeadows and the Craigieburn area, 298 jobs will go as of February 2010. Pacific Brands attributes this to what it calls a ‘debt reduction strategy’ as a consequence of the global financial crisis and long-term unviability of manufacturing in Australia. I certainly hope that this is the case and that companies are not just using the global financial crisis as an excuse to shift jobs offshore in search of cheaper labour. I and my constituents have no choice but to take Pacific Brands at its word. But, as you can see, a large number of Australians are going to be left without an income and will need to be retrained in order to re-enter the workforce. Hopefully the retraining package that I referred to earlier on will be of assistance to my constituents who face this latest round of job losses.
Calwell has two major growth corridors. This growth has brought with it an influx of young families with hefty mortgages. Financial counsellors in the various local welfare agencies began sounding alarm bells some 15 months ago as they experienced record levels of people seeking their advice and assistance. People had gotten themselves into so much debt and credit card debt that they were unable to meet repayments and ran the risk of being unable to feed their families and keep their homes. That is why, when it came to making practical decisions to help working families to balance their budgets and stimulate economic growth, the Rudd government delivered $3.9 billion to families raising children. This support was given to families who receive family tax benefit part A through a one-off payment of $1,000 for each eligible child in their care. Families with dependent children who receive youth allowance, Abstudy or a benefit from the Veterans’ Children Education Scheme also received a one-off $1,000 payment.
The appropriation bills we are debating today have gone a long way to assisting my community, because my community has been a beneficiary of them. In fact, it is estimated that some 44,000 households have directly benefited from this package. Appropriation Bill (No. 4) allows for our $300 million Regional and Local Community Infrastructure Program to be directly allocated to individual councils. I can report that my council, the Hume City Council, has already compiled a list of projects it has put forward, and I have already met with the mayor and the CEO to help move that agenda forward. Our council is very excited about the opportunities that have been made available by the federal government and is looking forward to meeting the challenges. Our council has received $1,627,000 under the program. That is the sixth highest figure in the state and a good indication of the level of need for infrastructure works in my electorate.
The top of my council’s list—and I would like to outline that list; I am sure they would be chuffed with this—is a $9 million Craigieburn library and learning centre, an important piece of infrastructure in a suburb that has experienced phenomenal growth. I referred to that ongoing growth in the figures that the Minister for Housing announced yesterday in relation to the First Home Owner Grant scheme. If you bring young families into new housing estates, you need to attend to their social, educational and recreational needs. This particular facility is an extension of the iconic Hume Global Learning Centre in Broadmeadows. I am very pleased that the council is keen and committed to establishing an outpost of the Hume Global Learning Centre in Craigieburn.
The council has also sought approval to build a car park on the western side of Progress Reserve in Coolaroo, a footpath along the Hume Highway between Fordson Road and Somerset Road, stage 1 of the shared footpath and bike path along Merri Creek from Western Ring Road to Barry Road in Campbellfield and an extension to the Gladstone Park Bowls Club and to design and construct a state park in Broadmeadows and work on the Sunbury town centre streetscapes on the east side of Evans Street. The council also wishes to build two extra courts at the Greenvale Tennis Club and a new outdoor netball court at Broadman Reserve, with training lights for the rear oval at Langama Park. As you can see, all are works for the direct and overall benefit of our community, in particular our young people’s learning and recreational activities.
The Rudd Labor government has risen to meet the most difficult economic challenge of our time, and it has resolved to do everything it can to help limit the worst impacts of the global recession in this country’s future as it navigates through what many are predicting will be a long period of hardship and uncertainty. It goes without saying that today’s announcement by Pacific Brands, for my electorate and for those of many other members of this House, will be an ongoing, rolling experience of job losses that need to be addressed by this government. This government is doing that, and I can only commend the bills to the House. I certainly hope that, in the next 12 months at least, my electorate in particular will not be the recipient of further bad news.
There can be absolutely no doubt that in recent months—indeed, in recent weeks—the global financial crisis has entered several dangerous phases which have had inevitable consequences for the Australian economy. That is why it is imperative that the Rudd government stays one step ahead by initiating serious solutions rather than giving knee-jerk reactions to serious problems.
Responsible governments around the world have acted in these dangerous and uncertain times to secure industries, to secure jobs and to ensure that their respective countries are prepared to make the most of economic opportunities once they present themselves. Domestically, this is not possible if steady hands and rational minds are unable to restore confidence in Australian markets, which have also been battered from pillar to post by the global financial crisis. In an article titled ‘Herd instinct rules in the circle game’, Ross Gittins states:
… humans are herd animals. We’re heavily influenced by the mood of the people around us, so feelings of optimism or pessimism are contagious. We all tend to be optimistic at the same time, then swing to pessimism at much the same time.
Often it’s not easy to pinpoint—
what—
caused the herd to change direction but we can say that the general mood at any point tends to be self-reinforcing, so that when consumers and businesses swing from optimistic to pessimistic, they won’t be swinging back to optimistic … soon.
The role of government in addressing consumer and business sentiment or confidence takes on enormous importance, given the scale of the global financial crisis, its unprecedented nature and the rapidly unfolding events overseas. The contemporary role of government has also taken on increased significance in the light of the obvious failures brought about by lax regulation and disinterest by the state.
I commend the Treasurer and the Prime Minister for taking swift and decisive action to address shortcomings that have originated from poorly regulated global markets and to restore confidence in our own economy. Nowhere was this more apparent than in the government’s swift commitment to the banking sector, which globally has had to bear the brunt of much of the crisis. Rather than stand idly by and allow the legitimate concerns of Australians about confidence in their deposits to go unaddressed, the Rudd government acted.
It is true that the Australian banking system is strong, has demonstrated its resilience to the turbulence overseas and is well capitalised. Our regulations and regulators are first class. We have long benefited from a framework of regulation which balances financial safety and efficiency as well as competition and competitive neutrality, yet the government was aware that it could not view the position of our banking sector through this narrow prism.
The risk of consumer sentiment changing direction without warning is always of pre-eminent concern. Uncoordinated international announcements could, for example, have had the potential to destabilise the Australian banking system if prompt action were not taken domestically. It would not have been hard to imagine the serious risk of an outflow of capital away from the unsecured Australian banks to foreign financial institutions with government guarantees. The stability of Australia’s financial system and our institutions’ ability to attract new funds for investment in the Australian economy were very real considerations. Rather than allow first-class Australian banks to be discriminated against by foreign government backed institutions with potentially poor balance sheets, the Rudd government acted rationally and immediately.
That is why I am proud of the government’s guarantee for all deposits in Australian banks, credit unions and building societies. When coupled with common-sense regulations and credible regulators to whom appropriations will be made by this legislation, the public’s confidence in Australian financial institutions was not going to be compromised. This was a clear demonstration of decisive government action and appropriate intervention being used to stimulate consumer and business sentiment. It was also a clear demonstration that the era of unbridled, neoliberal, free-market fundamentalism has no place in Australia. As the Prime Minister has quite rightly pointed out, the global financial crisis has proven that:
… it falls to social democracy to prevent liberal capitalism from cannibalising itself.
While it would be easy to throw the free-market baby out with the bathwater, doing so is premature, unjustified and unhelpful. Just as the excesses of the Right have caused much of the destruction we are seeing in today’s markets, an extreme reaction to the Left and the notion of an all-pervading state is an experiment that has been had and is best forgotten. There is still much value in the productive capacity of well-regulated, competitive markets coupled with appropriate government intervention.
The Labor Party, the party of social democracy, has long stood for promoting the productive capacity of competitive markets, rebuilding confidence in markets when necessary and protecting individuals that are invariably left behind. The legacy of the Hawke and Keating governments should not be understated in this context. It also should come as no surprise that the Rudd government is working around the clock to rebuild domestic demand as well as to ensure that domestic and global markets are appropriately supervised. Much has already been said about the government’s $10.4 billion economic security strategy package to stimulate the economy by providing one-off payments to Australians who are most in need as well as boosting the first home buyer grant. The strategy provided support against the impact of flat domestic economic activity by targeting the people most likely to drive consumer spending as a result of the one-off payments.
More recently, the government announced its $4 billion partnership with the banking sector to finance office buildings, shopping centres and other commercial property projects. Because of the weakening demand and the tight availability of credit, almost 50,000 direct and indirect jobs are under threat in this industry. The risk of nonintervention by the government was best summed up by the AMP chief economist when he stated:
The alternative, unfortunately, would be more job losses and corporate closures.
The government announced its most recent stimulus package, the unprecedented $42 billion Nation Building and Jobs Plan, a couple of weeks ago. This is on top of the $4 billion nation-building package, the $12 billion Building Australia Fund and prior commitments to skills training and an education revolution. By combining immediate cash payments with an investment in longer term drivers of productivity, the government’s stimulus packages strike an appropriate balance between immediate support for jobs now and delivering long-term investments for future economic growth. The many initiatives in the Nation Building and Jobs Plan alone will provide a boost to economic growth of around half a per cent of GDP in 2008-09 and around three-quarters to one per cent of GDP in 2009-10. No-one could possibly argue that free markets should be left to wreak havoc on the Australian economy without government intervention. Concomitantly, no one could accuse the Rudd government of complacency in this context.
The temporary costs of these initiatives are a small price to pay for the security and confidence that will be provided for Australian industries, Australian jobs, Australia families and the Australian economy. With that in mind, the bipartisan support of these initiatives ought to have been a fait accompli. However, the opposition’s track record throughout the crisis has left much to be desired. We will long remember the shameful attacks on the Secretary to the Treasury, Dr Ken Henry, during debate on the government’s bank guarantee proposal. We all remember the opposition’s disgraceful claims that the Treasury growth forecast had ‘the whiff of manipulation’ about it. We remember the opposition bombarding Dr Henry with frivolous suggestions for six hours in Senate estimates, when Dr Henry’s time would have been better spent talking to bank chiefs about the banking guarantee. We all know that Dr Henry is one of Australia’s pre-eminent public servants. He has been held in the highest regard by both sides of politics and the business community. He did not deserve the misguided attacks on him by an opposition seeking to score a cheap political point in a time of crisis. We had hoped that the opposition would refrain from making further cheap political points during the global economic downturn.
No doubt members of the business community would be feeling the same way. While commenting on the government’s banking guarantee in October 2008, National Australia Bank chief executive John Stewart said:
It is unfortunate that this process has been so highly politicised ...
He is not wrong. The government’s stimulus package, like its banking guarantee, deserves the full support of the opposition, free of the usual political pointscoring. The packages are far more important for the national interest than the opposition’s short-term political interest or anachronistic ideological obsessions. Unfortunately, it has not taken long for the coalition’s ideological obsession to rear its ugly head.
As we now know, the Leader of the Opposition stood in this parliament in the middle of the global economic maelstrom to baselessly attack the Rudd government’s numerous stimulus packages. He continued his misguided attacks on the government’s deposit guarantee. He could not resist the cheap political shot of pleading against deficits for the sake of our children. He described the government’s $10 billion Economic Security Strategy as ‘ill considered’ and ‘ill thought out’. This is despite retail figures showing that sales skyrocketed 3.8 per cent in December compared with November. If the opposition leader’s attacks were anything other than an attempt to cling to the last vestiges of neo-liberal economic thought, he would have presented a detailed alternative vision of strong government intervention. We would have seen attacks grounded in fact and current economic orthodoxy. The fact that we did not speaks volumes about the nature of the opposition leader’s pious attacks.
Several things are now clear: (1) the coalition has no alternative plan, no alternative solution, to the crisis that confronts us, (2) the coalition is still stuck in the quagmire of discredited economic orthodoxy from another age, and (3) you cannot trust the coalition to guide us out of these dark economic clouds, because they have a natural aversion to economic stabilisers. They would rather pontificate on the sidelines while the market spins wildly out of control. This approach is not only unwise; in my view, it is extremely dangerous. It is tantamount to committing economic suicide. The opposition would do well to listen to the many families and community groups that are crying out for more support, particularly in my electorate of Lowe. They would also do well to observe the advice of the Business Council of Australia, the Australian Industry Group, the Property Council of Australia and the International Monetary Fund—all of whom have applauded the government’s handling of this crisis.
Market libertarians are no longer justified in making an argument against public spending and intervention or against better regulation and closer supervision. That said, we cannot allow the world to return to protectionism under the guise of stimulating domestic demand and consumption. Australia’s fate is inextricably linked to that of the other world economies. The continuing financial crisis has provided a pertinent reminder of just how closely the world’s major economies are linked. Six out of Australia’s 10 largest trading partners are already in recession, and that has clearly contributed to the $115 billion hole in Australia’s budget. Opening the door to global opportunities also means exposure to global risk. However, this crisis does not warrant calls for isolationist policies. No-one can argue that the globalised economy, which has brought tremendous benefits to Australia and other nations, should be wound back. World trade has been one of the drivers of global growth over the past six years. Trade is itself a stimulus because it has a multiplier effect on domestic activity. There can be nothing worse than one trading partner’s reversion to isolationist policies under the guise of ‘fiscal domestic stimulus’, invariably followed by a tit-for-tat response from other trading partners. We cannot allow global exports, global trade, to suffer in this way.
The global economic crisis tells us that only a truly global response can put our economies back on track. In November last year WTO Director-General Lamy said that the international response to the economic crisis must include initiatives that lock in the benefits of globalisation as well as manage its risks. He is absolutely right. Free trade is not part of the problem; it is part of the solution. That is why concluding the Doha Round remains one of the Australian government’s highest trade policies and also why the Minister for Trade, the Hon. Simon Crean, has been working tirelessly to generate the political will and high-level commitment needed to conclude the Doha Round. No-one has worked harder than Simon Crean in the international environment to resuscitate Doha, which is so critical for our country and so critical for the world at this time.
Finally, at this most critical of junctures for the Australian economy a successful conclusion of the Doha Round and a genuine liberalisation of trade in goods and services would provide a significant boost to confidence. Perhaps this is something that all sides of politics can agree on.
It gives me great pleasure to join the debate after the member for Lowe. I listened to his comments with great interest and in particular the comments he made in relation to trade policy. I wish to take this opportunity to acknowledge and take note of his great contribution in the role that he previously served in as the parliamentary secretary in that area. I know that he has been for many years now and will continue to be a very strong advocate for the people of Lowe. I first met the member for Lowe when he was campaigning for the seat in 1998.
I think you were very active in that campaign.
I did assist, and it was a great pleasure to do so. I know that those efforts have been repaid to all of those people who assisted the member for Lowe, with his outstanding service to the people of Lowe and the people of Australia through this parliament.
It gives me great pleasure to contribute to this debate and I wish to make a few observations in relation to the government’s approach over the last 12 months in confronting what is without question one of the greatest challenges that the international economy has ever faced. It began with the subprime crisis. We saw those toxic loans, for those assets that were not worth as much as the loans that were taken out against them. We saw that trickle through various parts of the American economy and it was not long before we started to see the impacts of those difficulties flow through to other parts of the world economy.
We have seen some massive slowdowns in growth figures from some of our key trading partners. We have seen slowdowns of a magnitude that we have not witnessed in the global economy—certainly not in my lifetime and not in the lifetime of most of us in this parliament. I think the gravity of these times was brought to our attention with the collapse of Lehman Brothers in September last year. These very difficult times have called for strong and decisive leadership, and that has become a mantra that has been spoken about and repeated in this place and outside this place. Strong and decisive leadership is what was required, and I think that on any measure what this government has demonstrated over the last 12 months is strong and decisive leadership.
There are many instances of that. Perhaps the first decision that was taken, which was such a significant decision in so many respects, was the government’s decision to guarantee bank deposits. That decision involved guaranteeing retail deposits up to $1 million, providing much-needed assurance to mums and dads—deposit holders all around this country—to ensure that they did not fear that their funds were under threat and to head off what might have led to some uncertainty and potentially, in the worst case scenario, a run on the banks. It can be said that we had not approached that dangerous territory where a run on the banks was a real threat, but, in a sense, the minute people start to ask questions about whether or not their money is safe is the time for action, and I believe that the government’s action in that regard has been vindicated.
That was a significant decision not just for retail deposits up to $1 million but, at the same time, in relation to the wholesale funding that banks secure. Providing a guarantee in that space has essentially allowed our banks to access funds and finance at a time when banks right across the world are finding it increasingly difficult to do so. Without access to that finance, particularly in the highly globalised and debt-dependent economy that we have developed into, the ordinary wheels of commerce could not continue to turn. But, as a result of providing that guarantee, we are seeing credit being made available to people and businesses throughout this economy.
Those decisions that were taken then were not made without controversy. I have to say that I found it disappointing that, throughout the debate that occurred on the guarantees, the opposition consistently took the duplicitous approach of, on the one hand, saying that they supported the package but, on the other hand, wanting at every opportunity to whinge, snipe and carp about specific aspects of the package. We all recall that Malcolm Turnbull had said he wanted a cap at $100,000. The government came out very decisively and said there would be an unlimited guarantee, and in effect that is what we have when you combine the two guarantees as they were ultimately implemented. I would have thought that that provided even more decisive action, worthy of the support of the opposition, but we did not receive that support.
In the kerfuffle that occurred at the time, I remember in particular that the Australian ran a number of articles that related to the comments attributed to officers of the Reserve Bank. There was much speculation about whether or not the Reserve Bank had in fact supported the actions that were being taken, so I was very pleased to have the opportunity just last Friday, through the House of Representatives Standing Committee on Economics, to ask some questions of the Reserve Bank governor, Mr Stevens. I targeted some of those questions to this issue of the bank guarantee, and I was exceedingly delighted that his response was overwhelming in its support of the actions that government had taken in relation to the guarantees. In his evidence before that committee he made the point that in his observation as a citizen of the community, turning on the television and listening to the radio, he had started to pick up a little bit of comment and talk out there in the community from people who were concerned about whether or not their funds were safe and whether there was any uncertainty over the funds that they had placed on deposit in their banks.
The governor said that clearly in that context early and decisive action was required. I do not want to quote from his evidence at length, but I encourage members to look at the transcript because it makes for very interesting reading. The governor was referring to the guarantee when he said, ‘I think that has been very effective.’ His support of the guarantee is much more glowing than that but I do not want to waste the House’s time by going into too much detail on the comments he made. I implore all members to look at the transcript—it makes for interesting reading and is a very strong endorsement of the action that was taken by the government at the time.
We still hear from those on the other side—though not as much these days, I must say—criticism of the actions the government took in relation to the bank guarantee. But we see that on the one hand the guarantee has provided reassurance to deposit holders and on the other hand it has freed up those arteries of credit. Wholesale funding for banks has become more attainable and as a result of that they have been able to continue to lend throughout the economy, which has been a good thing. This is not some esoteric debate: if banks do not have the ability to access finance they cannot lend money. They cannot lend money to you and they cannot lend money to me. They cannot lend money to the small businesses that employ such a significant part of the workforce in my local economy in the Lindsay electorate. I am sure that is reflected right across the country—indeed, I know it to be the case.
The bank guarantee delivered on both those objectives: certainty for deposit holders and freeing up access to finance for banks. That was a significant decision that had been taken but the government recognised that the scale of the challenge ahead was such that more needed to be done. We will all recall that on numerous occasions the Prime Minister has said, ‘This is what we are doing but we stand ready to act.’ Not only has the government stood ready to act but it has acted consistently.
The next step in the process was to provide some stimulus to the economy. These days it is pejoratively referred to as the ‘cash splash’. There are various other names, but ‘cash splash’ is the one that we hear most. I remind those members on the other side that the so-called cash splash was that particular package that delivered the payments that pensioners across this country received before Christmas. We remember how all of a sudden—after having done nothing for pensioners whilst in government over more than a decade—the opposition, with obvious political opportunism attached to it, saw a great opportunity to run a campaign on how they would champion the cause of the low-income earner—of the pensioner, in that case. So they ran this minicampaign, but do not forget that in the first instance the then shadow spokesperson for that particular area had indicated that she was running a petition to increase the pension, until she got slapped down very quickly—on radio, as I recall—by the then shadow Treasurer, the member for Wentworth, who of course is now the Leader of the Opposition.
The shadow minister was out there saying she was going to start a petition to take up the plight of pensioners, and the now Leader of the Opposition slapped her down very quickly and we did not hear any more about the pension. Then, all of a sudden, the then opposition leader, Dr Nelson, the member for Bradfield—I know it gets a little bit confusing to follow, but stick with me—said that they would be introducing a bill into parliament to increase the pension. A big political argument occurred over whether or not pensioners deserved that money.
In the end, as part of the stimulus package—the Economic Security Strategy implemented before Christmas—we saw a significant bonus being paid to pensioners. I have to say that the response I have received in my electorate has been uniformly positive—people thought that was much needed and a very positive step. If we move forward a couple of months, all of a sudden we see that whenever they are talking about that package it is not about the pensioners—who have not only already received their money but also in many cases already spent it, for the good of the economy—but just some vague, nebulous notion of a cash splash. They were not suggesting to pensioners that it was merely a cash splash back when we were delivering some additional disposable income to people who were doing it tough at the time.
Much has been said in this place and outside of it by those on the other side about whether or not that package was effective. Well, it has been effective. You can look at the data or the commentary of those who are in the know. Looking at the data, the seasonally adjusted estimate for the retail trade figures which were released by the ABS indicate that there was a 3.8 per cent increase in December 2008. That followed a 0.4 per cent increase in November and a one per cent increase in October. December 2008 represents the largest monthly seasonally adjusted percentage increase since August 2000, following the introduction of a GST. So what we have seen is a very significant increase in retail trade. That is the first objective measure.
What else have we seen? We have seen an increase in housing finance approvals. I note that the ABS statistics show that there was a 6.4 per cent increase in December in home loan approvals. Most importantly, loans for new dwellings skyrocketed 15.2 per cent in that month. The significance of that is that that is in direct response to the government’s initiatives in relation to first home owners grants. By doubling the grant—and tripling the grant for those with newly constructed properties—we have seen a stimulus into the economy led in large part by first home buyers. We saw yesterday in figures released by the Minister for Housing that 29,489 first home buyers entered the property market by the end of January. So we have seen a significant influx of first home buyers.
I was discussing this increase with a local real estate agent on the weekend, Mr Terry Heidtmann, who I think I have had opportunity to mention in this place before. He is the current citizen of the year in Penrith. Mr Heidtmann told me that in January he had one of the best months that he has ever had, and he indicated that that was predominantly in the first home owners segment of the market. To those on the other side who say that these measures are not working, I say: go back to your communities and talk to the people whose lives are being affected in a very real way by this global economic slowdown and whose lives are being affected in a positive way by the impact of these actions and decisions that government has taken.
On all of these measures we see evidence that what occurred before Christmas has been working. On top of that, we had the grants to local governments, the Regional and Local Community Infrastructure Program. That is a significant investment from federal government in local councils of a scale that we have not seen for many years. As someone with a background in local government, I can only say that for many years there was considerable frustration throughout the local government sector with the lack of interest from the federal government. Not only do we now have a government that is showing interest, but they are prepared to put their hands in their pocket and they see the great opportunity that local government presents for investing in local communities—generating and delivering local economic activity and the jobs that will flow from that. In my local government area of Penrith, the only council area within my electoral boundaries, $1.7 million was the allocation that the council received. The Independent Mayor of Penrith, Councillor Jim Aitken, has been very glowing in his praise of this package, as has the entire council, from all political persuasions.
We have seen measures that have worked and will have an impact on the ground. Since that we have seen the stimulus package, and once again there has been much criticism of that coming from those on the other side. They said they would not quibble when the Economic Security Strategy was introduced. But then they decided to oppose the package. The hairy-chestedness finally prevailed. This time they were actually going to vote for what they believed in. On the earlier occasions they said, ‘We support it and we’re going to vote with it, but we will take every opportunity to criticise it.’ At least this time they had the courage of their convictions. I think it was a terrible decision for them to take. It was not in the best interests of people throughout this country, but at least they had the courage of their convictions in blocking it.
In blocking the stimulus package, which ultimately went through with the support of the Greens and the minor parties—the Independents in the Senate—they were also exposed for not having an alternative plan. We heard from the former shadow Treasurer that the best strategy was to wait and see. How many more jobs would have to be lost whilst we employ this wait-and-see approach? The only thing that the Australian people can be clear about is that, had a Liberal government, a coalition government been at the helm rather than the Rudd Labor government, then you would not have seen the bank guarantee, you would not have seen the stimulus package that came through before Christmas, you would not have seen the spending on local government and you would not have seen the stimulus package that has just been passed through this parliament. What you would have seen was more waiting and seeing. People in communities such as the one that I represent know that we cannot afford to sit back and wait. Urgent and very significant, very bold action was needed. That is what we have seen through the Rudd government.
We have heard from those on the other side that the stimulus package is too much, even though pitching it at around two per cent of GDP is what the IMF suggests to be an appropriate amount. But we hear that it is too much. When the Reserve Bank governor was asked about this, he said, ‘It does not strike me as obvious that somehow it is grossly excessive.’ And when pressed on the issue by the current shadow Treasurer whether or not it might be better to hold a little more ammunition in the weapon and not fire off too early, by asking, ‘Isn’t it better for us just to hold back a bit; not spend as much now so that we’ve got a little bit more ammunition in the gun?’ the Reserve Bank governor replied:
You can make that argument, but I think you can also make the argument that, the longer you wait, the more ammunition you will end up having to use. These things can get a sort of self-fulfilling momentum behind them and we may or may not be able to head that off. But I think you should try …
So, we have heard there from the Reserve Bank governor. Let us not leave the ammunition in the gun. We need to be firing to create economic activity, to protect and to create jobs, and that is what this government is intent on doing.
I conclude by saying that we have heard a lot about debt and deficit, but the one thing that you will not hear from those on the other side is that, if they were on the treasury bench, they would have no proposal and no plan that would allow this country to be governed without going into debt and deficit at this point in time. Tax revenues amounting to $115 billion have been lost. We confront that challenge. We will do our best to get the economy moving again and to get those revenues back up.
After being in opposition for more than a decade, the first year of the Rudd Labor government was an exciting change. We came into government committed to building a modern Australia for the 21st century and we are delivering on that promise. In our first budget we cut taxes for working families and low-income earners and we are well on the way to abolishing the Howard government’s extreme workplace laws. Our education revolution is underway with the building of trade training centres in high schools and the installation of thousands of new computers in schools across the country. We ratified the Kyoto protocol and, among a range of measures to reduce our greenhouse gas emissions, we are well advanced on the introduction of our Carbon Pollution Reduction Scheme. The government is now starting to receive reports of several studies into options for improving healthcare services, and we have started to address medical workforce shortages with measures such as the establishment of more than 1,000 new training places for nurses. Of course, we also said sorry to the Indigenous Australians on behalf of the Australian parliament.
Late last year we unexpectedly had to respond to the worst financial crisis since the 1930s. The government took early, strong and decisive action, writ large, to protect the Australian economy and jobs and have continued to act as the crisis has developed. We injected $10.4 billion into the economy last year to stimulate economic activity and support jobs, followed by the recently announced $42 billion economic stimulus package. We protected the savings of working Australians by guaranteeing deposits in Australian banks, building societies and credit unions for the next three years.
Finally, the Rudd government has responded decisively to the tragedy of Victoria’s worst ever bushfires with practical measures to help victims in the immediate aftermath of the fires and during the long recovery and reconstruction process that lies ahead. This is a record of considerable achievement during the first year or so of the Rudd Labor government and one that all members of the Australian community can be proud of.
I now go to the stimulus package and Appropriation Bill (No. 3) 2008-2009 and Appropriation Bill (No. 4) 2008-2009. I am extremely proud that the Rudd government has taken more decisive action to strengthen the Australian economy. The direct investment by the government in long-term nation building will boost economic growth and productivity and support jobs in both the long and short terms. The targeted bonuses for low- and middle-income households will provide an immediate economic stimulus and help those most in need to deal with the flow-on effects of the looming global recession. Australia is fortunate it has a federal Labor government to deal with today’s unprecedented economic circumstances. Had the Liberal Party been in power, all that we would have seen would be more of the extreme neoconservative policies that got the world into this mess in the first place: tax cuts for the well off, unfettered free markets and the voodoo economics espoused by the former shadow Treasurer in recent times. Only Labor has the vision and determination to take actions that will help Australia weather the economic crisis while at the same time making keen investments in our future prosperity.
I particularly welcome the proposed investment in house construction and note that this has already been applauded by the Housing Industry Association. The $6 billion for new public and community housing will not only help more central Victorians find a home but also create jobs for local builders and contractors. Those earning less than $100,000 a year, single income families, farmers and students will all benefit under the package.
I also welcome the additional funding for regional roads, including black spot funding and additional level crossing boom gates. These initiatives will help make central Victoria’s roads safer and save lives. Businesses large and small throughout the Bendigo electorate will benefit from the tax breaks announced. These will help increase productivity through increased tax deductions for investments in plants and equipment. Improving the energy efficiency of existing homes will support jobs and help reduce greenhouse gas emissions. Free ceiling insulation and increased rebates for solar hot water systems will help make our residential houses more energy efficient and cut Australia’s carbon pollution.
The global recession is hitting the budgets of all countries. The Rudd government has reaffirmed its commitment to maintaining budget surpluses over the course of the economic cycle. As the economy recovers and grows more above trend, the government will return to a budget surplus by banking any increase in tax receipts associated with the economic recovery and hold real growth in government spending to two per cent a year. The Rudd government is taking the necessary and responsible action to help Australia through this global economic crisis.
Improving Australia’s education system was a key policy initiative in Labor’s 2007 election campaign. Now every primary school in the Bendigo electorate will benefit from the announcement of an investment of $14 billion in schools’ infrastructure. This will not only create local jobs in the short term but will benefit our economy for decades to come. Facilities such as libraries and halls will be built or upgraded in every primary school. Funding is available for new science and language labs in secondary schools, and every school will benefit from up to $200,000 for essential building maintenance. While improving the quality of education of every Australian child, this program will help deliver an economic stimulus today and underwrite higher productivity tomorrow.
The coalition continues to peddle the myth that the Rudd Labor government cancelled the popular Investing in Our Schools Program. Nothing could be further from the truth. This program had a limited shelf life. John Howard extended the program himself when he announced a final extension to the funding scheme. In fact on 19 February 2007 the former Prime Minister announced a $181 million extension to the program as a pre-2011 election sweetener to his 2004 election promise. In his media release he said:
To ensure that every school community has an opportunity to benefit from this program, we are providing an extra $127 million to Government schools and an additional $54 million to non Government schools in 2007 for a final round of funding.
Clearly, the Howard government had decided to end the program after the final extension of funding for 2007 was completed. In fact, on 28 August 2007 the member for Curtin, who was then education minister, announced that the Howard government would continue support for the Investing in Our Schools Program. The member for Curtin, now deputy opposition leader said that details of the continued support for the Investing in Our Schools Program would be announced in due course. The election campaign came and went, and it seems that due course never arrived, with no additional funding committed to by the Liberals.
Despite the failure of the previous Liberal government to come good on their promise of continued support, Liberal Party members continue to run around claiming that the new Rudd government had abolished the $1.2 billion program. What the opposition does not mention is the fact that, after the fourth and final round of funding for public schools in August 2007, $26.1 million remained unallocated by the previous Liberal government. At the direction of the previous Liberal government, this unallocated funding of $26.1 million was returned to consolidated revenue, ending the Investing in Our Schools Program prematurely. So not only was there no funding for the program beyond the 2008 round provided by the previous Liberal government but they failed to allocate all of the money announced and clearly did not plan to spend the money in any extension of the program.
The Liberals’ Investing in Our Schools Program was a hit-and-miss affair. Schools had to prepare a submission and hope it would receive funding in an extremely competitive environment, with some schools missing out. Labor’s $14.7 billion schools infrastructure and maintenance program announced by the Prime Minister will benefit every school in Australia—public, private and Catholic sector. Fourteen local secondary schools in my electorate will have $1.6 million to invest in the latest computer technology through a second round of funding from the National Secondary School Computer Fund. This fund is a key component of the Australian government’s $2.2 billion Digital Education Revolution initiative. I congratulate all central Victorian secondary schools that were successful in obtaining funding under round 2. This very important program was announced by the Prime Minister during the 2007 federal election campaign and has committed $1.9 billion in funding for new computer equipment in secondary schools. So far the Rudd government has invested more than $258 million in two rounds of funding, including more than $300,000 in flexible funding for students with a disability. The fund will give students greater access to and teach more sophisticated use of information and communications technology to prepare them for the jobs of tomorrow.
The National Secondary School Computer Fund is a partnership between the federal government and all education jurisdictions. The government has agreed to fund a further $807 million for on-costs to install and maintain the computers and costs associated with the subsequent funding rounds. A further supplementary round opened on 10 September 2008 for schools that have not reached the target ratio of one computer to every two students and have so far not applied for funding under the first two rounds. When this supplementary funding round is completed, all secondary schools in Australia will have been offered the opportunity to obtain funds to bring them up to the one computer to two students ratio, including funding for costs of installing additional equipment.
I am very proud that Elmore’s primary health service has received $506,000 from the National Rural and Remote Health Infrastructure Program towards demolition works and the construction of a new allied health unit. I am pleased that this important program is funding projects in rural and remote communities where a lack of infrastructure is a barrier to new health services or the enhancement of existing services. This investment in Elmore will improve access to and the quality of allied health services in the area. The NRRHIP fund was founded in the 2008-09 federal budget and is providing $46 million over the next four years for rural and remote communities, including strategic planning for small rural private hospitals. The fund is a competitive grants program and is a result of the government’s election commitment to reform the former Rural Medical Infrastructure Fund. There will be further funding rounds under this program and I invite interested parties to contact my office for more information. This program is one of the Rudd government’s initiatives to improve health care in rural and regional communities. The government is committed to important investments in rural health, including an initiative to address workforce shortages across the country. In November the government announced an investment of $1.1 billion to train more doctors, nurses and other health professionals. This is the single biggest investment in the health workforce ever made by an Australian government.
We are also assisting farmers in the challenges of climate change. The Rudd government is continuing to help our primary industries prepare for climate change, with applications now open for Farm Ready grants to reimburse the cost of training courses. Those in the farming, fisheries and forestry sectors can now apply to reclaim up to $1,500 per year for attending approved training courses. The Farm Ready funding is available under the Climate Change Adjustment Program, which aims to help primary producers with professional advice, training and re-establishment grants. It is part of Australia’s Farming Future, the Rudd government’s key initiative to invest in research and training to help the farming sector boost local productivity and adapt to climate change.
Labor will continue to deliver on our commitment to work with our primary industry sectors to meet the challenges of the future. In particular, the farming sector has the most to lose from climate change. In the last few weeks, southern Australia has experienced prolonged and extreme high temperatures which will impact on our dairy industry, pasture crops, horticulture and vegetable crops and intensive livestock production. While we do not know whether individual events are directly related to climate change, we know that extreme weather events will be more severe and will occur more often in the future. The initiative will help producers who want to learn about the impacts of reduced rainfall on their properties or to develop a long-term business plan. We must also continue to invest in technology, research and development and training to ensure our farming sector is resilient and remains globally competitive. The scheme will take the best science and technology and transfer it from the lab to the farm. Reimbursement grants are not means tested and are available nationally to those in the farming, fishing and forestry sectors and their immediate family members, management staff and Indigenous land managers.
We are also helping farmers by extending drought assistance. The Rudd Labor government has extended exceptional circumstances drought assistance to 31 March 2010 for the Central Victoria North regions including Bendigo and Redesdale. The government’s decision will ensure that eligible farmers suffering under drought will receive ongoing support. Drought continues to place immense pressure on farmers in the region of Bendigo, and I know this decision will be met with great relief. I am sure eligible farmers and small businesses will value the certainty of knowing that EC assistance will continue as the drought and its effects drag on. Exceptional circumstances drought assistance includes income support subsidies and interest rate subsidies for eligible individuals and small businesses. The declaration follows the government’s acceptance of the advice of the independent National Rural Advisory Council. Exceptional circumstances in the Bendigo area was due to expire on 31 March 2009. It will now be extended until 31 March 2010.
Orchestra Victoria delivers around 200 performances to more than 230,000 people throughout Melbourne and regional Victoria each year. Orchestra Victoria is one of Australia’s busiest orchestras. Orchestra Victoria is the performance partner for Opera Australia, the Australian Ballet and the Victorian Opera. In addition, the orchestra delivers free concerts and education workshops throughout Victoria via its community program. The community program is based on a unique model of partnerships in which the Orchestra works closely with local councils, charitable organisations and community representatives to develop concert and workshop programs that meet the needs of communities. I am delighted to say that the program currently reaches communities in Melbourne and in Bendigo, Shepparton, Horsham, Hamilton, Warrnambool, Mildura, Morwell and Moe. Orchestra Victoria has been awarded a grant of $1 million over three years to present a series of large-scale outdoor events.
The attached articles provide further context for the Myer 2009 Commemorative Grants Program, a special initiative of the Myer family to mark two significant anniversaries in the family’s philanthropic history. The Orchestra Victoria concert series titled ‘On Air—One Concert, Two Places’ will initially span three years, from 2009 to 2011, and will involve a free open-air concert in an iconic regional location each year. The live concerts will each be simultaneously broadcast to another ‘live site’ location in regional Victoria utilising state of the art audio and video technology. It is planned to build further support and sponsorship for the concert series to give it life beyond 2011. The inaugural On Air concert will take place in the idyllic surroundings of Bendigo’s Rosalind Park on Saturday, 28 February 2009. This free outdoor community event will be surrounded by other activities for young and old, including a late-afternoon street party in View Street and pre-concert entertainment. Under the baton of Principal Guest Conductor Marko Letonja, Orchestra Victoria will perform a thrilling program including works by Dvorak, Tchaikovsky and Strauss, and will be joined by renowned German cellist Nicolas Altstaedt. All the orchestral action will be visible on a giant video screen, and the entire concert will be transmitted by satellite to a big screen in the centre of Shepparton, joining the two cities in an evening of musical celebration.
I am looking forward to this particular concert because it is quite timely that it is going to be staged in Bendigo next Saturday. That follows on from the horrific events of Black Saturday, when Bendigo faced the worst disaster in its history. Those firestorms ravaged the whole community, resulting in about 72 homes being demolished. I am sure that a lot of people will take the opportunity to go to Rosalind Park next Saturday, listen to the superb entertainment provided by Orchestra Victoria and enjoy some much needed relief from the horrific events of the last couple of weeks.
I rise to speak on Appropriation Bill (No. 3) 2008-2009 and Appropriation Bill (No. 4) 2008-2009. We are debating these bills during a very difficult time for Australia’s economy, and I want to take this opportunity to express my support for the measures undertaken by the Prime Minister and the Treasurer over the past few months to prevent Australia following the rest of the industrialised world into recession.
Right from the start the Rudd government showed that it understood the gravity of the threat posed to our economy by the financial crisis that erupted in the US in September. The government took two vital steps: the guarantee of all deposits in banks and similar lending institutions, and the $10 billion stimulus package to shore up demand, boost small business and protect employment. Both of those measures had the support of the opposition when they were announced. When the Prime Minister announced the bank guarantee the Leader of the Opposition said:
We welcome this measure, we support it and we will give the Prime Minister every assistance.
One week later, he changed his mind and described it as a ‘catastrophic unlimited bank deposit guarantee’. When the government’s $10 billion stimulus package was announced, the Leader of the Opposition said:
We support these measures and we are particularly pleased about the measure, the payments to pensioners.
Only a few weeks later he changed his mind and said that the package was reckless and ineffective. In fact, as all responsible commentators have acknowledged, both these measures are highly effective. The bank guarantee, which was announced on the advice of the Treasury and the Reserve Bank of Australia, was decisive in maintaining the stability of our banking system by preventing the lack of confidence that has undermined foreign banks.
In an environment where leading British, American and Japanese banks were failing, where giants like the Bank of America and Citibank were wobbling on the brink of insolvency, Australia needed to move quickly and boldly, and that is what the Labor government did. The opposition ridiculed the $10 billion stimulus package, just as they are now ridiculing the $42 billion Nation Building and Jobs Plan. The evidence is now in and it shows that the $10 billion package was effective in boosting demand and consumer spending in the pre-Christmas period. This boost to spending put money in the tills of Australian businesses and it prevented businesses from laying off staff. The Leader of the Opposition likes to pose as the champion of ‘jobs, jobs, jobs’, but it was the Rudd government that took decisive steps to protect the jobs of Australian workers and it was the Leader of the Opposition that opposed those measures.
Yesterday we saw more evidence of the effectiveness of the Rudd government’s response to the crisis. ComSec’s chief economist, Craig James, said that Australia will still have positive growth in this financial year. That is an amazing achievement when all of our major trading partners are sliding into recession. The Age, in a misleading line, led its story by saying that Australia may get lucky and avoid a recession in 2009. In fact, this achievement has nothing to do with luck. As Mr James said:
The relative strength of the Australian economy is due not to luck but by policy decisions taken by the Rudd government and the Reserve Bank.
He attributed our success to big interest rate cuts and federal government stimulus programs. He said:
No other country has received the same economic boost from all three factors - Government spending, lower interest rates and a cheaper Aussie dollar.
So if Australia does succeed in avoiding recession, there is no doubt where the credit will lie—it will lie with the current government’s timely, bold and decisive actions.
In considering these appropriation bills, I turn to an area of appropriation where state, local and federal governments have worked together to make sure that the parents and children of Melbourne Ports are provided with adequate child care, as per our election promises. I commented a few weeks ago that the Labor government has fulfilled its promise to establish 260 early learning and childcare centres to address unmet demand around the country. This news was of particular interest to young families in the city of Port Phillip, as the electorate is fortunate enough to have been nominated as one of the 38 priority sites in the first round of funding. In fact, we have received funding for two centres: one in Port Melbourne and one in St Kilda. The St Kilda one is already up and running as far as the funding is concerned.
Unfortunately, the nomination of these two new centres gives little comfort to parents at the two ABC Learning Centres in South Melbourne and East St Kilda, who are no doubt feeling less secure about the futures of their children. The incompetence of ABC Learning’s management is no secret and has been well known for quite some time. The two ABC centres in question in my electorate are not exempt from this strain of mismanagement. Despite having an occupancy rate of 75 per cent, both centres are considered by those who have looked at them to be unviable. It seems that unfortunately even the Port Phillip council may not be able to proceed with the preparatory bid that they have made.
The national press has widely condemned ABC Learning—accurately, in my view—for the shocking way the nation’s now-defunct childcare provider ran its business. Now it is alarmingly clear that a hefty number of the 241 ABC Learning Centres classified as unviable have been subject to exorbitant commercial rents. Unless liquidators or the owners of these properties—mysterious entities who will eventually be got to the bottom of—negotiate new rental agreements, the two centres in Melbourne Ports, in the city of Port Phillip, will probably close by 31 March this year.
Most members are aware that 80 of the 241 failing ABC centres are owned by the Australian Education Trust, which is in turn owned by Austock, a company in which ABC founder Eddie Groves has a percentage stake. Lest we forget Mr Groves—the member for Oxley should know him quite well—he was one of the paymasters of the Liberal Party in Queensland. Groves infamously told Canadian television, when it was proposed that that country adopt the privatised childcare system on the Howard Liberal model, ‘Government subsidies make child care in Australia a licence to print money.’ Very subtle! In addition to Mr Groves, the chairman of Austock is Bill Bessemer, a founder of ABC Learning. Austock received almost $48.3 million from ABC Learning in commissions and corporate services and management fees between ABC’s float in 2001 and 2006.
Let there be no doubt: ABC Learning, Mr Groves and Austock let our children’s infrastructure in their privatised centres go down a slippery slope for too long. The ordinary men and women of Australia have helped ABC Learning stay afloat—thanks to the good management of the Parliamentary Secretary for Early Childhood Education and Childcare, Maxine McKew, and the Deputy Prime Minister—but we cannot support all of these centres forever. Many of them are commercially viable, but some of those that are not come up for decision on 31 March. The onus is on the liquidators or the owners to negotiate new rental agreements to make these centres with large occupancies in my electorate viable. I call on members of the opposition and government to pressure the liquidators and owners to do so. It is imperative that we work together to ensure that the parents at our ABC centres in various electorates, including mine in South Melbourne and St Kilda, not be subject to fear and uncertainty over the future of their children’s care and that proper commercial rent be negotiated for these places.
I turn to another area of the government’s appropriation that I have been following very closely. I am very pleased that we have been very active in my electorate in following through the national promises of the new government. A hundred and five thousand Australians spend the night without a home to go to. This figure is much too high. Our new government takes this issue very seriously, and we have acted promptly. We proposed at the last election to reduce homelessness, and late last year the Prime Minister and the Minister for Housing announced a plan to halve homelessness by 2020. The handling of this issue and, I would say, the issue of Indigenous affairs reflects well on the entire ethical standard of the Australian people and the Rudd government. The ethical way in which we have approached these issues reflects very well on Australia.
Shortly before election night, the then opposition leader and now Prime Minister, Kevin Rudd, visited the Hanover Welfare Services centre in Southbank in my electorate. I think that visit was very emblematic of his concern with the issue of homelessness. Also in my electorate, the Sacred Heart Mission caters for the homeless. It operates an organised, efficient and successful program which focuses on assisting disadvantaged and homeless people in our borough. Sacred Heart is famous for its healthy lunch programs, which feed hundreds who might otherwise not eat a healthy meal in an entire day. On the day after Christmas, Boxing Day, 600 people are fed at the Sacred Heart Mission. Local schools have programs in place where students volunteer in the preparation of food and the cleaning up afterwards. One of my staff, Francis Ventura, is a former student of Christian Brothers College in East St Kilda, which runs a program whereby students volunteer their time during school hours to assist with the program. The program is very popular and reflects the good intentions of my younger constituents.
Earlier this year, Deputy Prime Minister Gillard, Australia’s first ever Minister for Social Inclusion, and Justine Elliot, the Minister for Ageing, made another announcement with a private Melbourne based organisation, Winteringham, for a further $3 million to provide affordable housing and support services to frail elderly homeless people. This organisation houses around 800 people on a nightly basis in Melbourne, and the extra $3 million will ensure a facility to accommodate 60 people can be built in Dandenong, in Melbourne’s outer suburbs.
Similarly, together with the Minister for Housing, Tanya Plibersek, I attended a wonderful briefing at the Salvation Army last year. They announced plans to build a centre for the homeless in my electorate, right on Punt Road. I hope this centre, which the Salvation Army would like to complete this year and which has received wonderful donations from local Melbourne philanthropists of great social conscience such as the Fox family, will get support from the federal government in the budget and we can look forward to commencing the fourth project to wind back the issue of homelessness in our electorates. This comes on top of the announcement by the Prime Minister and the Minister for Housing in December last year to provide $1.2 billion over the next four years, a 55 per cent increase in funding for homelessness from the previous budget, as part of the white paper The road home. As I said, this plan is the centrepiece of a 12-year reform agenda by the Rudd government, which aims to halve homelessness and provide shelter for 16,000 Australians who currently sleep rough every night of the year by 2020.
I will turn to another area of appropriations which puts in context the two bills, Appropriation Bill (No. 3) 2008-2009 and Appropriation Bill (No. 4) 2008-2009, and which the Minister for Finance and Deregulation spoke on when he was discussing these issues. That relates to the funding of the United Nations welfare and relief association. In the past decade, Australia provided $16 million for such agencies, mainly via the United Nations Relief and Works Agency, UNRWA, set up in 1949 to provide funds for Arab refugees. Following the recent conflict in Gaza, Australia committed an additional $10 million aid to the Palestinian Authority, of which $7.5 million will be a direct budget support to the PA and $2.5 million will be for emergency food assistance. This brings Australian assistance for the Palestinians to a total of $45 million since 2007.
I remain in favour of humanitarian assistance to Palestinian inhabitants of the West Bank and Gaza, but at the same time we have to be very aware of the chronic corruption and mismanagement of the PA and the history of the unaudited expenses of UNRWA. UNRWA is the only UN agency which exists to cater for a particular refugee population. In my view, it has long outlived its rationale for a separate existence and it has been maintained by a majority in the United Nations for political reasons. In its bureaucracy there are many examples of officials who are in its employ who are also members of Hamas, which is officially classified by the Australian parliament as a terrorist organisation. And of course Hamas was involved in the recent conflict in Gaza, including the unprovoked rocket attacks on civilian population centres.
Even if all inhabitants of the camps of Jordan, Syria and Lebanon were classified as refugees, the Palestinians and their progeny would constitute 17 per cent of the world’s refugees, yet they receive 33 per cent of all refugee funding, 90 per cent of which comes from the developed world. Millions of other refugees in Sudan, Chad, Congo, Sri Lanka, Darfur, Burma and on the Thai border who do not have powerful friends in the United Nations continue to live in the most wretched circumstances. In my view, compared to the UNHCR, UNRWA is overfunded, overstaffed and unaudited. Notoriously, millions of dollars in aid channelled to the PA in the 1990s was diverted for the purchase of arms and into the pockets of the Palestinian Authority leadership.
The European parliament received a report from the German police that €800 million that went to the Palestinian Authority during the 1990s was unaccounted for and unaudited. This is completely unacceptable, particularly from the developed world, which is providing the majority of this aid. Honourable members who want to know more about this should read both Claudia Rosett’s very powerful article in Forbes on the comparison between UNHCR and UNRWA and the article on the British Labour government’s shift in attitude entitled ‘Palestinian power struggle swallows millions in aid cash’ in the Independent on 4 November last year.
Most Western donor countries have been reluctant, for obvious political reasons, to call the PA or the UN to account over what frankly is the theft and waste of our taxpayers’ money in the morass of corruption and extremism of the Authority in the West Bank and Gaza. The European Union has failed to exercise supervision over millions of dollars given to the PA. The British government, as I said, is more interested in examining this issue now. No other international authority that Australia gives money to would have unaudited expenditure.
I have recently read that colleagues in the United States congress are raising the issue of auditing UNRWA’s expenditure. They are not seeking to persecute people who need assistance, but want to ensure that that assistance is being given effectively and that the generosity and humanitarian assistance of the world is being considered in the context of what other refugees need in, for example, Afghanistan, Darfur and Burma. Australia can and should make a useful contribution to this process by assisting those elements amongst the Palestinians who accept the need for a genuine peace settlement and want to end terrorist attacks, suicide bombings, reckless talk of jihad and martyrdom, the endless exaggerated rhetoric, corruption, waste, factional fighting and lawlessness.
I think there needs to be much more open discussion in Western countries, including Australia, about where our aid money is going and whether UNRWA is any longer an appropriate recipient of our aid money. That is not to say money should not go to the Palestinian people; however, I think the fact that they have 26,000 employees and UNHCR has only 5,000 employees and looks after 11 million refugees worldwide says something about the effective distribution of assistance and the work being undertaken by the two agencies. UNHCR covers all of the refugees of the world and UNRWA is the only agency devoted to one lot of refugees. One agency, UNHCR, aims to get refugees out of their current circumstances and assist them to live the rest of their lives in fulfilment. The other agency seems to be focused on keeping people in their circumstances and not taking them to a new stage where their families and children can benefit and move on.
I will make some further comments on what might be useful appropriations for Australia in future military expenditure in Afghanistan. If one looks at the way the Australian Army training team in Iraq was able to train a large number of Iraqi infantry battalions—which now have obviously secured a successful, free and fair election in Iraq—one might think that that would be an effective way of spending Australian taxpayers’ money in Afghanistan. The Afghan ambassador has told us that the Afghan National Army stands at only 63,000 at the moment, out of a population very similar in size to Iraq. The proposal at the moment is to increase the size of the Afghan army to 126,000—that is, double what it is now. In my view, any request for Australia to increase its forces ought to be focused on having an Australian training team, of the size we had in Iraq, training the Afghans to eventually take over their own security. After all, Australians do not want to be seen as continuing foreign occupiers of Afghanistan. This would be a way of Australia transiting out of Afghanistan eventually, while at the same time providing effective, long-term security in Afghanistan through the Afghans themselves. I do not want to speak further on that issue now, but I will return to it and provide some detail on expenditure, as would be appropriate in an appropriations debate.
In speaking in support of Appropriation Bill (No. 3) 2008-2009 and Appropriation Bill (No. 4) 2008-2009, I want to talk about what I call the ‘Page priorities’. Quite a number of them were commitments that came out of the 2008 budget. Importantly, they were commitments that would contribute to building infrastructure in our community. I do not just mean roads and bridges—they are important, and some of the money is directed to projects in those areas. I also mean community infrastructure—the things that are the glue of communities, that hold communities together and that make sure communities work—such as local halls and the like, which help to create the social fabric of our community.
One of the hallmarks of the Rudd Labor government is that it is doing exactly what it said it would do. The government said: ‘This is the sort of government we will be: ideas matter; values matter; and infrastructure and projects in communities matter. These are the things that we are committing to doing for the Australian people, electorate by electorate.’ It proceeded immediately upon election to do that at the national level and at the electorate level. Some of those commitments on the national stage were clearly honoured almost immediately. There were no promises that were ‘core promises’ and ‘non-core promises’; each and every one of them is being rolled out.
The Rudd Labor government also talked about and committed to stopping the blame game and working in a cooperative relationship with the states to make sure that some of those community and infrastructure projects could move ahead without the ducking, shoving and argy-bargy that go on around a whole lot of projects. We all know that that is a challenging task. We understand our federation and the challenges of working cooperatively, but it is another hallmark of the Rudd Labor government that we have proceeded to do that. Quite a few of the agreements and a lot of the cooperation in seven particular areas are happening through COAG, but it is also happening in a range of other areas. Most recently, it has been happening as well with the Nation Building and Jobs Plan. A coordinator-general has been appointed at the national level, and I am advised that counterparts are being put in place at the state and territory level to make sure that a cooperative relationship happens.
Some of the things that happened immediately on the national stage were that the Kyoto protocol was signed—the Prime Minister said he would do it, and it was done—and we said sorry. I know a lot of members of parliament felt good about being able to say sorry. That was the commitment of the Rudd Labor government and a commitment of federal Labor, but equally I know that there were people on both sides of parliament who felt good about being able to say sorry on that day. In the area of infrastructure, a big commitment was made by the government; this commitment is delivered within the appropriations bills. Three bodies have been set up: one for education, one for health and also Infrastructure Australia.
Then there is the relationship with local government, which is reflected in the appropriation bills. There are two parts to it. One is about relationships and working with local communities. Under the previous government’s regional development program, a lot of local government was actually cut out or sidelined and a lot of priorities that local government had worked up with their local communities never really got a guernsey. It was a completely different focus. Again a hallmark of the Rudd Labor government is the close working relationship with local government. That has been cemented by the meeting here in December last year when mayors and deputy mayors came from right around Australia. When I was writing about it in my local paper, I said it felt like a big town hall meeting except that we were in the Great Hall in Parliament House. That is what it felt like with all of these mayors and deputy mayors.
The program that is operating with local government is the local community infrastructure program. That is a program that obviously is well received, welcomed and popular at local level. It has allowed the local councils to upgrade areas that they have not been able to tackle for years, and it reaches right across the local community. I will give an example from the seat of Page. I have five local government areas: Ballina Shire, Clarence Valley, Kyogle Shire, Lismore City and Richmond Valley. As I have moved around the community—and I meet regularly with the mayors and the councils—I have been well aware of all the local projects that they have not been able to touch for years. We also know that local governments have an increasing responsibility—burden, some would say—to deliver projects at local level. As there is more legislation, more policy initiatives, they have the burden to deliver those. In Ballina Shire, for instance, they were able to get $712,000 from the program for infrastructure spending. In Clarence Valley they got $1,406,000 and they have been able to address a whole range of outstanding programs in the community with various halls, with upgrades and the like. Kyogle Shire got $401,000, Lismore City got $1,049,000 and Richmond Valley got $534,000. They might not seem like huge amounts but they are in local communities, where we have all of those very local projects.
Another commitment that is being rolled out within the time frame up until 2013 is universal access to preschool for all children four years of age. That is another one that will take a lot of cooperation with the states and territories because they deliver the services to the preschools. In my state of New South Wales I know there are about 800 preschools. About a hundred of those are in public schools under the department of education, and they are relatively free; there is no cost. But there are about 700 that are community preschools and the families have to pay. I am told it is somewhere between $35 and $40 a day. I have had a look at other states and territories where some of it is actually free. I have been meeting regularly with the local community preschools and talking about this issue because it is one of the issues that need to be further worked on and resolved before the program of universal access can be implemented. I have advocated that they all come in under the department of education, and then it would be easier to implement. Some community preschools agree. I got an email last night from the president of the Lawrence community preschool advocating that. Some of them say no—that they want to stand alone and keep their own unique characteristics. This is clearly one of those issues that we have to work on. I hope that it will all be free, because I see preschool for four-year-olds not as being about child minding or child care, which is fine, but as being about education.
What I call the ‘Page priorities’ in terms of infrastructure spending are commitments that I went to the election with—and the commitments have been honoured. Some of them are still being implemented, but they have all been honoured. An example is the Alstonville bypass. Bob Wilson, who is the chair of the Alstonville Bypass Action Committee, has beavered away for some 18 years on a 40-year design project to get this funded and operational. He said that if it would come to fruition—that is, if the money would materialise—he would dance in the street with me. And that is literally what we did last week. We actually went out and danced in the street in celebration. We were both a wee bit embarrassed because it was very public, but it was one of those things that we said we would do and we are in the local paper, dancing in the street. I am afraid we held up a bit of traffic while we did that. That was one of those things that I felt good about. It had dragged on for years—everybody had made promises, no one had ever really honoured them and I knew that when I made that commitment with Kevin Rudd that it would be honoured and that is why I did it for the first time.
There are lots of projects. A small commitment was $125,000 for the upgrade of the Grafton saleyards. We have a beef industry, as well as a timber industry, across the Northern Rivers in Page and in the Clarence Valley, and $125,000 made a big difference to what could be done at the saleyards with steel fencing and the like. I hope that is the start of one part of the upgrade. I said that I would endeavour to get some more funding if and when it becomes available. That is a significant industry, and industries like that really need supporting because they add to our local economy.
In Lismore there was $140,000 for the Lismore Flood Management Plan. Lismore is my home and I know a bit about floods because often when I say to people that I live in Lismore they will say ‘Oh, you come from the flood place’—it has that reputation. We are pretty used to floods—not on the scale that we see right across Queensland, and we have not suffered any loss of life in recent years, but we did in earlier years in my neck of the woods. So $140,000 makes a huge difference. The issue is that it was responding to local priorities and local needs. One of the ways of doing that is to work hand-in-glove with local government.
I would like to comment on the money that goes to aid and I briefly mention Timor-Leste, or East Timor as we call it. I know that all members of this place support our ongoing commitment and program with Timor-Leste, as we do with many other neighbours but with that one in particular. It is one place for which I hope we can continue to enjoy bipartisan support, because they are neighbours and friends who really deserve any assistance that we can continue to give through appropriations and budgetary support and, equally, through friendship, the parliament and all the other mechanisms that we have at our disposal. I lived in that country for 3½ years and worked for the Timor-Leste government so I have not only a good working knowledge of the country, the people, the culture and the government but also an understanding and, obviously, a commitment to it. I commend the bills to the House.
I rise to speak on Appropriation Bill (No. 3) 2008-2009 and Appropriation Bill (No. 4) 2008-2009. Unlike some opposite, we do not have a zealot’s faith in the invisible hand of the market or the unblemished wisdom of overpaid merchant bankers in the financial capitals of the world. Thanks to the good sense and ability of Independent senators to negotiate in good faith with the government, rather than indulging in pointless political pointscoring, we have managed to pass our stimulus package through the Senate. However, I believe it is worth reminding the House of the reckless and a tad unprincipled opposition that our measures received from some opposite who appear to prefer us to sit back and destroy the jobs that thousands of Australian families depend on. The government, unlike the opposition, accept that there is a role for government in helping the economy and realise that the Australian public expects us to react responsibly to the economic crisis that is engulfing the world.
We know that the Rudd government’s October stimulus package had a positive effect on the Australian economy in the December quarter. Australia avoided the collapse in retail demand that hit other economies across the world over Christmas. Consumer spending in December last year was up two per cent on the year before thanks to the government’s package. AMP Capital Investors chief economist Shane Oliver was quoted in the Australian newspaper as saying the stimulus package announced last year had ‘done the trick’ in lifting consumer spending. Our stimulus package also got positive reviews from many economic experts. ANZ senior economist Katie Dean has said that without the package the economic outlook would be much worse, but warned that the boost to the economy will only be short term. Ms Dean said:
It actually may help Australia avoid a technical recession which is two quarters of consecutive negative GDP growth over the longer term.
If some in this place do not understand the virtue of trying to keep Australia out of a recession then heaven help us all. We know that the October package worked, but more was needed. That is why the Rudd government announced its second rescue package. Stimulus packages act like a defibrillator, jolting life back into the economy. Some opposite, unfortunately, are like a doctor who would rather watch their patient expire gently on the operating table than give them the treatment they require.
Serious economists across the world support the concept of governments stepping in so as to soften the impact of the crisis through spending packages. When the effectiveness of monetary policy is impaired, governments have a responsibility to step up, step in and unblock the economy. Chris Richardson from Access Economics also praised the second stimulus plan as a response to what he sees as a ‘diabolical international situation’. Commonwealth Bank of Australia senior economist Michael Workman said the payments to households would boost consumption in the short term. Mr Workman also said that the construction and mining sector workers, hard hit by the economic downturn, would benefit from the infrastructure programs and that construction workers at risk of losing their jobs could find work in government funded infrastructure projects.
When private spending falls away, government spending should step up so as to smooth out the economic cycle and reduce the devastating impact of unemployment on Australians. American economist Mark Zandi, a supporter of the stimulus package of US President, Barack Obama, has calculated that, for every dollar spent on infrastructure projects, we see a boost of $1.59 to a nation’s gross domestic product. This multiplier effect occurs as the dollars the government put aside for infrastructure spending flow through the economy. In this regard, at this particular point in time, tax cuts are not as effective as a well-designed and targeted stimulus package, despite what some in the opposition seem to think.
Some in the opposition are clinging to the discredited idea that simply cutting taxes for the highest earners in the community is the special economic tool that a government needs. Unfortunately, some of the Liberals have demonstrated their lack of economic understanding by referring to the payments to low-income families as a ‘cash handout’. Leaving aside their distaste at the thought of money going to families who are doing it tough, I believe that these comments show that the opposition does not understand how these payments assist the whole economic cycle. They are a payment that will flow through the economy and benefit small businesses, tradespeople and workers across Australia and their families. In this regard, tax cuts are not as effective as a well-designed and targeted stimulus package.
With regard to tax cuts, Australians will get income tax cuts, as scheduled, this July and in July of next year. However, tax cuts, which give a little bit of extra money each week, are simply not as effective as one-off payments in sparking consumer spending. The cash payments will go to low- and middle-income families and singles, with a back-to-school bonus for families with little children. These are the families who have the most pressing expenses and who will put money back into the Australian economy, continuing growth and keeping jobs.
The package, of course, is more than just one-off payments, as important as they are. For this government it is possible to walk and chew gum at the same time. We can offer a stimulus package that will deliver a short-term boost to the Australian economy while keeping our eye on the long-term game. This economic slump will be tough and it will get tougher, but it will pass. When that happens we will need a skilled, well-educated workforce to consolidate our productivity and our prosperity. That is why in this package for every dollar that goes in payments to low- and middle-income families two dollars goes to spending on vital long-term infrastructure.
Anyone who has ever driven across the Sydney Harbour Bridge or along the Great Ocean Road, both public works projects funded during the very tough economic circumstances of the thirties, will know that tough economic times are not incompatible with public works of lasting value. The Hoover Dam in the USA is another example of a national infrastructure icon which was completed during the Great Depression of the 1930s.
Spending on schools, ensuring that young Australians get the best possible facilities, the best libraries, science labs and language labs that are available, will ensure that they are prepared to join a global economy which will be even more competitive in the future. The bulk of the package is taken up with $28 billion in spending on crucial infrastructure: social housing, schools and making our housing stock more environmentally friendly. The bulk of the social housing will also have greater access for people with disabilities, a particular interest of mine.
This spending has two purposes: first, to boost the economy and to keep jobs in the short term; second, to provide infrastructure to support our economic growth in the medium to long term. This is direct spending. This will be spent in Australia and provide jobs for Australians. It is labour intensive spending, and it will preserve the jobs of thousands of bricklayers, carpenters, labourers, trades assistants and builders, who are beginning to struggle to find work as the economy slows.
There is the usual objection which is raised when governments decide to increase infrastructure benefits in response to an economic slowdown, which is that, by the time the infrastructure projects come on stream, the downturn is already over and the effect of the spending is to increase inflation as the economy is picking up. No-one can forecast how long the current downturn will last or how serious it will be, but what is particularly clever about this infrastructure stimulus package is that the spending announced by the government focuses on projects that can be started quickly and where the bulk of the money can be spent quickly, thus avoiding that problem I alluded to briefly earlier. Further, it focuses on small-scale projects which are a lot more likely to be started straight away without some of the cumbersome start-up lags which can afflict larger projects.
Anyone familiar with the previous government’s neglect of, disdain for and disinterest in public housing will know that social housing is in high demand across Australia, and that any units built will be used immediately. That is why the 20,000 units of social and defence housing will, we hope, all be built by the end of next year, providing a valuable boost to the construction industry and relief for people battling in a tough rental market.
Anyone who visits public schools and talks to teachers will know that they do have urgent maintenance needs that do need to be fixed as soon as possible. This package will provide crucial, immediate funding that they are crying out for. It will encourage investment in infrastructure projects designed by the people who know exactly what needs to be done.
All of the measures in the package will act as immediate stimulators, giving the economy the jolt it requires to compensate for the sudden and unprecedented drop in private investment. The reason behind this package is simple. We shall not give up on Australian jobs without a fight. The main cost of a recession is not economic; it is human. It is the family struggling to pay off their home once the breadwinner is made redundant. It is the young person being knocked back at hundreds of job interviews simply because no-one is hiring. There can be little so demeaning, so corrosive to self-esteem and so damaging to a person’s confidence as being willing and able to work but being unable to find a job.
Our package is unashamedly about preserving jobs. We want to ensure that as many people as possible stay in the workforce. As well as being a social good, this will also be an economic good in the long term. Working Australians will be able to retain links to the workforce and not have their skills wither and their identities diminish during a period of unemployment. We have already seen employers making efforts to retain as many staff as possible, and they should be congratulated. They do this because they know that the cost of losing good workers and then having to rehire when the economy picks up will damage their business in the long term. Preserving jobs is the No. 1 concern of the government during this recession, unlike, unfortunately, some of those opposite who would wish to put thousands of jobs at risk by not supporting this package.
I rise to bring the debate on Appropriation Bill (No. 3) 2008-2009 and Appropriation Bill (No. 4) 2008-2009 to a close, and I thank those members who have made a contribution. The additional estimates bills seek appropriation authority from parliament for the additional expenditure of money from the Consolidated Revenue Fund in order to meet the requirements that have arisen since the last budget. The total additional appropriation being sought through Additional Estimates Bills 3 and 4 this year is $3.1 billion.
The government finds it somewhat disappointing that too many of our opponents have failed to take the opportunity afforded them in this debate to address the important measures proposed in these bills. They could not bring themselves to say ‘I support an additional $21.3 million to increase the number of organ donations and transplantations across Australia’ or ‘I commend the additional $14.4 million to meet the costs associated with an increased uptake of the breast cancer drug Herceptin’. Rather, the opposition have chosen to ignore these bills and instead raise quibbles with elements of the government’s plan to strengthen growth and support jobs through the $42 billion Nation Building and Jobs Plan. It is, therefore, worthwhile to remind them of the important measures contained in these bills.
The government will provide $300 million for the Regional and Local Community Infrastructure Program—an outstanding program which has been supported by local government across the country. Of this $300 million, $250 million will be distributed to local councils, with allocations based on a formula that recognises need and population growth. This is a transparent formula which has been published and understood by local government and advocates for investment in local government. The balance, $50 million, will be invested in larger-scale, local projects such as new sports stadiums, entertainment precincts and cultural centres that require a larger Commonwealth contribution of $2 million or more. That $50 million investment has been the subject of bids by just about every local government authority across the country.
There is $227.1 million that is proposed for drought assistance under the Exceptional Circumstances interest rate subsidy program. AusAID will be provided with $150 million to contribute to the World Bank, $50 million of which is for the trust fund established in response to the global food price crisis and $100 million of which will be contributed to the Clean Technology Fund. The Department of the Environment, Water, Heritage and the Arts will be provided with $101 million to meet the increased demand for household rebates under the Solar Homes and Communities Plan. The government will provide $61.6 million to assist small-block irrigators in the Murray-Darling Basin who are affected by drought and wish to cease irrigation farming but stay on the farm. An additional $93.3 million is proposed to meet the increasing costs of the LPG Vehicle Scheme, which arise from additional customers who are expected to access the scheme in 2008-09. The LPG Vehicle Scheme is designed to encourage the uptake of LPG as an alternative transport fuel and to assist families facing high petrol prices. These continued expenditures and policy origins grow from initiatives of the former government, so it is surprising that these initiatives were not endorsed fulsomely by those of the opposition who spoke in this debate.
The government proposes to reallocate $99.4 million to establish a Global Carbon Capture and Storage Institute. The institute will accelerate the take-up of carbon capturing projects by facilitating demonstration projects and identifying and supporting necessary research on related topics, including regulatory settings and regulatory frameworks. Carbon capture and sequestration initiatives grow from many years of consideration and contemplation by the former government and ultimate execution by the current government. The government will provide an additional $39 million for the Job Capacity Assessment program. The additional funding is required to meet higher-than-expected demand for assessments and will provide for an additional 139,000 assessments to be undertaken in 2008-09.
The Department of Families, Housing, Community Services and Indigenous Affairs will be provided with $70 million for the Australian Remote Indigenous Accommodation Program. This amount represents a reclassification of appropriation from the states, territories and local government item to allow the department to make payments directly to non-government organisations. An additional $17.5 million will be provided to improve access to childcare and early childhood services for Indigenous Australians. This funding will contribute to the establishment and operation of 15 new children and families centres in urban areas and will expand the government’s contribution to the establishment and operation of 20 centres in rural and remote communities that have Indigenous populations. An additional $7.5 million is proposed to increase the number of places available under the Prevocational General Practice Placement Program, which provides opportunities for junior doctors to gain clinical experience in primary care, with the aim of encouraging them to take up general practice as a career.
These bills are important pieces of legislation which build upon the budget’s far-sighted steps to address long-term challenges in infrastructure, health and climate change and which deserve support. I commend the bills to the House.
Question agreed to.
Bill read a second time.
Ordered that this bill be reported to the House without amendment.
Debate resumed from 4 December 2008, on motion by Mr Tanner:
That this bill be now read a second time.
Question agreed to.
Bill read a second time.
Ordered that this bill be reported to the House without amendment.
Debate resumed from 3 December 2008, on motion by Mr Bowen:
That this bill be now read a second time.
The opposition supports the Tax Laws Amendment (2008 Measures No. 6) Bill 2008, which contains four schedules. I will, in summary, go through each of those schedules and address some of the detail in each of them. Schedule 1 of the bill amends the Income Tax Assessment Act 1997 to prevent a market value cost base being used when interests in an entity are acquired by another entity through a scrip for scrip capital gains tax rollover that is a restructure. Schedule 2 amends the Tax Administration Act 1953 to correct the legal and administrative barriers relating to debts that are removed from the foreign claims register. It also provides for certain types of payments to be made by the Commissioner of Taxation to other countries. Schedule 3 amends the Superannuation Guarantee (Administration) Act 1992, with the objective of expanding the time period in which an employer can make a late superannuation contribution and still elect to use the late payment offset to reduce their superannuation guarantee charge obligation. Schedule 4 is, in layman’s terms, a series of housekeeping measures that correct errors and anomalies within a number of tax laws to ensure their proper operation and original intention.
There has been a longstanding policy debate on schedule 1, which deals with the scrip for scrip CGT rollover. It was pursued in great detail by the former coalition government. In fact, we had made a number of announcements on that. The former coalition government recognised that certain entities were undertaking a scrip for scrip CGT rollover and obtaining a market value cost base for the shares in the acquired entity. The entities would then be able to use the consolidation tax cost setting rules to push the market value cost base into the underlying assets of the acquired entity. In a sense this mischief allowed entities to reduce the capital gains tax. What was able to happen was that, in tax terms, a mischief was allowed to occur where the tax assets were able to be sold and increases in the capital allowance deductions were able to occur beyond what had been originally intended. So in October 2007 the previous coalition government publicly announced it would introduce measures to prevent the intentional tax mischief, for want of a better term, relating to the resetting of tax values relating to scrip for scrip capital gains tax rollovers. The former government also announced a commitment to undertake consultation with the business community to ensure that the legislation, which of course is quite technical in this area, was framed properly and would operate well and with the correct intention. The announcement reflected a longstanding commitment to the integrity and correct operation of the tax system, and this side of the House welcomes the fact that the government agrees with that and has taken up the consultation and is introducing measures in this tax law amendment bill.
The schedule prevents entities from exploiting the scrip for scrip CGT rollover provisions to minimise their tax liability. Where a scrip for scrip rollover is taken to be a restructure, entities will not be able to apply a market value cost base. The schedule will prevent entities undertaking scrip for scrip CGT rollover restructures with the intent of reducing their capital gains tax liability from the disposal of the acquired entity’s assets. This is consistent with the intent of capital gains tax to apply to increases in the value of capital assets.
Schedule 2 addresses the legal and administrative issues arising from deeming debts being removed from the foreign claims register. The schedule also expands the types of payments the Commissioner of Taxation can make to other countries. It expands the types of payments from principal and general interest charge to allow the commissioner to pay other amounts that may need to be paid.
Schedule 3 amends the time within which an employer can make a contribution to an employee’s superannuation fund and be able to use that payment to offset the superannuation guarantee liability. This schedule will encourage employers to be timely in making superannuation contribution payments. Schedule 4, the final schedule in the tabled bill, will make a whole series of what can be described as housekeeping changes, corrections of anomalies, to ensure that confusion is cleared up and unintended mistakes are dealt with and that the law operates as was originally intended. This is a feature of all tax law amendment bills. It is through these bills that this sort of ongoing housekeeping work can be done.
I am aware that there will be a fifth schedule through an amendment that the Assistant Treasurer will move. I have been consulted on the substance of that and the Assistant Treasurer made a public announcement last night. In essence, as he will outline in the summing up of this debate, those amendments will clarify and ensure that donations for the Victorian bushfires in all the forms that they are being made do not attract tax, which is very sensible. From time to time the rules relating to tax deductibility mean that there have to be flexibility and announcements by governments of all persuasions in this regard. It is quite obviously fitting that he has made that announcement so that there is no uncertainty whatsoever. It is appropriate, given that this tax law amendment bill is before us this day, that at the earliest opportunity he moves the required amendment to be able to achieve that in a legislative sense. I know that will of course also have the unanimous support of the House.
I rise to speak in support of the Tax Laws Amendment (2008 Measures No. 6) Bill 2008, which is an important tidying up of some significant changes in corporate law and the CGT rollover situation. It is important that, when companies undertake restructures, they do not do it in a way that minimises return to taxpayers in a way that is unfair to the integrity of the taxation system. And it is important for taxpayers to know, when they pay tax out of their pay every week or every fortnight, that companies do the same and do it correctly with respect to corporate tax and CGT.
This is just the sort of provision that should have bipartisan support, and I am pleased that the coalition is supporting it. As the shadow minister mentioned, there will be some tidying-up amendments to this bill, which will make an important improvement with regard to the status of moneys given for charitable purposes for the recovery and reconstruction of the communities in Victoria and in Far North Queensland, which are so suffering at this time. Our thoughts are with them. I see that, tragically, the forecast for North Queensland is for rain yet again overnight. The people up there have suffered enormously in terms of dislocation, damage to property and injury to persons, as well as in terms of profit loss to business. It is just tragic what has happened to them, and they must not be forgotten.
The amendments in this bill are by way of schedule. I will deal with the first schedule very briefly. It relates to modification of the capital gains tax provisions for corporate restructures. Companies will not anymore be able to obtain a market value cost base for shares and certain other interests acquired in another entity following a scrip-for-scrip CGT rollover under an arrangement that is taken to be a restructure. That is important in terms of the integrity of the system. It is important that the government address this issue. The previous government attempted to address this in October 2007. They issued a press release in relation to the matter, but it caused more confusion in the marketplace than they intended.
The government is doing this reform because it is well targeted and well measured. There has been tremendous community consultation across the sector in relation to this measure. It will not impact on genuine commercial transactions. If companies engage in proper arrangements, then they are not going to be affected. This is about the integrity of the tax system. Companies will no longer be able to effectively rip off the Australian taxpayers by very elaborate corporate restructures in this way. So I am very supportive of this measure. I know my electors in Blair pay their tax. I am sure every member of this chamber hears from their constituents that they pay too much tax and do not necessarily get value for the tax dollars they pay, so it is important that companies, who are well financed—many of them—and who have access to good accountancy advice and accurate legal advice, are prevented from restructuring their corporate arrangements in this way. I am pleased that the coalition is supporting us on this measure.
The second schedule makes some minor amendments to assistance-in-collection provisions in schedule 1 to the Taxation Administration Act 1953, to get over some identification problems in relation to effective administration. The shadow minister outlined those provisions and I am not intending to go into them in any great detail. Suffice it to say that the measure will ensure that the collection provisions of the Taxation Administration Act operate with efficiency and effectiveness and ensure that we can as a country meet our obligations under the relevant international agreements that we enter into with other nations.
It is important that we as a country meet our existing and future treaty obligations with other countries in terms of a whole range of issues, whether it is in business, child support, trade or the collection of taxation debts. These are important measures in the circumstances. They are largely administrative in their character but they are important insofar as they significantly impact upon debtors resident in Australia or having assets in Australia and owing money in other countries. It is an important measure that shows what kind of goodwill and what kind of nature we have as a country that we will fulfil obligations and ensure that our citizens do the right thing by friendly countries and other countries in our region and beyond.
The third measure, schedule 3, is in relation to late offset for superannuation guarantee contributions. Again, this is an administrative measure but it will amend the Superannuation Guarantee (Administration) Act 1992 to tighten the period within which an employer can make a late superannuation guarantee contribution and still be able to use the late payment offset to reduce their superannuation guarantee charge liability and vary the calculation of the general interest charge on unpaid superannuation guarantee charges where the employer has elected to use the offset. This particular measure will encourage employers to pay the superannuation guarantee in a more timely way. It is important that employers fulfil their obligations. They expect their employees to fulfil their obligations in the workplace, and it is important that employers do the right thing by their employees. The offset, of course, allows an employer who makes a late superannuation guarantee contribution for an employee to use that contribution to offset against part of their superannuation guarantee charge liability which is charged if they do not pay the superannuation guarantee on time.
Currently, there is no actual time limit in which the employer is required to make the contribution, and the amendments will specify that an employer will be able to use the offset if they make the contribution before they are assessed with the superannuation guarantee charge liability. It is important also that it amends the calculation of the general interest charge on an unpaid superannuation guarantee liability where the offset is used. The explanatory memorandum and the information I have received from the Parliamentary Library suggest that we might be able to save about $25 million for the Australian Taxation Office in the current financial year, and that is not to be sniffed at—$25 million in this current climate is an important saving. These three schedules are important; they are worth noting; and they are worth bipartisan support. I am pleased that it is receiving that support.
The final thing I want to talk about is the amendments which the Minister for Superannuation and Corporate Law has foreshadowed in the circumstances and which the shadow minister for financial services, superannuation and corporate law also mentioned. They are the amendments to ensure that charities collecting donations for bushfire victims are tax-deductible. It goes beyond that, of course, to other disastrous circumstances. Curiously, the Australian Taxation Office has taken the view, as I understand it, that we need legislative change because of problems with the definition of what is a charitable donation, what is a charity and what should get tax concession status. Currently, according to what I have read in relation to this matter, there is a need for amendments to our tax laws to ensure that those persons who make donations for long-term recovery and reconstruction of the community infrastructure in Victoria in these terrible times should receive the benefits of tax deductibility.
So what we are doing here in this regard is specifically listing the Red Cross’s and the Victorian government’s 2009 Victorian bushfire appeal as a tax-deductible gift recipient for a five-year period, and that will allow tax-deductible donations for that purpose. We are also doing more than that: we are allowing further concessions to be made and amending the disaster relief category to allow a Treasury minister to declare a disaster for tax purposes, and it goes on. So there are some important amendments in this regard which will help to allow donations and assistance which have been given in circumstances of fire, flood and other disasters to be used for the benefit of people such as those in Victoria and North Queensland.
I want to say briefly in relation to that that the Red Cross are to be commended for the work they have done in Victoria and also in Queensland. I have heard about what they have done, and the Red Cross are such a wonderful organisation, deserving of the kind of assistance the Australian people have given them. The kind of legislative change that the minister has circulated will help the Red Cross in their operations.
The minister has said that the bill amends various tax laws to implement a range of improvements to Australia’s tax legislation. I have to say that I agree with him. I think that that is the case with these amendments. Having gone through them carefully, I think that the bill makes our tax system more efficient and effective and gives it greater integrity. It also gives the kind of security that we need to ensure that our tax system operates in a way which is fair to our citizens and also deals with other countries in such a way that they know we are prepared to do our bit when it comes to international tax collection.
Finally, I want to pay tribute to the Red Cross workers who will get so much benefit from these deductions which are foreshadowed in the amendments. They have come to my electorate in the last few months to help us with the storms and floods which there have been in South-East Queensland, including in my electorate of Blair. I have to give a tribute to the five Red Cross workers from Bendigo who came up to help us. Their enthusiasm, compassion and humanity were on display for all to see. I took the Minister for Human Services to the recovery centre in Ipswich. The mood was infectious, and I want to say that the Red Cross have done a marvellous job. Anything we can do in terms of amendments to our tax laws to help the Red Cross is of great merit. I want to pay tribute to them and thank them for the wonderful work they have done locally in the federal electorate of Blair, in Victoria and in North Queensland with our sisters and brothers, our fellow Queenslanders, who have suffered so much at this time. I commend the bill to the House.
I am very pleased to have the opportunity to speak on this bill. As the member for Blair said, it is a bill that is supported by both sides of this House. The Tax Laws Amendment (2008 Measures No. 6) Bill 2008 has the primary function of precluding taxpayers from inadvertently obtaining a tax benefit from capital gains tax rollovers where the transaction was a restructure rather than a takeover. That is one of the main aspects of this bill, but there are some other important changes too.
Tax law is extremely complicated. I remember studying it quite a few years ago and thinking, ‘I think what we should do is put it all in a great big pile, burn it and start from the ground up again,’ because it is extremely confusing and difficult for many people out there in the community. From time to time, when legislation is passed in this place, loopholes are found. If we want to maintain the integrity of the tax system then it is our responsibility to make sure that appropriate amendments are made as we see those needs arise.
This is one of those situations where we are trying to ensure the integrity of the taxation system. If we do not do that and corporates can escape their responsibilities and the legitimate intent of these bills, it means that the average taxpayer out there has to pick up the slack. We do have a considerable responsibility and obligation at all times to make sure that there is clarity within the tax system, that the integrity of the tax system is maintained, that it is fair to everyone in the community—this is most important—and that everyone is pulling their weight.
The first schedule to this bill modifies the capital gains tax rules to prevent entities from perhaps avoiding tax under certain circumstances. This is where they would use a market value cost base for acquired interests following scrip for scrip rollover that is considered to be a restructure. The schedule amends the scrip for scrip CGT rollover provisions related to the cost base valuation for restructures. There are some rules around this. The new provisions will apply under the following conditions: that it is reasonably expected that a scrip for scrip rollover will be obtained, that the common stakeholder test is satisfied and that the acquisition arrangement is deemed to be a restructure. An arrangement is deemed to be a restructure if the market value of the scrip issued by the acquiring entity to the stakeholders in the target entity is more than 80 per cent of the market value of all interests on issue by the acquiring entity after the arrangement takes place. As I said, this is to ensure that the original intentions of the tax laws are adhered to in order to maintain the integrity of our tax system and of these measures in particular.
Schedule 2 of the bill amends the Taxation Administration Act 1953 with regard to issues with the assistance of collection provisions. The provisions of interest were enacted by the International Tax Agreements Amendment Bill (No. 1) 2006 and enabled the Commissioner of Taxation to collect or conserve tax debts that an individual or company may owe in foreign jurisdictions where they are resident in Australia or where they have resources that are located in Australia. Currently, the debt that is recorded on the foreign claims register that is removed or reduced is deemed as ‘never to have been payable’. According to the explanatory memorandum, this could ‘significantly frustrate any proceedings that the commissioner has commenced or finalised to collect the debt’. Rather than being deemed ‘never to be payable’, debt that has been removed or reduced will, under this bill, be treated as a credit. This schedule will also clarify that the role of the foreign claims register is to transform foreign debt into Australian tax debt.
Schedule 3 of the bill amends the Superannuation Guarantee (Administration) Act 1992 with regard to the late-payment offset and should be of benefit to many of those small and medium enterprises that are out there, some of which are doing it tough in the current financial difficulties. This amendment will, according to the explanatory memorandum:
… vary the period within which an employer can make a superannuation contribution after the due date for a quarter and still elect to use the late payment offset to reduce their superannuation guarantee charge liability for the quarter.
Currently, an employer is required to pay the prescribed superannuation contribution on a quarterly basis to avoid paying superannuation guarantee charges. An employer that has not paid superannuation on time is currently allowed to make a late payment at any stage before the superannuation guarantee charge is payable and then claim a late payment offset against their superannuation guarantee charge. So it is a bit of a convoluted kind of process. I guess the intent of this is to try to streamline it a bit. Further, it provides no incentive for an employer to pay the superannuation as close as possible to the original due date. The bill will amend the period in which late superannuation can be paid while still claiming a late payment offset to provide such an incentive.
Now to what is perhaps one of the most pressing aspects of the bill: the measures contained in schedule 1 to do with the CGT—that is quite a mouthful. These amendments were first proposed under the former government, and there were some criticisms levelled at the coalition by the then opposition, who alleged that some aspects of it caused uncertainty. That really is a bit of hypocrisy at its worst, because this government unleashes uncertainty on the Australian business community almost as readily as it breaks election promises. I suppose nothing could be more obvious than the confusion unleashed on small businesses in particular because of the original decision to provide unlimited bank guarantees, in a knee-jerk reaction to the international financial crisis. We all know that it is a very serious matter and governments do have to act, but that was a rather rash decision made in haste, and it has caused a lot of difficulty for the business community out there trying to raise loans to keep their businesses running. We have seen references to this in recent times on Four Corners. To level this criticism about creating uncertainty at the coalition is pretty hypocritical.
The part that I suppose has been a bit controversial was raised by Mr Davidson, a partner at PricewaterhouseCoopers, in an article in the Australian Financial Review:
“So people could be doing deals thinking we’re safe,” Mr Davidson said, “but all of a sudden we’re caught by these provisions.”
He was actually talking about the first measure that I discussed, which was schedule 1 of this bill. This is exactly the confusing behaviour that businesses do not need. In fact, industry can now be satisfied that the matter is clarified. What caused the confusion was that on 13 May there was an announcement that these changes to the capital gains tax scrip for scrip rollover provisions would apply to takeover arrangements entered into after 13 May. The government published an explanatory memorandum and the ATO website reiterated this position. Then the draft bill was released and the wording relating to takeover bids was changed slightly. The change to the bill would apply to those listed companies who conducted a takeover that was completed after 13 May rather than entered into after 13 May. We do not have a problem with this. It needed clarity; there is clarity now, and I think Mr Davidson can be satisfied that this matter has now been made quite clear to Australian businesses who might be caught up in this provision.
I was pleased to hear both the member for Casey and the member for Blair mention, and also to see the media release by the Assistant Treasurer announcing, that donations to the 2009 Victorian bushfire appeal would also be affected by an amendment to this bill so that they would not have their current tax concessional status affected by those monies that are used for longer term recovery and reconstruction. We on this side certainly welcome the addition of this amendment to the bill, should it be agreed to by this House. As both the member for Casey and the member for Blair have said, many organisations and people have raised a considerable amount of money to assist those people caught up in these terrible fires in Victoria, and this amendment will give greater clarity to the tax treatment in this case. We need to ensure that the Australian Taxation Office is in a position to make sure that these donations are not caught up and taxed inadvertently.
This piece of legislation will also provide greater clarity for the status of organisations collecting donations in response to a disaster. There may be other disasters that take place, but it will certainly apply to the 2009 Victorian bushfires. The mechanism will provide a means to ensure that donations to organisations in support of victims of such disasters can be used for immediate relief or for reconstruction. Like the member for Blair, I would also like to take the opportunity to pay tribute to the incredible work of many organisations; for the moral, physical and practical support that they have offered and also for their tremendous fundraising efforts. We have seen this incredible outpouring of generosity from the community and we know that the Red Cross has been at the very forefront of that. We appreciate the work that they do and the last thing that any of us in this place would want to see is those donations, and the ability for those donations to help rebuild people’s lives, interfered with or detracted from by having them taxed. I think this is a welcome amendment to this bill.
There is a fourth schedule, but it is a bit of housekeeping, so I am happy to say that we can support the measures in this bill.
I rise to address the Tax Laws Amendment (2008 Measures No. 6) Bill 2008, and would like to begin by endorsing the generous words of the member for Pearce, especially with regard to the bushfire situation and the generosity of Australians. It is commendable, and I would particularly like to note those people in Far North Queensland who were undergoing their own difficult circumstances with the floods but who were still able to support the Victorian bushfire victims.
That is obviously a common-sense amendment in terms of looking after those donations, and this bill before the House is all about common sense. It contains lots of common-sense amendments to three areas of tax law. Firstly, it adjusts the capital gains tax provisions for corporate restructures, which is very timely and necessary in the current climate after the global financial crisis; secondly, it amends the provisions enabling collection of tax debts owed in another country; and, finally, it improves the late payment offset for superannuation guarantee contributions.
Deputy Speaker Burke, I do not intend to dwell on any of these amendments in any great detail. I know that will disappoint you and the member for Corio, because I know about the enthusiasm that you and the member have for complex areas of tax law. Instead, I am just going to go over a couple of other things. Nonetheless, I will look firstly at the changes to capital gains tax rollovers for corporate restructures.
Back in 1999, then Treasurer Peter Costello introduced scrip for scrip rollover provisions as part of the New Business Tax System (Capital Gains Tax) Bill 1999. Under the scrip for scrip rollover system, if you are an investor and the company in which you own shares is taken over and you receive new shares in the takeover company, you are entitled to roll over capital gains. In other words, the rollover allows the taxpayer to disregard the capital gains from the original shares, and the replacement shares are considered to have been acquired for the cost of the original interest. Surprise, surprise—some people have exploited that situation. Unfortunately, under the member for Higgins’s system, these provisions were exploited by some companies for tax minimisation. I have no problem with lawyers and accountants finding ways to be gainfully employed—obviously those private school fees do not pay themselves—but this is a common-sense amendment. Some companies were able to gain significant tax benefits through restructures where an original company joins a new holding company to attract the scrip for scrip rollover without any significant change in the ownership of the assets.
This bill will prevent companies from obtaining a market value cost base for shares and certain other interests acquired in another entity under an arrangement that is taken to be a restructure. A takeover or a merger that meets certain criteria will be considered a restructure and the cost base for membership interests will reflect the cost bases of the underlying net assets of the original entity. This measure is about ensuring companies are not able to shirk their tax obligations. As I said, it is a common-sense approach to the exploitation of a Higgins loophole. Australian workers who flog their guts out to pay off their mortgage, care for their families and pay their taxes are fed up with wealthy companies ripping off the tax system under the veil of tax minimisation. The government should act to close these loopholes, and I am pleased that this bill will restore greater integrity when it comes to these capital gains elements of tax law. This measure will not impact genuine commercial transactions and will deliver on the original intent of the provisions, which was, as Peter Costello said in his second reading speech, to ‘free up the market for competitive takeovers’.
This bill also amends the Taxation Administration Act 1953 to improve the administration of the collection of tax debts owed in another country where the debtor resides or has assets in Australia. Particularly, these amendments will address a number of issues which affect the commissioner’s ability to collect tax debts. They will also ensure Australia can meet its treaty obligations relating to mutual assistance in collection of tax debts. This bill clarifies that the role of the foreign claims register is to transform foreign tax debts into Australian tax debts. This enables the commissioner to engage in debt collection and make the payments to the foreign country.
Finally, this bill amends the Superannuation Guarantee (Administration) Act 1992. It places a time limit on the period in which an employer can offset any contribution to an employee’s late superannuation guarantee against part of their superannuation guarantee charge liability. The charge liability is paid if employers do not pay the superannuation guarantee on time. However, there is currently no specified time limit in which an employer is required to make the contribution. Employers will be able to use the offset if they make the contribution before they are assessed for the superannuation guarantee charge liability. The inclusion of a time limit will encourage employers to more quickly make their contributions to take advantage of the offset. These measures are expected to achieve about $25 million in savings for the ATO. The Assistant Treasurer consulted widely and this measure has been positively received by genuine, good corporate citizens. I commend the bill to the House.
in reply—I thank the members who have contributed to the debate on the Tax Laws Amendment (2008 Measures No. 6) Bill 2008. Schedule 1 of this bill modifies the capital gains tax provisions of the Income Tax Assessment Act 1997 for corporate restructures. Companies will be prevented from obtaining a market value cost base for shares and certain other interests acquired in another entity following their scrip for scrip capital gains tax rollover under an arrangement that is taken to be a restructure. An arrangement will be taken to be a restructure if, broadly, the market value of the shares and certain other interests issued by the acquiring entity under the arrangement in exchange for similar interests in the original entity is more than 80 per cent of the market value of all the shares in other interests issued by the acquiring entity. If an arrangement is taken to be a restructure then the cost base for the shares and other interests that the acquiring entity acquires in the original entity will reflect the tax costs of the underlying net assets of the original entity rather than its market value.
This is an important integrity measure, which the former government announced its intention to deal with in October 2007. However, the former government’s proposal was poorly targeted and effectively stopped scrip for scrip arrangements, causing disruptions in the market. The government’s measure has been refined through very extensive consultation and will effectively target the mischief. The amendments will apply to arrangements entered into after 7.30 pm Australian Eastern Standard Time on 13 May 2008 and will prevent companies from gaining significant unintended tax benefits by restructuring. I commend the bill to the House, this schedule and the other schedules noted therewith.
Question agreed to.
Bill read a second time.
Message from the Governor-General recommending appropriation announced.
Bill—by leave—taken as a whole.
by leave—I present a supplementary explanatory memorandum to the bill, and I move:
(1) Clause 2, page 1 (lines 7 to 9), omit the clause, substitute:
2 Commencement
(1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.
Commencement information | ||
Column 1 | Column 2 | Column 3 |
Provision(s) | Commencement | Date/Details |
1. Sections 1 to 3 and anything in this Act not elsewhere covered by this table | The day on which this Act receives the Royal Assent. | |
2. Schedules 1 to 4 | The day on which this Act receives the Royal Assent. | |
3. Schedule 5, Part 1, Division 1 | 29 January 2009. | 29 January 2009 |
4. Schedule 5, item 4 | 1 July 2011. However, if item 99 of Schedule 3 to the Tax Laws Amendment (2009 Measures No. 1) Act 2009 commences before 1 July 2011, the provision(s) do not commence at all. | |
5. Schedule 5, items 5 and 6 | 1 July 2011. | 1 July 2011 |
6. Schedule 5, Part 2 | The day on which this Act receives the Royal Assent. | |
7. Schedule 5, Part 3 | 29 January 2009. | 29 January 2009 |
Note: This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.
(2) Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act.
(2) Page 27 (after line 5), at the end of the Bill, add:
Schedule 5—Victorian bushfires and North Queensland floods
Part 1—Ex-gratia Income Recovery Subsidy Assistance
Division 1—Main amendments
Income Tax Assessment Act 1936
1 Subsection 159J(6) (after paragraph (b) of the definition of separate net income)
Insert:
(ba) does not include an ex-gratia payment from the Commonwealth known as Income Recovery Subsidy for the Victorian bushfires of January and February 2009; and
(bb) does not include an ex-gratia payment from the Commonwealth known as Income Recovery Subsidy for the North Queensland floods of January and February 2009; and
Income Tax Assessment Act 1997
2 Section 11-15 (table item headed “welfare”)
Before:
maintenance payment............................................................. | 51-30 and 51-50 |
Insert:
Income Recovery Subsidy for the North Queensland floods of January and February 2009............................ | 51-30 |
Income Recovery Subsidy for the Victorian bushfires of January and February 2009............................................. | 51-30 |
3 Section 51-30 (at the end of the table)
Add:
5.2 | an individual in receipt of an ex-gratia payment from the Commonwealth known as Income Recovery Subsidy for the Victorian bushfires of January and February 2009 | the payment | the payment must be claimed: (a) after 28 January 2009; and (b) before 13 May 2009 |
5.3 | an individual in receipt of an ex-gratia payment from the Commonwealth known as Income Recovery Subsidy for the North Queensland floods of January and February 2009 | the payment | the payment must be claimed: (a) after 30 January 2009; and (b) before 13 May 2009 |
Division 2—Sunsetting on 1 July 2011
Income Tax Assessment Act 1936
4 Subsection 159J(6) (paragraphs (ba) and (bb) of the definition of separate net income)
Repeal the paragraphs.
Income Tax Assessment Act 1997
5 Section 11-15 (table item headed “welfare”)
Omit:
Income Recovery Subsidy for the North Queensland floods of January and February 2009............................ | 51-30 |
Income Recovery Subsidy for the Victorian bushfires of January and February 2009............................................. | 51-30 |
6 Section 51-30 (table items 5.2 and 5.3)
Repeal the items.
Part 2—Gifts
Income Tax Assessment Act 1997
7 Subsection 30-45(1) (table item 4.1.5)
Repeal the table item, substitute:
4.1.5 | a public fund (including a public fund established and maintained by a public benevolent institution): (a) that is established for charitable purposes; and | see sections 30-45A and 30-46 |
(b) that is established and maintained solely for providing money for the relief (including relief by way of assistance to re-establish a community) of people in Australia in distress as a result of a disaster to which subsection 30-45A(1) or 30-46(1) applies |
8 Subsection 30-45(2) (at the end of the table)
Add:
4.2.41 | 2009 Victorian Bushfire Appeal Trust Account (established under section 19 of the Financial Management Act 1994 of Victoria) | the gift must be made: (a) after 7 February 2009; and (b) before 6 February 2014 |
9 After section 30-45
Insert:
30-45A Australian disaster relief funds—declarations by Minister
(1) For the purposes of item 4.1.5 of the table in subsection 30-45(1), an event is a disaster to which this subsection applies if the Minister has declared it to be a disaster. The Minister may do so if satisfied that:
(a) it developed rapidly; and
(b) it resulted in the death, serious injury or other physical suffering of a large number of people, or in widespread damage to property or the natural environment.
(2) The Minister’s declaration of an event as a disaster:
(a) must be in writing; and
(b) must specify the day (or the first day) of the event; and
(c) must be published on the internet or by another method determined by the Minister.
(3) The Minister’s declaration of an event as a disaster is not a legislative instrument.
(4) You can deduct a gift that you make to a public fund covered by item 4.1.5 of the table in subsection 30-45(1), in relation to a disaster to which subsection (1) of this section applies, only within the 2 years beginning on the day specified in the declaration as the day (or the first day) of the event for which the fund is to provide relief.
Note: Public funds under item 4.1.5 of the table in subsection 30-45(1) are for disaster relief of people in Australia. Public funds may also be established for disaster relief of people in other countries. See items 9.1.1 (which is not limited to disaster relief) and 9.1.2 of the table in section 30-80.
10 Section 30-46 (heading)
Repeal the heading, substitute:
30-46 Australian disaster relief funds—declarations under State and Territory law
11 At the end of subsection 30-46(1)
Add:
; and (d) subsection 30-45A(1) does not apply to it.
12 Subsection 30-46(2)
After “subsection 30-45(1)”, insert “, in relation to a disaster to which subsection (1) of this section applies,”.
13 Section 30-315 (before table item 1AA)
Insert:
1A | 2009 Victorian Bushfire Appeal Trust Account | item 4.2.41 |
Part 3—Application
14 Application of amendments
(1) The amendments made by Division 1 of Part 1 of this Schedule apply in relation to the 2008-09 income year.
(2) The amendments made by Part 2 of this Schedule apply in relation to:
(a) the 2008-09 income year; and
(b) later income years.
These supplementary amendments to the Tax Laws Amendment (2008 Measures No. 6) Bill 2008 introduce taxation measures to alleviate financial hardship being felt in communities affected by the 2009 Victorian bushfires and North Queensland floods. Part 1 of schedule 5 amends the Income Tax Assessment Act 1936 and the Income Tax Assessment Act 1997 to exempt the income recovery subsidy from income tax and to ensure the subsidy is not included in separate net income for the purposes of calculating an entitlement to certain tax offsets. The income recovery subsidy will provide financial assistance to employees, small business owners and farmers who can demonstrate that they have experienced a loss of income as a result of the 2009 Victorian bushfires or the North Queensland floods.
Part 2 of Schedule 5 amends the Income Tax Assessment Act 1997 to allow the Treasurer to declare an event as a disaster for the purposes of establishing Australian disaster relief funds. The declaration of a disaster by the Treasurer will allow Australian disaster relief funds to receive tax-deductible donations and provide money for the relief of people in Australia in distress as a result of the disaster. Public benevolent institutions, which must normally operate for direct relief efforts, will also be able to establish Australian disaster relief funds for longer term recovery and community reconstruction efforts.
Part 2 also lists by name the 2009 Victorian Bushfire Appeal Trust Account as a deductible gift recipient in the Income Tax Assessment Act 1997. This will ensure the fund can use tax-deductible donations for relief, recovery and community reconstruction efforts in communities affected by the 2009 Victorian bushfires. The cost to revenue of listing the trust account will be in the order of $46.5 million in the 2009-10 income year. Could I take this opportunity to say that these amendments are very important in ensuring the ongoing tax deductibility of the Victorian bushfire appeal and to ensure that the funds can be used appropriately for certain reconstruction efforts in the aftermath of those fires. I thank the officers of the Treasury for working so quickly with my office and me to ensure that these amendments are readily passed by the House. I also thank the opposition for their cooperation. The shadow minister and I have discussed these matters at length privately and I thank him for the approach that the opposition has indicated that they will take.
The opposition fully supports these amendments as outlined by the Assistant Treasurer. I commend the Assistant Treasurer for his consultation and for the speed with which he has made the announcement and sought to legislate the necessary amendments.
Question agreed to.
Bill, as amended, agreed to.
Ordered that this bill be reported to the House with amendments.