I rise on behalf of the opposition to indicate our support for this legislation, with one exception, relating to part 4 of the bill. But I do want to indicate our broad support for the Renewable Energy (Electricity) Amendment Bill 2015. The opposition does not do this with any particular sense of joy. We do it more with a sense of relief. In introducing this bill, and his second reading amendment, the minister indicated that the change, particularly to the Large-scale Renewable Energy Target, was, to use Minister Hunt's words, 'to better reflect market conditions'. We do not agree with that diagnosis. Instead, what this bill does is to pull an industry, a critical industry, back from the brink and put it back on a stable footing, not only in relation to the existing investments that do so much for our electricity sector and underpin so many jobs, but also to allow further investment to take place.
The government and the opposition need to do this because of a reckless and gratuitous attack that the Prime Minister launched on the renewable energy industry last year, adding this to a very long list of broken election promises. The election promise that the government made in relation to the Renewable Energy Target was not a vague promise. It was not off-the-cuff or ill considered. It was a promise that extended back many years—back to, in its second form at least, the renegotiation of the Renewable Energy Target between Minister Wong and then shadow minister MacFarlane, who is in the chamber and is now the Minister for Industry—
And science!
and Science, as he is at pains to stress in this place. You will have your chance, Minster for Industry and Science. The Prime Minister, as the opposition leader, voted for the Renewable Energy Target, in 2009, and he took the coalition's support for the Renewable Energy Target to elections in 2010 and in 2013. Although the Renewable Energy Target policy, before the framing of the actual legislation, was often described in an everyday sense as 20 per cent by 2020, it was quite clear that the coalition was expressing support for the large-scale target that existed in legislation before the 2013 election of 41,000 gigawatt hours. The bipartisan support that the renewable energy industry, through the Renewable Energy Target in particular, has enjoyed goes right back to 2001, when the then Howard government, involving, again, the now Minister for Industry and Science, developed the first mandatory Renewable Energy Target, back in 2001. That bipartisan support has been critical to underpin the confidence of investors—both investors here in Australia, but more recently investors from overseas—to come and put their money on the table for investments that run for many years, for 15 to 20 years in many cases. Obviously these are investments that, in the ordinary course of things, would span at least a couple of changes of government.
Because of that bipartisan support and the investor confidence that came from that, we have had extraordinary success, particularly during the last term of the Labor government, from 2007 to 2013. There have been billions of dollars invested in Australia's renewable energy industry, both in the small-scale part of the sector, particularly rooftop solar, but also in large-scale renewable energy investment. During our term in government between 2007 and 2013, Australia's wind power tripled in just six years. There were a whole range of wind farm projects, particularly over the southern part of the continent, but also some iconic projects were developed, particularly, towards the end of our term in government, often with the support of the Australian Renewable Energy Agency, ARENA, and the Clean Energy Finance Corporation. In 2013 alone, the Gillard government was able to announce the largest wind farm in the Southern Hemisphere, the Macarthur wind farm in Victoria. It was supported by a range of proponents, including AGL. Later in that same year the largest PV solar farm in the Southern Hemisphere was announced, again being built by a range of partners including AGL, in Nyngan and in Broken Hill, in Western New South Wales. This really highlighted the degree to which Australia had become a world leader in renewable energy development—in the small-scale sector, but particularly the large scale sector. Ernst & Young does a quarterly index called the Renewable energy country attractiveness index, which is broadly regarded around the world as one of the leading indices of renewable energy investment. In 2013, in the June quarter, before the change of government, Australia had joined the powerhouses in this area—Germany, China and the United States—as one of the four most attractive countries on the face of the earth in which to invest in renewable energy.
Over that course of time, during our time in government—and it will not be of any surprise to anyone hearing those statistics—the number of jobs tripled in this industry. That was a period that included—which those opposite often choose to forget, but all the rest of us know—the global financial crisis. There are not many industries that over that period were able to triple the number of jobs. And they were not just the core jobs in renewable energy; there were spin-off jobs in manufacturing that had been in many cases operating for some time, in places like Portland and Tasmania, building components for wind towers. But also in my own part of Adelaide, in northern Adelaide, Elders IXL, a very old family company that had work in appliances and more recently in automotive components, took the decision to invest in a factory in northern Adelaide to build, using Australian steel, the frames that were used to support the PV solar panels in the wind farm at Nyngan and Broken Hill—around two million panels on about 100,000 steel frames made from Australian steel, great manufacturing jobs in the north of Adelaide.
Also over this period a huge success story was emerging in rooftop solar. The Small-scale renewable Energy Scheme, or SRES, part of the renewable energy target legislation, has underpinned an explosion in the number of solar panels on the rooftops of Australian homes. When we came to government around 7,400 households in Australia had rooftop solar panels. By the time we left it was more than 1.2 million. In 2014 alone, in spite of the uncertainty that had afflicted the renewable energy industry because of the Prime Minister's reckless attack on the Renewable Energy Target, there were still about 186,000 Australian households with rooftop solar panels added to their roofs, with about 3½ thousand per week being added on average. Just to give that some context, only 14 years earlier, at the turn of the century, in 2000, an average of two households a week—not 3½ thousand but two—were having solar panels added to their roofs, exemplifying the degree to which this has genuinely been a revolution.
The renewable energy target and associated policies has also been a roaring success in starting to bring down carbon pollution levels in Australia's electricity sector. That is central to the challenge we have as a nation in our response to climate change, because electricity generation is the largest source of carbon pollution in our economy. Australia has a very emissions-intensive electricity sector, particularly in generation. It is more emissions-intensive than China and about 90 per cent more emissions-intensive than the OECD average. So, getting carbon pollution down in electricity generation is a central part of the national response to climate change. In 2012-13, the first year of the operation of the carbon price mechanism in the national electricity market, carbon pollution was reduced by seven per cent, in just that one year. That was due in part to a reduction in demand, but only in small part. Two-thirds of that reduction in carbon pollution from the national electricity market was because of a change in energy mix, a significant reduction in the market share in the NEM of coal, particularly brown coal, and an increase by 25 per cent in the renewable energies share of the national electricity market. That reduction continued in 2013-14, a reduction of four per cent in carbon pollution levels from the national electricity market. But, unsurprisingly, given the termination of strong climate change policies and the attack on renewable energy investor confidence, carbon pollution levels have started to rise over the past 10 to 12 months on this government's watch.
South Australia is a great example—and I do not say that just because I am from that state—of the inroads that can be made on carbon pollution levels through strong investment in renewable energy. Since 2005—in less than a decade—in spite of having largely equal demand from our electricity generation over that period, carbon pollution levels have been reduced by a third, from nine million tonnes on average in 2005 to about six million tonnes of carbon dioxide equivalent, in part due to some expansion in electricity generation through gas but overwhelmingly because of the enormous investment in renewable energy, particularly wind and solar generation in that state.
Also, something that is very important in terms of the political backdrop to this debate is that the renewable energy target has helped to keep downward pressure on household and business power prices. For the Prime Minister, this is really where this all went off the rails. In an interview with Sydney broadcaster Alan Jones in the earlier part of 2014 the Prime Minister claimed that the renewable energy target was, to use his words, 'pushing power prices up'. In the subsequent several months four significant pieces of modelling came out, including by the Prime Minister's own hand-picked panel, the Warburton review panel, which confirmed that the expansion of renewable energy capacity in the system operated to put downward pressure on power prices, particularly wholesale power prices, flowing through in terms of power bills for households and small businesses.
Because of that extraordinary success, the sector was on track to achieve the large-scale target of 41,000 gigawatt hours, and, again, the Prime Minister's own hand-picked panel, the Warburton review, confirmed that there were enough projects in the pipeline to achieve that large-scale target. But the Prime Minister's ambush on this policy in the first half of calendar year 2014 caused investor confidence, which had been sky-high only 12 months earlier, to absolutely crash. The 2014 figures from Bloomberg New Energy Finance confirmed that a shocking picture immediately followed the Prime Minister's attack. Investment in the large-scale part of the market in Australia collapsed by 88 per cent in 2014 alone. At a time when renewable energy investment around the world soared by 16 per cent and in China soared by 32 per cent, investment in Australia collapsed by 88 per cent. The total money invested in 2014 saw us drop, in aggregate terms, from 11th in the world in terms of dollars invested to 39th, behind countries such as Myanmar, Honduras, Panama and others which became bigger investors in renewable energy than Australia. Billions of investment was at the edge of the cliff and thousands of jobs were at risk.
Labor have great ambitions for renewable energy in Australia. From our point of view, the renewable energy target for 2020 and the associated policy framework, such as ARENA and the Clean Energy Finance Corporation, is just a beginning for further investment and further expansion in renewable energy. Australia is blessed with some of the most extraordinary renewable energy resources in the world. We have extraordinary wind resources, particularly across the southern half of the continent, solar resources across pretty much the whole of the continent, marine resources, particularly in the Southern Ocean, and much, much more. We want a base that will see further investment in renewables, not less investment. Our very clear view is that the Australian people take the same view on that.
Labor could have sat back and watched this fairly tragic story unfold after the Prime Minister's attack on the renewable energy target and said, 'They are the government. They need to pick up the mess.' We reflected on that. We took the view that our very serious concern about the long-term damage that would be done to Australia's reputation as a safe investment destination, particularly in energy and renewable energy, required us to go to the table and do all that we reasonably could to restore investor confidence, which, after all, has been our overarching objective through this.
This deal does that. The deal that has been struck between the government and the opposition, as the two major parties of government and two parties of alternative government in this country, does that. This restores confidence in the rooftop solar sector. Confidence had been damaged by recommendations from the Warburton review that that program be scaled back. It was recommended that that hugely successful and very, very popular program in the Australian community be scaled back. In particular, the Warburton review focused on potentially scaling back the small-scale scheme from a ceiling of 100 kilowatts, which is particularly important for small businesses and organisations such as nursing homes and the like, to just 10 kilowatts. I am very glad that, following a strong campaign from the industry, coordinated by the Solar Council, we have been able to restore confidence in that part of the market through this deal.
This deal and this legislation also restore confidence in the large-scale renewable energy target. The Labor Party would far prefer that the Prime Minister had stuck to his election promise to roll out 41,000 gigawatt hours of large-scale renewable energy by 2020. But, given we have lost 18 months of investment during this period of time, 41,000 gigawatt hours is broadly not obtainable anyway. So 33,000 gigawatt hours as the new large-scale target is something that we are confident, based on all of the advice we have, will restore investor confidence to the large-scale part of the industry. It will require, as the Minister for Industry and Science has indicated on a couple of occasions now, that the industry pretty much double the existing large-scale renewable energy that it has built over the last 15 years in the next five years. So it is a very substantial and reasonably ambitious bill task for the large-scale sector, but every indication shows that it will be able to be achieved.
The Clean Energy Council indicates that the 33,000-gigawatt-hour large-scale target will mean that about 30 to 50 large projects will be built over the next few years, involving about $10 billion in investment and 6,500 jobs. In broad terms, there will need to be 6,000 megawatts of capacity added. The industry has said for some time now that there are more than 6,500 megawatts of capacity involved in projects that have already received project planning approval. Almost all of them are either large solar or wind projects. So we are very confident that we have restored investor confidence and that we can achieve this target.
On the basis of the deal set out in this legislation, the government says that we are likely to be in a position in 2020 of having around 23.5 per cent of Australia's electricity delivered by renewable resources. That depends on what you think will happen in the rooftop solar program and also where you think electricity demand might be by the end of the decade. But it may well be that we will even be close to 25 per cent of Australia's electricity being delivered through renewables. Although Labor is disappointed that we were not able to see the rollout of the previously agreed large-scale target of 41,000 gigawatt hours, there is no question that this deal still provides a strong platform for further growth during the 2020s.
Now Labor want to focus on the future. There are exciting technologies emerging almost every week, it would seem, in this industry—in the solar sector, the wind sector and many other emerging renewable sectors such as marine and geothermal. Particularly exciting technologies have started to emerge this year in the area of storage, large-scale renewable projects and also particularly households and small businesses. Labor want to start talking now. We have been able to move on from this controversy. We want to start talking to the industry and the community now about our ambitions for the future.
The Leader of the Opposition has indicated that, if we are elected at the next election, be that this year or next, it would be our proposal to move to lift the large-scale target for 2020. We think particularly in the out years of the decade that there is extra capacity there. We would only do so, obviously, in a way that was consistent with market stability. The Leader of the Opposition has also indicated that we are already talking with industry stakeholders about post-2020 arrangements. In order to do that in a measured and orderly way, we think that those discussions need to start this year and next so that any legislation that would start to build a platform for post-2020 arrangements was able to be put in place, at the latest, by mid-2018. We are very confident now with this platform that we can have those discussions.
Labor will also continue to defend the work of the Renewable Energy Agency, ARENA, and the Clean Energy Finance Corporation from the attempts by this government to abolish those two organisations. We will do everything that we can in the Senate and in the community to continue to prosecute the arguments for keeping those two very, very important organisations.
Before I address the remaining point of disagreement around native wood waste, I want to say, firstly, a few more words about the process that led to this legislation. We took the view—I think the government took the view, ultimately, as well, as does the industry—that bipartisan agreement in this area, particularly for the large-scale target, is critically important. This is not a deal you can land with the crossbench.
Investors will not invest for multi-year projects on the basis of a deal done with the crossbench. They want to know that the two parties of government have agreed with the core elements of this policy. That was the view we, the opposition, took early on. I thank the shadow minister for resources and energy, the shadow Treasurer and the Leader of the Opposition and his office for the very resolute view they came to, early, that we needed to sit down with the government to see if we can resolve this controversy.
Those were constructive and mature negotiations, largely conducted with the Minister for Industry and Science and the Minister for the Environment. I thank both those ministers and their officers for the way in which those negotiations proceeded. I also thank on behalf of the opposition the frank advice we received from the industry and stakeholders, the Clean Energy Council, the Solar Council, Solar Citizens and many other organisations that were active participants in this process.
The bill now sets a new yearly large-scale target between now and 2020—or new targets every year between now and 2020—which we understand has been the subject of consultation with the sector and the Clean Energy Regulator. They now have our support as well. The bill also provides full exemptions for the emissions-intensive trade exposed sector. This follows strong advocacy by the Leader of the Opposition on that point—particularly in relation to the aluminium sector but also in relation to a number of other parts of manufacturing—by Tasmanian members of the Labor caucus, led by the member for Franklin, by the member for Corio, in relation to operations around Geelong, by the members for Newcastle, Charlton, Shortland and Hunter and the member for Makin, in my own state of South Australia, Labor's parliamentary secretary for manufacturing. I thank them all for their support and advice.
The bill provides for the Clean Energy Regulator to prepare annual reports on the progress of the renewable energy target. Opposition takes the view that this will be a useful addition to the debate, although we do trust that the report on power prices will look at the net impact of power prices of this scheme—not just the impact of the certificates but also the impact the scheme has on wholesale power prices—in order to give a true reflection. The bill also removes the two-yearly reviews, which I think we now all agree will provide much more certainty for investors. As the minister said in his second reading speech, the major parties have agreed to work cooperatively to resolve any issues that may arise with the operation of the renewable energy target to 2020. The opposition indicates its support for all those elements of the bill.
I talk now to a part of the bill that Labor cannot support. That is the reinsertion of native wood waste into the scheme. It is worth repeating that Labor has approached these negotiations and the debate around this bill with an overarching objective of restoration of investor confidence in the renewable energy industry. Advice we have received from the industry, more broadly, and those parts of business that fund the industry, through equity or debt, has been that this question of native wood waste is not material to the question of broader investor confidence. It will not impact on broader investor confidence, either way.
As I have said publicly on a number of occasions, our view is that this attempt to reinsert native wood waste into the renewable energy scheme is nothing more, nothing less, than a cynical red herring that was foisted on the government negotiators at the last minute and which they put on the table, again, at the last minute. It is not an issue that was raised with me, at any point, during negotiations—they went for some 12 months—with the industry as something that was a critical issue for them.
Labor's position on this question should be very well known, and for anyone who has an interest in this it should come as no surprise. It was the Labor government that took this provision out of the renewable energy scheme some years ago. It was inserted originally under the Howard government. It was a Labor government that removed this element of the Howard scheme, from the scheme, some years ago. It was also the Labor government that proposed attempts to reinsert native wood waste over the last couple of years. So it should come as no surprise that the Labor Party opposes this attempt again.
We take the view that native wood waste is neither clean nor renewable, in the sense that term is used in the modern parlance for the renewable energy scheme. Boosters of this provision like to pretend that what we are talking about here is small amounts of waste, small amounts of refuse, that are left on the forest floor after some harvesting. Small amounts are raked up, put into a pile and then put into a wood furnace. It is not the case. That is not an accurate way to describe the work this provision put forward by the government seeks to do. We know that the definition of native wood waste would involve the whole of any tree that is harvested but not ultimately saw-lopped. It would involve all the remaining parts of a tree that were harvested from a native forest, except that part of a tree that was saw-lopped.
Labor is not willing to see the renewable energy scheme used to provide an alternative to the hard work, the really serious questions, that need to be debated around the future of our traditional logging industries, not just in Tasmania but more broadly around Australia. We are not willing to see the renewable energy scheme used to provide an alternative to the hard work that was under way during the Tasmanian forest agreement between industry, the CFMEU representing workers in the industry, environmental organisations and the Tasmanian and Commonwealth governments. The cynicism of those, particularly from the Tasmanian state Liberal government, who would now seek to insert native wood waste back into the renewable energy scheme, given the damage that they did to the Tasmanian forests agreement, is breathtaking. It is simply breathtaking.
To that end, I indicate that during consideration in detail and the third reading of this bill, I will be moving amendments that have already been circulated in my name. Firstly, to remove the provisions in this bill that seek to reinsert native wood waste into the scheme, and, secondly, to amend the act to prevent any future regulation being made by the government to reinsert native wood waste into the scheme. I commend the amendments when they come before the House, to the House.
In rising, can I thank the shadow minister for the environment, and other shadow ministers, for their participation in the negotiation. As is always the case, there was a fair amount of useful and helpful discussion to ensure that we did clean up the mess that had been left by the previous government in relation to the renewable energy target, as we do in a whole range of areas—I mentioned the Home Insulation Program yesterday, and of course we know about the mess left in the budget.
This renewable energy scheme, as the shadow minister quite rightly identified, was originally introduced by this government. In fact, I lay claim to being one of the few people, as a minister, who has been involved in this issue since it was first instituted, in 2001, when I was the Minister for Industry, Tourism and Resources. This scheme was heading for the rocks, and it was in a state where the target was no longer sustainable. We set out as a government to make sure that the renewable energy target was a sustainable target, and that the renewable energy industry itself was sustainable, because it relies very heavily on this scheme—very heavily. We are getting close, particularly on rooftop home solar, to a scheme that may be able to stand on its own two feet without others subsidising the cost of those things—and we are close in a number of other areas—but renewable energy in Australia, and in fact globally, still requires a subsidy from electricity consumers. We need to be sure that we have the balance right.
We said in opposition— as members of the Clean Energy Council would recall if they thought about it, because I said it on three occasions in front of them—that the coalition, in government, would support a renewable energy target of 20 per cent. My view was that the target should be more aligned to the original aspiration, which was 20 per cent of the energy consumed in the form of electricity. The target of 45,000 gigawatt-hours that we were confronted with when we came to government was more like 27 per cent, and there was a real question mark as to whether or not this scheme was sustainable from the perspective of even building that amount of renewable energy. As we know from experience, and a little bit of disappointment, that target will be achieved only through one technology, and that technology is wind.
I heard the shadow minister talk about jobs, and jobs are important in the renewable energy industry, but we need to remember that those jobs are subsidised to the tune of $200,000 each. No job that requires the support of electricity consumers to that degree can be given without some questions being asked about how we want this industry to take shape.
There has been, at the bottom of this, a discussion about the changing shape of energy markets—and cue a joke about economists, but I will not tell the House the same joke again, although it is very funny! The reality is that the economic forecasts made in 2009 about the amount of electricity we would be consuming in 2020 were wildly inaccurate. That is for a whole range of reasons, not all of them because of a change in the economy and the change in industry. The reality is that we have felt a significant impact from things like rooftop solar, and more particularly from energy efficiency, with the introduction of smart meters, and with consumers understanding how they can save electricity and not only benefit the environment but also benefit their own pocket. This has seen a significant change in energy consumption and energy consumption forecasts. That is why a target of 41,000 gigawatt hours for large-scale, combined with what we quite happily saw was an explosion in the number of houses that were fitting rooftop solar, would have meant that the renewable energy scheme was going to far exceed not only the expectation, but, in the case of large-scale, the ability of the industry to build a scheme that would have been 27 per cent of electricity consumed.
The other fundamental issue is that as a result of the change to energy demand Australia is suffering from a massive oversupply of generation capacity. We currently have in Australia around 9,000 megawatts of over-capacity in generation, or about 15 per cent more generation than we need. That position makes managing the energy market in Australia particularly difficult. It also means that adding another 5,000—I heard the shadow minister say 6,000—megawatts of generation to the target is going to put further pressure on that market. So getting people to buy the electricity that was being generated by the wind farms was proving to be impossible. I heard all the conspiracy theories—I have heard them all before. With all respect to the shadow minister, perhaps he should talk to the shadow minister for resources and energy and actually get an insight into how the energy market works, because it was the inability of renewable energy components to get off-take agreements, or someone to actually buy their electricity, that was grinding these projects to a halt. There was still plenty of room—anything that had been built in the time that we had been in government would have been grandfathered under whatever the outcome was. The industry knew that the minimum position was 26,000 gigawatt hours. So that is an excuse from the shadow minister and, I dare say, a political point which does not become him, because the reality is that without a clear path on the Renewable Energy Target set out in a bipartisan way then there was just not the confidence in the market for people to actually commit themselves to buy the electricity from these wind farms for the next 15 years.
I did also say that there has been an enormous penetration into the market—and it is a great thing—of rooftop solar household renewable energy. A prediction—cue the economist joke—of 4,000 gigawatt hours of generation from rooftop solar is, again, wildly incorrect. In terms of the capacity in generation that is coming from rooftop solar at the moment, 7,000 gigawatt hours has already been achieved. It looks to us—as in the collective wisdom of economists, departments, government and people in the energy industry—that that number will actually double in the period between now and 2020 as rooftop solar becomes a viable proposition with the Renewable Energy Target because you can buy a rooftop solar system and have it pay for itself sometimes in as little as five years, and the coming advent of battery technology will make that even more viable.
We have seen a massive acceleration in generation from rooftop solar. So, when people talk about what the target is, the target is still 45,000 gigawatt hours, but the mix has changed. In terms of how much will come from large scale, we know that number is now going to be 33,000 gigawatt hours. How much will come from rooftop solar? Probably another 14,000 gigawatt hours, and you only have to do your maths to know that that is 2,000 gigawatt hours more than the 45,000 gigawatt hours that was originally agreed to in 2009, and, as I said, the revised target is now about 23 per cent of energy consumption.
We are confident that not only do we have a scheme that now gives the best opportunity to put the renewable energy industry in Australia on a sustainable level but we also have a scheme that householders and industry can afford, because someone has to pay the cost of this scheme, and it is substantial. It is not $1 billion. It is not $10 billion. It is at least $20 billion, and that has to be paid for by industry. In terms of the impact of that, we want to make sure that we are getting the result that we as a nation want.
Australia has a lot to be proud of in terms of renewable energy and in terms of our position in the world. Although sometimes you would think that we were absolutely back in the stone age, we are, in fact, amongst the world leaders. In fact, if you would look at rooftop solar, it is us first, daylight second and, I think, Hawaii third. Then we have those people who like to look down their noses at us from perhaps the EU or somewhere like that who are way behind us. Australia leads the world by a country mile in rooftop solar. So this nonsense that goes on about us not pulling our weight or doing what we should or taking advantage of our position is just that: nonsense.
We are facing a bit more of a challenge in terms of getting commercial large-scale solar up. We are seeing a great project, as the shadow minister mentioned, that will be completed under this government at Nyngan. I have to commend the proponents of that, and I also have to commend the local community for not only what they have done in supporting that project but also being part of that project. It has already begun. I think the first panels have been erected. With the other large-scale solar project being put in place at Broken Hill, we will see a second scheme.
These schemes are being deliberately put in the outback not just because it is great sunshine but because they are on the end of the grid. At the end of the grid is where solar really shines—excuse the pun—where solar really comes into its own, because the cost of electricity is not just in the generation. It is in the transportation to where it is consumed. So, when you are on the end of the grid, you are paying huge transportation cost. It just makes sense to generate it there. As I said earlier, we are looking at where the next generation of batteries will come from—and I know from visiting companies like RedFlow in Brisbane, who are working on some great technology—that battery storage is just around the corner.
There are a number of parts of this bill that are important, but one part is, of course, the 100 per cent exemption that will come under these amendments to energy intensive trade exposed industries. We are keen to make sure that those industries, which face international competition for their products and from countries that do not do anything like what we do in terms of renewable energy, are still competitive. The shadow minister did mention the challenge that faces the renewable energy industry, and the challenge to meet this target is significant. They have to build in the next five years as much as has been built in the last 15. The low-hanging fruit, in terms of the good sites for wind, in particular, have gone, and the alternate technologies to wind, unfortunately, have not come to fruition, although Carnegie Wave Energy in Western Australia have done a fantastic job. They have always been modest in their claims. In terms of what they have achieved, whilst they have exceeded what they expected to do, it is still modest and a generation capacity of more than four or five megawatts is still quite a challenging proposition.
If we look at the challenge for the wind energy industry as the industry that will fill this target, they have plenty to get busy with. The challenge is that, if they do not meet that target, the scheme defaults. It has always been the coalition's fear that, if the scheme defaults, the cost of the renewable energy credit will rise threefold—or twofold now because it has obviously lifted a bit in recent times since it has become clear that the scheme is sustainable. But the price of a RET will go to $93, and that is a high cost to consumers which will flow back into their household bills and into the industry bills. So we have asked that the Clean Energy Regulator make an annual statement to parliament in terms of the impact and potential impact of the renewable energy scheme on the cost of electricity. We look forward, during those reports, to a bipartisan approach from the opposition in terms of making sure that the adjustments can be made quickly and effectively to not only preserve the scheme but also protect households from extraordinary costs, or unreasonable costs, from the new renewable energy scheme.
In conclusion, I was disappointed that the shadow minister persisted in this idea that the coalition's position on wood waste was something new. Our note takers will show quite categorically that this was raised not only at the first meeting but at several meetings and as recently as January. It is a good idea because the wood just lies on the floor of the forest. If he was the minister for science, he would know that it still emits CO2 as it decays. I commend the bill to the House.
The minister, interestingly, made the comment that someone must pay. Indeed, someone must pay. In his analysis he was talking about the cost of renewable energy and what that did to electricity prices. I think we should be looking at who, in fact, will be paying if we do not move towards renewable energy and if we do not move towards the reduction of emissions. The minister seems to be living in some sort of fool's paradise where he believes we can continue coal-fired power generation without there being a cost to the community. The cost might not be appearing immediately on your power bills, but it is a cost that is going to accrue to this community over the coming generations.
We are already seeing how these costs are playing out with climate change. We are already seeing this very real problem in the north of Australia where increasing weather volatility is leading to a massive increase in insurance payments—a massive increase in insurance payments that far exceeds the increase in energy costs that comes from having a renewable energy industry. Indeed, we all know that we have to go through this period where we do support renewable energy technology to ensure that we give it an ability to reach a stage of development where it can be competitive in its own right. When we talk about who is going to pay, we must look at the price being paid by our community—both economically and in terms of health—from climate change, and recognise that we need to make this strategic investment now so that we will have a source of energy that will enable us to deal with climate change and, in the long run, bring the cost of energy down. It is very much a question of making a strategic investment now.
The quite extraordinary thing is that countries around the world are recognising this as an investment that must be made. When we look at the United States, their last federal budget alone had $1.9 billion injected into the Office of Energy Efficiency and Renewable Energy to support new projects, to engage in the development, research and early commercialisation of renewable energy and energy efficiency projects. What have we done here in Australia to ARENA—the equivalent organisation? ARENA is an excellent organisation with a fantastic remit to take everything through from pure research to early commercialisation and to providing actual implementation funding. We have seen $434 million pulled out of its budget over the next 10 years. Indeed, had the government had their way, ARENA would have disappeared altogether. But, fortunately, through the work of the Senate, we were able to see that ARENA has been kept on life support. This year it will have a very modest $89 million to invest in renewable energy projects. These are very important for us to ensure that we have an industry.
The fundamental philosophical problem of this government is that it thinks that somehow or other you can create those 21st century industries without there being active engagement of government and that all you have to do is create a small government and a small business environment and somehow or other we are going to see the florescence of all these new technologies. As I say, you can see from the investment in research and in early commercialisation that is going on in countries around the world, including in countries like the United States, that they understand that this is not true. It is not true in any of the 21st century industries and it is certainly not true in the renewable energy space.
We need this architecture. The renewable energy target is part of a composite architecture that was put in place that included a price on carbon and the establishment of the Australian Renewable Energy Agency and the Clean Energy Finance Corporation, which was able to move in where venture capital was, at this particular point of time, too reluctant to go. We need that whole suite of projects, that suite of climate change infrastructure, in order for us to remain competitive.
The minister made an extraordinary statement. He said that when they came into government the RET was on the rocks. No; when they came into government they cut down the lighthouse, threw a hand grenade into the renewable energy target and commissioned a well-known climate sceptic to undertake the review of the RET. Even without their ability to change the legislation, even though the legislation remained in place, setting the large-scale renewable energy target at 41,000 kilowatt hours, they were, nevertheless, able to completely and utterly undermine the renewable energy target by creating this climate of uncertainty. We saw, since the announcement that they were beginning this review, with Mr Warburton in charge, until now, where we have finally landed on a compromise arrangement, that renewable energy investment fell 90 per cent in this country. So we saw a 90 per cent fall in renewable energy investment.
Global investment in renewable energy projects during the same period last year was $270.2 billion, and that is excluding large hydroelectric projects. That is 17 per cent higher than the previous year. For solar alone, it was $149 billion. Those are extraordinary figures. If we go to China, the figure was $83 billion, up 39 per cent; in Japan it was $35 million; and in India it was $7 billion. We understand that even Saudi Arabia is now making a big push into the renewable energy space.
It is not as though we had ever been arguing that we should not be doing something that all other countries around the world are doing, but, for some reason or other, there is a view in the government that we can just contract, we can cut down all of the architecture in place and somehow or other this industry will survive; or, I suspect, more importantly, they do not care whether this industry survives. Indeed, they have probably been the beneficiaries of considerable largess from the fossil fuel companies and they are quite happy with the fact that we have seen a resurgence in brown coal use. Just as everyone around the world is trying to wean themselves off it, we are happy, apparently, in Australia to—as Colin Barnett has done in Western Australia—reopen Australia's dirtiest coal fired power station and to see a renaissance in brown coal being used for electricity generation in Victoria. It is an extraordinary set of circumstances, and the government would think that this is an acceptable outcome and that this is the type of outcome that we wanted.
We strongly supported the work that our shadow minister did in negotiating this compromise. It is absolutely critical that we preserve what we can of the complex architecture that we put in place to deal with climate change; it is absolutely critical that we get renewable energy investment back on track. It is certainly quite clear, as the shadow minister has said, given that they have been cutting down the lighthouse and creating enormous instability and loss of investment over the last 18 months, that it is now going to be virtually impossible to get to 41,000 gigawatt hours. Again, that is not because it was an unreasonable target in the first instance but because they have come in and sabotaged the investment that would have allowed us to achieve that.
We have been prepared to work with the government to come up with a compromise on this—not one that we are entirely happy with, but we take responsibility for ensuring that we need to put this industry back together and we need to get those investments flowing. Certainly, from talking to the renewable energy companies in Western Australia, they have been very keen for us to reach this compromise—companies like WestGen, who have a whole raft of relatively small-scale projects, such as 10-megawatt style projects—so that these projects in the pipeline can get underway, once the uncertainty that has been created by the government has been dealt with.
The long-term job opportunities are there. In Western Australia, we have the prospect of a new vanadium mine. This is a very high-quality, high-grade vanadium mine just south of Meekatharra. That project has an inferred resource of 125 million tonnes of very high-grade vanadium. Vanadium has extraordinary possibilities for renewable energy storage. The vanadium redox battery, which is a very high-density storage battery, is being developed through the University of New South Wales. It gives us the opportunity to be world beaters in this energy storage space, which is so important for the sustainability of renewable energy. We are hoping that, with this Yellow Rock Resources vanadium mine, we can build on that and develop the battery production within Western Australia. We have to think about this. This is a 21st century industry. This is a sunrise industry and we must do all that we can to ensure that we have the strategic investment in Australia, in Western Australia, that is going to ensure that we are technology makers, not just technology takers. The prospect of developing this high-grade vanadium mine in Meekatharra, with a battery storage production facility, is extraordinarily exciting.
Again, we must think. If we are just focusing on the immediate electricity price, we are losing the battle. We must be creating those opportunities for the 21st century. We have to be up there, matching what is happening in the United States, China and India, and providing that capacity for our renewable energy industry to develop, prosper and be competitive in the world.
Today I am pleased to be able to speak on the Renewable Energy (Electricity) Amendment Bill 2015. It is a bill that represents a balanced approach and that will implement changes to the renewable energy target to better reflect market conditions and allow sustainable growth in both small- and large-scale renewable energy in this country.
This is a government that balances the needs of the environment with the needs of the Australian public. This is a government that is looking to the future and recognising the importance of using renewable energy to power our lives. This bill will do just that. It will lead to more than 23½ per cent—not 20 per cent but 23½ per cent—of Australia's electricity being sourced from renewable energy, by 2020.
What is a RET? To break it down, the RET allows renewable energy power stations and owners of small-scale renewable energy systems to create certificates for each megawatt hour of eligible renewable electricity they produce. Electricity retailers and other liable entities need to purchase certificates created by renewable energy generators such as wind farms, solar farms, hydro-electric power stations, rooftop solar panels and solar hot-water systems.
Certificates are then surrendered annually to the regulator to demonstrate compliance with the RET and avoid shortfall charges. This creates a market which provides financial incentives to increase the generation of renewable electricity. The RET encourages the use of electricity from renewable sources, it reduces greenhouse gas emissions in the electricity sector and it ensures that renewable energy sources are ecologically sustainable.
The RET was the brainchild of the Howard government and was designed way back in 2001. Then, in 2010, it was hijacked by the Labor government and was expanded to ensure that, by 2020, at least 20 per cent of Australia's electricity comes from renewable sources. To achieve this, annual targets were increased to peak at 45,000 GWh in 2020.
Since the beginning of 2011, the RET has separately supported large-scale renewable electricity projects, such as wind and solar farms, and installations of small-scale renewable energy systems such as rooftop solar that we see on so many homes across the country. The annual targets under the LRET were amended to rise to 41,000 GWh in 2020.
Many of the good people in my electorate of Paterson already know the benefits of using renewable energy. There are homes across my electorate, like so many others, with solar panels scattered across their roofs, using renewable energy in their homes on a daily basis. Others choose to opt for renewable energy options when it comes time to deciding on their electricity or utilities provider. As a community and as a government we are focusing our attention on renewable energy and delivering outcomes.
My region is also home to the CSIRO Energy Centre where top-class research is undertaken into solar and renewable energy. In April last year I opened a $1.7 million solar thermal demonstration plant at the city of Newcastle's West Wallsend pool. A first-of-kind demonstration plant generates 30 kilowatts of electrical output and 150 kilowatts of heat for the swimming pool.
The plant combines a solar thermal field with new heat engine technology developed by the University of Newcastle and the Newcastle Institute for Energy and Resources. The Australian-designed GRANEX heat engine increases the efficiency of solar thermal energy, which means more electricity can be generated from the solar thermal field. The application of this technology could particularly benefit remote and regional communities and businesses, as well as have the potential for export sales. It is a great example of the world-leading renewable technology being developed in Australia.
So why is this renewable energy amending legislation so important? When my colleague Minister Hunt read this bill for the second time last month he outlined how it addresses problems that emerged more than three years ago with the renewable energy target. There was a significant drop in electricity demand, which occurred following the global financial crisis, which coincided with the closure of energy-intensive manufacturing plants, spelling disaster for wholesale electricity prices. And there were the changes to the renewable energy target, introduced by the Rudd government, and the effects of the phantom credit bank that are still being felt today.
This bill addresses those problems in a number of ways. Firstly, it adjusts the Large-scale Renewable Energy Target, LRET, to 33,000 gigawatt hours in 2020. It will increase the partial exemptions for all emissions-intensive trade-exposed activities to full exemptions. It will reinstate biomass from native forest wood waste as an eligible source of renewable energy. And it will remove the requirement for Labor's legislated biennial reviews of the RET.
When it comes to sustainable growth in the renewable energy sector, it is important that we have bipartisan support and our agreement with Labor is to legislate a Large-scale Renewable Energy Target of 33,000 gigawatt hours by 2020. This will result in more than 23 per cent of Australia's electricity being derived from renewable sources by 2020. It means cleaner, greener energy for our communities and our environment.
We will be working co-operatively with the opposition on a bipartisan basis to resolve any of the issues which may arise with the operation of the RET through to 2020. The agreement this government has reached with Labor will ensure that renewables continue to play an important role in Australia's energy mix in the future.
One of the things I like about this bill is that there will be no change to household solar in the Small-scale Renewable Energy Scheme. It means those who use solar or who have invested in solar or are thinking about doing so should continue to do so. For renewable energy on a small household scale, this is great legislation. Solar will be a winner, with significant new investment in small- and large-scale solar expected.
The bill will reduce the Large-scale Renewable Energy Target from 41,000 gigawatt hours in 2020 to 33,000 gigawatt hours in 2020. The reduction in the Large-scale Renewable Energy Target from 41,000 gigawatt hours to 33,000 gigawatt hours will result in 830 to 1,000 fewer wind turbines. This target is separate from the 850 gigawatt hours that is to come from waste coalmine gas generation each year until 2020 under pre-existing transitional arrangements.
As highlighted in our energy white paper, Australia has an oversupply of generation capacity and some of that is aged. From 2009-10 to 2013-14, electricity demand has fallen by about 1.7 per cent per year on average. This is due to many factors, including declining activity in the industrial sector, increasing energy efficiency and strong growth in rooftop solar PV systems which has reduced demand for electricity sourced from the grid.
This government welcomes a diverse energy mix in Australia but we also recognise that circumstances have changed since the 41,000 gigawatt hours target was set. This new target of 33,000 gigawatt hours directly addresses these issues. It represents a sound balance between the need to continue to diversify Australia's portfolio of electricity generation assets, the need to encourage investment in renewables while also responding to market conditions, the need to reduce emissions in the electricity sector in a cost-effective way and the need to keep electricity prices down for consumers. Most importantly, this new target of 33,000 gigawatt hours by 2020 is achievable. The bill will also give the renewable energy industry the certainty it needs to grow. In order to do that, there will not be a review of the Renewable Energy Target until 2020. Instead, the Clean Energy Regulator will provide an annual statement to the parliament on how the scheme is tracking towards the 2020 target and any impact the RET is having on electricity prices.
I have outlined in the past how this is a government that protects industry and jobs. The renewable energy industry and the employment it provides for hardworking Australians is no exception. However, in order to protect the industry and jobs, there will need to be a 100 per cent exemption for emissions-intensive and trade-exposed industries from costs associated with the RET—including Tomago Aluminium in my electorate. This bill will increase support for all emissions-intensive and trade-exposed activities to a full exemption from all RET costs—that is, the costs of the original target as well as the costs of the expanded target. A full exemption will protect jobs in these industries and ensure they remain competitive.
The reduction in the direct costs of the RET resulting from the lower Large-scale Renewable Energy Target will more than offset the impact on other electricity users of the increase in assistance for emissions-intensive and trade-exposed activities. The bill is about protecting jobs in the emissions-intensive and trade-exposed sectors by reducing their costs. It does not matter whether it is aluminium, zinc, silica, cement clicker, copper, newsprint, packaging, industrial paper and many other industries—this bill is designed to protect those jobs. So this bill is to be supported.
One of the other issues the minister raised was the need to reinstate biomass from native forest wood waste as an active eligible source of renewable energy. Renewable energy is diverse and there are many, many, many sources. This government is committed to the inclusion of wood waste as an eligible form of renewable energy generation and this will be included in legislation. Native forest wood waste was in place as an eligible source of renewable energy under Labor's own legislation until November 2011. As my colleague Minister Hunt told ABC Radio a fortnight ago, if wood waste is going to lie on the floor of a forest to rot and create methane, or if it is going to be burnt and create CO2, then surely it is much better to make use of it, to turn it into renewable energy and reduce emissions as a consequence. It is not just a theory, it is the practice. That is why Labor previously legislated and why the European Union in many places incorporates biomass. Similarly, it is why the Climate Change Authority has also recommended that it be reinstated in the original form as legislated by the Labor Party itself.
Consistent with our election commitment, this bill reinstates native forest wood waste as an eligible source of renewable energy under the RET, basing eligibility on exactly the same conditions that were previously in place under the ALP. One of the objectives of the RET is to support additional renewable generation that is ecologically sustainable. We are reinstating native forest wood waste as an eligible renewable energy source because there is no evidence that its eligibility leads to unsustainable logging or has a negative impact on Australia's biodiversity. In all cases, the supply of native forest wood waste is subject to Commonwealth and state or territory planning and environmental approval processes, whether within or separate from the Regional Forest Agreement frameworks. Burning wood waste for electricity generation is more beneficial to the environment than burning the waste alone or simply allowing it to decompose. Its inclusion as an eligible energy source is another contribution to the target. Reinstatement of native forest wood waste as an eligible fuel source represents a return to common sense.
When it comes to the environment, this government has the runs on the board. We have the Green Army out across the country revegetating, repairing and improving hundreds of areas—a magnificent bunch of young Australians working hard while gaining practical environmental experience and training. This government is returning water to the Murray-Darling Basin to ensure the survival of the country's most important food bowl and to see habitats and wildlife restored. And we have just had the World Heritage Centre praise the significant and unprecedented work undertaken by Australia to protect the Great Barrier Reef and make it clear the reef will not be listed as 'in danger'.
This bill is consistent with the government's conviction that policy decisions must be based on sound economic principles and real-world experience together with outcomes. What we want to do is encourage efficiency, competitiveness and better outcomes for electricity consumers and Australian families. This bill reflects changes which have occurred in the electricity market and will allow for sustainable growth in small- and large-scale renewable energy. This bill will provide certainty to the renewable energy industry and its jobs, and it will encourage further investment while helping Australia reach our emissions targets. This is a good deal and this bill should be supported. I commend the bill to the House.
The Renewable Energy (Electricity) Amendment Bill 2015 seeks to amend the 2000 act and the 2001 regulations, as well as making consequential amendments to the Climate Change Authority Act 2011. The majority of amendments reflect an agreement between the government and the opposition in order to provide certainty to an industry and to allow for investment in the sector to resume. The bill firstly reduces the large-scale renewable energy target to 33,000 gigawatt hours by 2020; it allows for the extension of full exemptions for emissions-intensive trade-exposed activities; it repeals the requirement for periodic reviews of the RET and it amends the Renewable Energy (Electricity) Regulations to reinstate native wood waste as an eligible renewable energy resource. In contributing to this debate I would like to deal with the details of the bill and the context of the debate that brings us to this point, and then to discuss some local feedback I have received on these matters.
We as a nation are particularly well placed to develop a significant renewable energy sector as we have abundant solar, wind and wave resources available to us. The opportunity to maximise these is supported by our world-class skills and the expertise that has been developed here. The previous member spoke of some of his own experiences from the Newcastle university activities, and I have to reflect on the fact that Wollongong university has also been very active in this space. These factors, which were supported by a Labor government at the time, made Australia a world leader in renewable energy. Labor has a longstanding record of support for the renewable energy sector. The record of Labor in government confirms this, with growth in homes with rooftop solar technology increasing from around 7,000 to more than 1.2 million. Wind power in Australia has tripled and the jobs in the renewable sector have also tripled. More than $18 billion was invested in wind and solar farms, hydro plants and renewable energy technology development.
The investment and jobs were a significant contribution to the national economy—as a sector it employs more than 21,000 people and attracts billions in investment. In addition to this, it was a significant contributor to reducing the carbon pollution produced by the electricity sector. Between June 2012 and June 2013 emissions from this sector fell by more than seven per cent. Internationally we are seeing nations around the world increasing their own commitments to renewable energy sources. The worldwide shift has seen an increase of 16 per cent in investments in renewable energy in 2014; in China alone, investment in renewables massively increased by 33 per cent. In 2013 Australia was ranked in the top four most attractive places to invest in renewable energy, alongside powerhouse countries such as Germany, China and the US. Sadly, we have now plummeted to 10th on that list.
For all of these reasons Labor's clean energy package had a significant emphasis on renewables, and this is why we have fought so hard against the attacks that this government has launched against this important sector since being elected. It is inconceivable that the government would actively undermine a sector that delivers jobs, attracts investment, helps households to reduce energy costs and provides a new manufacturing base to support the transition of manufacturing sectors that have been under transitional pressure. On top of all of this, it reduces Australia's carbon pollution. In the Illawarra we are at the forefront of these pressures, and across New South Wales there are 4,410 jobs in the sector—such as wind, solar, PV, solar hot water, sales and service-related jobs.
I would like to share a local story of global achievement from my backyard of Wollongong. In August 2013 a team of students from the University of Wollongong and TAFE Illawarra, named Team UOW, won first place in the solar decathlon competition in China. China was the most recent addition to the US Department of Energy Solar Decathlon, an award-winning program that challenges collegiate teams to design, build and operate solar-powered houses that are cost-effective, energy efficient and attractive. The resulting homes demonstrate to students, the public and industry that solar-powered houses are fully functional, comfortable and sustainable living spaces. The solar decathlon aims to promote collaboration in the solar industry and to facilitate innovation and adoption of solar energy and energy efficiency technologies. Solar Decathlon China was hosted by the National Energy Administration of China and the US Department of Energy, co-hosted by the Ministry of Finance and the Ministry of Housing and Urban-Rural Development, supported by the All-China Students' Federation secretariat and organised by Peking University.
The Wollongong team, I am very pleased to report again to this House, beat 19 other teams from around the world. They were the first team from Australia to successfully gain entry into a solar decathlon—indeed, they were offered places at both the China and US events. They were the first team ever in any of the competitions to demonstrate how to retrofit an existing home, and they achieved the highest ever overall score in any solar decathlon competition, scoring 957.6 of a possible 1,000 points. The team was supported and mentored by Paul Cooper from the University of Wollongong and Marty Burgess from TAFE Illawarra, and many staff, whom I acknowledge, were involved as well. The student team was led by Lloyd Niccol, who was the project manager, and the team worked under the auspices of the Wollongong University's Sustainable Buildings Research Centre, which is headed by Paul Cooper. This is a facility at the university's innovation campus that the former federal Labor government contributed $25.1 million towards. Its task is to help Australia move towards a low carbon future by making buildings more energy efficient. It will support the growth of new jobs and new skills in the broad range of careers in the building design and construction industries—innovations that can form the basis of new businesses, new industries and export opportunities. It is a strong indicator of the opportunities that a low-carbon economy can provide, and these fantastic students and their teachers, through their world-beating achievement, have proven Australians have what it takes to lead the world. It just needs a federal government with the vision and determination to make Australia a leader in this international effort.
Given the strength of the positive story of this sector, it is very reasonable to ask why we are debating a bill to reduce the renewable energy target, which underpinned the success of the renewable energy sector. In a very short time after the 2013 election, the Prime Minister broke a pre-election commitment to retain the RET at 41,000 gigawatts by 2020. This was despite the fact that the RET had enjoyed bipartisan support for a decade in this country. The initial RET legislation was introduced under the Howard government in 2001 and Labor in government expanded it in 2009 and 2010—indeed, the Prime Minister had voted in support of all those bills. Yet it quickly became apparent after the election that this was about to change, as the Prime Minister began to make statements claiming that the RET was contributing to increasing household power prices. Then, in the 2014 budget, there were direct cuts to programs such as the $600 million bucket available for solar roofs, towns and schools, which was cut to just $2 million. Added to this, the Australian Renewable Energy Agency, ARENA, had its funding cut in the 2013 MYEFO, and then in the 2014 budget it was listed for abolition.
The Prime Minister's RET review, however, injected significant uncertainty into the market and resulted in an almost complete stop to investment. The Prime Minister had claimed that renewable energy had contributed to an increase in power prices, yet even this RET review found that the existing RET of 41,000 gigawatts would actually put downward pressure on household power prices in the medium to long term, was driving investment in the sector and was also reducing Australia's carbon pollution and creating jobs. Despite these findings, the panel, hand-picked by the Prime Minister, recommended either abolishing the RET altogether or cutting it significantly, and so we saw the Prime Minister opt to try to cut the RET by more than 40 per cent.
The bipartisanship that had supported the renewable energy sector for more than a decade was shattered. Labor understood that action needed to be taken to give the industry the certainty it needed to attract investors in major projects, but we were not willing to do a deal that would see the industry ruined. Labor has been guided in this process by advice directly from the industry on what would be best for them. The result is an agreement with the government that will see around 25 per cent of Australia's energy generation produced from renewable energy sources by 2020. The Clean Energy Council predicts the revised target of 33,000 gigawatts will drive around $40.4 billion in investment and create more than 15,000 jobs. Labor's negotiation principles have contributed to some very important outcomes: firstly, no change to the small-scale solar scheme, which includes rooftop solar and solar panels for small businesses such as nursing homes; secondly, full exemption for emissions intensive trade industries, which relieves some pressure on those industries that are enduring downturns and job cuts; and, thirdly, the removal of two-yearly reviews to provide some of the long-term certainty that the industry so desperately needs in order to survive and thrive.
The issue of support for solar has been raised with me by a local constituent. Indeed, the national director of the organisation Solar Citizens, Claire O'Rourke, lives in my electorate and she came to speak to me about these very issues just last month. Claire briefed me on their campaign 'Stand up for solar'. She made the point that rooftop solar is a very important issue to an increasing number of Australian families and households. In 2007 there were around 8,000 solar photovoltaic systems installed on homes, but now there are more than 1.3 million Australian homes powered by solar. It is clear to me that the importance of solar energy to many local householders in my area is a very real issue for them, and I believe that Labor's role in this process of reaching an agreement to preserve the renewable energy sector is an important one in contributing to a strong future for technologies such as household solar photovoltaic systems. Indeed, renewable energy has a strong future under Labor. We have made it clear that, if we are elected at the next federal election, we will use the 33,000-gigawatt target as a floor to build upon and we will consult with the industry and finance sectors to develop an ambitious renewable energy policy beyond 2020. Labor know that renewable energy is the way of the future and we understand that Australia needs to transition to a clean energy economy—we have both the will and the ambition to see this happen.
There is one aspect of the bill that we do not support, and that is the inclusion of the native wood waste biomass in the RET. We do not believe that burning native forests for energy is either clean or renewable and we simply do not see a case for its inclusion in the RET. For those reasons, I support the shadow minister's proposed amendments when this bill is considered in detail.
It is clear across all our communities that the issue of the renewable energy future for Australia is one that plays out at the family and household level—indeed, my own parents have had a solar system on the house for as long as I can remember—and many, many households are looking for ways to find a more sustainable way to provide energy into their homes, particularly as they increasingly want to find more environmentally friendly options. I think that is a reflection of why we have seen across, I am sure, all of our electorates such a significant uptake of the solar systems, both hot-water systems and photovoltaic systems, that provide energy into the household. More than that, it is a good opportunity for places like our schools, community centres and nursing homes to put their own budgets on a more sustainable footing by having these smaller scale systems in place for them as well. Then it plays out, of course, from so many of our communities into our industry sectors. For an area like the Illawarra, as we see significant transition going on, the opportunity to build on the research and development being done at places like our university and TAFE and to build new industries, new employers and new jobs is significantly important.
For all those reasons, across all of our communities we have seen a very strong and determined support for the renewable energy sector, and people would expect us to be ensuring that the policy settings are in place to make that continue into the future. Of course, also there is increasingly an important responsibility on us for future generations to find a more renewable based economy so that we can do our bit in reducing carbon pollution in the world's circumstances.
The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour, and the honourable member will have leave, if she wishes, to continue her remarks at a later hour. Are there any statements from honourable members?
I rise to speak about the Abbott government's cuts to health programs and services. This budget contains so many cuts from last year's budget and at the same time it imposes almost $2 billion in new cuts to health. This is all despite the Prime Minister's election promise of 'no cuts to health', but that is exactly what we have got. In fact, total cuts across the health sector in his first two budgets now exceed significantly more than $60 billion. Some of these new budget cuts include the cruel cut to the IEM program, a $250 a month grant to assist people who need special foods because of genetic disorders. Despite the opposition continually calling on the government to reverse this cut, so far these calls have been ignored. It is a truly cruel and callous decision. The Abbott government has also abolished the GP after-hours hotline—a helpline that took more than 200,000 calls last year, some of those call from mums with sick kids in distress wanting help.
The budget has also cut $125 million from the Child Dental Benefits Schedule and more than $69 million from veterans' dental and allied health payments. We have also seen almost $1 billion in cuts to programs that fund important measures like preventative health care. And, of course, the government is also pressing ahead with its GP Tax by stealth, by freezing payments for general practices for four years. They are absolutely committed to this GP tax. They have tried many different forms of it. They are pushing ahead. This is all about the Abbott government trying to destroy Medicare through all these cruel and callous cuts.
Recently I had the pleasure of officially opening the Better Buddies Bench at Brook Avenue Public School. I am a strong supporter of the Better Buddies program and am pleased to be able support this great initiative within Dobell schools. Some children's first year of school can be daunting and difficult. Making friends is not always easy, and being away from the home environment can be challenging. Without adequate support, this anxiety can lead to school becoming a negative element of a child's life and result in long-term personal, educational and social issues. Better Buddies helps students entering the first year of primary school to feel safe, valued and connected to the school community. The program provides students with a Buddy Bear, which is a little purple friend with whom they can share stories and secrets. Now, with a Better Buddies bench, made possible thanks to a donation from Mr Paul Beech, the manager of Cresthaven IGA, students have somewhere to sit and talk with their Buddy Bears. It was rewarding to see children flock to the bench, join with their Buddy Bears and feel at ease within their school community.
I would like to especially thank Principal Kerry Wellham and Instructional Leader Karen Evans for their support of this great program and their commitment to our local students. Over the next few months, we would like to see the Better Buddies program rolled out through more schools, especially in particular areas of Dobell where there are a lot of children who come from troubled backgrounds. The Buddy Bear has proven very successful in helping these young children fit into school and enjoy their school years.
I rise today to acknowledge and say a warm thank you to you to all at Wodonga Institute of TAFE for the role they played in ensuring the success of the Australian manufacturing and food forum held on Friday 29 May. They put in a great effort in hosting the function and arranging the grounds, and coordinated enough chairs tables and marquees and signage for over 150 people who attended, and over 30 stalls and exhibitor sites. A big thank you to Katie, the Events and Functions Co-ordinator: you did a terrific job. And thank you also to Tegan, Josh, Jack, Maddy, Chloe, Renee, Fenella, Monica, Bianca, Natalie, Connor, Elise, Kim, Candy and Jerome. And thank you also to all the hospitality and events students for looking after us at breakfast and lunch. You did a terrific job.
Teachers also helped to bring the event together, including Katie Trebley, Brett White, Bruce Simpson and Nikki Macintosh. I would also like to acknowledge Wodonga TAFE's Department of Land, Built Environment and Sustainability—the director, Mr David Foote, Duane Hicks, Phil Lowe, Adam Strang, Chris Cheater and Don Terry. Thank you very much for your fantastic attitude and your great work.
Wodonga Institute of TAFE delivers over 2.5 million student contact hours of training every year to my community in Indi, from certificate I right through to advanced diploma, including specialist training centres, the National Industrial Skills Training Centre and Motorsports Training Australia. To the chair of the board, Ulf Ericson, and the CEO, Mark Dixon: well done and thank you. (Time expired)
I acknowledge my constituents, Jill and Julian from Launceston, in the gallery today, and I know that they would join me in congratulating Launceston's first textile Mill, Waverley Woollen Mills, on being chosen to provide a gift from the people of Australia to the Duke and Duchess of Cambridge on the birth of their new baby.
The Prime Minister announced the gift on Monday 4 May, saying that the cot blanket, made from Tasmanian merino wool, would be embroidered with the Australian floral emblem, the wattle, by members of the ACT Embroiderers' Guild. What a wonderful gift for the new Princess and what wonderful recognition for one of Launceston's longest operating businesses. I am pleased to say that during one of his many visits to Launceston, I took the Prime Minister, and some of his senior staff, to Waverley's factory outlet shop to see firsthand the quality of Waverley Woollen Mill's products. They were greatly impressed. Waverley Woollen Mills has made blankets in Launceston, on the same site, since 1874, when the founder, Peter Bulman, won a £1,000 Tasmanian government prize for producing the first woollen products from local wool. Over its 141 year history, Waverley blankets have become nationally recognised for their quality and durability. Indeed, one of the presents my wife and I got when we were married 29 years ago was a pair of Waverley Woollen Mill blankets, and we are still using them at home. I am sure that this connection between Launceston and the new Royal Princess is something all Tasmanians can be very proud of.
Recently I had the opportunity to meet with a young woman from my electorate named Simone Allen. Simone is a hardworking medical student at the University of Melbourne and she came to me deeply concerned about her future prospects as a medical graduate. So motivated was she by the issues concerning her that it was the first time she had come to see a politician. Simone adds her voice to the growing number of medical students and health professionals who are appalled at the recent announcement to open a new medical school in Western Australia without there being any plan for additional supporting training places. Last year 800 young doctors missed out on GP training places nationally, and the Australia's future health workforce report predicts that another 1,000 speciality training positions need to be funded and accredited to fill the training deficit Australia will experience by 2030.
Without ongoing support for additional training places, medical graduates like Simone will find it increasingly difficult to qualify and specialise, and Australia will be without an increase in the number of trained doctors available to meet the needs of the community. And what has the Abbott government done? They have cut $75 million from health workforce programs, abolished the Prevocational General Practice Placements Program and scrapped Health Workforce Australia, axing another $100 million. These measures will only worsen the training bottleneck. When these concerns were raised by doctors and medical students, the only thing the Abbott government did was make very clear that they were unwilling to listen to their advice, the Treasurer going so far as to insult the head of the AMA, Brian Owler. The government cannot continue to ignore the advice and expertise of doctors as they did with the GP tax and the $60 billion worth of cuts from health. (Time expired)
Last weekend I attended the Springsure Show in the Central Highlands to help the community celebrate a special milestone. The Springsure Show is the second oldest show in Queensland. Only the Toowoomba Show is older. This year marks 150 years since the very first agricultural show, back in 1865. The community is proud of the show and everyone who put in extra effort for this major event. The governor of Queensland, His Excellency Paul de Jersey, and his wife, Kaye, attended the event and enjoyed it very much, as did we all. There were a number of events for families: pony club, horse events, cattle judging and entertainment by Rooftop Express, combining showmanship, stunts, horses and cattle with the swagger of an Aussie larrikin.
In addition, there were displays from schools and other community groups: flowers, cooking, art, craft and photography. One of the best aspects of a show like Springsure is that it is led and operated by the people themselves, and what a fantastic effort they put in to make the show so enjoyable to the many, many people who visit. Springsure Show will be around for another 150 years if this year was any indication of the public's support. I cannot wait for next year's event.
I rise today to draw to the attention of the House an Age article run last Saturday and written by Chris Johnston that outlined some of the incredibly debilitating health issues facing Wyndham and its suburbs in the electorate of Lalor. The title of the article was 'Wyndham region home to Victoria's sickest suburbs'. It cited the Social Health Atlases of Australia, developed by the University of Adelaide. Sadly, my community has the highest rates of heart disease, diabetes, cancer, mental health issues, bad teeth, obesity and asthma. Type 3 diabetes is rising fast: 6½ people are diagnosed each week. A state survey shows that 74 per cent of Wyndham people do not exercise. The article bemoaned, as I do, the cruel and short-sighted cuts in this government's budgets to programs funded under federal Labor directly targeted to address these issues. I know these programs were working locally. They were reaching into schools, early childhood centres and workplaces. They have reached, by local government's measurement, 28 per cent of the population to date. This government's continued cuts to health care are hurting communities across this nation. They are hurting my community of Lalor. They need to reinstate this funding immediately.
I rise to speak on the disgraceful lack of action by the South Australian Labor government to help our farmers who are experiencing drought. The Commonwealth has funded $10 million to South Australia for drought concessional loans, with applications to be assessed by—you guessed it—the state government and determined by the Minister for Agriculture, Leon Bignell. Each state is subject to exactly the same criteria for assessment. Across the country there have been 394 applications, with 193 approved and almost $115 million approved to help struggling farmers who are in drought affected areas—except, of course, South Australia.
The Bureau of Meteorology states:
Monthly rainfall over the southeast of South Australia … has been below average from August last year. Serious or severe rainfall deficiencies have been observed in parts of these regions for various medium-term periods since late 2013.
Despite this finding by the bureau, and despite the hundreds of applications made in other states and 193 approvals under exactly the same criteria, Minister Bignell and the South Australian state Labor government has failed to approve a single drought concessional loan for South Australia. Despite this failure to approve a single concessional loan, South Australia is retaining the administrative funding the Commonwealth provides to the state. It is outrageous that South Australian farmers are being ignored while state Labor sits on these funds. Leon Bignell needs to get off his backside and start approving these much-needed loans
This is a budget that does nothing to reverse the cruel cuts to the health budget from last year and indeed imposes massive new cuts to health. Despite the Prime Minister's solemn election promise of 'no cuts to health', total cuts across the health sector in his first two budgets now exceed more than $60 billion. My electorate of Newcastle has not been spared. In last year's budget the Abbott Liberal government cut more than $150 million from Hunter New England Health, which delivers essential health services across Newcastle. The Hunter Medicare Local is closing this month because of another broken promise from this Prime Minister. Funding for GP Access, our essential primary after-hours service, had to be fought for tooth and nail by my community to survive and now has been thrown only a 12-month lifeline. The Deadly Choices program that educated and empowered young Aboriginal people in Newcastle and the Hunter to make healthy choices to help avoid long-term health issues has been abolished.
While we are yet to see the full impact of the Prime Minister's new cuts to health care in Newcastle, my constituents are already telling me that their health is suffering as a result of increased cost-of-living pressures. My constituents are very worried about the cuts to the Child Dental Benefits Schedule that will halve the amount paid for child health assessments. And my veteran community is extremely concerned about the $69 million cut from veterans dental and allied health payments. Far from having learnt the lessons of last year's disastrous budget, the Abbott government appears determined to inflict more pain and chaos.
In the past when I walked around Capricornia, small business owners were telling me that they were worried for their future and needed some support. I listened, and each time I brought their voice and concerns back to Canberra. Now, thanks to the coalition government, mum-and-dad businesses will benefit from the biggest small business initiative in our nation's history. It is called our Growing Jobs and Small Business package.
Capricornia tradies, sole traders and partnerships will get a tax cut. Significantly, small businesses with a turnover below $2 million can claim an immediate tax deduction for every asset they acquire that is valued up to $20,000. For example: if Jeffery Pearce, who proudly operates Cal's Snack Bar in Kawana in North Rockhampton, needs new kitchen equipment, he can take advantage of this generous tax related incentive. Peter Fraser, President of the Capricornia Chamber of Commerce, described the measures as extremely important and some of the best in decades. When the federal small business minister visited Rockhampton just after the budget, Mark Woods of Stewarts Department Store, an iconic Rockhampton family business, told him that our government delivered an excellent budget for local small business.
If you care about health then it has been a shocking year. 2014 saw probably the worst budget on record when it came to health care, and it is not much better in 2015. I am sure there are people on the other side of the House who care just as much about struggling kids as we on this side of the House do. This is why you have to wonder why they have ripped out the funding—$250 a month—for the program that was supporting kids who are suffering from inborn error of metabolism. Why have they ripped that money out?
Last year, the GP helpline took over 20,000 phone calls, often from mums with sick kids, pensioners and elderly patients looking for a little bit of advice. Do you know how many calls they are going to take this year? Zero. The reason for that is that this mean government has closed down the scheme. A few weeks ago, the minister stood up and proudly said she was re-establishing the Labor scheme on dental benefits. But, in the fine detail, they have ripped out over $125 million from the Child Dental Benefits Schedule and over·$69.6 million from the DVA dental and allied health benefit payments. At a time when we are suffering from doctor shortages, the government has cut $72 million from training places. We need a government that is going to look after health in this country.
In 2014, more people died from advanced melanoma than died in car accidents. I am a walking example of why people need regular skin checks, which is why I was delighted to participate in the fourth annual Pollie Skin Check this morning and to support the Know Your Own Skin campaign with campaign ambassador, and my local constituent, Mr Allan Border.
Australia has the highest rate of melanoma in the world. With one of us diagnosed with melanoma every hour and one dying every six hours, we need to get the message through. The Know Your Own Skin campaign encourages people not only to make time to get their skin checked but also to regularly check their own skin. We have even launched a telephone application that allows you to take photographs and track the progress of any suspicious spots between regular skin checks and then send reminders when it is time to get a check-up.
So now there is now no excuse to be ignorant about sun damage. Considering that one in two Australians will develop a sun spot which may lead to skin cancer and two in three are diagnosed with skin cancer, knowing your own skin will literally save your life. I know it has saved mine.
In my electorate there is a truly remarkable group of people who run the Good Start Program. The program chases a simple but important goal: to improve the health and wellbeing of Pacific Islander and Maori children and their families by teaching good exercise and nutritional habits or, in their words, 'To bring health back to our people.' I have spent a bit of time in the past year or two with Mary Bartlett Johnston and her team, and I have seen for myself the difference they are making to our community and communities like ours around the state. One of the many great things about the program is the way they work to recruit health workers from the target communities so that it is all culturally tailored.
When the Abbott government cut billions of dollars out of preventative health last budget, and left those cuts in this budget, the program was in dire straits. This is the sort of short-sighted health policy we now expect from those opposite. Labor has a different approach to preventative health. In that context, I want to congratulate the Queensland health minister and member for Woodridge, Cameron Dick, for stepping in and funding the program for three more years. Had he not done so, their great work might not go on. Cameron's announcement means healthier brothers and sisters from the Maori and Pacific Islander communities and it means Good Start can continue their amazing work.
I am pleased to discuss the ice summit I will be hosting in Geraldton tomorrow at POSH on Marine Terrace. Stakeholders in the community—such as police, health officials and rehabilitation service providers—as well as Assistant Minister for Health, Fiona Nash, will be in attendance.
According to the latest report, amphetamine type substances use, such as ice use, is more prevalent in regional areas of Australia such as Durack. Use is especially high among young men, with 34 per cent of users being males aged 14 to 29. The report found a rise of ice use and availability in the bush. For me, this is very worrying.
Following the crime forum I held in Geraldton last year, I want to listen to the local stakeholders and broader community and to let the community share their concerns about ice. I encourage everyone to attend, especially people who have been personally impacted on by ice. I will be submitting the feedback from the summit to the National Ice Taskforce to address the issue of reducing methamphetamine use in not just Geraldton but Durack more broadly.
Addressing this scourge is a priority of mine and of the Abbott government. I am committed to working hard to see ice and other drug use decrease in Durack. This summit will play a vital role in shaping the report given to the Prime Minister, with a national ice action strategy to be developed with the states by the end of the year.
Voters in Scullin remember all too well what the Prime Minister said the day before the last election. He said there would be no cuts to health. What an extraordinary breach of faith with the Australian people that was, with such far-reaching consequences for lives today and for the quality of lives into the future.
Today, I make particular mention of cuts to the Northern Hospital, in Epping, in my electorate. Of the more than $60 billion worth of cuts in hospital funding, nationally, nearly $500 million will affect the Northern Hospital. The real victims of this cut will be patients. Patients will now have to wait even longer in emergency departments or on elective-surgery waiting lists, in a hospital servicing growing communities. With these pressures compounded by the attacks on primary health care and preventative health, I think of the GP tax, which has gone through five iterations and is still being prosecuted by stealth. I think of the abandonment of Medicare Locals, which were doing such good work in providing access to primary health care.
No-one disputes that the number of people requiring hospital care will increase, but the Abbott government's response is simply to say, 'Too bad; so sad.' The Prime Minister himself has conceded these cuts are unsustainable and yet his government has made a further $2 billion in cuts in the most recent budget. They are cuts focused on preventative health and primary health care. Australians deserve better than this government of cruel cuts and broken promises.
I wish to bring the attention of the House to an ongoing issue of critical significance within the electorate of Canning. Denny Avenue and the poorly designed intersections with Streich Avenue and Albany Highway, combined with its strategic location in the centre of the Kelmscott Town Centre and recent development in the area, has turned this site into a notorious danger spot for motorists in the north of my electorate. It continues to endanger the lives of motorists and pedestrians alike, to the point where I receive daily feedback from concerned constituents about how dangerous it is to travel through this area.
I last spoke on this matter on 2 March, the day after a father of three was tragically killed in a three-way collision at the intersection of Denny Avenue and Albany Highway. At the time, I called upon the Western Australian Minister for Transport, the Hon. Dean Nalder MLA, to collaborate with me in finding a solution to, once and for all, put an end to this unacceptable risk that motorists are faced with when travelling along this 200-metre stretch of road.
Since then, two more significant collisions have occurred. On 14 and 28 May they happened, causing injury to those involved, lane closures and traffic building up across the arterial roads and nearby. I have received bipartisan support on this from Tony Buti MLA, the member for Armadale, but it is extremely disappointing that Minister Nalder refuses to meet with us on this issue. I ask Minister Nalder, the Department of Transport and Main Roads Western Australia, again: how many people must be injured and killed before this matter is taken seriously?
I want to report to the House on a particularly mean and petty decision in the latest federal budget that is impacting on people in my local area. On 28 May there was a headline in the Illawarra Mercury that read: 'Federal budget 2015: families reel at decision to stop grants to inborn error of metabolism sufferers'. It is an excellent article by Lisa Wachsmuth, with a great photo of a local family by Adam Maclean. This is another example of why Fairfax Media should reconsider its decision to slash the staffing at our local newspapers.
Callum Buecher suffers from PKU. It means his body can only tolerate six grams of protein per day. He and other Australians born with different types of the inborn error of metabolism have discovered in the fine print of the May budget that the government is going to slash the $256 that they are paid as a monthly grant to help them with the costs of their food.
This issue was also brought to my attention by Bulli resident Kate Kline, who contacted me in regard to her two nephews, Josh, who is eight, and Tom, who is six. They also have PKU and feel that this is a particularly mean and petty cut for families who are struggling with the costs of living. The special food these families require is very expensive. While the medications are covered under the PBS, the food is not. The government should reconsider this. It is such a small saving but at such a huge cost to families, across our electorates, who will suffer because it.
There is a big difference between that side of politics and this side of politics. While the Labor Party seeks to put government at the centre of our lives, we on this side of the chamber understand that if we get government out of our lives our nation can achieve greater prosperity. If Australian citizens pay less tax—not more tax—they can help reach their full potential.
Something very exciting is happening. The evangelical spirit of the Minister for Small Business is flowing through to small businesses in our community. That excitement, that encouragement, is coming from the largest small-business package our nation has ever seen. We are cutting 1.5 per cent company tax for incorporated businesses. There is a five per cent tax discount for non-incorporated businesses. The biggest measure of all is that you can claim up to $20,000 on each asset that every business goes out and invests in against your taxable income. That is keeping more of your own money in your pocket while you invest in things that increase the productive capacity of your business, allowing you to go out there and employ more people.
When you throw that on top of our red-tape-reduction agenda, our key infrastructure agenda, our free trade agreements and the fact that we have a lower Australian dollar and lower interest rates there has never been a better time to go out and have a go and grow our local businesses.
Before the last election we were told by the Prime Minister there would be no cuts to health. In budget 2014 we got five different versions of the GP tax. It started off as a $7 GP tax, which would have stopped one million people from going to the doctor in the following year if it had been implemented. We had $60 billion in cuts. We had the abolition of Medicare Locals. After all of this he said, on 3 March 2015: 'We are determined this government will be, as a former government was, the best friend Medicare ever had.'
What we find in this year's budget? We find that those suffering from PKU have had a very small $250-a-month grant removed in the fine print of this budget. They have abolished the GP after-hours health line that took 200 calls last year; $125 million from the Child Dental Benefits Schedule; $144 million from the MBS; about $70 million from the DVA; $70 million from health workforce scholarships; $214 million from e-health, not a single dollar allocated beyond 2018; $250 million out of PBS listed drugs; another $2 billion out of health, on top of the $60 billion they took last year; and $1 billion out of preventative health care, drug and alcohol rehabilitation, mental health and other crucial health programs. This is a government that is no friend of Medicare at all.
I had the pleasure of attending the 2015 New South Wales Asian Business Awards to acknowledge the achievements of Asian migrants in our business sector. As the federal representative for Barton, one of Sydney's most diverse electorates, with a high proportion of Asian migrants, it is exciting to acknowledge the contribution our migrant communities make to the Australian economy.
Asian migrants are some of the most hard-working individuals in Australia, and events like these acknowledge their persistence and hard work to local communities. It takes courage to create a business and to keep a business afloat to make a better life for yourself and your family, especially if you are a migrant to Australia. It certainly echoes our nation's ethos that if you have a go you can succeed. We believe in opportunity and reward and that anything is possible if an individual is given the chance to have a go. It is the businesses that create jobs, not government— (Time expired)
It being 2 pm, in accordance with standing order 43 the time for members' statements has concluded.
(
Question agreed to.
My question is to the Prime Minister. What did the Prime Minister mean today when he said that there would be political and personal consequences for his ministers who leak from cabinet, and what steps has the Prime Minister taken to identify those ministers on his front bench who are responsible?
I want to assure the Leader of the Opposition and members opposition, and the entire Australian community, that this government has a strong and effective policy to keep our country safe. That is all we have—a strong and effective to keep our country safe.
Opposition members interjecting—
The members for Rankin and Moreton will desist!
This strong and effective policy was further strengthened by the decision that the cabinet made last Monday night. It was a decision to strip citizenship from terrorists with dual nationality. I want to repeat that because I would like to hear what members opposite think about this particular decision. It was a decision to strip citizenship from terrorists with dual nationality, and that is the clear policy of this government.
Opposition members interjecting—
The shrieking will stop!
I wonder what members opposite think about that particular policy. As well, we want to have a debate—
Opposition members interjecting—
I will not tolerate a wall of noise. There will be silence on my left.
We want to have a debate about aspects of citizenship because it is—
Mr Perrett interjecting—
The member for Moreton can leave right now under 94(a).
It is absolutely imperative that the people of Australia understand that citizenship not only has rights, it also has responsibilities, and the fundamental responsibility is—
The Prime Minister will resume his seat. The Manager of Opposition Business has a point of order.
Madam Speaker, I raise a point of order on direct relevance. The question goes to the illegal action of a cabinet leak. He is not being relevant to it or referring to it in any way.
There is no point of order.
Actually, there is.
The Manager of Opposition Business simply gets up and asserts relevance. If you are serious about calling that point or order, you have to argue the point seriously. You are not doing that.
Madam Speaker, to that exact point of order, if I stood up and restated the question, you would tell me that was inappropriate. So I did not do that. I drew attention to the fact—
The member will resume his seat. I have told you again and again it is not a legitimate point of order merely to repeat the question. I am never changing my ideas. I said if you wish to argue it—and you might go back and look at some precedents—you have to argue on the point of direct relevance.
Let me make this simple point—
Mr Dreyfus interjecting—
The member for Isaacs can join the member for Moreton and leave under 94(a).
Anyone who raised a gun or a knife to Australians simply because of who we are and the values we have has forfeited his or her right to consider themselves one of us. That is the fundamental point.
The Manager of Opposition Business will show some respect to the chair or else resume his seat.
Madam Speaker, I rise on a point of order. If standing orders are not going to be ruled in any way approaching relevance, of course members will call out. They have no recourse left other than to do so if the standing orders are going to be completely flouted. You cannot have a situation where he is asked about cabinet—
The member will resume his seat, and the member for Isaacs has been asked to leave under 94(a).
My question is to the Prime Minister. Will the Prime Minister update the House on the response from small business to the government's budget? How will cutting taxes for small business strengthen the economy?
I do thank the member for Banks for his question and I can assure him and the small business people in his electorate that the Australian economy is fundamentally strong. We have 2½ per cent growth. There have been 250,000 more jobs created since September 2013. In the March quarter, export volumes were up by a remarkable five per cent. Housing starts are at near-record levels. The budget builds on all of this. Since the budget, we have seen a surge of confidence, not just in the statistics but in the testimony that so many people are giving to members of this government. I want to cite a letter I have just received from a business owner in Kingsgrove in the electorate of Banks who said:
I wanted to write to thank you for the recognition given to small business in the last budget. The measures you have taken will make a difference to us, and there is already an optimism spreading through my small business customer base.
Dr Neville Steer from Mornington has just emailed the small business minister to say:
Your budget measures supporting small business are going to be very helpful for our medical practice. We are in the process of spending about $45,000 to refresh our whole IT system as it is now over five years old. The announced measures will assist in achieving this and allow us to fit additional equipment purchases into our practice. As a small business owner, these are the types of policies that give confidence.
This is the best budget ever for small business. It is the biggest budget boost that small business has ever received. There is the 1½ per cent corporate tax cut for incorporated system businesses. There is the five per cent tax discount for unincorporated small business. Best of all, there is the $20,000 instant asset write-off for all small businesses. Because the Leader of the Opposition finally, in question time yesterday, agreed to pass this through the parliament, if you want to take advantage of the $20,000 instant asset write-off, you do not have to wait. You can go out and spend now, confident that the parliament will support this measure. Small business is the engine of our economy. It is the locomotive of job creation.
Ms Owens interjecting—
The member for Parramatta!
Small business is the heart of innovation. Small businesses are the people who are having a go so that everyone can get the fair go that every Australian deserves. So that is what we are doing. We are encouraging the people who are out there having a go because we want every Australian to get a fair go.
My question is to the Prime Minister. Given the Minister for Foreign Affairs is currently overseas, will the Prime Minister also be talking directly to the foreign minister about the political and personal consequences of leaks from cabinet?
I would have thought that the opposition would have been very pleased that the foreign minister is doing what she always does: promoting the interests of our country abroad. That is what she does. She is promoting the interests of our country abroad. Thanks to the fine work of the foreign minister, the standing of our country has rarely been higher in the councils of the world. Everything that this government does, including what we did in cabinet last Monday night, is designed to strengthen our national security and strengthen our economic security. I am sure that, as part of her trip to Paris to sit down with our partners and allies to talk about what can be best done to disrupt, degrade and ultimately to defeat the Daesh death cult, she will be referring to the fine work that our Air Force is doing in strikes on Daesh positions inside Iraq and the fine work that our Army is doing in training members of the Iraqi security forces and advising and assisting the Iraqi special forces in their vital mission to regain control of their country. I am very pleased with the work that the foreign minister has done and I am sure she will add further lustre to her record in Paris this week.
My question is to the Treasurer. Will the Treasurer inform the House how the government's budget reforms are strengthening our tax systems to ensure that they are fair and sustainable? How is the government ensuring that individuals and large multinational companies are paying their fair share of tax?
Gee whiz, that is a fine question.
It is about time! Well done.
It is about time. It is a question that I would have thought would have been asked since budget night by the Labor Party, but no. In this case, the member for Reid has taken a keen interest in ensuring that multinational organisations pay their fair share of tax. And the fact is: when we came to office, we actually embedded people from the Taxation Office in a number of major international companies operating in Australia. As a result of being embedded in their businesses, we have been able to identify 30 multinationals that have been shifting profits offshore. They have substantial operations here on the ground in Australia but have been shifting profits offshore to Singapore, then to Ireland, then across to the Netherlands, then back to Ireland and then across to Bermuda. We have been able to identify that because we have actually been in their businesses. It is known colloquially as a double Irish Dutch sandwich—
That sounds like a mouthful.
It is a mouthful, Prime Minister. The accountants love that sort of talk. On budget night, we released legislation that not only strengthens our anti-avoidance provisions but ensures that we can recover the tax that should be paid in Australia and apply a fine of up to 100 per cent plus interest on the tax that should have been paid in Australia. We have done this in a measured and considered fashion. In contrast, we just heard in Senate estimates the deputy secretary of the Treasury provide an observation about Labor's approach to multinational taxes. What we do know is this: Labor say one thing but, actually, what they do is completely different. They are running around saying that they have an option that will crack down on multinationals and raise $7 billion in revenue over the next 10 years. All their savings seem to be over 10 years and all their spending over four. That is another argument. But they said it would save $7 billion over 10 years. We have found out from the Parliamentary Budget Office that the reliability of that figure is low. That means it is highly unlikely they are going to get $7 billion. But it gets better. Their proposal not only does not raise the money that they said it would; their proposal is going to cost jobs. It is going to cost jobs as well. The deputy secretary of the Treasury was asked: 'Did you go through Labor's proposal? Did you go through their proposal? What would be the impact on jobs?' He said, 'Yes, it would cost jobs. Yes, yes, it would cost jobs.' So not only has Labor come up with a tax that will raise no money but it will cost Australian jobs. Well done, Labor!
My question is to the Prime Minister. New analysis from Professor Peter Whiteford shows that a family with two children aged 11 and eight with one parent earning $60,000 a year will lose around $84 a week because of this government's unfair budget. Does the Prime Minister think it is fair that this typical Australian family will lose more than seven per cent of their disposable income because of this government's unfair budget?
There has been no new analysis. The analysis that the shadow minister refers to is the old analysis, and the old analysis did not actually analyse the 2015 budget—simple as that. It did not actually analyse the 2015 budget—
The Prime Minister will resume his seat. The member for Jagajaga on a point of order.
I seek leave to table the article in today's The Conversation by Professor Peter Whiteford.
The member will resume her seat. The Prime Minister has the call.
So there is a media report—that is what there is—based on the NATSEM analysis which was used and abused by members opposite in the last sitting week. Let me make the fundamental point: the NATSEM analysis in question failed to take into account the incentives to move from welfare to work. But I am not surprised that members opposite do not take into account incentives to move from welfare to work because, I regret to say—
Mr Giles interjecting—
The member for Scullin is not entitled to speak!
the once great Labor Party is now the welfare party; it is not the workers' party. This is the fundamental thing that the people of Australia are coming to understand: it is the welfare party, not the workers' party. I understand—and this government understands—that the best thing we can do is to get people into work.
Ms Chesters interjecting—
The member for Bendigo will desist.
The best form of welfare, as decent Labor people understand, is to get people into work. I have to say that the member who asked the question once had that view as well.
The Prime Minister will resume his seat. The member for Grayndler on a point of order.
Honourable members interjecting—
There will be silence on my right as well as my left. The member for Grayndler on a point of order.
It goes to relevance. In order to be relevant, the Prime Minister must talk about one parent who earns $60,000 a year.
The member will resume his seat. I pointed out before: once a question is couched in the terms of 'Is the budget fair?' it is a very wide-ranging question. The Prime Minister has the call.
Again I make the point that, once upon a time, decent Labor people understood that the best thing you could do for people on welfare was get them into work.
Dr Chalmers interjecting—
The member for Rankin is warned!
I am quoting here from two individuals called Jenny Macklin and Anthony Albanese who said:
We want all young Australians climbing the ladder of opportunity, not languishing on … benefits.
Exactly right. That is the position of this government.
My question is to the Prime Minister. Prime Minister, the $16 million promised to Cadbury was because of the desperate need for economic stimulus in Glenorchy. Now that Cadbury has sacked 80 staff, what is the government doing to help them? Will you commit to spend the $16 million in Glenorchy where the stimulus is needed more than ever? Do you agree, Prime Minister, that to spend the money elsewhere would make it a political slush fund?
I do thank the member for Denison for his question. Like the member for Denison, I am very disappointed that the Cadbury investment did not go ahead. It was quite a large investment by Cadbury that the government was going to assist to the tune of $16 million, which was an investment in the tourism infrastructure side of that particular investment. So, like the member for Denison, I am disappointed that Cadbury decided not to go ahead. The member for Bass, the member for Braddon and the member for Lyons are all equally disappointed that this particular investment did not go ahead. I am pleased to say that a lot of investment in Tasmania is going ahead. This government, for instance, is investing an additional $200 million in the Freight Equalisation Scheme to boost the exports of Tasmania, not just to the mainland but beyond on the mainland, to the wider world. This government is investing $60 million in new irrigation infrastructure in northern Tasmania, particularly water storages, because this government is determined to end the dam phobia which has afflicted our country everywhere, including in Tasmania.
We've got dams in Tasmania—
I hear some bellowing opposite about Midlands. We are building the Midland Highway—$400 million in that too. Yes, it is a pity that Cadbury are not going ahead with that particular investment, but, as the members for Braddon, Lyons and Bass keep telling me, a lot of good things are happening in Tasmania right now. Tasmania is not just a great place to live and a great place to visit; it is becoming a great place to work, a great place to employ and a great place to invest. It is high time that Australia had—
The Prime Minister will resume his seat. The member for Denison on a point of order. The Prime Minister has concluded his answer.
My question is to the Minister for Small Business. Will the minister update the House on the government's plan for small business? How will the budget encourage small business to grow and create jobs, particularly in my electorate of Eden-Monaro?
It is great to get a question from the member for Eden-Monaro—a CEO of the Australian Chamber of Commerce and Industry; a lifetime dedicated to supporting enterprising men and women through ACCI; and now in our nation's parliament. What an example of the kind of commitment to those enterprising men and women he represents. It is a testament to all the people on this side of the House. He brings good advice and he brings insights, and that is why our Jobs and Small Business package has so hit the right spot. It is a game-changer for those enterprising men and women, because the Abbott government listens to, collaborates with and engages the men and women of small business—something that has ensured that our program hits the right spot.
For the 12,000 small businesses in the member's electorate, this is a particularly positive budget. It has been received so well. We have seen examples that the member has conveyed to me. Peter Dickson Motors in Queanbeyan has seen a great increase in interest in motor vehicles available through him to support enterprising men and women. We saw John when we went to Googong's Yellow Belly Cafe with the Prime Minister and the Treasurer. Those expansion plans are something that is being energised by this budget commitment. There was the Batemans Bay small business forum—what a great occasion that was—where we had dozens and dozens of enterprising men and women share with us their ambitions and what we can do. We do not need encouragement from those opposite; we just need some action.
It is pleasing that yesterday the Prime Minister was able to recognise that the Leader of the Opposition had clarified Labor's position. We heard the Leader of the Opposition deride the asset write-off as a giveaway to start a fire sale at a second-hand car yard and Harvey Norman. That did sound a tad derogatory. We saw the member for Oxley unable to agree with the member for McMahon about the virtue of a small business company tax cut. At least Labor has now landed in the right place. They will do something to support the Small Business and Jobs package, and that will help energise enterprise and encourage those men and women who are going to be creating the jobs of the future, supported by a government that has the policy settings right. That is good news. Now all we need to do is see this legislation for the reduction in the small business company tax rate to take it to the lowest it has been since 1967. All we need is this parliament to pass the instant asset write-off and get it over to the Senate so that, when the Senate reconvenes, one of their early orders of business can be to get these measures passed, so that the confidence and the positivity can be turned into action. We do not need any funny business with committees to ponder the imponderable. Just get behind this measure, just like this government has got behind enterprising small business men and women. Let's see if Labor has got follow-through and not just backswing.
My question again is to the Prime Minister. Marlene Lamb turns 74 today. She is a grandparent carer in the electorate of Petrie who has cared for her 12-year-old daughter since she was four due to tragic circumstances. Marlene writes:
How the hell will I manage if I lose $100 a fortnight because of this government's cuts to Family Tax Benefit Part B?
Does the Prime Minister agree that grandparent carers like Marlene should lose $100 a fortnight?
I make two points in response to the member who asked the question. First of all, as a 70-year-old carer, no doubt she is on a pension. What we have done is scrapped the carbon tax and we have kept the compensation for pensioners. The first thing Labor would do if they came back into office is whack the carbon tax straight back on. That is the first thing that Labor would do—they would whack the carbon tax straight back on.
When it comes to family tax benefit part B we know that, when the member who asked the question was the relevant minister, she cut $15 billion from the family tax benefit.
Opposition members interjecting—
They can interject and shake their heads. Labor in government cut $15 billion from the family tax benefit. I have to say that much as—
Madam Speaker, a point of order on relevance. This lady really does deserve a decent answer from the Prime Minister.
There is no point of order. The member for Jagajaga will resume her seat. That is argumentative and you know it.
Madam Speaker, I am entitled to point out, for the benefit of all Australians, the absolute hypocrisy of the person asking the question, who was the minister who cut $15 billion from the family tax—
The Prime Minister will resume his seat.
Madam Speaker—
I will give you the call when the Prime Minister has resumed his seat. The Prime Minister has resumed his seat. Has the Prime Minister concluded his answer? No.
Madam Speaker, I rise on a point of order. Would you ask the Prime Minister to withdraw the word that he used about the member for Jagajaga. It is deeply offensive.
If the term 'hypocrisy' was applied particularly to the member for Jagajaga, the Prime Minister will withdraw.
Madam Speaker, I did not call the member a hypocrite but, nevertheless, I talked about the hypocrisy of members opposite. But, if it assists the House, I withdraw.
Madam Speaker—
The Manager of Opposition Business will resume his seat. The Prime Minister will assist the House if he would simply withdraw.
Madam Speaker, I am happy to withdraw. The other point I would make about the member for Jagajaga is that not only did she cut $15 billion out of the family tax benefit but also—
Ms Macklin interjecting—
The member for Jagajaga will desist.
she changed the indexation method for the family tax benefit, from MTAWE to CPI. Shame on the member for Jagajaga! Here she is: she cuts $15 billion out of family tax benefit and she changes the indexation for the family tax benefit. I have one final point to make: members opposite plainly do not like our policies; tell us theirs. They do not like our savings; tell us theirs. There is a $58.6 billion budget black hole. Will members opposite, just for once, tell us how they would fill it. Because, as things stand, no spending is too much, all saving is cruel and yet, at the same time, they want a bigger surplus. Like everything with the opposition, it just does not add up.
My question is to the Deputy Prime Minister, and Minister for Infrastructure and Regional Development. Will the Deputy Prime Minister update the House on measures in the budget that will help provide essential services to remote communities in my electorate of Durack and around the country?
I thank the honourable member for Durack for her question. Australia is one of the most urbanised nations in the world and yet we have an affinity with our great outback and those who live in remote parts of our country. It is especially important that governments recognise those people living in remote locations and provide the kinds of services and facilities that they have a right to expect.
In the budget significant funding was provided for roads in outback communities, both for highways and their local roads. The Outback Way was amongst those to be funded—Australia's longest short cut, from Cairns to Perth—and many other significant projects will also receive funding.
But there are many people who live in locations across remote and isolated parts of the country which cannot be serviced reliably by road and which are dependent upon air services just to receive their daily goods, food, education materials, mail and urgent supplies. In this budget the federal government provided an additional $5.9 million to top up the Remote Air Services Subsidy Scheme for remote communities. This scheme actually services 366 remote locations and 260 direct services to particular locations, with light aircraft carrying not only passengers but also these essential supplies to these stations and Aboriginal communities. There are around 100 Aboriginal communities serviced through this scheme and it enables them to get the basic supplies that they need. The scheme covers: in the Northern Territory, the Gulf Country; in Queensland, Cape York; in South Australia, the APY and Channel Country areas; in Tasmania, nearby Cape Barren Island; and, of particular reference to the member for Durack, the Kimberley, the Pilbara and the desert country regions around Western Australia. There are 62 services in her electorate alone. This scheme provides a significant benefit to those communities. But we are doing more.
There is $33.7 million of new funding over the next four years under the Remote Airstrip Upgrade Program so that the Flying Doctor Service and other essential air services can be provided to some of these really remote communities. And for the Flying Doctor Service itself there is an extra $20 million over the next two years to increase its funding to $68 million per annum so that a 'mantle of safety' can be provided for people in remote communities.
This is a government that cares about those people who are out of sight and out of mind of the cities. We are providing services that really matter and are absolutely essential to life in these communities.
My question is to the Treasurer. I refer to the Treasurer's comments last year that the idea of a housing bubble emerging was 'lazy analysis'. Yesterday the Treasury Secretary stated:
When you look at the housing price bubble evidence, it's unequivocally the case in Sydney.
When it comes to housing prices in Sydney, does the Treasurer agree with himself or with the secretary to the Treasury?
There is no doubt that, since my comments last year, housing prices have increased in Sydney. I think we should be welcoming an increase in housing values. Anyone out there who has a loan would be wishing that their home is worth more than their loan; that is what they would actually want. I know that is a difficult concept for Labor to get their heads around—that you actually want to have equity in your own home. I know that is difficult because Labor loves debt and they love other people carrying debt to help to pay for their lifestyles. But, actually, there are a lot of Australians out there with a mortgage who hope that the value of their home increases above the value of their mortgage.
Of course, there are two issues here: there are housing prices and then there is housing affordability. We have been concerned about the challenges associated with housing affordability. There are a number of responses. Firstly, at the meeting of treasurers in April this year, as I announced at the time—but clearly our opponents were not paying attention— the Victorian Labor Treasurer is heading up a task force on behalf of all the treasurers to look at ways we can help to improve housing affordability in Australia. Secondly, the biggest issue to address rising house prices and low affordability at the same time is to increase the supply of housing. Under this government, 198,000 new dwellings have been constructed in the last 12 months, which is 19,000 higher than at any other time under the previous Labor government. Construction in housing is up 12 per cent in the last 12 months. So we are actually working together with the states to increase the level of supply.
As I have said in this place and in numerous places previously, whenever I travel overseas and speak to rating agencies and banks, they raise the issue of housing prices in Australia and the potential risk; and I quite rightly point out, as does anyone who analyses the situation, that we have a shortage of supply which is also contributing to rising house prices. The final point I would make is this: we want integrity around the purchasing of housing in Australia. That is why we have taken a tough stand in relation to foreign investment in residential housing. One of the things that Labor is left out on is that they are not yet supporting our tough stand on foreign investment in residential housing. So please do not lecture us in a hypocritical way.
My question is to the Minister for Agriculture—and agriculture is critically important in my electorate of Lyons. Will the minister inform the House how the government's budget assists Australian farmers and agri-businesses through investment in research and development?
I thank the honourable member for his question. He has incredible experience in the wool industry. He has a long history in the wool industry. He has been part of wool sales. The wool industry is a great example of research and development. When the wool industry first started in our nation, an average sheep would probably cut around four pounds, or two kilos, of wool; and now they are cutting up to seven kilos of wool. And the microns have gone down. It used to be around 24 or 25 microns, but now it is down to about 19 microns in the member for Lyons's seat. This is all part of research and development.
One of the reasons it is great to talk about the wool industry in the member's seat is that I have realised lately that we are now experiencing some of the highest prices for four years; in fact, they say the wool market is going ballistic. Isn't that good! The wool market is going ballistic. We have got record prices in cattle, record prices in sheep, strong prices in cotton and the wool market is going ballistic. You would almost think that we had good management, good government, bringing about good returns. Of course, the reason that happens is that we are happy to be part of the research and development that this nation puts towards this industry. Around $700 million a year is invested in research and development and extension. In the forward estimates, close to $250 million a year will go towards research and development. This will ensure that our nation stays at the forefront of the soft commodity market, the agricultural market.
It was only today that we made the very large announcement in this building that the GRDC will put $45 million towards research into making sure that we have more effective chemicals to deal with zero-till agriculture. This is extremely important if we want to preserve water, have greater carbon reduction in soils and make sure the organic content in the soils stays high. This is important and it happened today in this building. It shows the clear nexus between investment in the budget and investment in a stronger soft commodity market. We will be doing this with Bayer in Frankfurt. It will help us deal with 39 weeds that are currently resistant; it will help us get on top of this. It is a clear example to the Australian people that this is a government that is not only presiding over the strongest soft commodity prices in a long time but also has a strong mind to the future.
My question is to the Prime Minister. Yesterday the government's top economic adviser warned Australians that there is a housing bubble in Sydney and parts of Melbourne. Does the Prime Minister agree with his top economic adviser that there is a housing bubble in Sydney and parts of Melbourne?
Millions of Australians have borrowed money to buy a house—millions of Australians have mortgages—and the last thing they want to see is a decline in the value of their most important asset. That is the thing. Why should members opposite be talking down our economy? Why should members opposite be saying that somehow people's houses are worth too much? That is what the Leader of the Opposition is saying. He is saying that people's houses are worth too much. This is someone who wants to be the Prime Minister of Australia, and he wants your house to be worth less. The Leader of the Opposition wants your house to be worth less.
Honourable members interjecting—
There is too much noise on my left, and on my right.
This bloke has wrecked a lot of things, but what I do not want him to do is to wreck the housing market of Australia. Do not trust this man with your house price, do not trust this man with your superannuation, do not trust this man with your future and do not trust this man with the government of Australia. What he wants is for your house to be worth less. Just imagine how you would go paying back your mortgage when your house is worth less.
Honourable members interjecting—
There is too much noise!
Just imagine how you would go if you had to repay your mortgage if your house was not worth what it was worth when you bought it. That is the spectre that this leader of the opposition is now holding out to the people of Australia. He is not just saying the carbon tax comes back, he is not just saying the people smugglers come back, he is not just saying the superannuation tax comes on, but he wants your house to be worth less. Really and truly, this leader of the opposition is going from bad to worse.
Honourable members interjecting—
There is far too much noise. We will have some silence for the question from the member for Longman.
My question is to the Assistant Minister for Employment. Will the minister update the House on the government's plan to reinvigorate Work for the Dole? What challenges does the government face in helping young people to get valuable work experience?
I thank the member for his question. I must say that the member for Longman may not have seen the Labor Party deliver a surplus in his lifetime, but he does understand the benefits of Work for the Dole. Over the past 11 months the government has successfully rolled out phase 1 of its revamped Work for the Dole program, and I can inform the House that, on 1 July, Work for the Dole goes national as part of the new jobactive employment services system. This is, in turn, part of the government's $7.3 billion investment to assist job seekers to move from welfare into work. Work for the Dole provides job seekers with the opportunity to learn new skills and, at the same time, to give back to their community.
The member for Longman understands the benefits of Work for the Dole because there are success stories in his electorate. I want to bring to the attention of the House a job seeker who was referred to Work for the Dole, did two weeks of a Work for the Dole placement in office administration and showed such great work ethic and ability that the host hired that person, who is now a Work for the Dole supervisor—after two weeks in the Work for the Dole program. I will bring to the attention of the House another job seeker—those opposite are laughing; they want people in welfare; they do not want people in work. This job seeker, who was 221 weeks unemployed, got a Work for the Dole placement in office administration, finished a Cert II in community services and was offered a traineeship in business administration.
I was asked what challenges the government faces in helping young people to get into work. There are challenges, and they are sitting over there. We know that Work for the Dole is hated by the Labor Party; they showed that in Senate estimates last night. They hate Work for the Dole. They hate work experience. We know that the ACTU dislikes work experience; they made that clear last week when they came out opposing the national work experience program, despite the fact that ACOSS supports work experience, ACCI supports work experience and the Brotherhood of St Laurence supports work experience. On this side of the House we have a plan for getting young people into work; the members opposite hate work experience. The opposition leader has shown his contempt for young people and the problem of youth unemployment by his failure to even mention it in his budget-in-reply speech. A person holding himself out as a potential future prime minister failed to mention the plight of youth in his budget-in-reply speech.
My question is to the Prime Minister. In the event that the government's top economic adviser is right, does the Prime Minister have a plan for housing affordability for young Australians who are locked out of the housing market?
What we do not want to do is to jeopardise the future of Australian families who are buying their homes by reducing the value of their biggest asset. That is the problem with the Leader of the Opposition's truly bizarre line of questioning today: he is saying to the homebuyers of Australia, 'I want your asset to be worth less.' That is what he is saying. He wants that asset—that they have invested their heart and soul in—to be worth less. That is what he wants.
Madam Speaker, I rise on a point of order. When quotes are being given from the Treasury secretary, there has to be some limit to the verballing from this Prime Minister.
The member knows perfectly well that is not a proper point of order, and we will not have it again.
What this government wants to do is produce a strong and prosperous economy for a safe and secure Australia.
Why is debt up? Why is the deficit up? Why is unemployment up? Why are taxes up?
The member for Sydney will desist.
I do not want for a second the price of people's homes, the worth of people's biggest asset, to fall. That is the last thing I want, and it comes passing strange for the Labor Party to say that they want the value of people's homes to fall. That is what they are saying—that they want the value of people's homes to fall. Let me read from a statement which came out just a few minutes ago from the Governor of the Reserve Bank. He said:
Credit is recording moderate growth overall, with stronger lending to businesses—
That is good—
and growth in lending to the housing market broadly steady …
That is good too. The Governor of the Reserve Bank went on to say:
Dwelling prices continue to rise strongly in Sydney, though trends have been more varied in a number of other cities.
Let me repeat that:
Dwelling prices continue to rise strongly in Sydney, though trends have been more varied in a number of other cities.
Why does this Leader of the Opposition want to punish the people of Sydney? Why does he want to punish the people of Sydney? Why does he want to make policy based on what is happening in one city for the whole of the country?
What this proves is that this Leader of the Opposition is a menace to the economic welfare of the people of Australia. That is what he is. He just does not get it. He does not like aspiration. He does not like people who want to have a go. It is a party that is more interested in welfare than work, it is a party that does not even want people to work for the dole and it is a party which—as a result of this repeated line of questioning we can clearly understand—wants your house price to fall. That is the last thing that any responsible government would want and it is certainly not something that this government would ever consider.
My question is to the Minister for Education and Training. Will the minister inform the House of action the government is taking to protect our young people from the insidious scourge of radicalisation in schools?
I thank the member for Bass for his question. I know that he takes very seriously the measures that this government is implementing to counter violent extremism across the whole of government, whether it is the Minister for Justice, the Minister for Foreign Affairs, the Attorney-General or, indeed, in my own portfolio of education. No-one could doubt the very serious nature of the threat posed to our way of life by the radicalisation of students at schools—of Australian youth. This was starkly brought home to all of us in recent weeks by the case of Oliver Bridgeman, an 18-year-old Gold Coast student who had recently returned to Toowoomba and then, from Toowoomba, was radicalised and is now, we believe, suspected of joining a terrorist organisation overseas. It provides us with a stark reminder of the challenges that we face at every facet of our society.
So, last Friday, I asked the education ministers council, the state and territory ministers, to join with the Commonwealth in devising a strategy around the deradicalisation of at-risk youth at school. While baby steps were made, it is fair to say, there was some movement. There was not the sense of urgency that I think the Australian people demand from their governments, state, territory and Commonwealth. We want to work with the states and territories on a number of different measures. We need to create the resources for teachers and for schools that provide information, that identify at-risk students, that tell the teachers and principals where to get help and to provide advice in emergency situations.
We also need to provide resources to parents to be able to see the signs of at-risk children at home, to ensure that they get very early to nip in the bud potential danger signs of their own children and then provide them with the information they need to contact those who know how to help for emergency assistance. Every single family knows in their households they are dealing with children who have terrific access these days to the internet, and all of the people who are trying to radicalise our youth are operating through the internet—operating online.
So we do need the policies in place, and the government wants to work with the states and territories. I do call on the states and territories to accept that offer to work with us to ensure that we have the policies in place, right across government, to protect our society and our way of life from those who would seek to overthrow it.
My question is to the Prime Minister. Yesterday, when asked about superannuation, the Secretary of the Treasury said:
… any government that doesn't have a process of review of their longer term commitments, I think, is letting the community down.
But, given that the Prime Minister has ruled out making any changes to superannuation ever, does the Prime Minister agree with the advice of the secretary of his Treasury department?
I am very pleased to get this question about superannuation from the Leader of the Opposition because it gives me an opportunity to reassure the retirees of Australia that we are not going to be raiding their piggy banks. We are not going to be raiding their savings. The savings of the people of Australia are safe with this government, unlike the situation when members opposite were in charge, when some $9 billion—
Nine billion dollars of new taxes.
I think there were 12 separate changes to superannuation. Remember the then Leader of the Opposition, Mr Rudd, back in 2007 made a solemn commitment to the Australian people on the subject of superannuation? It would not change—not one jot, not one tittle. What did we get from members opposite? Twelve separate changes and $9 billion ripped out of people's savings.
I rise on a point of order, Madam Speaker. It goes to relevance. I asked: does the Prime Minister agree with his chief economic adviser or not? That is the question.
Simply repeating the question is not a point on relevance. The Prime Minister has the call.
Not only does the Labor Party have a very bad collective record when it comes to ripping off people's superannuation but the Leader of the Opposition has a particularly poor record when it comes to stealing people's savings. This is the bank account thief.
Opposition members interjecting—
Okay—trousering. I withdraw and I say 'trousering people's savings', because that is exactly what he did. If people's bank accounts had not been touched for three years, because maybe they were youngsters who were putting the money away for when they grew up or they were older people who were putting the money away for their retirement, what did the Leader of the Opposition do?
Here you go.
Yes, that's right. There it is!
A government member: It's exhibit A.
Not one of these piggy banks was safe when the Leader of the Opposition was the relevant minister! Let me repeat this government's position on superannuation. We said before the election there would be no adverse changes to superannuation in the life of this parliament, and that is absolutely correct. We have delivered on that commitment. We have no plans—
Ms Macklin interjecting—
Ms Owens interjecting—
Ms Butler interjecting—
The members for Jagajaga, Parramatta and Griffith will all desist!
to change superannuation beyond the life of this parliament and, unlike members opposite, we do not regard people's superannuation savings as an emergency fund to be raided by government whenever government is short of money. You cannot trust your savings to the Labor Party, but your savings will be safe with this government.
My question is to the Minister for Justice and Minister Assisting the Prime Minister on Counter-Terrorism. Will the minister update the House on action the government is taking to counter violent extremism and keep our community safe?
I thank the member for Dobell for that question. Every day, this government is working with its state and territory colleagues to combat violent extremism. Recently, at the Law, Crime and Community Safety Council, the Attorney-General and I had the opportunity to update our colleagues about the current threat environment, and all of those present reiterated their determination to disrupt and degrade terrorism in all its forms. This sensitive work is already underway, with intervention programs operating in every single state and territory. This work is vital to keep our nation safe, because the number of Australians with hands-on terror experience continues to rise. More than 250 Australians are now actively fighting with or supporting terror groups in Syria and Iraq, and Australians continue to be groomed by extremists in an effort to radicalise and recruit our young people in particular. This government will work with communities to provide the support they need to turn those who would be susceptible away from this dark and violent path.
The government's approach to countering violent extremism comprises four tiers: building strength in diversity and investing in social cohesion; focus work with communities where people are vulnerable to radicalisation; challenging and tearing down extremist propaganda; and intervention and diversion of radicalised or radicalising people.
The government is investing $40 million in major initiatives to turn vulnerable individuals away from these extremist ideologies. This funding allows the government to work with grassroots organisations to support early intervention and to tackle extremist groups online. We are also providing almost $13½ million through our Living Safe Together intervention programs. These programs identify people who are at risk and deliver tailored services to help them away from the ideologies of violence and hate. There has already been $1.6 billion allocated for 34 community based organisations under this program.
Other examples of the work this government is doing include a half a million dollar grant to the Islamic Museum of Australia. This will provide a new education program to promote understanding of Islamic art and culture which in turn promotes social cohesion. We are also allocating $200,000 to the Bachar Houli Academy, run by the AFL, for a high-performance leadership program for junior footballers of Islamic background. The Minister for Social Services has also allocated $650 million for settlement services that promote integration into our society.
Community partnerships are vital in attacking violent extremism, because intervening early requires the support of everybody in the community. Like the Minister for Education said, educators, police and partnerships will remain vital to turn people away from radicalised and violent ideologies. (Time expired)
My question is to the Treasurer. I refer to Dun & Bradstreet's Business Expectations Survey, which shows a significant fall for May, with a deteriorating third-quarter outlook for sales, profit, investment and employment levels, coming on the back of last week's terrible capital expenditure figures. When will the Treasurer take responsibility for the impact on the economy of his words and his policies?
I refer to Dun & Bradstreet's Business Expectations Survey. The index currently sits at 13.4 points. The average for the period under Labor was eight points.
Opposition members: Is that it?
Mr Giles interjecting—
The member for Scullin will not be reminded again!
My question is to the Minister for Social Services. Will the minister advise the House why it is important to achieve savings in the Social Services portfolio to ensure a sustainable safety net for current and future Australians who need our support?
I thank the member for Herbert for his question. We know on this side of the House that you have to have savings to pay for the things that you want to do; and, if you want to fix the budget, you have to have savings to fix the budget—otherwise, you are just a budget smuggler! You are just a budget smuggler. That is what the Leader of the Opposition does.
In this budget, there are $7 billion worth of savings in the Social Services portfolio, and those savings are designed to ensure that we can invest in programs to get young Australians and families into jobs. That is what we are doing to support them to make the choice to be in work, and we are doing it with these savings to reduce the deficit—the deficit we inherited from those opposite, as they ran up the bills year upon year and years on top of that. We are also doing this to accommodate the investments and the expenditure which we know we will have to make to ensure a secure safety net in the future.
We have talked about the need to fund the Jobs for Families package but we also have to fund the NDIS. The NDIS is something that is supported by both sides of the House, right across the chamber and over both chambers, but there are some realities that we have to deal with. The NDIS will grow one full percentage point of GDP in terms of cost over the next five years. When it comes to full effect in five years from now, it is going to cost the Commonwealth some $11.7 billion—$5.4 billion of which is unfunded. It is unfunded by the levy. If those opposite think they can make big commitments without making the savings they need to absorb these important investments then they are not up to the job.
I know that the shadow minister, the member for Jagajaga, has said that you have got to pay for these things somehow. Well, I have been thinking: where is this 'somehow place' where you can magically fund all of your commitments? I thought it might be 'Somewhere over the rainbow way up high. There's a land that I've heard of once in a lullaby' That is what they think. They are living in a fantasy land when it comes to how you pay for your budget promises. We have got the Wizzard of Oz over here—all smoke and mirrors. It is time for those opposite to come back to reality, whether it is the flying monkeys up the back, the cowardly lion—
Opposition members interjecting—
or Dorothy herself over here. It is time for her to stand up and tap her shoes together, come back to reality and say: 'There's no place like home. There's no place like home.'
I ask that further questions be placed on the Notice Paper.
Madam Speaker, a brief question for you. During question time, between 20 past two and half past two, it appears from the tape that the member for Braddon was a taking a photograph in the chamber. I ask that you review the tape.
I will take a note of that, because that is not permitted.
I wish to make a personal explanation.
Does the member claim to have been misrepresented?
Yes, most grievously.
Then you may proceed.
Yesterday, I gave a radio interview to Stan Thomson of ABC SouthEastSA based in Mount Gambier. A story about that interview was posted on the station's website yesterday afternoon and the station's Facebook page linked to that story earlier today. The Facebook link states:
Liberal Member for Barker Tony Pasin has said he would not support a change to legislation on the issue of same sex marriage and said the majority of his electorate has told him they agree.
The overwhelming majority of comments attracted by that post have negatively reacted to me allegedly claiming to have spoken to the majority of my electors. In actual fact, what I said in the interview was:
An overwhelming majority of people who have approached me on this issue have asked me to confirm the position as the traditional definition.
I trust this allays the concerns of people who have been offended by the misreporting of my comments.
The member has completed his personal explanation.
I stand to my feet to refute the claims of the member for Watson. No such photo was taken.
The member will resume his seat. Under the standing orders you are not permitted to stand and debate such an issue. You may stand and seek indulgence, having said you have been misrepresented. If you wish to do that, you may.
I seek leave to make a personal explanation.
Do you claim to have been misrepresented.
I certainly do, Madam Speaker, most grievously.
Then you may do it without engaging in debate.
Thank you, Madam Speaker. I refute the claims that have been made in this place by the member for Watson. No such photo was taken. He wouldn't know a good flash if he saw one!
The member is not to engage in debate!
I refute the claim. No such photo was taken.
Opposition members interjecting—
There will be silence! I will say with regard to the question of when people rise to make a personal explanation that it is on indulgence only. An abuse of that indulgence will not be tolerated, and that includes smart comments.
I present the Auditor-General's performance audit report No. 38 of 2014-15 entitled Administration of enforceable undertakings—Australian Securities and Investments Commission.
Ordered that the report be made a Parliamentary Paper.
I have received a letter from the honourable member for Grayndler proposing that a definite matter of public importance be submitted to the House for discussion, namely:
The Government's cuts to infrastructure investment in Australia.
I call upon those members who approve of the proposed discussion to rise in their places.
More than the number of members required by the standing orders having risen in their places—
'For an "infrastructure prime minister", Tony Abbott's efforts have been pathetic.'" They are not my words; they are the words of the business commentator Alan Kholer in a piece written immediately after this year's budget. In another piece he said:
… the detail of the budget papers show a real decline in spending in the Infrastructure and Regional Development portfolio of 11.2 per cent between 2014-15 and 2018-19.
This budget has blown the lid on Tony Abbott's big infrastructure con. After more than 18 months of broken promises, dodgy process and the magical infrastructure re-announcement tour, the figures are in. Infrastructure funding in this budget has been cut by $2 billion over this year and next, with a funding decline by 11.2 per cent over the forwards.
Let's have a look at the real impact here: Victoria, $812 million cut; Queensland, $613 million cut; South Australia, $318 million cut, Tasmania, $31 million cut; ACT, $12 million cut—big iconic projects cut. The Pacific Highway was cut by $129 million in 2015-16, in what was previously promised in their own budget last year. The Bruce Highway: because they elected a Labor government, what was the response? Cut Bruce Highway funding by $93 million from what was previously promised last year.
There is nothing for public transport, nothing for high-speed rail and nothing for freight rail beyond the $300 million that we put in the 2013 budget for the inland rail link between Brisbane and Melbourne. The Heavy Vehicle Safety and Productivity Program—cut, with only $1 million of last year's $48 million budget actually spent.
This is even with their own programs. They did come up with something new last year: the Bridges Renewal Program. But this year they cut it by $60 million! And if you want an example of mean-spirited stupidity that is dangerous, they cut the Seatbelts on Regional School Buses program by $1 million a year—cut! Talk about risk management! What a stupid decision for any government to make!
Last Friday, they decided that because Victoria had just eight per cent of infrastructure spending in the budget they would make an announcement. They pretended it was new. They were going to put $150 million into the Western Ring Road, known as the M80. The problem is that last year they cut it by $500 million. It is a great way to get new announcements: you cut $500 million in the 2014 budget, you put $150 million back and you say, 'We are investing in infrastructure.' Genius! Why didn't we think of that? Absolutely extraordinary!
Today, the Prime Minister and other ministers stood up and spoke about the Midland Highway in Tasmania. They said, 'We're putting $400 million in.' But there was $500 million in the budget before! That is less. They said they were funding irrigation, except they took that from rail freight in Tasmania in order to fund the irrigation program. There is nothing that they do that is not taking more, giving less and then claiming it is new. It is an extraordinary performance.
This is the same mob—
What about the money you took off the F3 to M2? You never funded it Albo! You did nothing about it!
This moron raises the F3 to M2! Thank you—come in spinner! There was $405 million in the 2013 budget. The MOU was signed between myself and Minister Gay in June 2013. They changed the name to NorthConnex. It is not a new project; it is just a new name, son! It is the same project, begun and signed under us.
When we took office we were 20th in the OECD for investment in infrastructure. When we left office we were first. We doubled the roads budget, we increased the rail budget by more than 10 times and we committed more to urban public transport than all governments combined from Federation right through to 2007. What have those opposite done? In spite of the fact that Infrastructure Australia under them actually produced something at last—they produced something spooky about urban congestion and the cost to the national economy of not dealing with urban congestion—what did we see from the government? A complete refusal to invest in any urban public transport and a complete refusal to engage in our cities.
We actually embarrassed them into producing the State of Australian cities report for 2014. It had been produced in 2011, 2012 and 2013. It had been downloaded—the minister at the table knows what is coming!—three million times. So they put out a tender on AusTender. We found that on the website. It said it was going to be published just in time for Christmas—for the stockings!—on 15 December. It was printed—I have seen the cover of it. And yet what happened in Senate estimates?
If you had better leaks you would have got it!
You don't think we've got it? It's all about the timing, sunshine! They printed the State of Australian cities 2014 report, paid $11,000 for the printing of it and produced it. But it is now June, and where is it? At Senate estimates, the secretary of his department said that it was 'collecting dust' and that the minister has advised them not to release it. That is new research. Why? Because it probably mentions that they have to do something about urban congestion, they have to do something about public transport and they have to do something about planning in our cities, and that they should be funding the Cross River Rail, they should be funding the Melbourne Metro and that they should be making sure that Infrastructure Australia guides where the investment goes.
And yet what we have also seen in this budget—in spite of their promises—is that they have not listened to Infrastructure Australia. They funded the East West Link to the tune of $3 billion, with an advance payment of $1½ billion and with a cost-benefit analysis of 0.45. I will explain it: you pay a dollar and you get 45c back. It is not that complex. That is what the analysis showed—a dud project. They took money from projects like the Western Ring Road and from projects like the managed motorways program, that had a cost-benefit ratio of greater than five, and from the Melbourne Metro and put it into a dud project. Then they made an advance payment to the Victorian Napthine government to make their budget look better at a time when those opposite were cutting pensions, cutting education and cutting health and essential services. That is what they were responsible for.
So, they have learnt the lesson on Infrastructure Australia. They have finally produced a report that they have not released.
But now, in this budget, they have cut Infrastructure Australia's funding in half from $15 million a year to $8 million a year across the forward estimates. That is why the Leader of the Opposition announced a proposal in the budget reply to restore Infrastructure Australia to the centre of government, to fund projects in the Infrastructure Australia priority list. Like the former Treasurer did, like the former Labor government did, look at where it is going to produce the best investment and that is what should be directed. And we even promise to consult with the opposition on Infrastructure Australia appointments.
This nation needs a government that not only talks about infrastructure but that actually builds infrastructure, that builds roads, that builds rail lines—not just reannounce old projects and pretend it is doing something while it is actually cutting funding.
You can see why he had so much support among the Labor branches. The contender is back and he is working hard. He is available if they are ready; there is no question—big speeches in the parliament. Unfortunately, like usual with the member for Grayndler, there is not much truth to the delivery. He gives a good speech but he does not actually give much truth in the speech. We will correct some of the false assertions that he has made and we will put on record exactly what this government is doing and why this could Prime Minister will be remembered as the infrastructure Prime Minister.
We will start with Labor's record because the member for Grayndler wanted to make much of it. He wanted to make much of his new-found love of cost-benefit analysis. Some do not remember, but the member for Grayndler was Deputy Prime Minister for a short period. But, during that time, he was also Minister for Communications. In fact, he claims that it was a golden era in communications policy. I think that is his claim. The only problem with the member for Grayndler's new-found love of cost-benefit analysis and economic analysis of government spending on infrastructure projects is he refused to allow Infrastructure Australia—or anyone for that matter—to do a cost-benefit analysis on the NBN. There was no cost-benefit analysis on the biggest spend on an infrastructure project in Australia's history. We are a bit sceptical about the genuine commitment from the member for Grayndler about cost-benefit analysis and economic assessments of projects before they are funded by government.
In respect of Labor's record when they were in government when it came to infrastructure, the first point we should make is that the Business Council of Australia's report card on Labor's stimulus package made it very clear that during that time that they increased spending. We remember the money they inherited from the Howard-Costello era that they spent during the GFC, the member for Lilley. Fourteen per cent of that money was spent on economic infrastructure. The rest of that money was spent on free money—the $900-cheques. The Pink Batts program was infrastructure under Labor as were overpriced school halls.
The member for Grayndler is fond of referring to the Global Competitiveness Index. We went and had a look at the Global Competitiveness Index and we looked at how Australia has performed. In 2007, the 2008-09 report of the global competitiveness index ranked Australia's overall quality of infrastructure as 25th in the world. In 2013, in the 2014-15 report, we dropped 10 places to 35th—that was during Labor's period in office. The IMD World Competitiveness Centre, in its yearbook, ranked Australia fifth best on basic infrastructure in 2007. By 2013, we had dropped to 22nd. In 2015, we are back to 18th. We have got work to do and we are doing that work.
What we have seen since we came to government, in last year's budget and in this year's budget, is some nearly $17 billion more spending over the forward estimates on infrastructure than Labor would have spent had they been re-elected.
The member for Grayndler is fond of claiming that there are no new projects in the budget. That is completely false. In fact, there are 85 or nearly 95 new projects under this government. We are focused on building more infrastructure for more jobs and a stronger Australia. The projects that are new and funded by this government include: WestConnex stage 2; the Perth Freight Link, a very exciting project in Western Australia, and there will be more to say about that project in the coming weeks—
Ms MacTiernan interjecting—
I knew I would get the member for Perth going on that one. It was just a little fly-fishing exercise. Chuck her 20c and there you go. The North-South Corridor; the Darlington project, which, the member for Grayndler at one point said was a low priority project. We are funding that and the Torrens to Torrens project and we will have more to say about South Australia in the coming weeks. The Toowoomba bypass project is a project the member for Grayndler has never liked, has never supported. We know the Queensland government is working away on producing that and there will be announcements. There will be $1.2 billion spent on that project. The member for Grayndler does actually support the Western Sydney Infrastructure Plan as do some sitting on the backbench but the member for Chifley is not one who supports this.
There will be $3½ billion worth of roads in Western Sydney along with a new airport, the Western Sydney airport, the first airport in Western Sydney, delivered by the infrastructure Prime Minister. We have doubled the Roads to Recovery money with $350 million of new funding. We have doubled the Black Spots Program with $200 million of new funding. There will be $3 billion in a locked box to build the East West Link project. We want to do that because Infrastructure Australia's audit rightly identified—just like Sir Rod Eddington did and just like the Leader of the Opposition did twice in two submissions—Melbourne needs an additional east-west crossing.
As for public transport projects, we are funding public transport projects. We are funding the Sydney Rapid Transit Project, which will be a second harbour rail crossing and which will increase the public transport system's capacity by 60 per cent. We are contributing funding to that project. We are committing funding to infrastructure projects right across Australia and we have more to come. We will have more to come through the Asset Recycling initiative. The Victorian government will shortly announce their intentions with the Melbourne port; there will be a new infrastructure project out of that. We very much welcome the decision of the Western Australian government to sell the Fremantle port. There will be new infrastructure projects from that decision. The South Australian government has signed up to the Asset Recycling initiative, and we welcome that decision. Obviously, the New South Wales government will get first-mover advantage with the lease of its electricity assets and it will spend billions of dollars on new infrastructure projects.
We are getting on and building infrastructure projects right across the country. In the member for Bradfield's electorate, we are building the NorthConnex project.
Mr Albanese interjecting—
This is the thing with the member for Grayndler: he was very good at announcing his intention to do things, but he was not any good at delivering the projects. He was good at delivering things like the pink batts program and overpriced school halls but not real infrastructure. We are spending billions of dollars in the cities; we are spending billions of dollars in the regions; we are doing it to improve Australia.
We are also reforming the system. The Productivity Commission report last year made recommendations about how we could improve infrastructure delivery across the country, and we are working with the states to do just that. We have improved the operations of Infrastructure Australia—we made them truly independent for the first time. No longer does the minister appoint the CEO at his whim, as the member for Grayndler did last time.
Mr Albanese interjecting—
Let's understand what he did last time, Mr Deputy Speaker. The Labor minister appointed someone heavily associated with the Labor Party for five years. Then two months before the election he brought forward the next five-year contract—he gave him five years two months before an election—so let's not have this tripe that we hear from the member for Grayndler about true independence from Infrastructure Australia. That was delivered by the 'infrastructure' Prime Minister. Infrastructure Australia has got on with the audit of—
You just appoint the board who then elects the chair who appoints the CEO!
That is a complete lie.
You are talking to an empty chair!
The member for Grayndler!
Mr Deputy Speaker, I think he has lost touch with his senses. We are delivering infrastructure reform to Infrastructure Australia and we are working with the states to deliver more infrastructure more quickly and more efficiently. We want the states to do more and we think the states can do more; they can deliver projects better and more efficiently. We are working with them to do that because it is very important for our future—it is a very important part of our economic plan to deliver more infrastructure right across Australia, whether it be road, rail or improved freight networks. By the end of the year we will have a 15-year plan that Infrastructure Australia is now working on with the states, local government and the Australian community. We are a government that consults; we are a government that listens; but we are a government that delivers.
We have heard from the assistant minister, but we have not heard the assistant minister refute the claim in his own budget papers that there will be a $2 billion cut to infrastructure in Australia over this year and the next year. We did not hear the assistant minister try to refute it, because it is true—it is in their budget papers. We have seen the Deputy Prime Minister do his re-announcement tour around the country. He came to Tasmania and so did the assistant minister, but they did not bring any money with them. What they brought to Tasmania was cuts in their re-announcement tour.
For quite a few years we have heard from the Prime Minister, from Liberal members when they were candidates and from the current premier in Tasmania about the need to duplicate the Midland Highway. In the last couple of weeks the assistant minister has been down to Tasmania and had to confess that they would not be able to duplicate the Midland Highway for $400 million. Of course, we told them it was closer to $3 billion to duplicate the highway. They said they would duplicate it for $400 million, but Labor already had $500 million on the table for the Midland Highway. So there has actually been a cut of $100 million to safety improvements on the Midland Highway. We have heard a lot of rhetoric from the Liberal members about the need for safety upgrades to the Midland Highway, but they have ripped $100 million out of its infrastructure.
Not only that, but we also had invested $120 million in freight rail in Tasmania—a very important investment that I thought those opposite actually agreed with. Indeed, they said they had agreed with it in the past, as they did to all the other Labor commitments for infrastructure in Tasmania. But there is a cut to freight rail of $30 million this year and another $30 million next year—$60 million coming out of freight rail. We heard the secretary of the department in estimates admit this cut and say that they had taken this money and put it into irrigation in Tasmania—both are great projects, but both should be funded by the federal government. Tasmania needs that irrigation investment, but we also need the freight rail to get stuff out of the state. We need to put our produce on that rail and out of the state. It is another important investment that has gone missing. We are now up to $220 million coming out of the state of Tasmania for infrastructure to date.
The government did commit to some of the great projects that the member for Grayndler and I had agreements for in my electorate—the Tasmanian Highway ramps—but unfortunately the state Liberal government has delayed construction of that project. We announced $15 million, but it is six months behind schedule. A little work has started, which I am really pleased to see. Other projects are also behind schedule: the state Liberal government is behind schedule on the Huon Highway, $17½ million, the Domain Highway, $4 million, the Brooker Highway, $25.6 million. They are all great projects, but they are all behind schedule because of the federal and state Liberal governments. They are just the cuts to infrastructure in Tasmania.
We have also seen cuts in the budget to financial assistance grants to local government. This has been really important for local government. It is $925 billion over four years. Local governments have primarily been spending this money on roads. And primarily in regional areas, this cut to financial assistance grants will hurt. It is a cut that local government right across the country is angry about, and those opposite know it. They know that local government is not investing because of this cut of almost $1 billion over four years to local government right across the country.
In my home state of Tasmania, $18 million has been cut from local governments. That is $18 million that local government in Tasmania no longer has to spend on local roads in our state. Those opposite come in here and say, 'We have got our new bridges program,' but they have cut money from that this year; $60 million has been cut from the bridges program. They talk about doubling Roads to Recovery, a great project— (Time expired)
The opposition talk about a $2 billion story. I have got a $2 billion story to tell as well. At the last election there was a big distinction on the North Coast of New South Wales between the commitments of each side to the duplication of the Pacific Highway. Let's make this very clear. Labor went to the last election with $3.5 billion on the table to complete the duplication. They wanted the state government to go fifty-fifty and also put $3½ billion on the table. This is even though, when there was a state Labor government—this is an important part of the story—the federal Labor government were happy to fund that duplication at 80 federal and 20 state. When there was a change of government in New South Wales, suddenly federal Labor only wanted to fund the duplication at fifty-fifty. So they were going from 80-20 back to fifty-fifty.
We talk about $2 billion story. What did we do? As a coalition in opposition at the time, we said, 'If we win government we will maintain the funding at 80-20.' So the $2 billion story here is this: at the last election, the coalition opposition said that we would put over $5 billion of federal money on the table to complete the duplication, and the then Labor government went with $3 billion. So that is a $2 billion story.
The reason for this is very important. We know that duplication of a highway saves lives. There are lots of jobs created during construction. There is better transport, along with the commerce that that brings. Given that we put $5.5 billion on the table to complete this highway—$2 billion more than the Labor government promised—we are getting on with the job. Just last month we announced the winning tender for the 165-kilometre section of the highway from Woolgoolga to Ballina. Pacific Complete have won that tender. It is under a new delivery model, the tailored delivery partnership model. From the Ballina to Woolgoolga section, that will provide 3,000 direct jobs. As we know, there is always a multiple of two. Over 10,000 jobs will be created when we take into account the indirect jobs. So that is the $2 billion story there. The money is budgeted for. It is in the forward estimates that we as a federal government will be committing over $5 billion for the duplication of this highway. The Labor government was going to commit $2 billion less—again, for blatant political purposes. When there was a change from a state Labor government to a state coalition government, federal Labor suddenly pulled $2 billion from that project.
As the Assistant Minister for Infrastructure and Regional Development has mentioned, we have also increased funding for Roads to Recovery, which is very important in my electorate. This year Ballina Shire Council will get over $1 million. They normally get about $600,000. They are getting double that this year. The Lismore City Council is getting double—over $800,000 more. Clarence Valley Council is going to get $1½ million more than they normally do. Richmond Valley Council is going to get an extra $700,000. Kyogle Council is going to get an extra $700,000 as well. Again, there is an increased infrastructure spend in my electorate. We have increased black spot funding. A few weeks ago I announced a number of projects in my electorate for black spot funding. We have change the formula for that funding, so more money will go to it—nearly $900,000 to Ballina Shire Council, $500,000 to Lismore City Council, and Kyogle Council and Richmond Valley Council will each get a few hundred thousand dollars.
So there is a $2 billion story, and the big $2 billion story for me and for my electorate was that the previous federal Labor government pulled $2 billion from the project. They did it simply for political purposes. They wanted to go from an 80-20 split to a fifty-fifty split because of a change in government. My electorate saw that as quite a cynical ploy. I was very pleased that the opposition Deputy Prime Minister at the time, Warren Truss, agreed to keep the funding split at 80-20, which was an increase of $2 billion towards that project.
Mr Deputy Speaker, I wish to make a personal explanation.
Does the honourable member claim to have been misrepresented?
I do.
You may proceed.
The previous speaker, the member for Page, alleged that we cut $2 billion from the Pacific Highway. The fact is that the former government, under me as minister, put $7.6 billion into the Pacific Highway in the budget, which compares with $1.3 billion under the former Howard government over double the time.
Just before the budget we had the Prime Minister come to town to tell the people of Western Australia that after the sterling efforts made by members of his team he was actually going to take note of the problem that Western Australia had with its GST, and that he agreed that it was unfair that Western Australia was only getting 30 cents in the dollar for its GST. So he was going to make up the gap between what we got last year, which was 37 per cent, and what we were going to get under this new, highly dodgy process that the Grants Commission had embraced. He was going to make the difference up. He was going to give us $499 million. I thought that was great. He is going to give the state of Western Australia a one-off grant. He could not get that resolution on the matter, but he was going to give Western Australia a one-off grant of $499 million. We welcome that. I publicly welcomed it. It was good, following on from the announcement Labor had made a couple of weeks before, that we were going to give a cash grant to Western Australia if we got into government.
However, I thought we should just wait until the budget comes down, because what will be incredibly interesting to see is whether or not we have robbed WA to pay WA. And, sure enough, we have. Sure enough, when we look in the budget over the four years of the forward estimates, we see the one-off grant, the $499 million, was for road infrastructure. We are going to be $499 million better off. But, when we look in the infrastructure budget we see Western Australia has, indeed, $250 million dollars stripped out of the budget. So, he has given us $499 million dollars in one hand, and made much of it. My good friend the member for O'Connor was really excited by this and put a release out saying he 'welcomed the Commonwealth government's investment of an additional $499 million for road infrastructure in Western Australia'. He did not mention that we were actually going to lose $250 million, so in fact what we are getting is $249 million.
Much of the loss has come from scaling back and moving out the much vaunted Perth Freight Link, which indeed is the only new project that this government has undertaken in Western Australia. All the other projects were substantially in the budget. The Perth Freight Link, as the assistant minister was saying earlier on, is a very exciting project. It is an extraordinarily exciting project! It is a project the changes on a daily basis—as they find more and more problems with this cobbled together project they are coming up with new solutions each day. Now we are thinking that in fact this project is going to involve a tunnel—a massive tunnel—which, of course, will add, at the very least, one would expect, some $400 million to the cost of this project. So it now will be something in the order of a $2 billion project, going into a port, which, on the government's own analysis that they put in their alleged business case for this project, will be out of date and will need to be replaced within the next 10 years—indeed, according to this, within eight years. So, within two years—if this actually gets built and they can finally determine what the route is—they are going to be required to build, and have completed, the first stage of a new port down in Cockburn Sound, a port that has indeed been on the cards for the last 10 years at least. We are spending all of this money to try to cobble together a solution going into Fremantle port. Why are we doing this? We are doing this because we took $500 million out of Western Australia. (Time expired)
This is an extraordinary MPI today. To have the member for Grayndler, with his glass jaw, get up and give a personal explanation in the middle of an MPI just shows how outrageous this is. This government is making $50 billion of commitments in productivity enhancing infrastructure. We have initiated a $5 billion Asset Recycling Initiative, and that just shows that we are committed to building the infrastructure that our cities, our regions and our country need.
Today I wanted talk about a project that is going to be a millstone around the neck of the Labor Party in the Victoria, and that is the abandonment of the East West Link project—the single biggest infrastructure project in the country. We have seen the member for Grayndler, the opposition leader and all the members that sit over there in Victoria standing shoulder to shoulder with Daniel Andrews, who has spent up to $1 billion not to build the East West Link—even after the Premier of Victoria said that he would not spend one dollar to cancel the contract. We have seen up to $1 billion of hard-earned taxpayers dollars spent not to build a piece of infrastructure that Rod Eddington said in 2008 was the most crucial piece of infrastructure that Victoria needed. The Leader of the Opposition signed two submissions to that inquiry saying that it was important for jobs and for the Victorian economy. Has the opposition leader changed his mind? Yes, unfortunately. Finally, we got him to answer. Because for months and months he squirmed and wiggled and would not answer the question. Finally we nailed him, and he said, 'No, I support Daniel Andrews cancelling the East West Link contract and spending up to $1 billion to do so.' Just a couple of weeks ago, Infrastructure Australia released their report on the infrastructure needs for Victoria. It highlighted the two greatest areas that would have the biggest impact on the Victorian economy—$9 billion per year. The worst traffic congestion in Victoria was highlighted as being between CityLink and the Eastern Freeway and the Eastern Freeway itself—$9 billion of costs to the Victorian economy. The East West Link would have addressed those two bottlenecks the most. That is $9 billion of drag on the Victorian economy now, in addition to the $1 billion that was splashed up against the wall by the Labor Party, with the full support of the opposition leader and the full support of every Victorian member in this House today.
Our record is proud on infrastructure. We want to build the East West Link, and we have committed that $3 billion will remain there for any future Victorian government that will build it. And let's be honest: it is going to be built. The East West Link will be built, and everybody will look at that $1 billion that was wasted as an absolute crying shame. Indeed, last week the Prime Minister announced another great project for Victoria. Putting aside our disappointment at the outrage of the East West Link, we are committing $150 million to complete the M80 ring road between Sunshine Avenue and the Calder.
You took 500 out last year, you idiot!
The member for Grayndler is out of order.
It is absolutely outrageous that the state Labor Party would then come, cap in hand, after splashing $1 billion against the wall. But for the benefit of Victorians we will put that aside, because we will not punish Victorians for the reckless decisions of Labor. And the member for Grayndler supported the East West Link, alongside the opposition leader, until they had a conversion—a late conversion before the state election. Unfortunately you are all bound to support Dan Andrews, and I know in your heart of hearts you think it is an outrageous decision. You should put your constituents first, get up in this House and say, 'We will not support someone creating the sovereign risk and ruining the liveability of our suburbs,' because, I am sorry to say, Labor, not everybody lives within three kilometres of the CBD. I know that is all you are worried about, and you are trying to appease the Greens, and those who do not live within a three-kilometre radius of the CBD are forgotten. Well, I am sorry; my constituents need to use their cars. My constituents need to get on the Eastern Freeway, and that is why we are committing $3 billion. It will remain available for the East West Link, and it will remain a millstone around your necks until election day, because Victorians want the East West Link built. I can assure you that everyone in the outer eastern suburbs wants it built, and it will be built.
It is astonishing listening to members opposite trying to defend the indefensible. This Abbott Liberal government has an appalling record when it comes to investment in infrastructure. As the Leader of the Opposition outlined in his budget reply:
This is the first Budget in living memory with not one significant infrastructure project funded.
Not one. The latest figures for infrastructure investment show public sector spending on infrastructure falling by 17.3 per cent between the December quarter of 2013 and the December quarter of 2014, with private sector spending falling by 12 per cent. In contrast, under the federal Labor government Australia's national investment level as a proportion of GDP rose from No. 20 to No. 1 in the OECD in 2011 and 2012.
While I accept that it is a hard task for members opposite to try to beat No. 1, no-one—I repeat: no-one—anticipated this government's dissent into complete high farce when it came to infrastructure in Australia—the grand magical mystery tour that this government embarks on as it zips around the country re-announcing, renaming, rebranding, reallocating and recycling Labor's funding and commitments in infrastructure. It is in fact very fitting of a cameo appearance in utopia, where nation building becomes theatre of the absurd. That is what it is like watching these guys trying to defend their appalling record in infrastructure in Australia. Over 18 months they have re-announced literally dozens of projects. I must say, the member for Grayndler has done a sterling job in bringing it to the House's attention each and every time, and I congratulate him for doing so.
But in addition to renaming, rebranding, recycling, reallocating and re-announcing, there is a sixth R that should be added into this, and that is of course 'ridiculous'—the ridiculous nature by which this government tries to defend the indefensible. My electorate of Newcastle and the neighbouring areas of the Lake Macquarie and Hunter regions form Australia's largest regional economy, generating an estimated $38.5 billion. But we are a region that is completely ignored by this government. As the Newcastle Herald pointed out in its budget wrap-up this year:
Mr Hockey's first Budget a year ago was light on capital works detail for the Hunter … and this document follows suit.
That is the assessment of my region of your second budget—nothing in there in infrastructure for the Hunter region. We have seen no new funding for infrastructure and millions pulled from major enabling projects. The Glendale transport interchange, a really important piece of infrastructure in the seat of my colleague and neighbour the member for Charlton, has been identified by Regional Development Australia, by their RDA Hunter Committee, as our region's No. 1 priority piece of infrastructure. It is needed for the continued growth and development of our region. Was there any funding in this budget for a Glendale interchange? Nothing. How about the 11 combined Hunter councils that unanimously identified it as the most strategically significant infrastructure project in the region? Does it appear anywhere in the Abbott government's budget papers? Well, in the words of this Prime Minister: Nope. Nope. Nope. What about high-speed rail? High-speed rail has the potential to completely transform the city of Newcastle. But, again, the Abbott Liberal government has taken it completely off the table. The $52 million in seed funding that Labor provided for high-speed rail planning and corridor protection was pulled from the budget and not restored by this one that we saw just a couple of weeks ago.
We are just 150 kilometres from Sydney, yet the journey by road or rail today takes between two and three hours. High-speed rail could transform our local economy. It is wanted by businesses in our community, it is wanted by the commuters in our community and it is wanted by our manufacturers. So, why doesn't this government step up to the mark, start investing in infrastructure in Australia and understanding the needs of regional communities like Newcastle and the Hunter and put some money in there where it is needed most?
Earlier on I was listening to the member for Perth and I was quite incredulous that someone could have such a hide on the issue of transportation infrastructure. Let's just get things in perspective here. On 5 May the member said Freight Link is a 'scandalous squandering of taxpayers' funds'. Let me tell you what is a scandalous squandering of taxpayers' funds. A minister in the WA government decided that she did not like Roe stage 8 and that she also did not like the Fremantle Eastern Bypass. So what happened is that Roe 8 was designed in a spaghetti junction deliberately to try to prevent any further staging from Roe stage 7 into Roe stage 8. It was designed to terminate. I asked the engineers at the time, 'Why have you designed it like this, so that it cannot continue?' They said, 'We had instructions to do so.'
The fascinating thing is that she removed the Fremantle Eastern Bypass. I was on the standing committee of transport and I asked the head of her department what research had been done to indicate that the Fremantle Eastern Bypass should be removed. His answer was: 'It was a state government decision.' I asked him again: 'What studies have been conducted that indicate that this is the right thing to do?' He answered in exactly the same political way again: 'It was a state government decision.' In other words, there were no studies. It was just a purely political decision to wipe the Fremantle Eastern Bypass off the map.
Ms MacTiernan interjecting—
The incredible thing is that the member for Perth is complaining now about how much it is going to cost for the tunnel to go to Fremantle. Boy, talk about 'pot meet kettle'! The Fremantle Eastern Bypass which would have given a surface road that would have enabled easy access to the port has been deleted and the land has been sold by the member for Perth. Now we have to tunnel underneath to get to the Fremantle port because the minister had the audacity to sell off a bypass reserve purely to satisfy her colleague's constituents in that part of the Fremantle electorate. So removing the Fremantle Eastern Bypass was effectively all about vote buying.
Here is something that is a further concern. If you speak to, for instance, a whole lot of road engineers and councils and so on in my electorate, they will tell you that they are very concerned. We have the Fiona Stanley Hospital coming up to full steam at the moment. It is causing massive congestion in that area.
It's built on a railway line.
The member obviously does not live in the area because she has not seen the congestion there almost 12 hours a day. It is a very serious issue, Member for Perth, when you have ambulances that are not easily able to get in because of significant congestion for the majority of the day because you deleted a bypass and also tried to get rid of the ability to get to Roe stage 8 in order to simply satisfy the votes that you saw as necessary for getting the seats that you required. There was no study done to indicate that the Fremantle Eastern Bypass should be removed. It was a blatant political decision. It is as simple as that. That is a disgrace.
For my electorate, the work that is being done by our government in funding Freight Link is very much welcomed. People are sick and tired of the congestion in my electorate. They see Roe stage 8 as a very welcome piece of relief. They are relieved that they are going to get some relief from the traffic snarl-up that is there every single day with roe stage 7 and the Kwinana Freeway. It is a debacle and your design stinks.
This is a debate about nation building, about competing visions for delivering the infrastructure to lead us to a more productive, more liveable and more sustainable future. It is really interesting that the member for Tangney ended by talking about debacles, because 'debacle' sums up beautifully the government's failing in this regard. It is nothing less than a debacle. This debate has demonstrated the intent of government members to add insult to injury. We have heard from the member for Perth about what has happened in WA. we have heard from the member for Newcastle about the neglected infrastructure needs of her community and the wider Hunter. We heard from the member for Franklin about the cruel neglect of Tasmania.
I am going to speak a little bit about the biggest loser in infrastructure, and that is my state of Victoria. It has 25 per cent of Australia's population and it will receive eight per cent of infrastructure investment under this government. This is at a time when Melbourne is growing enormously, as the member for Gellibrand knows, and certainly as I and my friend the member for McEwen know looking at the suburbs that we represent. Melbourne faces enormous challenges in getting the infrastructure mix right, and what do we get from this government? Nothing. It has walked away from any responsibility for urban policy.
As the member for Grayndler pointed out, even though we have paid for it, we still have not seen the State of Australian cities report for last year, a document which should be informing our decision making this year. It is just extraordinary. It is just one example.
Who is the minister?
'Who is the minister?' the member for Griffith asks me. That is a very good question. I am glad everyone is sitting down here, because the Deputy Prime Minister, the responsible minister, said something interesting in question time today. I was shocked. Deputy Speaker Goodenough, you seem shocked too, and you should be. He recognised that Australia is the most urbanised country in the world. But what has he done? The first act of this government was to abolish the Major Cities Unit, and we see a policy of bad investment in urban infrastructure driven by one thing and one thing only: the Prime Minister's personal and pathological hatred of public transport.
We talk about adding insult to injury, but the member for Deakin seems to have missed November's state election. It was an election described, in this place, by the Prime Minister and the responsible minister—by the assistant minister too, and what a compelling contribution he made in this debate; he almost got his 10 minutes. The member for Deakin, in his contribution, took us to the Infrastructure Australia audit. I am glad he did, because that is a very interesting audit.
It tells us about the state of our cities, even though the government's own bureaucracy has walked away from this. It tells us about the increasing cost of congestion. It tells us about the urgent need to invest in urban passenger rail. Funny that, because the Melbourne Metro project was the No. 1 rated project by Infrastructure Australia. It sat alongside very significant public-transport projects in Perth and Brisbane—the Cross River Rail, as my friend the member for Griffith would be well aware. These are the sorts of projects that productive, liveable and sustainable cities need. These are the sorts of projects Australia's economy needs. Melbourne, particularly, is projected to grow to a population of eight million by 2050. Increasing our road capacity is vital in growing areas, but it is not sufficient to meet the needs of Melbourne's economy or the challenges of Australia's economy into the future.
We see here a rejection of the evidence that the member for Deakin put forward in favour of the views of the Prime Minister, who seems to think people prefer cars to trains. He only needs to come to South Morang station on the border of my electorate and the member for McEwen's to see the alternative, particularly in a city like Melbourne, where jobs growth is highly concentrated in the centre of the city. There is only one way to get in and out of where jobs are, from suburbs that the member for Lalor represents, the member for McEwen represents and I represent—that is, by heavy rail. Melbourne needs this investment and Australia needs this investment if we are serious about meeting infrastructure challenges of the future.
It is not simply about rebadging projects and getting to announce them wearing a hard hat. It is about taking seriously where Australia is going, how our cities are being transformed, where the jobs of the future are being located and, fundamentally, how we help people live better, more sustainable and more productive lives. This is a profound challenge and one this government has failed.
One of the problems with opposition members constantly talking down our great nation is that negativity impacts on how the world sees us. That, in turn, impacts on whether people feel confident to invest in things here, like infrastructure. Let me keep it positive and tell you about some really good things our government is working hard to achieve, in regional Australia, when it comes to infrastructure.
Regional Australia creates the real wealth for our nation. In fact, two-thirds of our export earnings come from regional Australia. That is why I am proud to stand with a coalition that offers a real chance to expand future infrastructure in Northern Australia. The future development of Northern Australia—from the Tropic of Capricorn northward—is important to our nation's agricultural and resource future.
Our government is providing a new $5 billion Northern Australia infrastructure facility. This facility will be available for major infrastructure projects, like ports and railways—to transport food and commodities to ships waiting to export it—through to pipelines and electricity generation. Investment in this type of infrastructure is important because Northern Australia has untapped potential.
When it comes to Northern Australia, in my role to represent Capricornia, I will continue to push water-infrastructure projects, like the Fitzroy Agricultural Corridor, Urannah Dam and the longer-term future construction of Connors River Dam. Near Rockhampton, federal coalition MPs in Central Queensland are continuing to push the case for the Fitzroy Basin. We know this is being seriously considered by our government as an important piece of regional infrastructure.
Let me outline some of our other successful policies that go a long way to boost investment in infrastructure. Our work to secure free trade agreements with Japan, Korea and China provide preferential access to a market of over 1.5 billion people. This puts our home-grown industries in the driver's seat of lucrative Asian markets. Back home, increased business due to free trade deals means an increase in local production. This, in turn, means increased private investment in Australian infrastructure, from port facilities to on-farm or factory infrastructure, to satisfy new demands for our food and products.
The 2015-16 budget reaffirms our government's $50 billion infrastructure-investment commitment. We are spending $300 million over the next few years, through our Bridges Renewal Program, to help repair or replace old bridges across the nation. And we are fixing roads through the largest infrastructure investment in Commonwealth history, including $6.7 billion to upgrade the Bruce Highway and up to $1.3 billion for the Toowoomba Second Range Crossing. In fact, when it comes to roads, my electorate of Capricornia spans 91,047 square kilometres. For country people, roads are often the only form of travel available.
Under local road infrastructure projects, our government will spend $35 million to replace four bridges on the notorious Peak Downs Highway;·$166 million to fix the Eton range section of the Peak Downs Highway leading to the coalfields, with the first instalment of $30 million paid in 2015-16; and a further $500 million on works to fix up the Bruce Highway in regional Queensland, including Rockhampton to St Lawrence, Sarina and Mackay. This includes a further instalment on the Yeppen South project, which is raising the Bruce Highway near Rockhampton.
When it comes to local councils, we are investing $2.5 billion to help councils fix streets and roads under our Roads to Recovery program. In fact, in the latest budget we have doubled this investment on the ground. Rockhampton, Livingstone, Isaac, Whitsunday and Mackay councils will receive double their normal road-maintenance allocation—worth up to $10 million—across Capricornia towns. This is under the Commonwealth's Roads to Recovery fund. This includes: Isaac Regional Council, over $2.1 million; Livingstone Shire Council, over $1.2 million; Mackay Regional Council, over $2.8 million; Rockhampton Regional Council, over $2.1 million; and Whitsunday Regional Council, nearly $1.5 million.
Investing in infrastructure is important to this government. In doing so, our aim is also to help build jobs, growth and opportunity and provide a credible path to budget surplus.
The discussion is now concluded.
) ( ): On behalf of the Parliamentary Standing Committee on Public Works, I present the Committee's fourth report of 2015 addressing Referrals made in December 2014 and March 2015.
Report made a parliamentary paper in accordance with standing order 39(e).
b y leave—On behalf of the Parliamentary Standing Committee on Public Works, I present the committee's fourth report of 2015 addressing Referrals made in December 2014 and March 2015.
Report 4/2015 considers three referrals received by the committee: one from the Department of Finance, in December 2014; and one each from the Department of Defence, and the Department of Foreign Affairs and Trade, in March 2015.
In the first referral, Finance sought approval from the committee to remediate sections of the Cox Peninsula, in the Northern Territory. Commonwealth use of this land for maritime, communications and Defence purposes has resulted in extensive contamination at ground level and below. Without substantial remediation, there is a risk that in-ground contamination will impact on local bore water. This would present a potential health risk to the site users and the local community.
The Department of Finance told the committee that the preferred method for remediation was to secure contaminated material in a sealed 'containment cell' and recycle non-contaminated material, where suitable. The estimated cost for the works is $31.8 million over four years.
The Cox Peninsula is subject to an Indigenous land claim by the Kenbi Aboriginal People. The claim was lodged in March 1979—21 years ago. Twenty-one years ago, Gloria Gaynor singing I Will Survive was on the airwaves and Apocalypse Now had just been released—that is a long time. In late 2000, the Aboriginal Land Commissioner recommended that a substantial area of the land claim be granted as Aboriginal land. In January 2009, the Australian Government undertook to settle the claim.
The Public Works Committee visited the Cox Peninsula and saw the need for remediation first hand. The Committee also held hearings in Darwin on the same day. Finance told the committee that the greater part of the land will be transferred to the traditional owners on settlement of the claim. A small portion of the site will not be transferred until the aforementioned remediation is complete.
At the public hearing, the committee heard that Indigenous groups are keen to access employment and training opportunities associated with the remediation. The committee has encouraged Finance to make a range of positions available to local Indigenous residents, where possible.
While the committee is satisfied that the project has merit in terms of need, scope and cost, and recommends that the project proceed, it has also asked Finance to report on progress annually. In addition, the committee seeks information on Indigenous employment levels and on any issues raised by the community in relation to the project.
The second referral concerns the construction of a multi-user barge ramp facility at East Arm in Darwin. The proposed facility is a collaboration between Defence and the Northern Territory Land Development Corporation, with an estimated cost of $18 million. The cost to Defence is $16.1 million, excluding GST.
The barge ramp facility will provide Defence with a watercraft capability to load and unload helicopter docks, amphibious craft and explosive ordnance in Darwin, irrespective of tidal conditions. The works will also allow Defence to provide humanitarian assistance, disaster relief and civil evacuation duties in the region.
The committee received a briefing from Defence and conducted a site inspection. This was followed by public and in-camera hearings. Defence told the committee that the new barge ramp facility will be managed by the Land Development Corporation through a deed of licence. The deed of licence will be valid for a period of 20 years, with the option of two five-year extensions.
Defence will have access to the barge ramp facility for 60 days per calendar year, which Defence advised is sufficient to meet its needs. For the remaining days, the facility will be leased to commercial users. Revenue will fund ongoing maintenance. Defence will be granted the first opportunity to take up any unused commercial days over and above the 60 days, at no extra cost. The committee is satisfied that the project has merit in terms of need, scope and cost, and recommends that the project proceed.
The final referral concerns reconfiguring and refurbishing residential accommodation and staff amenities at the Australian Embassy in Kabul, Afghanistan. In February 2015, the committee received two medium works notifications for the embassy site in Kabul. The committee agreed to examine them as one project and so sought referral of the project through a motion of the House.
The project relates to five leased residential housing lots constructed in the 1960s and 1970s. The Department of Foreign Affairs and Trade told the committee that the buildings are in need of extensive repair and refurbishment. There is also a need for increased security features. The committee received a briefing and conducted hearings in Canberra. The committee was told that the works will consolidate the current property footprint in a way that substantially improves security and safety. This is especially pertinent, given embassy staff in Kabul are working in a high-risk environment.
Drawing on their own experience in delivering overseas projects and similar works undertaken for the British and Canadian Embassies in Kabul, the Department of Foreign Affairs and Trade is confident that the tender process will achieve value for money. The department also identified a number of ways that consolidation will result in cost savings, with fewer movements between locations and reduced maintenance costs. The estimated cost of the project is $23.25 million.
The committee is satisfied that the project has merit in terms of need, scope and cost and recommends that the project proceed. In concluding, I commend this report to the House.
I wish to talk about the Renewable Energy (Electricity) Amendment Bill 2015, and reflect on the journey that has brought us to this point, and on the way forward. The journey so far was all about how we, as a nation, create a mechanism to encourage renewable energy in our midst. Renewable energy does inspire the hearts of people. As Australians, we aspire to have an energy mix made up of fossil fuels, but also, increasingly, of renewable energy in an affordable and sustainable fashion.
Not long ago, one of the prime ministers of Australia talked about climate change being the greatest moral challenge of our time. There were those who saw that as disingenuous. But in a big fever to move towards renewable energy, we realised what happens if you develop policy in isolation of industry or policy in isolation of the cost that it puts on people. In the great moral crisis of our time, we saw a carbon tax introduced into Australia. Effectively, what that did was take away what is our competitive advantage.
Our competitive advantage as a country has always been cheap electricity. We do not have the benefit of having cheap wages, or we might say we are the recipient of higher wages. That, of course, has created a standard of living that we, as Australians, enjoy. When people go to work they expect to be well paid, and they should be well paid. But what has helped us when we have produced goods is that our energy costs have been reasonably cheap. We compete with countries that have more expensive energy but have cheaper wages. But at least having cheap electricity has been our competitive advantage.
The challenge is that the carbon tax and then the Renewable Energy Target have actually put power prices up. The outworking of that is that we have seen industry shift offshore. Our government made a commitment that we would repeal the carbon tax. That is what we have done, and we are now moving forward on discussing how we ensure that we keep our competitive advantage as well as continue to encourage diversity in our energy generation mix.
One of the great testimonies of the Australian people has been the changed behaviour that we have seen within energy use. The projections of what amount of renewable energy we thought we would need have been put out and skewed simply because we have changed behaviour. I do not need to tell the schoolkids who are no doubt looking on up in the gallery that they now turn the light off instead of having lights just blazing away all day and that we now think about how we minimise our impact on the environment. I think that is something that we should be proud of as the Australian people, and some of the leadership of that has come from our younger Australians.
But in changing behaviour we have found that we have not needed as much generation capacity within our mix as we anticipated. The challenge we have at the moment is that we originally had a renewable energy target of 41,000 gigawatt hours, which was scoped to be quite a large percentage. But we did not need that much because we simply have changed behaviour. We have also moved some industry offshore. That changed behaviour has meant that we now need to make some changes and some adoptions to our renewable energy target. It is not to diminish the role of the target, but it does give an example of where we do not need as much in the mix as we originally thought. So this amendment bill is to move the target from 41,000 gigawatt hours to 33,000 gigawatt hours, still a very ambitious target to hit within the time frame and still very conscious of the government's role in creating a diversified energy mix.
The other thing that has happened is panels have got cheaper in solar and the technology has got better. I fear that as we have developed the renewable energy target over successive governments we have perhaps missed the opportunity to better enhance utilisation of our fossil fuels instead of demonising them. If we can burn coal hotter and create less emissions per unit of output of power, that is also a way of reducing our impact on the planet.
But it is very minimal.
We can, and I think this does need to be explored because, whilst we have been the beneficiaries of fossil fuel, whilst we have been the beneficiaries of lifting our standards of living out of fossil fuel, the great challenge for Africa is how they lift their standard of living in a continent where they have large amounts of fossil fuel. If we had used part of our renewable energy target to develop cleaner coal, we would have a technology that could be replicated in a part of the world that is going to have to focus on fossil fuels for many years to come if they are going to lift their standard of living. It is disingenuous for us, as a rich country, to tell a poor country what they can and cannot do on their emissions.
But, be that as it may, reducing power has come at a cost, and yet we have also seen that the price of power has not diminished as much, because of the investment in the distribution networks right across Australia—the poles and wires. Some of this is an outworking of the royal commission after the Black Saturday fires, certainly in Victoria. My concern with the renewable energy target is: are we favouring one part of our economy over another? I have this double edged sword within my electorate where I have a lot of dairy farmers, a lot of irrigators and a lot of horticultural producers who are using electricity driven pumps.
A renewable energy target is, in fact, in a small way, driving up the price of their business, driving up their costs of doing business, and so, in some regards, we are working against those particular parts of our economy. If you are a dairy farmer in Victoria, most of your milk is usually exported as dehydrated milk. They are an energy intensive and somewhat trade exposed industry, but they are not currently exempt from the impacts of the renewable energy target. My argument is that we should be excluding our food producers and our food processors in the export industry from the impacts of a renewable energy target.
Finding the balanced solution is also an issue when it comes to the communities that I represent. I think, overwhelmingly, they do favour solar. They do like solar, and my fear is that this bill still leans towards wind generation. Wind generation has had a pretty fair run, in my opinion. But solar probably has not, and what has happened is that the price of solar panels has got cheaper. The ability of a community to work together so that they can collectively have a solar farm needs to be enhanced in legislation. It is currently not there.
The other thing that is a conflict in my area is the impact both on health and on aspect—of looking at wind turbines. I know that, when I talk to people in the southern parts of my electorate, they are very concerned about the new changes in planning from the Victorian state government which limit their opportunity to have a say when a wind farm is going to be put in their area. The flip side, of course, in all of these conflicting areas, is that our local councils, who obviously do not have large amounts of rate bases, are attracted to the earning capacity of wind farms. So we have an interesting paradox where some parts of my electorate are very much the recipients of a renewable energy target, some parts of my electorate are very much the losers of a renewable energy target and some parts of my electorate are exposed to the risks of power prices increasing.
I think we do need to review, with a balanced solution—and this is what this attempts to do. I think we also need to understand, and we need to move towards some renewal. I think it is just not fair if those who have an objection to a wind farm do not have an opportunity to have their objection heard. It is not fair if those who are impacted in their daily lives and in their activities are not able to be heard as to how we move forward.
My great dream is around solar, and I will share where I want to go with this. Currently, a person can put solar panels on their roofs and they will pay $8,000. If you have a look at solar panels on roofs, whilst they are reasonably effective at reducing the power for the person who has them on their roof, they are very hard to manage into a grid. If you were to get around 100 people who also wanted to commit $8,000 and wanted to collectively put together a bid to build an $800,000 solar farm on the outskirts of some of my regional towns, which are very sunny, I think that is something we should be more open to when thinking through this legislation.
Currently, the renewable energy target system favours solar panels on roofs but does not favour the same solar panels on a paddock right next door to a town. Something about my community that I have been very proud of is that people do have a sense of working together. We do have land that is reasonably cheap. If you look at any studies about how to manage a grid and how to maintain a mix of solar panels, it is much easier to do it from a maintenance perspective when they are on a paddock because you do not have to climb on the roof. But also you have a bulk of power that can be managed into the whole grid. Ultimately, that needs to be looked at when we talk about renewable energy.
It really should come down to practicality, not ideology. This legislation is trying to recognise that we ran the risk in the current legislation, as it stood, of putting prices up through the roof by hitting penalty rates. There were time frame restraints on how to build the amount of renewable energy at a time when behaviour has changed. One thing that we must do is to commend the Australian people for changing their behaviour. They have learnt to use less electricity. They have learnt to insulate their houses better and to turn lights off. But it is also important that we work with industry so that we do not put ourselves at a significant disadvantage when it comes to producing the goods that we produce and to grasping our competitive advantage—that being cheap electricity—as we move towards being good global citizens.
The contrast in my electorate, as I say, is a discussion between the wind farm generators and the irrigators and the dairy farmers who also have their milk processed. It is a discussion around those who have to live with a view to wind farms and the concerns they might have around their health, and it is a discussion around how we can look at solar panels collectively, as communities, rather than just have them on our roofs. The legislation does not embrace everything I would like, but it is certainly a step in the right direction. The challenge for us is how we, as a country, continue to grow the standard of living we want and ensure that the environment is also looked after. The other thing we must also think of is how we develop technology that can be taken up in developing countries so that they can also lift their standard of living without having adverse effects on the planet.
Recently, I had a meeting with representatives of ACCIONA Australia. ACCIONA is one of the largest investors in renewable energy projects in Australia and abroad. During the meeting with the representatives of ACCIONA, one of the company directors asked me a very direct question. He said to me: 'Why is it that the Australian government is seeking to reduce the amount of renewable energy that it will produce over the next five years?' I was quite shocked. My reply was: 'There is only one answer to that question, and that is: because Tony Abbott is our Prime Minister, and Tony Abbott does not believe in climate change and does not believe in taking concerted action to promote renewable energy in our economy.'
Since his election as Prime Minister, Australia has become probably the only developed nation in the world to go backwards on tackling climate change and on policies that promote progress and greater uptake of renewable energy in our economy and our society. As a result of that, our kids will pay the price. Our kids will pay the price in the form of more pollution in our economy into the future, of lower economic growth in the longer term and of fewer new jobs being created in the industries of the future. In the long term, we will pay with higher electricity prices. There are many reports that detail this fact.
The Prime Minister has deceived the Australian public. Before the last election, the Prime Minister gave one of his many ironclad guarantees—no change to the renewable energy target. The 41,000 gigawatt hours by 2020 was supposed to be a bipartisan commitment. It was supposed to be beyond politics—something that all Australians could feel comfortable with; that, no matter who was in power in Canberra, our national government would be taking action to combat climate change and to promote renewable energy. Once again, this is another broken promise from a Prime Minister who makes a habit of deceiving the Australian public.
As soon as he was elected, the Prime Minister sought to appoint a known climate change sceptic to review the operation of the renewable energy target. When that announcement was made, the new investment in the industry completely stopped. It ceased. All of the progress that had been made under the Howard government and under the Gillard and Rudd governments was halted. Projects were stopped and, over the months that ensued, jobs were lost. The renewable energy target, up to that point, had facilitated $20 billion of new investment in large-scale renewable energy and billions of dollars of new investment in small-scale solar panels and solar hot water. That investment was growing. In 2012, the renewable energy industry employed 24,000 Australians. These are highly skilled, high-wage jobs of the future—jobs that we need to be promoting into the Australian economy.
Other nations are investing heavily in renewable energy—in particular, some of our closest trading partners. It is remarkable to see the transition that has occurred in the last five years in the Chinese economy. The Chinese get it when it comes to investment in renewable energy. They understand that the jobs of the future and the transition from an industrial based economy to a clean energy economy will be based on the promotion of renewable energy. So they are investing more than any other nation, in dollar terms, in renewable energy projects—in research and development, in commercialisation, in funding, in manufacturing, in installation and in production of power through renewable energy. Unfortunately, because of this Prime Minister's deception of the Australian public, Australia has gone backwards in this area because all new investment was halted when the Warburton review was announced.
We have seen the loss of bipartisanship, which has affected investment in the industry. The change sent shockwaves through the renewable energy industry because, as I said, prior to the election those investors—and many of them are big banks, superannuation funds and big corporations—were given a guarantee by the Prime Minister that there would be no change in the renewable energy target. You could invest safely and you could invest with the comfort that the government was not going to change the policy. In an area like this, government policy, stability and certainty is crucial to investment and jobs. Then the Prime Minister backflipped. Then the Prime Minister deceived the Australian public. The destruction did not stop there. The Prime Minister will continue his campaign to decimate the renewable energy sector by cutting $600 million to the commitment for solar roofs, towns and schools to just $2 million in the 2014 budget and slashing funding to the Australian Renewable Energy Agency in the 2013 MYEFO, before adding the agency to the abolition list in the 2014 budget. The biggest shock and the biggest broken promise came after the review of the renewable energy target. The Prime Minister's RET review created uncertainty in the market that would ultimately see investment in Australia practically stop.
Despite the Prime Minister's insistence that the renewable energy target drives up power prices, the RET review found—and this is important evidence—that the current RET of 41,000 gigawatt hours would put downward pressure on household power prices in the medium to long term. That is a finding that has been backed by the Clean Energy Council when they commissioned a report from ROAM Consulting which found that, over the medium to long term, the uptake and increase of renewable energy will actually put downward pressure on electricity prices. The reason is that, once the initial investment is made, the source of the power is free. Wind is free and solar energy is free. So, once the initial investment is made, over time prices come down. So there is actually an advantage to our economy—for businesses and for households—by promoting more renewable energy, but the Prime Minister wants to put the brakes on that. The Prime Minister does not want to see us move from coal to more renewable energy. The ROAM report found that the effect was that households will pay $50 more for their electricity in 2020 if the renewable energy target were eliminated. The current RET of 41,000 gigawatt hours is driving investment in new projects. It is also reducing Australia's carbon pollution and it is driving new jobs.
Labor believes in climate change. Labor believes in renewable energy. In government, Labor expanded the renewable energy target to ensure that at least 20 per cent of Australia's electricity would come from renewable sources by 2020. In government, we established the Australian Renewable Energy Agency, or ARENA, to manage $3 billion in renewable energy investment and the $10 billion Clean Energy Finance Corporation to provide a new source of finance to renewable energy, low emissions and energy-efficiency technology. This was a process of ensuring that there was support to get many of those important renewable energy projects off the ground—start-ups, if you like. It is support from government for start-ups in renewable energy, ensuring that they have the commercial backing to make those projects viable. As I said, once they are established, once the capital investment is made, the long-term running costs are very low because the energy source is free. The result was spectacular growth in jobs. From 2007 to 2013 direct employment in the industry doubled, to over 24,000 jobs. Wind capacity trebled to 3,000 megawatts and over one million solar PV systems were installed. We went from 7,400 systems at the end of the Howard government to over a million households and businesses with solar panels on their roofs, generating renewable electricity for their households and businesses through that process. That was Labor's commitment to a renewable energy target. It was Labor's belief in investment, a greater uptake of renewable energy and using government policy to promote that in our economy.
The Abbott government are seeking to cut the RET. The renewable energy industry has been gobsmacked by the approach of the Abbott government. As I said, they failed to see, because they were given a commitment before the election that there would be stability and certainty in the industry and that the government would not change the goalposts midway. But that is exactly what they did. As a result of that, as I said, new investment halted.
The industry has been absolutely begging the political parties to reach an agreement on this issue, to ensure that there is ongoing certainty into the future so that there will be investment and that jobs will not be lost. Labor has heeded those calls and we made offers that were reasonable to the government to ensure that the renewable energy target continued and that there continued to be investment in jobs growth into the future. It is pleasing to see that the government finally did adopt Labor's approach, come to the table and agree to the compromise offer.
The Clean Energy Council recommended 33½ thousand gigawatt hours. We have agreed on 33,000. It estimates that that will drive about $40.4 billion in investment and will create more than 15,000 jobs. The agreement will see projects start to be built again and businesses begin to enjoy certainty again to allow them to assure their staff's job security.
I want to congratulate Mark Butler, the shadow minister, for the wonderful job that he has done in representing the views of the renewable energy industry. I think without Mark's advocacy and deft negotiation in this matter, we may have seen the renewable energy target in this area fall over.
Labor also negotiated principles that we are pleased to see have achieved outcomes, including no change to the small-scale solar scheme, which includes rooftop solar and solar panels for small businesses; full exemptions for emissions-intensive trade-exposed industries, which relieves some pressure on those industries that are enduring downturns and job cuts; and removal of the two-year reviews, which provides the long-term certainty that the industry so desperately needs to survive and to thrive.
The final point to make is that I am deeply disappointed that the government continues to pursue its plans to include the burning of native forests in the renewable energy target. It is something that I and my Labor colleagues are opposed to. Burning native forests for energy is neither clean nor renewable. And the best advice is that that is so.
The definition of 'waste' is not what those opposite would have you believe. We are not just talking about the bits that are left over after logging. 'Waste' can be large parts of trees and, in some cases, entire trees that are not up to scratch for other uses. We simply do not see a case for the inclusion in the RET of burning wood waste and, on that basis, we will oppose that aspect of this bill.
If that is the sort of speech you get from the member for Kingsford Smith when there is bipartisan agreement on a renewable energy target, imagine the performance if he disagreed.
I have great pleasure in telling you, Deputy Speaker, that this bill, the Renewable Energy (Electricity) Amendment Bill 2015 reflects an important bipartisan agreement between the government and the opposition on renewable energy.
Ms MacTiernan interjecting—
I might just remind the member at the table that 'bipartisan' is an adjective. It means 'involving agreement or cooperation of two political parties that usually oppose each other's policies'. By any measure, this is not only a bipartisan but an ambitious agreement, which seeks to achieve 23.5 per cent of Australia's energy from renewable sources by 2020. And, as the Clean Energy Council has pointed out, that will require about $10 billion of investment.
I have been a persistent champion for this deal, with my colleague the member for Lyons and our other amigo the member for Braddon, along with a number of my colleagues, in writing to the Prime Minister a year ago to make the point that aluminium smelters should be exempt from the renewable energy target. This advocacy is linked to a desire to secure over 1,500 direct or indirect jobs at Bell Bay Aluminium in my electorate of Bass.
I have lobbied everyone from the Prime Minister, to the industry minister, to the environment minister on this issue and I am pleased at their willingness to listen and act so decisively in support of jobs in Northern Tasmania.
I am particularly grateful to the member for Flinders, Greg Hunt, the environment minister, frequent visitor to and great supporter of Northern Tasmania. Greg has done an outstanding job. Not only does this include making good on one of the coalition's key promises to repeal Labor's ill-considered carbon tax but he has now played a central role in delivering this deal on the RET.
His work in protecting our iconic Great Barrier Reef is also noteworthy and most deserving of this parliament's acknowledgement. In recent days both UNESCO and the World Heritage Centre have praised the significant and unprecedented work that Australia has done to protect the Great Barrier Reef and made it clear that the reef will not be listed as 'in danger'. In fact, there is no mention of 'in danger' at all.
While the reef may have gone onto a watch list under the Labor-Greens government, it has come off that watch list under us. Minister Hunt deserves great credit for securing this great news for all Australians and we welcome that decision. It demonstrates that this government and the member for Flinders are committed to protecting the reef at home and its reputation abroad.
Returning now to the agreement on a renewable energy target, it undoubtedly alleviates millions of dollars in renewable energy target costs annually on Bell Bay Aluminium's operating costs. Importantly, the RET agreement includes a 100 per cent exemption for all emissions-intensive trade-exposed industries, including aluminium, which will remove a regulatory cost burden to my smelter in Bell Bay of between $8 million and $10 million per year. The net impact of the RET on what we refer to as Tasmania's 'big picture industries' is around $20 million a year. RET payments by these industries over the next 10 years would see a wealth transfer of around $200 million out of the Tasmanian economy.
Looking just at Bell Bay Aluminium in my electorate of Bass, since the RET scheme commenced in 2001 it has cost the company more than $48 million. Forecast RET costs for the next five years were $42 million if no change was made. This business is, sadly, one of the few of its size left in Northern Tasmania and its importance cannot be overstated. It uses 25 per cent of Tasmania's total electricity, contributes almost $700 million to Tasmania's gross state product each year and provides 1,500 direct or indirect jobs. It is worth noting that the power this smelter has used since 1955 has been predominantly renewable. Consider this: the power that Tasmanian families and businesses use is well over 80 per cent from renewable sources, primarily hydro. So, frankly, it fails the common sense test to impose RET costs on businesses like Bell Bay Aluminium in a state that is the exemplar within the Federation on using renewable energy.
The General Manager of Bell Bay Aluminium, Ray Mostogl, is a good man—the member for Lyons and I know him well. He has won CEO Magazine's Manufacturing Executive of the Year. His operation at Bell Bay has cut costs in a very difficult market, with a high Australian dollar and historically low aluminium prices, which has caused well over 130 jobs to be shed from this business in recent years. As Mr Mostogl has said publicly, they have continued to absorb RET costs at a time when their industry can least afford it and when many other Australian manufacturers have closed or are signalling their closure. And as aluminium is a globally traded commodity, Bell Bay Aluminium has no ability to pass these additional costs through to its customers. So it should be no surprise that Bell Bay Aluminium has warmly welcomed the Abbott government's deal on the Renewable Energy Target. I am grateful that, in their public comments, Bell Bay Aluminium states that they 'would like to particularly thank the local MP for Bass, Mr Andrew Nikolic, for his support through these negotiations.' I appreciate that support from one of Tasmania's biggest employers and taxpayers.
Removing regulatory costs from businesses like Bell Bay Aluminium through this RET agreement helps to secure the long-term future of aluminium smelting in Australia. But while most people in our community celebrate this agreement, those perennial ideological whingers in acrylic koala suits, the Greens, have ungraciously rejected it. In doing so, they have again put their flawed and superficial voodoo ideology ahead of helping secure jobs in Northern Tasmania—an area that has been doing it too tough for too long. As a Southern Tasmanian, it was predictable that former Greens leader Christine Milne would refer to major Tasmanian industrial companies like Bell Bay Aluminium as 'exaggerators wanting a handout'. Ms Milne is able to hurl such abuse from trendy cafes in Hobart, a luckier part of the state that can always rely on a steady flow of taxpayer funded public service jobs. But the North of Tasmania does not have that luxury. You would think Greens senators north of Oatlands would show more common sense and respect for the jobs at Bell Bay. I have had many people contacting my office to express their disgust at the comments of Greens Senator Peter Whish-Wilson, who lives and works in Launceston—not too far away from Bell Bay Aluminium. Senator Whish-Wilson has publicly referred to aluminium producers as 'a dirty industry always overstating the risks of the RET'. It appears there is no limit to the local jobs the Greens are willing to sacrifice on the altar of their superficial ideology. Once again, by failing to acknowledge that companies like Bell Bay Aluminium are amongst our biggest employers and biggest taxpayers, the Greens Party rules itself out of the rational debate.
This bill represents a balanced approach. The reduction in the large-scale target from 41,000 gigawatt hours to 33,000 gigawatt hours will result in 830 to 1,000 fewer wind turbines. Solar will be a big winner with significant new investment in small- and large-scale solar expected. As I said earlier, the bill protects jobs in the emissions-intensive and trade-exposed sectors by reducing their costs. The bill wisely reinstates native forest wood waste as an eligible fuel source, representing a welcome return to common sense. The bill acknowledges and reflects changes that have occurred in the electricity market and will allow for sustainable growth in small- and large-scale renewable energy.
I have already talked about some of the bill's key features but let me focus on one other matter in the time I have available. A vital feature of this bill from a Tasmanian perspective is reinstating biomass from native forest wood waste as an eligible source of renewable energy. I congratulate my friend the member for Lyons who last Thursday gave an eloquent, passionate speech exposing the soft underbelly of hypocrisy in Labor on this issue. He encouraged the member for Franklin to listen to her constituents and, indeed, the state Labor Party on this issue.
This government is committed to the inclusion of wood waste as an eligible form of renewable energy generation and it will be included in legislation. Native forest wood waste was in place as an eligible source of renewable energy under Labor's own legislation until November 2011. Consistent with our election commitment, this bill reinstates native forest wood waste as an eligible source of renewable energy under the RET, basing eligibility on exactly the same conditions that were previously in place under Labor. One of the objectives of the RET is to support additional renewable generation that is ecologically sustainable. We are reinstating native forest wood waste as an eligible renewable energy source because there is no evidence that its eligibility leads to unsustainable logging or has a negative impact on Australia's biodiversity. In all cases, the supply of native forest wood waste is subject to Commonwealth and state or territory planning and environmental approval processes either within or separate from the Regional Forest Agreement frameworks. Burning wood waste for electricity generation is more beneficial to the environment than burning the waste alone or simply allowing it to decompose on the forest floor and give off CO2. In rejecting this aspect of the bill, the Labor-Green opposition demonstrate that they are still tied at the hip on this measure—that they are, in fact, climate science deniers. As my colleague Senator Colbeck has said, by blocking biomass from being included in the renewable energy target they are clinging to last century ideology. The science is clear, I say to those opposite, when it comes to the environmental benefits of biomass as a source of energy. It is even recognised by international environmental groups such as the World Wildlife Fund. Instead of voodoo ideology and superstition, Labor and the Greens need to get up to date with the latest science. The environmental benefits of biomass are widely recognised. Let me quote to you a couple of things. A report by the World Wildlife Fund and the European biomass industry found that replacing coal-generated energy with biomass would significantly reduce carbon emissions. The IPCC—the Intergovernmental Panel on Climate Change—which is often quoted by those opposite, states that:
In the long term, a sustainable forest-management strategy aimed at maintaining or increasing forest carbon stocks, while producing an annual yield of timber, fibre or energy from the forest, will generate the largest sustained mitigation benefit.
This government supports wood biomass as a source of renewable energy and recognises the benefits it could bring to the environment, the forest industry and the economy. It is the policy we took to the last federal election: to reintroduce renewable energy initiatives using wood biomass. It was a key element of our forestry policy, and it is a complete sham for Labor to describe this is a last-minute push. In fact, I repeat that this used to be the Labor Party's own policy before their dirty deal with the Greens. Using wood biomass is making use of an otherwise wasted product such as timber offcuts, bark and branches that would otherwise be discarded. You would not slaughter a cow for the prime eye fillet and leave the rest of it to fester and rot, and the same principle applies to the forest industry. Federal Labor has shown their true colours yet again by siding with the Greens and indicating that they will attempt to block biomass from inclusion in the RET. It is disappointing that they are not interested in supporting an environmentally and economically beneficial industry.
In conclusion, let me say this: this bill is a very good deal that should be supported. It reflects the government's commitment to a renewable energy target that will encourage sustainable growth in both small- and large-scale renewable energy in Australia, and I commend the bill to the House.
The glaciers are retreating, and so is the Abbott government when it comes to supporting renewable energy. Just as the dinosaurs were wiped out by the ice age, by rejecting renewables this government risks wiping itself out politically. Until the election of this government Australia was emerging once again as a world leader in renewable energy, but this Prime Minister is frozen in time while the world warms around him. It is having real consequences already. Jobs are being lost and investment is plummeting, with a decline in investment in renewables of 88 per cent since this government came to office.
What is the context of this? Renewable energy in Australia is a no-brainer: we have abundant solar, wind and wave resources and the world-class skills and expertise to turn those resources into reliable energy. Renewable energy creates jobs, including jobs in manufacturing; it attracts investment; it drives down household energy prices and it reduces Australia's carbon pollution. But uncertainty has been killing jobs and investment.
In spite of the fact that the Abbott opposition campaigned saying that the renewable energy target was a bipartisan target, they sought to undermine it when they came into office. There are more than 20,000 renewable energy jobs—with some already lost—around Australia, including more than 4,000 in my home state of New South Wales; there are jobs in wind, solar, hydro and bio energy. It is not just the technical jobs; it is the manufacturing and the retail, maintenance and administration staff. There is a multiplier effect. But, since the election of this government, investors have been abandoning us. In 2013 Australia was ranked alongside Germany, China and the United States in the top four most attractive places to invest in renewable energy. Under this government we have plummeted to 10th place and we have seen that extraordinary drop-off of 88 per cent in investment in the renewable energy sector since the change of government.
The fight against climate change, of course, is not just economic. UN Secretary-General Ban Ki-moon said it best. He said this:
Saving our planet, lifting people out of poverty, advancing economic growth ... these are one and the same fight.
We must connect the dots between climate change, water scarcity, energy shortages, global health, food security and women's empowerment. Solutions to one problem must be solutions for all.
On this side of the House we do see the big picture. We aim to connect the dots. We are not in this just for ourselves, but for the future. We believe in appropriately charging polluters for their emissions—not paying them more using taxpayer funds. We take a whole-of-government approach; this government refuses to.
We know the Australian community gets it as well—more than one million Australian homes now have solar panels; when we came into office in 2007, only 7,000 did. That is a remarkable transformation. Latest research shows that Australians back renewables. Some new research, conducted by IPSOS on behalf of the Australian Renewable Energy Agency, has come out in the last week or so. The report shows strong community support for solar across Australia: 87 per cent of Australians are in favour of home solar panels; more than three-quarters of people are in favour of large-scale solar facilities, and there is also strong support for hydro energy and wind farms—72 per cent—even if we have a Treasurer now who finds wind farms somehow offensive.
Labor has been doing the hard policy yards on climate change for a long time. As shadow environment minister in 2006 I attended the Walk Against Warming with then Labor leader Kim Beazley. I said that day:
We can't afford to wait any longer.
The only way we will tackle climate change in Australia is with a change of government.
… … …
Australia needs a whole of Government approach to avoid dangerous climate change.
Labor's systematic climate change plan offers Australia a way to avoid dangerous climate change.
We must take action not just to protect the environment, but to protect jobs and the economy.
On that day, Labor committed to a comprehensive policy: pursuing a target of a 60 per cent cut in emissions by 2050, joining the global community and ratifying the Kyoto protocol, which we went on to do. It was the first action of the Rudd Labor government on the day that we were sworn in. We committed to giving a price signal by having a national emissions trading scheme. Of course, that would have come into place in 2009 if more than the two Liberals who crossed the floor had voted for it in the Senate. Most significantly, I think, if the Greens political party had voted for a price on carbon in 2009, it would still be in place today. We committed at that time to support renewables, including the '20 by 2020' target, and to introduce a climate change trigger in Commonwealth environmental legislation. We supported effective action on climate change once we came into government. In government, we have a record that I am certainly proud of, in spite of opposition from those opposite and, of course, from time to time, from the Greens political party in the Senate, who lost the opportunity that they had back in 2009.
The fact is that Labor's renewable energy target has been a success. I have mentioned before solar panels—with numbers going from 7,000 up to 1.2 million—but wind power in Australia tripled. The number of jobs in the renewable energy sector tripled. There was more than $18 billion invested in wind and solar farms, hydro plants and renewable energy technology development. On top of these major economic benefits, the explosion in renewable energy in Australia saw carbon pollution from the electricity sector come down. Between June 2012 and June 2013, emissions from the electricity sector fell by more than seven per cent. Renewables are an essential component of cities policy—for making them more productive, sustainable and liveable. Labor's cities agenda has a strong energy and environmental focus. New housing developments are using tri-generation technology to power water, heating and cooling. An example is in my electorate, where I went along to the opening at Canterbury Hurlstone Park RSL of a system, funded by the former Labor government, that will save the club $800,000 a year. That is a good investment supporting a community based organisation, making an enormous difference. The whole-of-government approach comes through when it comes to our policy of being prepared to support public transport as well as roads, which is one of the distinctions between the two sides of politics.
Of course, when the Abbott government came to office, in spite of the promise that it made—that it would not make the renewable energy target an issue of partisan politics—we saw the opposite occur. We had the review conducted by Dick Warburton into the renewable energy target. What was remarkable about that was that the review found that the RET that then existed would put downward pressure on household power prices. It found that it was creating jobs in Australia. It found that it was reducing Australia's carbon pollution. It found that it was driving investment in Australia's renewable energy industry. So what did the government do with that report? It said, 'The renewable energy target is too successful, so we need to undermine it.' From that point on, it attempted to drive down the target as low as possible, or possibly to make it disappear altogether.
That is why Labor was in a position of having to compromise its preferred position in order to save the renewable energy target, at the urging of the Clean Energy Council. The Clean Energy Council predicts that the revised target of 33,000 gigawatts will drive around $40.4 billion in investment and create more than 15,000 jobs. The agreement will see projects start to be built again and businesses enjoy certainty that will allow them to assure their staff's job security. Despite the government's best efforts, we are proud to have achieved the following outcomes: no change to the small-scale solar scheme, full exemption for emissions intensive trade industries and removal of the two-yearly reviews that they attempted to put back on the table at the end of this process. Again, that measure would have created absolute uncertainty and ensured that that investment would not occur.
They also proposed another last-minute change, which was to insert into the proposal the idea that native wood waste should be included in the scheme. We do not support this last-minute thought bubble based upon ideology rather than common sense. This proposal was never raised during negotiations of more than 12 months; it was only put on the table at the last minute. Native wood waste is neither clean nor renewable. The way the government have worded it makes it sound like it would just be the little offcuts which would be burnt, but the fact is that nothing is further from the truth. The definition of native wood waste under their proposal is the whole of any tree that is harvested and not ultimately saw-lopped. So, if you cut down a whole lot of trees but decide not to saw-lop them or to saw-lop only some of them, you can still burn the whole tree. That is the proposition before us today, and we are simply not willing to see the renewable energy scheme used to provide an alternative to the hard work being done by all those who have negotiated the Tasmanian forestry agreement, which focuses on employment, value adding and making sure that that resource contributes the maximum benefit to the economy, rather than this opportunistic, last-minute inclusion that the government have attempted. We will be supporting this legislation, with the exception of the element that we will seek to amend in both the House of Representatives and the Senate. We do so from a position of principle, but one that recognises that if we were the government of the day we would have a different approach. We believe the renewable energy target is too important, in terms of its practical survival, to not listen to the Clean Energy Council and others in the environmental movement who have urged us to have a pragmatic approach to ensure that the industry can continue, whilst committing to further change to improve the scheme, should we come into government. So I commend the amendment to the House, and I suggest that the last two amendments have been put on the table by the government as an attempt to distract from the real position, which seems to be that they simply do not support renewables. They have dropped off one of them; they should drop off the second as well.
I welcome the introduction of this bill to the House and the hard work of the ministers for environment and industry and many others to get the bill to this point. I welcome the fact that this bill brings an unavoidable period of uncertainty to an end, and protects past investments that were made in good faith.
I want to begin with a word of caution. Much work is necessary to deliver good policy outcomes from this bill. Many different stakeholders will determine the success, or otherwise, of this bill, including project developers, retailers, the Clean Energy Regulator, the Clean Energy Finance Corporation, local and state planning authorities, or any federal government in power during the life of the legislation. The choices and actions of these stakeholders will heavily impact on the quality of the outcomes we get from this legislation. These stakeholders can get it right, or, alternatively, they can get the implementation desperately wrong. Some of the stakeholders I have mentioned could trample over local communities, be biased towards the wrong technologies, ignore the inherent risks in this scheme, and ignore the real justification for the legislation. If they choose this path we will all pay the price. Or, they can choose to pay respect to committees, make sensible technology choices and set Australia up for a lower emissions future. That is what we all want.
Since 1983, I have closely followed developments in the science and policy of climate change. Over that time I have seen the science strengthen in demonstrating the causal relationship between rising atmospheric concentrations of carbon dioxide equivalents and global warming. I do accept that there is much uncertainty in the modelling, the forecasting and some of the causalities, but I also believe, as a policy maker, that the risk and uncertainty is, in itself, a strong reason for precautionary action. I remain firmly convinced that the world does need to act, and Australia does need to do its piece.
But I have learnt over the years that emotional policy responses to a problem, whilst understandable, rarely make for good policy. So we need to remember some very basic principles in developing our policies across the globe, not just in Australia. The number one point here is that this is a global problem and it requires a global solution. The atmosphere is totally neutral to the cause of rising concentrations. It does not matter whether it comes from China, India or Australia, from the electricity grid, from transport, or from other sources of carbon emissions. We also know that outsourcing carbon emissions from one country to another helps no-one and has no impact. You only have to look at the result of what has happened in Europe to see that. The Europeans have outsourced their industry and their carbon emissions and have claimed that as emissions reductions. Of course, the atmosphere does not see it that way.
Secondly, we cannot bring this down to a choice between prosperity and the planet, or we will not save either. Instead, we need to focus on the lowest cost of reducing emissions and containing atmospheric concentrations of carbon dioxide equivalent across the world. As a world, we are still moving 50 million people per year into the middle class. When your income is $5,000 or $10,000 per year, then food, housing, basic education and health come first. We will only solve this problem if a solution does not slow the pathway to prosperity for the poorest amongst us and for those moving into the middle class. We need to develop prosperity and the future of our planet.
We should avoid expensive symbolic gestures when there are other better, lower-cost alternatives. But we also know that if we are going to avoid this choice between prosperity and the planet new technologies will be central to any solution. This is not just in the electricity grid, but off grid as well. We do not yet have a technology that can replace transport fuels and nor do we yet have a low-cost technology that can provide a sure supply of baseload electricity at low cost in our electricity grids. This will continue to be a challenge for the world and for Australia.
More locally, we need to remember some key principles. The first of these is that the electricity grid in Australia is an expensive place to reduce emissions. There is a very simple reason that: we have low-cost coal and high-cost gas. Worldwide, developing countries have found the easiest way to reduce emissions, aside from outsourcing them to other countries—which is completely ineffective, as I have already said—is to switch quickly from coal to gas. That is not an easy solution for us because we export our gas at high prices and our local coal is very cheap. But we do have very good options for off-grid reductions: changes of land use, capturing waste methane, and energy efficiencies. That is why the direct action program has worked at a phenomenally low cost—much lower, and with far greater volumes, than anyone expected.
So, it should not worry us that Australia is an expensive place to reduce emissions in our grid, because the electricity grid is only about a third, or a little more, of our carbon emissions. We still have a huge part of our carbon economy outside the grid, where there are low-cost options, and that is why Direct Action has been the right policy and has been such a successful policy. But we are also unusual amongst developed countries in being a major exporter of carbon-intensive goods. That means that solutions and targets which are acceptable to the US and Europe, which are increasingly importers of carbon-intensive goods, should not apply to us, and I will come back to that in a moment. Ultimately, though, if the science continues in its current direction we will need to achieve significant reductions in emissions in our electricity grid, and that requires exploration and commercialisation of new prospective technologies.
Turning now to the LRET and why it needs to change, we need to reduce the target while at the same time making sure that we maintain our commitment to a five per cent reduction in overall emissions by 2020. The reason for this is very simple. The original target of 41 terawatt-hours for the large-scale renewable energy target became unachievable. The highest rate of new generation coming in to our system has been about 1.6 terawatt-hours a year, but in order to achieve the target of 41 terawatt-hours we need to go from 1.6 up to 7. It was never going to happen. It was an impossible target, set by a trajectory set many years ago, which was totally unrealistic, and it meant that we simply were not going to achieve it. And, as I will explain in a moment, that would have meant the system going to penalty, and we would have been paying out large amounts in our electricity bills for no emissions reduction. This was not going to work.
We also know that demand grew far less than was expected. In fact, the 41 terawatt-hour target was looking like it was going to take us to something closer to 30 per cent renewables rather than the original target of 20 per cent, which was anticipated when the legislation was put into place. So, the target was quite simply wrong, and it needed to be changed. On top of this, we have a situation in which we are punishing our exporters for absolutely no reason. If an exporter shuts and that industry moves to another country, there is no improvement in carbon emissions. In fact, in all likelihood, because the outsourcing would more likely shift to a high-emission country using high-emission technology, we would see a deterioration in atmospheric concentrations as a result of punishing our exporters. So that too needed to change. What is being proposed in this legislation is a target that is much more realistic—33 terawatt-hours—and exemption of our major exporters. These are good changes and the right changes.
We still face some serious challenges in making all of this work, and they come down to three. The first is that the large-scale renewable energy target risks becoming a technology monoculture—that is, all wind and nothing else—and this is a serious policy problem. You cannot justify the large-scale renewable energy target on the basis of its being the lowest-cost means of driving emissions down. Even at the moment, the cost of a certificate is about $45. That is supposed to be the equivalent of $45 per tonne of emissions reduction. In fact, in all likelihood it is more than that, because we do not get a tonne of emissions for every certificate. But let's go with $45. We know from Direct Action we can reduce emissions for under $14. This is expensive. So, how can we justify doing it? The only real justification is in providing a platform to test, commercialise and refine new technologies that offer us good prospects in the medium to longer term.
If the technology used in the LRET is exclusively or largely wind, the problem is that we know wind will not see the learning curve improvements that we are seeing with solar. Most who look closely at this over a long period of time have come to the conclusion that the technology that has the best prospects is not in fact wind but, in time, will be solar. And we are seeing massive improvements in the cost of solar cells and the cost of batteries, which are central to storage. Wind is also highly intermittent, and supply often comes at the wrong times, at night. It is focused in the south of Australia, and we know that the demand growth we are seeing in the electricity grid is in the north of Australia, not in the south.
It will also be a huge challenge to meet the target. We will need to build more in the next five years than we have ever built before. We know that if we do not reach the target the impact will be that the certificate prices will go to penalty, flowing through to electricity prices. Claims are being made that that is not the case, and these claims are deeply flawed. If the certificate price goes to penalty, we will pay for it in our electricity prices. The argument made is that because there are many long-term contracts at lower prices then the short-term prices of going to penalty will not be passed through. Of course, this flies in the face of the most basic principle of microeconomics: that prices equate to marginal costs. But, more simply, as one farmer in my electorate put it, this is the equivalent of a farmer buying sheep for $30, the market price moving to $100 and the farmer selling the sheep for $30. What business is not going to pass on the price increase? Of course they are going to. So, clearly, if the certificate price moves to penalty because we missed the target then there is no question that electricity prices will increase very significantly, and that is likely to be a cost of about $3 billion per year by about 2020 if we go to target.
The third risk is that, in the rush to meet the target, local community concerns will be ignored. Some wind projects are planned in regions with highly subdivided country, like the outskirts of the Canberra region, and the community divisions can be deep and damaging. Land prices are elevated in many of these regions, which means that there are significant downside risks to those land values, and we need to be conscious of that.
To solve these problems, we need to do three things. One is to closely monitor our performance versus the target, and we need to take strong and immediate action if it is clear that we are not going to reach the 33 terawatt-hour target. We need to avoid a wind monoculture in the large-scale renewable energy target scheme by encouraging solar and other technologies beyond onshore wind. The focus needs to be on technologies which offer the best prospects for the longer term. I take great comfort that retailers are starting to understand the real advantages of well-located large-scale solar projects. They are quick to commission, better able to match supply with demand and better suited to the north of Australia, where demand growth and prices will be higher. Regulators, particularly the Clean Energy Finance Corporation and the Australian Energy Regulator, have an important role to play here in making sure that we get technology diversity in the large-scale renewable energy target scheme and do not end up with a monoculture. The retailers and developers also need to be aware of this.
Finally, we need the retailers and developers to be alive to community concerns. I will be quick to challenge developers and retailers who promote developments where there are strong unaddressed community concerns. I ask that these developers provide appropriate compensation for all parties that are impacted on. I congratulate the ACT, which has actually taken these things into account.
The implementation of this legislation is critical for my local communities and many communities across Australia. It will also ensure that we have a portfolio of low-cost new technologies. I, for one, will be watching closely and will be quick to point out when we are getting it wrong. Subject to these caveats, I commend this bill to the House.
I rise today to join my colleagues in supporting this legislation, the Renewable Energy (Electricity) Amendment Bill 2015. Labor has been working tirelessly over the last 18 months to secure the renewable energy target to give Australia's $20 billion renewables industry the certainty that it needs. This bill amends the Renewable Energy (Electricity) Act 2000 and the Renewable Energy (Electricity) Regulations 2001 and makes consequential amendments to the Climate Change Authority Act 2011.
The bill adjusts the large-scale renewable energy target to 33,000 gigawatt hours by 2020. This will reflect a commitment to achieve approximately 23.5 per cent of electricity from all renewable sources by 2020. The bill also repeals the requirement for periodic reviews of the RET, including consequential amendments to the Climate Change Authority Act 2011, something which Labor did not support.
Throughout the entirety of the negotiation, Labor has been guided by advice from the industry on what is best for them. The Clean Energy Council predicts the revised target of 33,000 gigawatt hours will drive around $40.4 billion in investment and create more than 15,000 jobs. That is welcome news. This agreement will see projects start to be built again and businesses enjoy the certainty that they have not enjoyed recently. It will allow them to ensure job security.
Labor's negotiation principles throughout did not change, which is why it is so pleasing to achieve the following outcomes: no change to the small-scale solar scheme, which includes rooftop solar and solar panels for small businesses, such as nursing homes; full exemption for emissions-intensive trade industries, which relieves some pressure on those industries that are enduring downturns and job cuts; and the removal of two-yearly reviews, which provides the long-term certainty the industry so desperately needs to survive and to thrive. These amendments in this bill will provide much-needed certainty to the renewable energy industry and enable sustainable growth in renewable electricity generation.
However, this bill also amends the Renewable Energy (Electricity) Regulations to reinstate native wood waste as an eligible renewable energy resource. Labor have said on numerous occasions that we will move an amendment to the government's legislation to exclude this provision. There is no case for introducing native wood waste burning into the renewable energy industry, and Labor will not be accepting this proposal from the government. Labor do not support burning native forests as a renewable energy source. We opposed it in government and we oppose it now.
Labor have been a longstanding supporter of renewable energy in Australia. We have had a longstanding commitment to it. As a country with abundant solar, wind and wave resources, and the world-class skills and expertise to turn those resources into reliable energy, Australia was a world leader in renewable energy until the election of the Abbott government. Labor's renewable energy target has been a resounding policy success story. Under Labor, homes with rooftop solar grew from just 7,000 to more than 1.2 million. Wind power in Australia tripled. Jobs in the renewable energy sector tripled. There was more than $18 billion invested in wind and solar farms, hydro plants and renewable energy technology development. On top of these major economic benefits, the explosion in renewable energy in Australia saw carbon pollution from the electricity sector come down. Between June 2012 and June 2013, emissions from the electricity sector fell by more than seven per cent.
This is a critically important industry in Australia. It employs more than 21,000 people, it attracts billions of dollars in investment, which creates jobs, and, importantly, it contributes to Australia's carbon pollution reduction. Labor firmly believes renewable energy is the way of the future. The rest of the world is marching towards a clean energy future. Around the world, investment in renewable energy grew by 16 per cent in 2014. In China, which is one of our biggest trading partners, investment in renewables soared by 33 per cent. That is why renewable energy featured so heavily in Labor's clean energy package and why Labor has fought so hard against the government's attacks on renewable energy over the past 18 months.
Renewable energy in Australia is a no-brainer. It's a no-brainer around the capital region too. It is a burgeoning industry that creates jobs, attracts investment, drives down household energy prices, offers alternative job opportunities to replace those being lost in the traditional manufacturing sectors and reduces our carbon pollution.
We have seen broken promise after broken promise from this government—and the RET is just another example. As we all know, the RET was introduced by the Howard government in 2001 as part of its climate change strategy and sought to increase renewable electricity generation by an additional two per cent by 2010 on top of existing generation. Until just after the election, it enjoyed bipartisan support. It is quite extraordinary that it enjoyed bipartisan support for such a very long time.
The target was subsequently expanded in 2009, by the Rudd government, to 20 per cent of all electricity generation by 2020. Before the election the Prime Minister promised not to change the RET, saying, 'We have no plans to change the renewable energy target,' but shortly afterwards he backflipped on that promise. There are no surprises there. It is just another broken promise from the Abbott government.
There were many more renewable energy related broken promises from this Prime Minister. There was the $600 million commitment for solar roofs. The towns and schools commitment was cut to just $2 million in the 2014 budget. The Australian Renewable Energy Agency had its funding severely cut in the 2013 MYEFO, and then the agency was added to the abolition list in the 2014 budget. The biggest of all renewable energy broken promises came after the Prime Minister appointed a known climate sceptic to review the renewable energy target, a move that completely undermined the whole industry.
Over the past 18 months this government has taken the renewable energy industry right to the edge of the cliff. Australia has plummeted from the fourth most attractive country in the world to invest in renewable energy to the tenth. Over the past year investment in renewables has dropped by a—staggeringly—massive 88 per cent. That decline has been felt very strongly, here, in the Capital Region. There are at least 14 announced large-scale projects surrounding Canberra. Only a few of those are in construction, with the rest having been placed on hold since this government set its sights on the renewable sector. Our renewable industry has completely stalled over the last 18 months in the Capital Region, and there is no way around it. That means a loss in local jobs, job skills and innovation. Most importantly, the stalling of the Capital Region's renewable sector has ultimately stalled our ability to reduce emissions of greenhouse gases from the electricity sector.
Labor has a proud track record when it comes to renewables, and we mean business. We said that if elected in 2016 we would use 33,000 gigawatt hours as a floor to build on. It will be a minimum. And we will top up the 2020 RET. We are currently consulting with the industry and finance sector to develop an ambitious renewable energy policy, past that point, beyond 2020. We have plans for the future to 2020 and are consulting on what is next, after 2020. Labor knows renewable energy is the way of the future. We know Australia needs to transition to a clean-energy economy and Labor is the only party with the will and ambition to see that happen.
In closing, I support the majority of this legislation because it will provide much needed certainty to the renewable energy industry and enable sustainable growth in renewable electricity generation. However, Labor opposes the inclusion of native wood-waste biomass, and we will fight it.
I also rise to speak on the Renewable Energy (Electricity) Amendment Bill 2015, which is all about the legislative underpinnings of the renewable energy target. It has three features. The first is the rescaling of the RET from 41,000 to 33,000 gigawatt hours, the second is assistance to emissions-intensive trade exposed industries and the third is the inclusion of wood waste in the RET. As other speakers have indicated, we support the first two elements but not the third.
Like the member for Canberra, like the member for Isaacs and all of my colleagues, we are big believers, on this side of the House, in renewable energy. For my 20 years in the Labor Party, we have been the party of renewable energy. We believe in the transformative economic benefits of wind, hydro, geothermal and especially solar energy.
Twenty years!
Think about this stunning fact: more energy from the sun hits the earth in one hour than all the energy consumed on our planet in a year. You do not need to be Einstein—even the member for Mayo would grasp this—to see the opportunities in all of this for Australia, given our abundance of sun and wind in this country. We have all the ingredients to be a world leader in renewable energy—except a government that treats it as a priority.
My support for renewable energy extends to the programs that help make it a reality in this country: the Clean Energy Finance Corporation, the carbon price and the renewable energy target. We want an economy powered by clean energy, we want cheaper energy for middle-Australia in the medium term, and we need some business and investor certainty in this country. That is why I support almost all of the RET bill that is before the House of House of Representatives tonight.
Just like other speakers, I am proud of Labor's record when it comes to renewable energy. It is a fact that we were a world leader, during the Rudd and Gillard years, on renewable energy. We were in the top four for renewable energy investment alongside the powerhouses of Germany, the United States and China. That is an incredible feat for a nation like ours. I can rattle off lots of facts to demonstrate just how important investment in renewable energy was during that period. Solar rooftops grew from 7,000 homes at the beginning of the Rudd-Gillard years to 1.2 million homes. Wind power tripled. There was $18 billion of investment in wind and solar farms, hydro plants and renewable energy development.
One of the things I was most proud of is that there was a tripling of jobs in the renewable energy sector, despite a global financial crisis. Carbon pollution from the electricity sector dropped. In the last full year of Labor it dropped seven per cent from June 2012 to June 2013. You can see how this was achieved when you contemplate this, taking my own electorate of Rankin, to the south of Brisbane, as an example: 30,000 families in Rankin invested in solar energy for their homes. That is 42 per cent of the families in my community. That is much higher than the national average of 22 per cent, higher even than the Queensland average of 32 per cent. It is much higher than the Prime Minister's electorate of Warringah, which had 5.9 per cent take-up, or the Treasurer's electorate of North Sydney, which had 4.2 per cent.
You can see that communities like mine took up the opportunities of renewable energy with gusto. It shows this is not a preoccupation of the inner cities. It is something done by people of modest means, in suburbs like mine. They can spot an opportunity to do the right thing for the future of the economy, the country and the environment at the same time as they make a real investment in cheap, alternative energy for their families.
The contrast is really clear when you consider the achievements of the Labor government that I just ran through and compare them with what has happened since the election. It is a fact that the change of government had a devastating impact on investment in renewable energy in Australia. We went from being fourth in the world in terms of investment—remember, it was Australia, Germany, the US and China in the top four—and we are now 10th. The government should be acutely embarrassed of that fact. They shattered the bipartisan consensus over the renewable energy target, despite promising not to. They did not just try to trash our legislation in 2010, but they trashed the Howard legacy of the Howard legislation from 2001. They had a hand-picked panel that they tasked with undermining the renewable energy target. They headed it up with a guy who, remarkably, is the Prime Minister's business adviser, who thinks that the climate change debate is a cunning plan for world government. This was all part of their grand strategy to smash the RET, to smash the Clean Energy Finance Corporation, to smash ARENA and all the other institutions, policies and initiatives that helped make Australia one of the top four countries for renewable energy investment in the world, as it was under Labor.
They are supposed to be the party of business and investment, and in the process they smashed investor confidence. They brought investment to a standstill. If you consider this one fact: in 2014, worldwide investment in renewable energy went up 16 per cent; in Australia, in the same period in the large-scale sector, it was down 90 per cent—not 19 per cent, 90 per cent. It was up, around the world, by 16 per cent; it was down by 90 per cent in Australia in one year—and they have the gall to pretend that they are pro certainty, or pro investment, or pro business.
We entered into this negotiation because we value certainty for the sector. We wanted to restore confidence, even if we could not have absolutely everything that we wanted when it came to the renegotiation of the renewable energy target. I want to pay tribute to the member for Port Adelaide for his role in these negotiations, working with the government to get the best deal that we could for the renewable energy sector. We worked with the industry, and we worked with the stakeholders, to make sure that we could get for them, and the broader Australian community, the best possible deal. We reached agreement for about 25 per cent of energy from renewable sources by 2020. Even at 33,000 gigawatt hours, this will drive, with the certainty it brings, something like $40.4 billion in investment, and create more than 15,000 jobs. When you consider that the unemployment rate is higher now than at any point during the global financial crisis, those 15,000 jobs are very valuable indeed.
We worked with the government, but we did stand firm on some issues, including no change to the small-scale solar scheme for rooftop solar, including small businesses and other institutions—for example, nursing homes. We fought for a full exemption for emissions-intensive trade-exposed sectors and companies to protect jobs, and we fought against the two-year review so that businesses have the certainty they need. The two-year review that was thrown on the table late in the piece would have gone against everything we were trying to achieve when it came to certainty in the sector.
As other speakers have said, we do not support the inclusion of native wood waste biomass, for the reasons that the member for Port Adelaide ran through in detail. It was not in there when we were in government, as the member for Isaacs would know, having been a key contributor to our policy in this space, and it should not be in the agreement now. Our position will have absolutely no detrimental impact on investor confidence in this country.
We want an economy powered by clean energy. We want investor certainty. We want more people in communities like mine to access cheap renewable energy, and we want to help create the jobs of the future. That is why we need to be ambitious when it comes to renewable energy, and especially the renewable energy target. We have done a deal here in the interests of investor certainty, and we look forward to building on it and building on the substantial achievements of the Labor Party in renewable energy in the years ahead.
I note that the previous speaker, the member for Rankin, boasted of the Labor Party being the party of renewable energy. Given that renewable energy only exists in this country in the way it does through subsidies and government welfare, and that the Labor Party is the party of welfare, it is a neat match. We have heard from the member for Canberra that they plan to do more. They plan to ratchet up the amount of subsidies going into renewable energy, with the cost of power being driven up as Labor seeks to expand this sector, which is all subsidies.
Before I speak on the Renewable Energy (Electricity Amendment) Bill 2015, I want to address the changes that this bill will implement, and I want to preface those remarks by noting that a great deal of compromise has gone into achieving this negotiated agreement. This bill will make a number of key changes to the Renewable Energy (Electricity) Act 2000. It will adjust the large scale renewable energy target to 33,000 gigawatt-hours, in 2020. It will change partial exemptions to full exemptions for emissions-intensive trade-exposed activities. I note that the member for Rankin tried to claim this as a Labor Party feat, but part of the reason we went into this review was to give a reprieve to these industries. These trade-exposed emissions-intensive industries were copping it in the neck from high electricity prices caused by the carbon tax and the renewable energy target. It is certainly not a Labor feat, but one that the Liberal-National coalition has achieved because of this review. It will change partial exemptions for those industries to full exemptions. It will reinstate biomass from native forest wood waste as an eligible source of renewable energy.
This bill removes the biennial review—sadly, I have to say. I know the Labor Party and their Greens mates were very keen to see the back end of those reviews, and it begs the question: what exactly were they afraid of with the review? They tell us, ad nauseam, how great renewable energy is. They tell us it is a growing industry and creating all these mythical green jobs. But if renewable energy is such a wonderful thing, and if it is so efficient, then why would they not want it be reviewed every two years?
Are they afraid the review will show renewable energy to be not the raging success they think it is? I think they are afraid the review will highlight what a disastrously expensive indulgence it is, because the renewable energy target has already been reviewed. The Warburton review reported, and a key finding of the review was that:
In the presence of lower cost alternatives, the costs imposed by the RET are not justifiable.
Let me repeat that for the Labor Party: in the presence of lower cost alternatives, the costs imposed by the current renewable energy target are not justifiable. The Warburton review reported that the RET was an expensive means of reducing emissions because it failed to directly focus on emissions reduction and related only to electricity generation. Between 2014 and 2030, the cost of carbon abatement is estimated by the Warburton review to be between $32 and $62 per tonne for large-scale renewables. In small-scale renewables, the cost is even more outrageous, at between $95 and $175 per tonne of abatement.
One of the problems that this bill will address is the distortion caused by a changing market. As highlighted in the energy white paper, we have an oversupply of electricity generation capacity, when demand has fallen by an average of about 1.7 per cent per year from 2009-2010 to 2013-14. To allow for a changing market, this bill will reduce the large-scale renewable energy target from 41,000 gigawatt hours in 2020 to 33,000 gigawatt hours. The bill also changes the annual targets so that the 33,000 gigawatt hours in 2020 remains the target until 2030. These new targets address the fact that declining activity in the industrial sector and increasing energy efficiency have driven down demand. The changing target balances, on one hand, the desire to encourage investment and to reduce emissions and, on the other hand, the need or the absolute necessity to keep electricity prices down for consumers.
I note there is another section of this bill that the Labor Party says they no longer agree with, and that is reinstating biomass from native forest wood waste as an eligible source of renewable energy. I say 'no longer' because at one time they did agree with it. I was on the Labor dominated committee chaired by Dick Adams where a recommendation was made to the previous parliament that native forest wood waste be eligible as a source of renewable energy. The inclusion of native forest wood waste was in Labor's own legislation until November 2011.
The Liberal National government made a commitment at the last election that we would reinstate wood waste as an eligible source of renewable energy under the RET. In doing so, we were basing eligibility on exactly the same conditions that were in place under the Labor government. The whole idea of the RET is about support for additional renewable energy generation that is sustainable. Wood waste is a renewable energy source, and there is no evidence that it would lead to unsustainable practices, nor would it have a negative impact on biodiversity. In fact, the supply of wood waste as a fuel would have to work within the processes of Commonwealth, state and territory approvals. If burning wood waste to generate electricity is more beneficial for the environment than burning the waste alone or simply letting it decompose, how can Labor justify ruling it out?
The position Labor, the Greens and others in the same field have taken on this issue has been to block anything that would make energy cheaper and to search for ways that are going to make it more expensive because Labor and the Greens do not care if it costs more money. In fact, they want it to cost more money. Labor wants it to cost more because they are happy to keep borrowing money until they send this country broke. And what of the Greens? Well, the Greens do not believe in money. What the government has done is inherit a Labor Greens scam. It has made the most of the hand it was dealt, and credit is due to the government for limiting the damage and salvaging industry wherever it could.
But the reality is that the renewable energy target is a government mandated system designed to cost more. It is one viable sector of the industry being forced to prop up an unviable sector. There are many ways to generate electricity out there. The cheapest, the easiest and the most efficient is coal—coal fired power. In fact, the only way to generate reliable baseload power in this country is through coal fired power stations. There are other ways of doing it: nuclear, but we do not want to talk about that; or hydro, but, no, the Greens will not allow that either. There are the expensive ways of producing electricity, like wind or solar.
There are two problems, though, with wind and solar. They are intermittent and they are expensive because the wind does not always blow and the sun does not always shine. So it is necessary to have an alternative baseload generator. The baseload generator must be operational 100 per cent of the time because you cannot rely on wind and solar. So right from the get-go you are paying for two power sources when the cheapest one on its own could do the job.
When they introduced the job-destroying carbon tax—which they promise to bring back after the election if they are in, if they are given the chance—they droned on and on about green energy and green jobs. But their sermons never touched on how expensive that energy or those jobs would be. More important than what they said is what they did not say. They do not mention reports like the November 2014 report by Euan Mearns of Energy Matters, which concluded that renewable energy subsidies amount to 94 per cent of the value of the energy produced. Because the RET has forced Australia to use more expensive power generation, we all must pay more for power.
The Labor Party, during debate on the cataclysmic disaster that was the carbon tax, insisted that only the big polluters pay. The argument did nothing but confirm their own ignorance of anything to do with business or the real world. Any business that was forced to pay the carbon tax was forced to pass it on if they wanted to stay in business, and the same outcome applies to the RET. If we insist on using more expensive electricity, then someone has to pay that extra expense, and that someone is the end user: mums and dads and families around Australia. Every time they turn on the light, they are paying for the electricity, plus they are forced to pay more for more expensive electricity. Every time they cook dinner, have a shower, go to the fridge or watch television, they are using electricity that is much more expensive than it should be because of the RET. In some business operations, it is impossible to pass on that extra cost because there are other businesses in other countries that are not forced to use a more expensive means of electricity generation. So the RET places those businesses in an uncompetitive position. When the largest item of expense for a business is electricity, they are placed in an untenable position. They suffer massive cost blow-outs and will never be able to compete with a business that does not have that cost. That is why the government should be applauded for including in this negotiated agreement the raising of partial exemptions to full exemptions for businesses in that situation.
I am very pleased to say that that full exemption for emissions-intensive trade-exposed industry is very good news for a business like Sun Metals, a zinc refinery in my electorate up near Townsville. The refinery was built in 1996 by Korea Zinc, which produces 10 per cent of the world's zinc. Sun Metals is one of the most advanced plants in the world and one of the largest zinc refineries. It employs about 400 people. When massive cost increases were imposed upon the industry through schemes like the RET, and through Labor's other famous act of economic self-harm, the carbon tax, it was jobs like those that were put directly at risk. North Queensland is doing it fairly tough at the moment. Jobs are harder to come by since the downturn in the resource sector. The last thing we want is to see another carbon witch-hunt put 400 families out of work.
In conclusion, I want to address some of the fantasies that surround this mythical 'clean energy'. If you took the headlines at their face value, you might fall into the trap of thinking that families and business would be better off with renewable energy. For instance, consider a Worldwatch Institute article headlined, 'Renewables becoming cost-competitive with fossil fuels in the U.S.' These are the sorts of headlines that the Labor Party and the Greens love to promote and trumpet. If renewables are cost-competitive with coal, I ask: 'Why do they need subsidies? Why do we need any renewable energy target? Why do we need a government-imposed mandate at all?' But do not look at what they say; look at what they do not say—or at least read beyond the headline.
For example, there was a New York Times article from November last year headlined 'Solar and wind energy start to win on price vs. conventional fuels'. That sounds fairly promising. It even goes on to talk about:
… several companies signing contracts, known as power purchase agreements, for solar or wind at prices below that of natural gas, especially in the Great Plains and Southwest, where wind and sunlight are abundant.
But here is the kicker:
Those prices were made possible by generous subsidies …
And it goes on:
Both industries have managed to bring down costs through a combination of new technologies and approaches to financing and operations. Still, the industries are not ready to give up on their government supports just yet.
Already, solar executives are looking to extend a 30 percent federal tax credit that is set to fall to 10 percent at the end of 2016. Wind professionals are seeking renewal of a production tax credit that Congress has allowed to lapse and then reinstated several times over the last few decades.
In another article—one by Joel Hruska on the ExtremeTech site in December last year—it is a little bit more upfront. The headline declares, 'Solar and wind power are now fully cost competitive with fossil fuels—is it time to switch over?' But in the very first line the story says:
Renewable energy production has boomed across the globe in recent years, driven by improvements to solar and wind turbines, increased economies of scale, and in some cases, significant government subsidies.
They are right when they say that the Labor Party is the party of renewable energy, because renewable energy relies heavily on welfare and subsidies. And Labor is the party of welfare and subsidies.
I congratulate the government on what it has been able to achieve here in making a silk purse out of a sow's ear. I do commend this negotiated RET agreement to the House. I look forward to its passage in the Senate. And let us hope that some sense is retained here with the biomass wood waste being included in the final bill.
This bill, the Renewable Energy (Electricity) Amendment Bill 2015, amends the Renewable Energy (Electricity) Act generated in 2000. The major things that these amendments will achieve are as follows. Firstly, the target of 41,000 gigawatt hours will reduce to 33,000 gigawatt hours by 2020. It also increases the partial exemptions for all of the emissions-intensive trade-exposed industries to full exemptions. Currently, they are sitting at 60 per cent or 90 per cent to, roughly, overall, across the emissions-intensive trade-exposed industries, 70 per cent. Finally, it will also reinstate biomass from native forest wood waste to be an eligible source of renewable energy. Two other features are that it removes the requirement for biennial reviews of the RET—which is great because this current review seems to have taken forever, and we would have to be starting again in another six to 12 months time if we were left with that—and also that 850 gigawatt hours of energy from waste coalmine gas generation will remain as a separate requirement annually until 2020.
Next, I would like to bring to the attention of the House some popular misconceptions about the RET and these changes, and to document the serial changes in the RET since its inception in 2001. When you look at the history you can see why some of the illogical issues that we have to deal with now have come to be. Also, I would like to confirm that the large-scale renewable energy target of 31,000 gigawatt hours represents 23½ per cent, which generously exceeds the stated target of 20 per cent of all energy generation. The small-scale energy rollout currently has exceeded projections which were originally for 4,000 gigawatt hours by 2020. But already there are about 7,000 gigawatt hours—and it is projected to reach 13,000 to 14,000 gigawatt hours by 2020.
Also, the RET, or the renewable energy target, which is not to be confused with the renewable energy certificate, is quite different from feed-in tariffs, which many of my constituents get confused with. Feed-in tariffs are run by state governments and are a payment by the energy producers for the energy that is produced. One renewable energy certificate represents one megawatt hour of power. The renewable energy target originally was initiated by John Howard's coalition government in 2001. It was designed to produce another two per cent or at least 9½ thousand gigawatt hours of extra renewable energy on top of the existing baseload renewable energy, so that by 2010 we would have 12.7 per cent of our energy coming from renewable sources, with the original baseload of renewable energy coming from Snowy and Tasmanian hydro systems.
Liable entities—namely, energy retailers and some high-energy producing entities, which cover about 50 industries, including things like smelters and big LNG producers—were compelled to source renewable energy certificates to prove that the set percentage of their energy was generated by renewable sources. Originally, wind farms and sugar waste generated most of the early renewable certificates, but in 2007 the Labor Party and Prime Minister Rudd came along and overnight doubled the renewable energy target to 20 per cent of generation by 2020. At that time, with the current energy use, they estimated that, quite generously, at 41,000 gigawatt hours.
Around the same time they also started a fund, originally of $150 million, to give $8,000 grants to install photovoltaic solar panels. That was meant to run over five years, but within one year it reached $700 million. Along came the GFC and it appeared to keep going. When the need was obvious to remove the grants, they made another major change, which really created chaos in the renewable energy target and certificate market. Overnight, instead of one megawatt hour generating one certificate, or one REC, it created five RECs. Not too surprisingly, there were over 23 million of these phantom credits created without the proportion of energy that was originally intended. These phantom credits flooded the market and many of them still remain. So the renewable energy certificate price plummeted, effectively hobbling the large-scale renewable energy system, because the large-scale renewable energy producers, like wind farms, need $80 to $90 to break even. That is why they need a renewable energy certificate which gives them an extra income stream. I am sure they are quite happy now that the certificate price has gone up towards $60. It changes all the time. Back then, when they created the phantom credits, in typical Labor Party fashion they were trying to help a system that they destroyed. Only they could do something like that.
Also, since then, circumstances have changed dramatically, and that is why we have needed to readdress the 41,000-gigawatt-hour target. That estimate was wildly wrong as energy consumption has dropped dramatically. There are many reasons for this: the loss of many high-energy users, such as manufacturers of steel, aluminium and cement; high network costs; the explosion of photovoltaic solar panels with generous feed-in tariffs, as well as other state grants for things like solar hot water systems; along with building efficiency, lighting efficiency and heating efficiency. That all leads to lower energy consumption. So we have a market flooded with energy, a lot of it being subsidised. With the system being disrupted, so that even with the subsidy in place people were not expanding, there was a large likelihood that penalty payments would fall into place. If the targets are not met, the liable entities have to pay a penalty price, which is anything. Because it is not tax-deductible, it is up to $60 or more. There is a potential price that people would be paying for energy—wholesale prices of $90 to $95—and you can imagine what that would do to energy prices.
Baseload systems, which are cheaper to build and also much cheaper to run, have closed. Many industries depending on cheap energy have also closed. Small energy-dependent industries have struggled. It has become too expensive for many individuals and businesses. That is why we put in the adjustment to emissions-intensive trade exposed industries, as they are competing with producers in low-energy-cost markets. Whether you are an aluminium worker or a cement worker, or one of the many other high-end energy users that actually make and manufacture things, this is a matter of necessity. It is not a question of whether you like it or not; it means the industries will vanish if we do not correct the potential problems as well as the current problems.
Reinstating native wood waste is another issue which is entirely sensible. Some of the opponents of this initiative make out that there will be harvesting of primary wood sources just for generating biomass for bioenergy, but there are current state and federal agreements and legislation that prevent that. It is only the wood waste that will be eligible to be used as biomass. Also, the economics of the timber industry would mean that it would be a crazy waste of resources if they were using prime timber, which goes into our buildings, fencing, furniture and all those high-value things. What you get out of a renewable energy certificate would pale into insignificance compared with the value of the wood. So that legislation and pure common sense mean that it is only the wood waste—the sawdust, the offcuts, and all the other bits and pieces which will generate CO2 if they are left to rot or which, in many cases, are actually burnt because they are waste and every timber mill would fill up with waste if they did not dispose of it.
The legislation is also in keeping with the Kyoto protocol. It is quite sensible and, as I have mentioned previously, this is a sensible addition to the renewable energy certificate generating system.
I just want to say a few words about what we have achieved in Australia in terms of renewable energy. Our uptake of photovoltaic systems is exceptional and our target of 23½ per cent will put most countries in the world to shame. Yet we are criticised for not doing enough and not being generous in our support of renewable energy. They also say that renewable energy is cheap, but the economics of this RET scheme are incredibly generous. In fact, economically, it does not make sense it is so generous. But because we have a commitment to a renewable energy target we are running this system.
The cost of the subsidy in the RET, to 2030, is estimated at $17 billion. That is a huge subsidy and it is the electricity users of the nation, namely, the citizens who are paying for it. If penalty payments came in because the targets were not reached, that figure would rise to $35 billion. As I mentioned earlier, wholesale energy averages out at $30 to $40 per megawatt hour. It can go widely below to widely above. A two-megawatt turbine operates at 35 per cent capacity. So that would generate 6,100 megawatt hours of electricity per year. And if that turbine has a power purchase agreement with a certificate price of $60, that turbine would receive about $370,000 subsidy per year. If it dropped to $40 per megawatt hour, that would be $240,000 per turbine, per year. If you had a wind farm of 100 turbines—and there are some nearby that almost reach that number—the subsidy via the RET scheme would be half a billion dollars by 2030. That is a very generous subsidy.
When you look at the renewable energy target system to see whether it is a cost-effective way of carbon abatement, it probably is not. Before we got rid of the carbon tax, it was heading to $25.50 per tonne. And it was going to go up and up and up. With the recent Emissions Reduction Fund reverse auction we have achieved $13 a tonne—half the price. It is delivering six to seven years of reductions lock, stock and barrel. The cost of small-scale renewable energy via the RET—if you do the sums, the carbon accounting and the economics of prices and subsidies—is $95, up to $175, per tonne. Large-scale systems are slightly more efficient, at $32 to $62 per tonne.
So Australia is doing an exceptional job, compared to other places in the world like Europe that are held up by our political opponents, the Greens and the Labor Party. It is gold standard. We are streets ahead. Even the US has some large-scale systems but it, too, relies on extensive tax or physical subsidies. And the same in Britain. It is good to have a broad mix of energy production, but we do not want to blow up the whole system and have our baseload energy producers remove themselves from the market. We will then be like other countries that have brownouts or blackouts. This is a sensible bit of legislation that puts a bit of common sense into a very complex system and that meets our requirements to do our part for the environment.
I rise to discuss the Renewable Energy (Electricity) Amendment Bill 2015. Before I go to the substance of my address, I want to address some of the wild contradictions that the last speaker presented, because they are contradictions that are inherent in the entire approach of the coalition to this policy area, an approach that represents a reckless disregard for a very important industry and a very important arm in combating climate change and developing a new industry.
On one hand, those opposite argue that the Small-scale Renewable Energy Scheme is wildly inefficient. But, on the other hand, they took to the election a policy of one million solar roofs, a policy they have slashed to save money. But they have contradicted themselves on that. On the one hand, they attack the cost of abatement under the RET as being too high, yet their expensive and completely reckless Direct Action policy has a much higher cost of abatement. I just want to correct the myth propagated by the member for Lyne, which will probably be continued by the member for Hinkler when he has his go a bit later. The cost of the carbon price was $23 a tonne. On 1 July 2015, if that scheme still exists, we would have linked with the European carbon price and the cost of abating emissions under an emissions trading scheme would have been around $8 per tonne.
Under their dog of a scheme, where they cannot find a single economist to support the carbon price, the equivalent carbon price is $66 a tonne because two-thirds of their first auction results were for projects that would have existed anyway, that were funded under the carbon price, under the Carbon Farming Initiative, and that would have failed the additionality test. So once they were excluded, they purchased 10 million tonnes of abatement, at a cost of $660 million. That is a carbon price of $66 a tonne versus $8 a tonne under Labor's emissions trading scheme. So they cannot have it both ways. They cannot attack the cost of abatement under the RET and then defend their dog of a scheme with its $66 carbon price.
Let me return to the substance of the debate here. Why are we debating this bill? We are debating this bill because of the broken promise of those opposite, who, before the election said they would maintain the RET unchanged. They broke that promise because of their ideological hatred of clean energy, because their party room and their support base is made up of conspiracy therapists—not all of them, but Maurice Newman, their chief business adviser, sees climate change as some UN global conspiracy with world banks to dominate and take sovereignty away from sovereign nations. Their chief business adviser thinks climate change is a UN conspiracy to destroy the sovereignty of nations! The Treasurer is a man who thinks wind turbines are offensive, a blight on the landscape. We heard a sterling contribution from the member for Dawson. His understanding of clean energy is probably on par with his understanding of multiculturalism—and his contribution to both public debates is negligible; in fact, it is counterproductive. We also had a weird contribution from the member for Lyne saying we need to cut the RET because we are in danger of hitting the penalty price, we need to cut the RET because the penalty price will be hit and that will destroy industry.
The only reason anyone in industry started talking about the penalty price was the investment strike caused by the government's meddling, their ideological attacks on the RET and their constant reviewing. Because of the intervention, because of their broken promise, because of their ideological agenda, because of their appointment of Maurice Newman to conduct a review, what we saw was a complete investment strike by the global clean energy industry. They could not make investments in 2014 because of the mass uncertainty caused by the coalition government. The result of this was that we saw investment in the industry fall from $2.7 billion in $2013 to $240 million in 2014, an 88 per cent fall in investment in the clean energy industry because of the uncertainty caused by the vandals on the other side. We saw our global reputation damaged, we saw Australia's attractiveness for clean energy investment fall from fourth in the world to 10th in the world, and we saw 21,000 jobs in peril by their reckless approach.
We should contrast that with Labor's achievements in this area when in government. Under Labor, the number of solar PV systems on Australian roofs went from 7,000 to 1.2 million. There was a tripling of jobs in the clean industry, to 24,000, at the time we left office and we saw $18 billion invested in clean energy industry over. This move was matched around the world. Last year, we saw a 14 per cent increase in global investment in clean energy and a 33 per cent growth in China. Contrast that with the 88 per cent fall in clean energy investment caused by this government's ideological attack on renewable energy.
So we had the Newman report commissioned by the Prime Minister, a self-confessed weathervane on climate change, a self-confessed climate change sceptic who questions the science with rather pejorative terms. He commissioned Maurice Newman, 'Mr UN Conspiracy', to conduct the review. They then commissioned modelling with some of the most problematic assumptions ever seen in modelling. We often see modelling with dodgy assumptions and there will be argy-bargy on both sides about modelling—I understand that—but their modelling was so flawed that it was universally condemned for the assumptions underpinning it. Those assumptions included that the cost of base load coal fired power in 2030 would be exactly the same as it is now, that there would be no global carbon price and that there would be no price on carbon emitted from coal that would impact on the cost of production. It was incredibly flawed. But even this jury rigged, book cooked modelling—and let me emphasise this—still found that the 41,000 gigawatt hour Renewable Energy Target actually suppressed retail prices. Let me repeat that. The government's own modelling that was based on incredibly heroic assumptions to attack renewable energy found that the RET as legislated was suppressing retail prices, driving investment and increasing jobs in the industry. It found that, if you reduce the RET, jobs would go, emissions would rise and retail electricity prices would actually increase.
That is what those on the other side are actually arguing for when they argue for a huge cut in the RET, which is really what they want to do. This compromise is not where they want to land. They want to have either a RET with a two in front of it—in terms of 20,000 gigawatt hours—or no RET at all. What they are arguing for is an increase in electricity prices, not a reduction. That is based on the government's own modelling.
The government was pursuing this agenda and Labor had a choice. We could engage in empty political grandstanding and say that the RET as legislated was our policy, that we were going to help them keep their promise at the election—a broken promise like so many other broken promises. We could grandstand—and what would happen? The renewable energy industry would die. We would see the investment strike continue and 21,000 jobs in danger. We refused to do that because that is the response of a party that puts political interest above the national interest. Frankly, that is the response of the Greens.
The Greens were very happy to carp on the sidelines, to play no constructive role in this debate, to pursue an ideological agenda as narrow, fixed and opportunistic as the coalition and not contribute to the national interest. Instead, they chose to attack the Labor Party, who worked with NGOs and the clean energy industry to achieve the best possible compromise and rescue the government from a problem of their own making. Yet again, the Greens indicated that they would put their cheapjack political interests above the national interest. Labor will not do that. Labor, negotiated with the government and came down with a compromise that results in a Renewable Energy Target that, while unsatisfactory, is still unacceptable. That is why we are supporting this bill.
There are two important breakthroughs in this bill. Firstly, it ends the endless cycle of reviews that are constantly undermining certainty in the industry. That is a very important achievement that those on the other side tried to oppose and up-end at the last minute through the Minister for Industry. Secondly, it grants the full exemption to emissions-intensive and trade-exposed industries. This is an important initiative. This is a move that correct a massive flaw in the original mandatory renewable energy target as legislated by John Howard. Those on the other side can talk about protecting the industries that rely on cheap energy, but this flaw began under Prime Minister Howard. The 2009 amendments by Labor to produce a 20 per cent renewable energy target provided a substantial shielding for industries—we provided 90 or 60 per cent exemptions, unlike the original Howard MRET, which had zero exemptions for EITE industries. So I support that change to the renewable energy target to provide shielding to exporting industries that are emissions-intensive.
The result of all this is that, according to the industry's projections, we will see $10 billion of additional investment in the clean energy industry, 6½ thousand additional jobs and an additional 6,000 megawatts of capacity. This is very important. As important will be Labor's policies that will build on this. We have committed that the future Labor government will top up the renewable energy target's 2020 target to provide more space for large-scale solar and, secondly, that we will have a more ambitious 2030 RET target that we will bring into place. That is really important—to continue the development of this industry—because all this debate, all this heat and light, all this sound and fury, is about a choice. And the choice in this country is: do we want to develop a clean energy industry that will allow us to compete in the 21st century, or do we want to be a rust-belt, rust-bucket economy? Do we want an economy driven by fossil fuels that inevitably must have a carbon price somewhere in their production, and an economy where we are competing against the rest of the world that is investing in clean energy industries while we stick our heads in the sand? This is the choice in this debate. The renewable energy target is about carbon abatement. It is not the cheapest form of reducing emissions—that is an emissions trading scheme, and the RET works best when combined with an ETS.
But the main purpose of a renewable energy target is to develop an industry so that it has a mature stance and can compete against the rest of the world. That is really what we are talking about here. The nation that developed the technologies of steam and textiles production dominated the 18th century—that was the United Kingdom through the first Industrial Revolution. The economies that developed steel and chemicals dominated economically in the 19th century—that was the United States, the United Kingdom and, later on, Germany. The economies that had technological dominance in electronics through the transistor revolution dominated the 20th century—that is Japan and the United States. Just as these did, it will be the economies that invest and dominate in clean energy technologies in the 21st century that will be the most dominant economies in the world.
That is a dominance that Australia needs to be part of. We used to lead the world in solar technologies. Unfortunately the cutting edge solar technologies were sold off to Germany because of the lack of support here and the more production-ready technologies went to China. We have an opportunity to still participate in this industrial revolution, and we must. If we want to give our kids the best possible future and the best possible jobs, we must have good technologies in this area. We must be commercialising and productionising these technologies so that our jobs have these great, great opportunities. Our kids really need to have this opportunity, and this is what this debate is about.
Those on the other side with their real agenda of cutting the RET—and destroying it, eventually, if they get their way against the massive tide of public opinion—would have us as a rust-belt economy in the Pacific. We would be the laughing stock of the Asia Pacific. We would be an economy still built on very emissions-intensive energy production when the rest of the world had moved to clean energy. That is a future that is bleak. It is a future that is very short-sighted. And it is a future we must avoid. That is why I am proud to be part of a party that achieved a compromise on the renewable energy target in order to maintain it. It is a compromise that on some levels is unsatisfactory, but we must accept it so we can get that investment flowing through to the renewable energy industry. It is an investment that is vital not just for the future of that industry but for the future of the nation. I need to be able to look my children, and other people's children, in the eye and say: 'I supported Australia transitioning to a clean energy future—a future where we could compete with the rest of the world on the basis of clean energy production and low emissions-intensity production of manufacturing and other industries.' I commend the bill to the House.
I will not be supporting the Renewable Energy (Electricity) Amendment Bill 2015 that is currently before the Australian parliament. In my view, the renewable energy target—the RET, the deal the coalition has been forced into with Labor—will achieve only three things. It will increase the cost of electricity for those who can least afford it, Australian taxpayers will have spent billions of dollars subsidising private enterprise, and, come 2020, environmentalists will have little more to show for it than a warm and fuzzy feeling.
Let me explain. When I entered parliament in 2013 I was still a registered professional electrical engineer in the state of Queensland, and I promised to be a common-sense voice for the people of Hinkler and regional Australia. Over the past 18 months the issue raised most often with my office has been the spiralling cost of electricity—and for good reason. The median personal income in Hinkler is just $411 a week—just $411. A substantial number of pensioners call Hinkler home, and we have one of the highest unemployment rates in the country. Unfortunately, many of Hinkler's major employers are making workforce decisions based on the cost of energy—local foundries, farmers and manufacturers all say their overheads are rising at an unsustainable rate. Any relief businesses and households might have felt with the repeal of Labor's carbon tax quickly turned to dismay when Queensland electricity retailers substantially increased their tariffs. The end result was a net price increase of about five per cent. It is no coincidence that in 2013-14 the number of households in regional Queensland disconnected for debt or non-payment rose 87 per cent to 12,454. The Fraser Coast Chronicle last week reported that the local Meals on Wheels electricity bill jumped from $5,700 to $12,200 in just one year. The not-for-profit organisation says it has only two choices if it is to remain viable: to either increase the price of the meals or find $85,000 to buy solar panels.
What is the solution? I have heard politicians on both sides tell people to shop around for the best rate. That might be possible in the capital cities, but there is generally only one retailer in most regional communities. The lack of market competition will only worsen if the Queensland Labor government proceeds with its plan to merge state-owned corporations Ergon, Energex and Powerlink. The merger, combined with already high electricity prices, falling energy consumption and the renewable energy target, will result in substantial job losses in the energy sector. We heard a lot from the Electrical Trades Union during the January 2015 state election, but why aren't they out there actively fighting for their members' jobs right now?
In his second reading speech to this bill, the Minister for the Environment, Greg Hunt, said the renewable energy target introduced by the Rudd government resulted in:
… new subsidised capacity … being forced into an oversupplied electricity market …
I appreciate the government is trying to put the RET on a sustainable footing, but, in my view, this current legislation will still result in an increase in power prices, paid for by the people who can least afford it. Australians are using less electricity now than they were 10 years ago. The AEMO Electricity statement of opportunities report in August 2014 stated:
More than 7,500 MW would need to be removed from the market to affect supply-adequacy in 2014-15.
There is potentially between 7,650 MW and 8,950 MW of surplus capacity across the NEM in 2014-15.
Under any risk scenario, no additional capacity is required for at least 10 years. It also states that approximately 90 per cent of this excess is in New South Wales, Queensland and Victoria. Furthermore:
As operational consumption grows, the level of surplus capacity decreases. However, even with 10 years of consumption growth, by 2023-24 between 1,100 MW and 3,100 MW of capacity could still be withdrawn from each of New South Wales, Queensland, and Victoria without breaching the reliability standard.
The problem is that forecast consumption is expected to fall by 1.1 per cent per year at a minimum.
Current renewable technologies like wind and solar do not reliably generate power on a constant basis, and so the baseload coal or gas fired power stations still have to maintain capacity for peak use times when the sun is not shining and the wind is not blowing. Most of that peak occurs in the evening, after dark and, in many locations, when it is calm. Without some type of affordable storage system, there is no option but to maintain baseload power, and that will continue to force up the price of electricity. Put simply, if your running costs remain the same and you are selling less product, the next logical step is to increase the price of the product to be able to maintain your operations.
However, the Australian Energy Regulator, the AER, has advised of its plans to restrict Ergon Energy's proposed revenue by 27 per cent over the next five years, well below the $8.24 billion that Ergon requested. The measure is expected to save Ergon customers between $16 and $44 in network charges on their bills each year. The savings would have been substantially higher if not for the exorbitant feed-in tariff offered to solar users by the former Queensland Labor government. In very simple terms, the AER makes its decisions based on how much the businesses need to spend delivering electricity prudently through the distribution network, putting an end to the so-called 'gold-plating' that occurred in the Beattie years. The AER says any costs above efficient levels are to be funded by the network owners and not the customers. On the one hand, federally we are trying to keep power prices down for consumers by reducing the operating expenses and revenue of electricity companies; but, on the other hand, our current environmental policies are inflating the price of electricity because, without baseload power, you have to start turning the lights off.
The public expects coal fired energy companies to maintain the same availability and readiness, but the renewable energy target encourages people to use more renewables in an already oversupplied market. To give you a simple example, I spoke with a pensioner in my electorate last week. He gets up in the middle of the night, each and every night, to turn off his refrigerator so he does not use as much electricity. He relies on his rooftop solar to power the fridge during the day, and he would rather risk food poisoning than run up an electricity bill that he cannot afford to pay.
I would support the move towards renewable energy if wind, solar and battery technology actually worked—meaning if it were capable of reliably supplying electricity during peak periods to replace traditional baseload power generators. Plus, the cost at this point in time is astronomical.
Under this bill, $15 billion will be spent over the next five years on infrastructure that will run concurrently with coal fired generators, supplying into a market that is excessively supplied. Broad estimates by the department indicate that renewable energy certificates from 2015 to 2030, at an average of $47 per certificate, will cost $24 billion. If the RECs are allowed to reach penalty at $93, the cost to users will be $43 billion. Can you imagine the response if we went to the Australian people and said they needed to contribute an additional $43 billion through their electricity pricing as a surcharge? To meet the target, Australia will need to build as many renewable generators in five years as we have built over the past 15—all of which will need to be replaced in the short to medium term, when the technology outdates and the equipment deteriorates. Putting aside the cost of building the infrastructure, renewable energy is extremely expensive to generate. Coal fired power costs about $36 per megawatt hour to produce, compared to $190 per megawatt hour for solar and up to $120 for wind. If renewable energy were a sound investment, governments would not need to subsidise private businesses with renewable energy certificates.
I find it absurd that we on the conservative side of politics have abandoned the stated belief in the free market to reach a deal with Labor. Labor's recalcitrance will only hurt the very people they always purport to represent, and that is the poor. The Coalition's Direct Action Plan costs around $14.50 per tonne of carbon abated at its first auction. That is compared to $25 under Labor's carbon tax and a whopping $95 to $175 per tonne of carbon abated through the renewable energy target for the small systems scheme. Rather than subsidising jobs in private renewable energy businesses to the tune of almost $200,000 each over the period 2015 to 2030, we should be spending taxpayers' funds on research to advance renewable technologies that have real promise—growing our fuel, finding cheap and effective storage sources and ensuring ongoing jobs in Australian manufacturing through competitive energy pricing. The enormous buckets of money thrown at renewable research by Labor was haphazard and predominantly unsuccessful in large-scale trials.
I have personally worked in hydro power stations that have been operational for more than 50 years and they will continue to work into the future. These plants provide a multiplying effect into the local economy, providing water storage, generating capacity and long-term infrastructure with real benefits. They are a true renewable, with their energy source replenished every time it rains. The greatest of these installations is, of course, the Snowy hydro scheme. Hydros can be used as peakers. They are flexible and can be run up quickly, and at night, when there is no wind or sun, they still work.
If you really want to do something about emissions, we need to be having a proper debate about zero-emission next-generation nuclear technology. If you want renewables, we should consider growing the fuel source. Spend money on research for natural fuel sources such as biomass, where every year 100 per cent of the fuel supply can be regrown, providing long-term jobs. There is a proposal floating around for loans for irrigators to install solar pumps. Unfortunately, they will only be able to irrigate when the sun is shining—and it is back to the bad old days of watering in the middle of the day, when evaporation is at its highest. All of those years of water-use efficiency and capital installation down the drain. Typically, irrigation only occurs during times of low rainfall and drought, when water is scarce, but it is either be killed by electricity bills or invest in capital.
The public perception is that we have not done enough with respect to renewable energy. In fact, there was a large amount of capacity before the target was even set. The price of installing rooftop PV solar has fallen substantially. In terms of installed capacity, that is, gigawatts, rather than generation, that is, gigawatt hours, coal is currently only providing around 50 per cent of the energy mix. To even come close to meeting the target set in this bill, around 1,500 to 2,000 wind turbines would need to be built. Wind turbines are intrusive, ineffectual and always best placed in your neighbour's property, and out of view of your own. The remaining sites capable of having any chance of even 30 per cent utilisation for wind turbines are very limited, because you need a location where the wind blows consistently, of which there are not that many. And it should be close to where the energy is used.
Do I honestly think they can install the capacity needed to meet the reduced target? My answer is no. We will be back having this debate again in two or three years' time, when it becomes apparent that even huge subsidies will not be enough to get sufficient facilities built. If you want to subsidise businesses, subsidise exporters that create long-term jobs. Do not subsidise businesses that devalue and destroy assets already predominantly owned by the taxpayer.
Every business owner in my electorate would like to have the upper hand against their competitors. They would love to receive a guaranteed price for the products they produce, regardless of need, subsidised by someone else. If—and I say if—Australia meets its 2020 renewable energy target, it will not be because we have created an economically self-sustaining, reliable source of renewable energy. People will be using less coal-fired electricity for one reason only: they simply cannot afford it.
Labor has been a longstanding supporter of renewable energy in Australia and we will continue to be so in the future. As a country with abundant solar, wind and wave resources, and the world-class skills and expertise to turn those resources into reliable energy, Australia has been a world leader in the renewable energy sector.
All of this, however, has been put in jeopardy by the Abbott Liberal government. Billions of dollars have gone to other nations because of the uncertainty created by this government's broken promise on the renewable energy target. By 2013, under Labor, Australia was rated one of the four most attractive places in the world to invest in renewable energy, alongside China, the US and Germany. Under this government, we have now dropped to tenth. Investments in large-scale wind, solar and other clean energy sources plummeted 88 per cent in 2014 to $240 million, the lowest level since 2002. The reckless behaviour of the Abbott Liberal government has effectively driven investors in the renewable energy sector offshore. This is Australia's great loss: a loss of jobs—important jobs of the future—and a massive setback for our efforts to reduce carbon pollution.
Conversely, under Labor's guidance and commitment to the future, the renewable energy sector flourished. Homes with rooftop solar grew from around 7,000 to more than 1.2 million, including around 9,000 homes in my electorate of Newcastle. That's right: under Labor's leadership, Newcastle installed more rooftop solar panels than the nation as a whole had prior to the election of the Labor government. Wind power in Australia tripled. Jobs in the renewable energy sector tripled, with more than 21,000 Australians employed in the sector, 4,000 of where were in New South Wales. More than $18 billion was invested in wind and solar farms, hydro plants and renewable energy technology development. The Australian Renewable Energy Agency, ARENA, which was established by Labor in 2012, invested more than $60 million in my electorate of Newcastle, with private funds taking the overall investment in just two years to more than $100 million—and that is just in my electorate. What is the government's reaction to this investment and economic boost? They attempt to abolish ARENA.
Not only were there economic benefits to Labor's commitment to renewable energy but there were very big environmental benefits as well. The explosion in renewable energy in Australia saw carbon pollution from the electricity sector come down. Between June 2012 and June 2013, emissions from the electricity sector fell by more than seven per cent. Under this government, however, emissions are headed the other way. Research by energy consultant pitt&sherry released last month showed brown coal's share of the main national electricity grid surging to its highest level since September 2012, increasing the sector's greenhouse gas emissions.
Unlike the Abbott Liberal government, Labor firmly believes renewable energy is the way of the future. The rest of the world is marching towards a clean energy future. Rather than lagging behind other nations we should be out there leading the way. We have the brightest minds, so we need the best government policy and funding commitment to support them. My electorate of Newcastle hosts some of the leading researchers in clean energy, based at the Newcastle Institute for Energy and Resources and the CSIRO's flagship energy centre. World-leading projects and scientific breakthroughs should be harnessed and developed locally, here in Australia. We must be able to realise the potential that is on our own door-step.
With all of this considered, we have to ask why we are here debating a bill to reduce the renewable energy target, the very policy that underpins the success of Australia's renewable energy industry and sets us on a pathway to a clean energy future. We are here because of a broken promise from the Prime Minister. Shortly after the election, the Prime Minister backflipped on one of his pre-election commitments—to retain the renewable energy target at 41,000 gigawatt hours, by 2020. Even though the Prime Minister has made a habit of breaking promises after the election, this broken promise did take us by surprise, simply because it just made no sense. The RET had enjoyed nearly a decade of bipartisanship—the Prime Minister voted for John Howard's initial RET legislation, in 2001, and then again in 2009 and 2010, when the Labor government expanded the legislation. The first sign we had that the government was walking away from its pre-election commitment on renewable energy was when Tony Abbott went on commercial radio in 2013 to peddle his myth that renewable energy drives up household power prices. This is simply not true and was indeed proved wrong by the Prime Minister's own hand-picked review panel, but I will go to that with some detail shortly. Then the Treasurer went on the same commercial radio program and added his own helpful contribution to the debate, declaring that wind turbines were 'offensive' and a 'blight on the landscape'. What a fine contribution to the debate from the man meant to be driving our economy into the future!
There were many more renewable energy related broken promises from this Prime Minister. The $600 million commitment for solar roofs, towns and schools was cut to just $2 million in the 2014 budget. The Australian Renewable Energy Agency had its funding severely cut in the 2013 MYEFO. And then, as I mentioned earlier, the agency was added to the abolition list in the 2014 budget. But the biggest of all the renewable energy broken promises came after the Prime Minister appointed a well-known climate change sceptic to review the renewable energy target. Much to the Prime Minister's shock, he did not get what he was after from that review. Despite the Prime Minister's insistence that renewable energy drives up power prices, the RET review found that the current RET of 41,000 gigawatts per hour will put downward pressure on household power prices in the medium to long term, that it helped drive investment in Australia's renewable energy industry, that it was reducing Australia's carbon pollution, and that it was creating jobs in Australia. Yet the Prime Minister's own hand-picked panel recommended either abolishing the RET altogether or cutting it significantly. The Prime Minister chose to cut the RET by more than 40 per cent.
This enormous change in policy sent shock waves through the renewable energy sector. The bipartisanship that had underpinned the industry for more than a decade had been shattered. That bipartisanship drove billions in investment, secured jobs and saw the industry flourish. It was the solid foundation that investors needed to make commitments that span decades. When the government shattered that bipartisanship, Labor knew it needed to be returned in order to give the industry the certainty they needed to attract investors to major projects. But Labor was not willing to do a deal with a government that would see the industry ruined. We did not accept the initial proposal to slash the RET by 40 per cent.
Throughout the entirety of the negotiation, Labor has been guided by the advice of the industry on what is best for them. We have reached an agreement now with the government that will see around 25 per cent of Australia's energy generation coming from renewable sources by 2020. The Clean Energy Council predicts that the revised target of 33,000 gigawatts per hour will drive around $40.4 billion in investment and create more than 15,000 jobs. The agreement will see projects start to be built again and businesses enjoy certainty that will allow them to assure their staff's job security.
Labor's negotiation principles throughout did not change, and I am pleased that the following outcomes were achieved. There has been no change to the small-scale solar scheme, which includes rooftop solar and solar panels for small businesses such as nursing homes. We have achieved a full exemption for emissions-intensive trade industries, which relieves some pressure on those industries that are enduring downturns and job cuts. And thankfully we have removed the two-year review that the government wanted to put in place. This provides the long-term security and certainty that the industry so desperately needs to survive and thrive. The exemption for emissions intensive trade industries is of particular significance to my electorate of Newcastle, with more than 1,000 people employed at Tomago Aluminium. Over the course of the RET negotiations I met with both the management of Tomago Aluminium and the unions to listen to their concerns about the RET and their ideas for the future. While supportive of the renewable energy target as a policy direction for the nation, Tomago Aluminium emphasised their massive reliance on electricity, with no viable alternative in sight. I am glad Labor has been able to secure a full exemption for emissions-intensive trade exposed industries like Tomago Aluminium and that the government has seen fit to correct what was an anomaly from the prior Liberal government. That is good news for the 1,000 men and women working at Tomago, for their families and for our region.
Finally, I would like to touch on the one remaining aspect of this bill that Labor does not support. We are disappointed that the government continues to pursue its plans to include burning native forests in the RET. Labor opposed this in government and we oppose it in opposition. Burning native forests for energy is neither clean nor renewable. We simply do not see a case for its inclusion in the RET, and we will oppose it. Renewable energy has a bright future under Labor. We have said that if elected in 2016 we will use the 33,000 gigawatts per hour as a floor to build on, not a limit. We will top up the 2020 RET, and we are consulting with industry and the finance sector to develop an ambitious renewable energy policy beyond 2020.
Labor knows that renewable energy is the way of the future. It is the way of the future for the environment. It is the way of the future for our economy. It is the way for jobs of the future. We know that Australia needs to transition to a clean energy economy, and Labor is the only party with the will and ambition to see that happen. Labor does support the majority of this bill, although we do not, as I said, support the last-minute, petty inclusion of the native wood waste biomass in the RET. I urge the government to take this out of the legislation. It has no place in the RET. It is time for our nation to move forward with an eye on the future, and there is no time to waste.
I rise to speak on the Renewable Energy (Electricity) Amendment Bill 2015. Firstly, by way of background, the previous legislation had our renewable energy target set at 20 per cent of our electricity production by 2020. I am not sure what the wisdom of 20 per cent by 2020 was, other than that perhaps it had a nice sound or a nice ring to it. The RET as modelled in the original legislation would have required 41,000 gigawatts of electricity to be produced to achieve that 20 per cent target by 2020. But this was just another example of the reasons we need to always be aware of economic modellers when they believe they can foresee the future. As economic modelling often is, this was, again, hopelessly wrong. They did not factor in the effect that schemes such as the RET, the solar subsidies and the carbon tax—all these wonderful so-called green schemes!—would have on the price of electricity.
In the decade between 1990 and 2000, we had a four per cent total increase in the price of electricity. But, since 2007 to 2013, the price of electricity for Australian consumers and Australian households doubled. There was a 100 per cent increase from 2007. If electricity prices double—surprise, surprise!—you will get some reduction in demand. That is exactly what happened. It looks like our electricity demand will actually be 20 per cent less than where we expected it to be by 2020. again, That is 20 per cent less than what the experts foretold.
Currently, we are generating around 18,000 gigawatts of what is classified as renewable energy. This legislation in front of us that we are debating here today proposes to reduce the target down from 41,000 gigawatts to 33,000 gigawatts. Effectively, here today, we are locking in the need for this country to build another 15,000 gigawatts of electricity by 2020, the majority of which will come from wind turbines. This will effectively require around 2,000 additional wind turbines to be built throughout our nation. Many members, especially on the other side, have spoken up and said how wonderful this is. I would suggest that we could perhaps share the joy. We could each volunteer to have in our electorates a proportion of those 2,000 wind turbines. Then we will see how many members of parliament are still standing up and saying how wonderful this idea is to roll out another 2,000 wind turbines throughout our nation.
Here is the kicker: we as a nation do not need to spend one additional cent on any electricity generation capacity because we have a market that is oversupplied at the moment. So by resetting the target to 33,000 gigawatts all we are doing is creating a taxpayer subsidised, make-work program for the wind industry. Despite some of the nonsense peddled during this debate, wind turbines are simply not a cost-effective way to generate electricity. No-one in this country would build a wind turbine unless they received some type of subsidy. Wind turbines do not run on wind; they simply run on subsidies.
I have heard during this debate that somehow subsidising wind turbines will make the wholesale price of electricity cheaper. But 'wholesale price' is a completely meaningless term. It is simply a single cost point along the supply chain which is meaningless. What counts are the cost of production and the retail price to the consumer. It is an absolute and complete delusion to believe that we can somehow reduce the costs of electricity by mandating a higher cost and a more inefficient form of production. That is why this target simply will not work. In short, this legislation will lock in $20 billion worth of malinvestment in wind farms rather than $30 billion. Just think for a moment about all the things we need to do in our nation. Think of the opportunities lost and what could have been done with that $20 billion that will be unnecessarily spent building 2,000 wind turbines around this nation.
During this debate I heard the member for Rankin waxing lyrical about our nation's investment in solar. I believe that sometime in the future solar electricity will have great potential in this nation. Currently, I understand that in some cases in remote locations where the cost of connecting to the grid is prohibitive stand-alone investments in solar can actually be economically viable today. But I suggest the member for Rankin take time to read the recently published report by the Grattan Institute on the cost to this nation of the various solar subsidies. The report revealed that there is a $14 billion asset transfer. It is a subsidy being paid by consumers who do not have solar panels on their roofs to consumers who do have solar panels on their roofs. So I say good luck to those who have taken up these schemes; they are getting a subsidy. But that subsidy—$14 billion of it—is being paid by the majority of citizens of this country who do not have solar panels on their roofs. The Grattan Institute found that, even if we make an allowance for the so-called climate benefits of solar, the costs outweigh the benefits by $9 billion. So the investment in solar in this country by 2030 will see $9 billion of our nation's limited and precious resources—excuse my language, Deputy Speaker Goodenough—simply pissed up against the window.
What has greatly concerned me during this debate, listening to speaker after speaker from the Labor Party, is how clueless those opposite are about how we create wealth and prosperity in this country. The one way you do not create wealth and prosperity is by mandating the use of or having a compulsory requirement for a higher cost method of production. That is how you destroy wealth. That is how you destroy our prosperity. Our wealth and our prosperity is created by entrepreneurs, mainly our small business entrepreneurs, taking risks, experimenting with new ideas, trying out new methods of production, creating new goods and services, and investing in productive assets.
What we are doing by this bill—legislating 20 per cent of our electricity; a total of 33,000 gigawatts—is going backwards in our nation's productivity. This is at a time when we need to be looking at how we can do things more productively. By locking in the construction of another 2,000 wind turbines, we are doing things that are less productive. That destroys our wealth and hampers our ongoing prosperity.
The other fallacy in this debate is that having all these subsidies will create all these wonderful jobs. Under this bill, for every job created, the cost of the subsidies is something like $200,000. That is a great idea. We could create many more jobs if the subsidies cost $200,000. But by building things we do not need, building things that are inefficient, we are simply costing this nation jobs. For every job we create through artificial schemes, through subsidies to build wind turbines, we are destroying more real jobs in the economy.
In this bill I note there is 100 per cent exemption for what are called emissions trade exposed industries. But that exemption merely exposes the fraud or stupidity of those who have talked up this bill. If the RET is really going to lower costs, why do we have the exemption? The exemption is there because this bill drives up the cost of electricity. If you exempt some industries from the harmful effects of the RET, others have to pay more. There are many unintended consequences of this bill, and time does not permit me to expand on them.
Many Labor speakers say the reason we need to have all these—and they deny the additional costs of them—is they deal with climate change. They believe that if we build 2,000 wind turbines across our nation somehow they will change the weather. In truth, the belief that building 2,000 wind turbines will change the weather is little different from those in primitive societies who believed we could change the weather by throwing 2,000 virgins down a volcano.
The first question we should be asking ourselves is: how much CO2 will we reduce by building another 2,000 wind turbines? It is worth noting that a 1,000 megawatt wind farm produces seven million tonnes of carbon dioxide in component construction and concrete, and it requires almost 100,000 truckloads of concrete just for the footings. Then the wind farms need a 24/7 backup of carbon-dioxide-emitting coal fired or gas fired power stations. It is a question about how much if any carbon dioxide emissions will be reduced.
If we are serious about taking steps to reduce our carbon dioxide emissions and our footprint—
Mr Deputy Speaker, I seek to intervene.
Is the member for Hughes willing to give way?
No, I am not. I have a limited time and would rather continue. Most of the time I would be very happy to—
No more virgins down volcanoes, I hope.
Member for Hughes, please proceed.
If we are really serious about reducing the carbon dioxide emissions in this country, building 2,000 wind turbines is a tokenistic act to make us feel good. If we are really serious about having to reduce CO2what we should be doing is looking at replacing our coal fired power stations with nuclear power stations. That is what we should be doing. If we are fair dinkum. If we do not say that, we are simply hypocrites.
In the future, all of us would love to see renewable energy replace fossil fuel, but to do that we have to get renewable energy at a cost below that of fossil fuel. The best way we can do that is not to waste $20 billion on the construction and rollout of another 2,000 wind farms. That money should go into research and development. If we are able to create some form of renewable energy that is at a lower cost than coal or gas we can roll that out not only across the nation but also across the world. By going down the track of spending and investing that money, we are simply making ourselves poorer and making it more difficult for us to achieve that target.
I could go on with this bill for many hours. In conclusion, I appreciate the difficult job the ministers had in negotiating this renewable energy target. This is the least damaging of what was already a damaging bill. Yes, it would have been better if we had got that number lower. That would have made our country more prosperous. It would have helped us create more wealth. It would have helped us invest more resources into the research and development of renewable energy that would actually do the job—rather than simply waste $20 billion on the construction of these 2,000 wind turbines. I thank the House.
I rise to speak on the Renewable Energy (Electricity) Amendment Bill. Energy is front and centre in national economic debates. Twenty-one years ago Labor created the National Electricity Market, the NEM, because Australia needs a robust energy framework and a responsive market. The RET has been part of our National Electricity Market and the national electricity policy framework for about 14 years. But as electricity markets began an unprecedented trajectory, five years ago, we knew that our old energy certainties were not going to continue. We needed to review where we were and where we were going, not just with the network itself but also with the RET. So, although Labor did not support the appointment of Dick Warburton and his committee to do that work—we believed it should have been done by differently constituted group—I thank Dick, Shirley In't Veld, Brian Fisher and Matt Zema for the work that they did. I thank them for the transparency which underpinned their review. It is an important review, and Dick and his team should be acknowledged for their work.
Over recent years, we have seen complexities which both enable and weigh on the capacity and efficiency of our electricity market, and we need to ensure a way forward that will strengthen markets and create a price for electricity that is understood, a price signal that can be both sent and received, and price reflectivity for producers and consumers of electricity. We need to support stronger and diverse growth opportunities for our energy industry and specifically for our renewable energy sector. Diversifying Australia's renewable energy supply through our vast solar, wind, wave and thermal resources make sense. Labor is committed to the renewable energy industry, because, deployed effectively, it is widely supported in our community and it makes economic sense.
Across the world, energy consumers are moving to renewable technologies. As customers they are voting for renewable technologies. In Europe we have seen the massive value of old power utilities and networks destroyed as customers have moved, wiping trillions of dollars off the value of publicly listed electricity generation and distribution firms.
Labor are committed to renewable energy because we know renewable energy is good for the environment, it helps lower carbon emissions and it responds to consumer demand. Energy generation contributes around 30 per cent of Australia's total CO2 emissions, so we do need to look at this sector and we do need to utilise technologies to get it to respond to that carbon footprint. We also need an electricity market that is efficient and that can respond quickly to the needs of consumers and whatever disruption comes next. We need an effective price signal that operates in our electricity market.
The renewable energy target, the RET, plays an important role in diversifying Australia's energy supply. It is also a bipartisan instrument. Labor and the government have sat down in good faith to discuss the future of the RET, and I give due credit to Ian Macfarlane and Greg Hunt for their terrific endeavours and the open and frank way in which we discussed a range of issues. I also give great thanks and pay tribute to Mark Butler and Chris Bowen for the work that they did in order to help negotiate the bipartisan position on this policy issue and resolve the impasse that has been in place for the better part of the year. The conversations and negotiations were genuinely highly useful.
There is a deep, 13-year history of bipartisanship on the current RET that spans the leadership of prime ministers Howard, Rudd, Gillard and now Abbott. Bipartisanship has been at the heart of Australia's nascent renewable energy industry. This industry, much like any industry, craves the certainty created by such strong political consensus. Certainty begets business confidence and allows renewable energy businesses to build, invest and set plans for the future. Bipartisanship paved a solid and reliable path towards investment and growth in renewable energy. Businesses were sure footed when travelling along this path. Consensus is important because we do not want to see the RET revisited based on the vagaries of an electoral cycle.
Australia's progress on renewables was such that, not so long ago, Ernst & Young placed Australia in the top four countries in their renewable energy country attractiveness index. Prior to the last election, Australia sat alongside the economic powerhouses of China, the United States and Germany. Unfortunately, recent events have highlighted the fragility of investor confidence and certainty, and have led to a situation where the two sides of politics had to get together again to safeguard business confidence and create the right environment for investors by settling on a new target. We know the devastating impact that uncertainty has had on the renewables industry. Uncertainty kills investment, and it did no less to the entire renewables economy.
This policy area should not be treated like a political football on an ideological playing field. I want to make it clear that the Labor Party are committed to the RET and that the parliament is also committed to the RET. There is genuine bipartisan commitment to the RET, now at 33,000 gigawatt hours. Labor is pleased that there is finally the basis for an agreement on a RET of 33,000 gigawatt hours. That is a significant shift from the target of 41,000 gigawatt hours; but, if is legislated, we hope it will provide certainty for the industry to restart the building of projects. It should also provide certainty to the energy-intensive trade-exposed sector.
Prior to the 2013 election, the RET of 41,000 gigawatt hours enjoyed bipartisan support for large-scale renewables, with an uncapped program for rooftop solar energy. After the election, the government embarked on an attack on the RET on the basis that it was providing too much capacity to the electricity market and causing price increases. Much of that rhetoric has been rejected by the government's own Warburton review in its report, which was released early last year. Since 2013, we have seen billions of dollars in investment stall and hundreds of jobs lost in this industry. In 2014, investment in large-scale renewables plummeted by 88 per cent.
Labor will not alter the aims of the RET if it regains government at the election due next year. Labor will seek to grow the renewable energy sector further if it wins government next year and will use the revised RET as a floor to build on. Labor believes a strong renewable energy target is a critical part of Australia's response to climate change, and transitioning our economy to a clean energy future is a mission that binds us all together. The RET has been the driving force behind billions of dollars of investment in clean energy that has delivered thousands of new jobs in hundreds of communities through the installation of clean energy systems in thousands of businesses and millions of homes.
Labor believe that renewable energy has an important role to play in Australia's energy mix and that we should rebuild the policy structure required to see the industry return to growth. Labor recognises that energy sector policy is complex and interrelated. It is important, therefore, to get the policy settings right. Labor would take steps to increase the size and diversity of the renewables market and would move to reunite the electricity production sector with the climate change portfolio—reversing the Abbott government's portfolio split. Labor strongly supports aligning electricity generation with climate policy. The reason for that is straightforward: 30 per cent of our CO2 emissions are generated by the electricity sector. It makes sense to reunite these two policy objectives under one policy umbrella. While Labor has convinced the government of the need to maintain the RET and has worked to achieve consensus in this policy area, there are some aspects of the bill that the government has got wrong. My party cannot support the inclusion of native wood waste in the target. Labor does not support burning native forests as a renewable energy source. We oppose it. We opposed it in government, and we oppose it now.
Aside from the inclusion of native wood waste, there is another anomaly in the RET scheme which needs to be fixed and which has been overlooked. The self-generation exemption for the RET allows for incidental amounts of electricity to be provided to external parties. What this means in practice is that in remote areas, especially in my home state of Western Australia, the power generated by, for example, a major minerals processing facility can be used to power telecommunications or television and emergency services communications over remote areas in a cost-effective way. Under the current law, there is a risk that such use may trigger a substantial RET liability—that is to say, the loss of a partial exemption, and that may occur to the minerals processor. This imposes a disproportionate penalty on the provider, which would then make the use of incidental electricity completely uneconomic. The Warburton review recognised this anomaly. In section 712 of the report: 'It is noted that the panel recommends self-generators be permitted to supply incidental amounts of electricity to third parties for community services on an otherwise dedicated line, while still being eligible for the exemption.' Unfortunately, I am informed that the government's current bill does not address this issue.
As the renewable energy target has shown, renewable energy reduces emissions and supports new manufacturing jobs and may also put downward pressure on wholesale power prices. Leaving the RET alone would please some in the industry as well as many members of the community who have embraced renewable energy. Some established investors would be happy. Some newer investors would be unsettled. With excess supply in the wholesale electricity market and with reduced investment in renewables, it would have been a challenge to reach the 41,000 gigawatt hours in the required time frame by 2020 for the RET to stay on track. Modelling conducted by the Warburton review and work commissioned by the Clean Energy Council found that to keep the RET on track we would need an additional newly-built 9,000 megawatt hours of renewable energy capacity by 2020. That equates to around 1,500 to 1,800 megawatt hours of new renewable energy each year to the end of 2020. The Warburton review did encouragingly find a significant project pipeline, including 6,000 megawatt hours of projects that already have planning approval. I accept that some projects in this pipeline have withered, but others will come along. But I do not want to understate how challenging it will be to significantly ramp up our renewable energy build. In 2013 we reached the highest annual wind installation of 655 megawatts, and some predictions have up to 900 megawatts scheduled for installation in 2015. But there is still a big gap between 900 megawatts and the 1,500 megawatts a year that will be required.
We hope that the government heeds Labor's concerns about certain aspects of this bill. I also hope that the considerable areas of bipartisanship that I have mapped out today do create some desperately needed certainty for industry, that this parliament is at least taking a step in the right direction. I congratulate the two ministers, Hunt and Macfarlane, for the work that they have done, and shadow ministers Bowen and the member for Port Adelaide for the work that they have done to ensure that we can reach this deep bipartisan agreement. We also need to accept that, as we continue to progress to reform our energy markets, the RET is only one part of that. We do need to have reforms that orient our electricity markets and our networks in a market-driven way to allow price signals to be sent and price signals to be received. In this context, our regulators and the role that our regulators play in ensuring that our industry works efficiently and effectively and that prices to consumers are kept at levels that consumers can afford to pay is critically important. The AER in that context is a critically important regulator.
I ask the government to ensure that the regulator decisions that are made that support customers, consumers and communities in their desire for affordable, reliable, safe and efficient energy supplies are maintained. I have noted in the past my concern that the New South Wales government's decision to fight the AER's assessments in recent weeks is in conflict with all of those objectives. We need to have governments that support regulators, that support good market outcomes, that support prices for consumers and that are in the interests of all of our community and in the interests of a sound industry. I commend this bill to the House.
I rise to speak on the Renewable Energy (Electricity) Amendment Bill 2015, and I do so with pleasure. My electorate of Petrie is home to almost 40,000 families and 3,000 small businesses. In relation to renewable energy, it will mainly affect my electorate of Petrie with solar, but it may also affect people if targets are not achieved and there is a price to pay and then bills are pushed up. That is the main gist of how it will affect Petrie. More than 20 per cent of homes in the Petrie electorate use solar power. I put my electorate in the top 25 out of the 150 federal seats in the country who use renewable energy. As I said in my maiden speech, I support solar and renewable energy as a way to sustain our beautiful Australian environment and also to harness the resources that we have, particularly the sun.
I want to stress to the households and businesses in my electorate using solar power that this bill makes no change to household solar—the small-scale renewable energy scheme. And in relation to small-scale renewable energy and solar power in particular: the government is a great friend to small businesses, and small solar companies within the electorate of Petrie should be glad about the recent instant tax write-off that we announced in the budget. It is a real opportunity for every solar provider within the Petrie electorate to get out there and to talk to businesses in the area, to say to them, 'Look, you need a new solar system on your building. Now is the time to install it.' A five-kilowatt solar system may cost $5,000 or $6,000 for a good system. Or they may want to get a 10-kilowatt system, because businesses are the ones that can take advantage of solar—particularly in Queensland up in my seat of Petrie.
Most businesses work in daylight hours—pretty well between eight and five—so if they have a solar system on top of their roof then as they are creating the energy they can use it. We know that businesses have lights, air conditioners, computers, power tools or whatever it may be running. This is a great opportunity for every solar installer in the Petrie electorate right now—with this certainty around the RET and also with the $20,000 instant tax write-off—to get out, approach local businesses and say, 'Have I got a deal for you! Let's go.' It is a great opportunity.
We, the coalition government, are committed to a renewable energy target that will encourage sustainable growth in both small-and large-scale renewable energy in Australia. This bill makes changes to the RET to better reflect market conditions. It amends the Renewable Energy (Electricity) Act 2000 to adjust the large-scale renewable energy target to 33,000 gigawatt hours by 2020; it increases the pastoral exemptions for all emissions-intensive trade-exposed activities to full exemptions; and it reinstates biomass from native forest wood waste as an eligible source of renewable energy—and I note that those opposite want to exclude that and add amendments. This will mainly come into place down in Tasmania, but if there is wood waste on the ground that is going to be burnt up in a fire or sit there and rot I cannot see why it should not be used. I am sure that the members on this side of the House and the three fellows from Tasmania here would be particularly supportive of this if it helps to create jobs in Tasmania as well. The bill also removes the requirement for Labor's legislated biennial reviews of the RET.
The bill represents a balanced approach and solar will be the winner, with significant new investment in small-and large-scale solar expected. We have made an agreement with the opposition to legislate a large-scale renewable energy target of 33,000 gigawatt hours by 2020. This will see more than 23½ per cent of Australia's electricity derived from renewable resources by 2020. That is a great achievement. I think we went to the last election promising 20 per cent. Due to the drop in electricity usage, the previous scale was going to come out a lot higher than that. But 23½ per cent is a fantastic place, isn't it? It is a great place to start. Well done to everyone involved.
As highlighted in our energy white paper, Australia has an oversupply of generation capacity, and some of that is aged. From 2009-10 to 2013-14, electricity demand has fallen by about 1.7 per cent per year on average. This is due to many factors: declining activity in the industrial sector, which is not always good news; increasing energy efficiency, which is good news; and strong growth in rooftop solar PV systems, which I have experienced in Petrie—a lot of people are taking that up there, which is fantastic. All of this has reduced demand for electricity sourced from the grid.
While the government welcomes a diverse energy mix in Australia, we also understand that circumstances have changed since that original target was set. The new target represents a much better balance, because it has to be achievable. It covers the need to continue diversifying Australia's electricity generation assets; the need to encourage investment in renewables, while also responding to market conditions; the need to reduce emissions in the electricity sector in a cost-effective way; and the need to keep electricity prices down for consumers. That is really important. I heard the member for Hinkler before, talking about the pensioners in his electorate who are screaming because of high electricity bills. He has a really good point—he has a great point—because if we do not achieve the targets that we have set then there will be penalties. What will those do to the pensioners in the Petrie electorate? Or to the people who cannot afford to put solar on their roof? This is an important question. We all have to work together to make sure the target is achieved, because we do not want those penalties kicking in.
The bill is about protecting jobs in the emissions-intensive trade-exposed sectors by reducing their costs. It will take the common sense action of reinstating native forest wood waste as an eligible fuel source as well.
I do want to take this opportunity to thank the Minister for Industry and Science, Ian Macfarlane. I heard him speak today. He was a key negotiator on this and he speaks a lot of common sense, so well done to him. Thanks go to him for his contribution and, of course, to the Minister for the Environment, the Hon. Greg Hunt, who has been doing a fantastic job as well with this and with everything he does in the environment. This week we saw what he achieved with the Great Barrier Reef. He also exposed Greenpeace for the lies that they were telling about the Great Barrier Reef—trying to pass off some Asian reef destroyed by a cyclone as our Great Barrier Reef. I do not know where theses Greenpeace people and the Greens get their ideas from—they are dangerous! People should not support them.
But thanks to him for what he is doing, and also for what he is doing with the Green Army. I have two projects that have been rolled out in my electorate. The Minister for the Environment has been doing a great job there as well. We thank him and the Minister for Science and Industry for what they have both been doing. It is so important that we protect the environment we live in, now and into the future. I am proud to be part of a government that is delivering in this space.
I want to particularly acknowledge both the ministers in writing into this bill that there will be no review of the Renewable Energy Target until 2020. I still remember all the commotion last year during the RET review that was legislated by the previous Labor government that led to uncertainty. At the time, I had the shadow minister, the member for Port Adelaide, running up around in Petrie and going to forums trying to get some political points. In his speech today he spoke about the uncertainty of the time and that we would have achieved the 41,000 if it were not for us. He was not playing a really good positive contribution, running around the country trying to scare the hell out of people. I think that this will bring certainty to the industry.
By legislating that there will be no RET review until 2020, we will be able to give the renewable energy industry the certainty it needs to grow. Instead of a review, the Clean Energy Regulator will provide an annual statement to parliament on how the scheme is tracking towards the 2020 target, and any impact the RET is having on electricity prices. This bill will give the renewable energy sector the assurance it needs to innovate and develop and it cements our commitment to the Renewable Energy Target that will encourage sustainable growth. This is a good deal for the sector and for Australia and it should be supported.
I rise to speak to the Renewable Energy (Electricity) Amendment Bill 2015. I make it clear that I support the position as outlined by the member for Port Adelaide and supported only a few moments ago by the member for Brand, who also spoke on this bill and who I know was also party to the discussions in the negotiations that ultimately led to the target that is now before us.
The Renewable Energy Target was introduced by the Howard government for a very simple purpose—that was, to reduce carbon emissions in Australia. It is one of many initiatives that have been committed to by both government and the private sector over the years in order to achieve that outcome. And the reason why we want to reduce carbon dioxide emissions in this country is because the planet is warming, our climate is changing and there is increasing global scientific consensus that the global changes that we are seeing are being contributed to mostly because of human activity in the form of creating and producing greenhouse gases, of which carbon dioxide is the major one.
There has been a number of other measures put in place over the years to try and ensure that we actually begin to reduce carbon dioxide emissions in this country and, indeed, across the world. Countries across the world are each in their own way making their contributions to changing the level of greenhouse gas emissions that have been occurring over the last hundred years or so. Each country does so in a way that best fits in with their own economy. But what we are seeing, more so in recent years than ever before, is that the major emitting countries like the USA, India, China and Europe are moving in the right direction in as much as they are making some serious efforts to reduce their carbon dioxide and other greenhouse gas emissions. Each are doing so by different mechanisms and different methods but they are all acting in a way which takes them in the same direction.
Whilst here in Australia, we see the Abbott government taking this country in the opposite direction. The major policy of direct action has been dismissed and discredited by most analysts. It is a policy that pays polluters with little net benefit to the environment or to the country for that matter. In fact, the $2 billion plus that has been allocated to that program, I believe, will be money that will give very little return to Australian taxpayers. As the member for Adelaide recently pointed out, it worked out that for each tonne of abatement that was achieved by this government in the first purchase of certificates, the cost was $600 plus per tonne. That is not good value for the Australian taxpayers.
We saw the Abbott government also try to get rid of the Australian Renewable Energy Agency and the Climate Commission, which is, I understand, now the Climate Council. But this change, the change to the Renewable Energy Target, is only the latest and perhaps the most significant of all the changes it wants to make. The Renewable Energy Target has been in place now for over a decade and it is actually working. It is actually making a difference to the release of carbon dioxide and other greenhouse gases in the Australian atmosphere.
On that point, there are many who talk about the fact that we are only a small player in the globe and therefore our contribution to whether or not there is an increase in greenhouse gas emissions makes little difference to the climate. Whether or not that is true, we have a responsibility as a country within the globe to do the best we can and the most we can to play our part in reducing those submissions, regardless of whether others are living up to expectations or not. I hear it often said by members opposite, when they talk about the current state of the Australian budget. And I heard it only earlier this evening by the Minister for the Environment, the very person who currently has responsibility for the environment in this chamber, when he referred to the intergenerational theft of the previous government by not having balanced its budget.
There is no greater intergenerational theft that I can think of than by a government that reneges on its obligation and its responsibility to manage the issue of climate change. In effect what is happening is that we are passing onto future generations a very heavy penalty for the inaction of this government. It is even worse than that, because, as a result of the inaction of today's government, we may even have effects that are totally irreversible; and future generations will never be able to share, enjoy or be part of our current way of life.
The renewable energy target is indeed working. It has created some 20,000 jobs here in Australia and I understand worldwide there are currently around 7.7 million jobs in the renewable energy sector. That is because countries are embracing the opportunities provided to them by the emerging and growing renewable energy industries. As other speakers have pointed out, the number of solar rooftop panels on houses across Australia increased from 7000 homes when we came to office to 1.2 million when we left office. I believe there has been about 200,000 in the last couple of years. We have almost one million solar hot water systems in homes around Australia as well. There are wind power solar farms, hydro plants and renewable energy technology developments right throughout this country. These have been critical in sustaining and supporting the manufacturing sector in Australia at a time when that sector has been hit hard by other policies of the Abbott government.
I have spoken to businesses in my home state of South Australia about how important the renewable energy sector is to the future of the many manufacturing businesses which faced dire consequences of the Abbott government having orchestrated the collapse of the automotive industry in this country. The member for Port Adelaide mentioned the company IXL, which I visited with him and where we saw exactly the opportunities presented by the Renewable Energy Target. IXL had made the transition from automotive component manufacturing to making the frames for large solar panels for use in the large solar projects we will see around Australia. That the firm had two projects—one it was working on and one it had put on hold because of the confusion and uncertainty surrounding the Renewable Energy Target. Dozens of jobs were in limbo as a result of the government wanting to change the Renewable Energy Target. Tindo Solar, which is another company in my electorate, made the point very clearly: it was the Renewable Energy Target that was sustaining its business of making domestic solar panels. I understand that Tindo is the only home solar panel maker in Australia and it is very supportive of the renewable energy target. Other companies interstate made it absolutely clear that, if the Renewable Energy Target was interfered with in any way, they would have to shed jobs.
I can think of only one reason that the government would want to change the current target, and that is to protect the fossil fuel companies and the electricity generators of this country that provide most of the electricity at the moment. There is no other logical reason. The argument used by members opposite—that we can achieve a 20 per cent reduction in emissions by 2020 and therefore the 43,000 gigawatt target needs to come down as well—does not stack up. If we surpass the 20 per cent target, what is the problem? What is wrong with going beyond the 20 per cent target that we have set ourselves? That, indeed, was a minimum target; there is nothing to stop us from going further and, if we do, it means that we have contributed even more than we had planned in reducing greenhouse gas emissions in this country and across the world. That is exactly what we should be doing—when we should set only minimum targets rather than targets that we cap when we reach them.
The last point I would make is this: the uncertainty that has been created by the Abbott government in wanting to change the target has clearly affected the renewable energy sector in this country. The Clean Energy Council has made statements to the effect that there is about $10 billion worth of investments in the pipeline which would be affected or, conversely, would proceed and create thousands of jobs if a worthwhile target remained in place. There have been similar claims by other stakeholders operating within the sector. My view is that the RET is important, firstly, for our contribution towards tackling the issue of climate change; secondly, it offers opportunities for new businesses and new technologies; and, thirdly, it sustains what is already a major industry sector in this country. For that reason the work done by the government and the opposition in trying to reach a target is important. I do not agree with bringing in the changes that the government proposes in respect of the burning of woodchips, and the like, as part of the Renewable Energy Target. I do agree that, at the very least, we need to have certainty in the industry, and hopefully this legislation achieves that.
I rise to speak on the Renewable Energy (Electricity) Amendment Bill 2015. The legislative amendments to the RET restore some of the balance in the RET scheme. I will make some comments on the member for Makin's contribution to this debate. We should get a few things clear here. The uncertainty in the renewable energy sector has been caused by the reluctance of the Labor Party from 2013 up until now to be involved in negotiations. As the member for Makin leaves the House, I will remind him of his 2008 contribution to the debate on the ill-fated emissions trading scheme, where he said in this place that, if we did not pass Kevin Rudd's emissions trading scheme, the heatwave in Adelaide would never come to an end.
This bill is a victory for common sense. It overcomes some of the ideological mumbo jumbo that we see come out of this place and puts some certainty into the RET. Without this bill, the RET would revert to its default position, which would mean that the whole RET would be in jeopardy and the cost of electricity would go through the roof. So I do support this legislation.
My colleague the member for Hinkler made a very measured and well-resourced contribution to this debate tonight. This bill is about altering the RET; it is not about whether we have one or not. I want to make it clear to people listening to me tonight that I am supporting this bill because it brings the RET back to a more achievable level. Not to support this legislation would see the RET go to the default position, which would be disastrous.
The Parkes electorate is quite a leader in renewable energy, with solar farms at Nyngan, Moree and Lake Cargelligo. All three different styles will play an important role in filling in some of the gaps in electricity transmission in New South Wales. Their location away from the generators in areas of high levels of sun make them ideally placed to play that role.
It is important in this renewable energy debate that we respond in a practical and measured way. The ideological drive by the Left needs to be called for what it is. Our electricity consumption is dropping not because we have become superefficient; it is because we are turning off and using less. Unfortunately, many of the people making that sacrifice are the ones who can least afford to do so—the elderly and small business. This bill brings some certainty into the RET, and it will have a twofold effect. It will have a target that is achievable and it will also put some certainty into investment so that those projects that are in the pipeline, those that have had a significant amount of investment, those that are waiting for approval, will now have the certainty to go ahead.
The solar farm at Moree is the most recent one in the Parkes electorate. It is an ideal location for a solar farm, in an area of flat ground, supported by a large community. If renewable energy is going to mature, we need projects like this one. Renewable energy, whether it be wind or solar, is probably in its early stages of development. If we are going to get to a more efficient level of generation from the sun and wind, we have to put up some large-scale plants so that engineers get experience in constructing them and, as time goes by, we will become more efficient.
I understand that the Holy Grail of the alternative energy industry will be a battery that can store electricity in an economical and efficient manner. In places like Silicon Valley in the United States, billions of dollars is going into such a development, so solar and wind will be complete alternatives rather than, as they are at the moment, additives to our energy generation. As the member for Hinkler rightly pointed out in his contribution, we are still reliant on fossil fuel power generation, which we need at peak times and at times when either the wind does not blow or when the sun is not up. The member for Makin, whose home state of South Australia has the largest reliance on wind, will know that in the recent past that state has had a large number of problems because of its complete reliance on wind without having an adequate mix of other forms of technology.
The Nyngan solar farm will certainly be the largest solar farm in Australia, and the construction of that is pretty well completed. It has been a wonderful project for the Nyngan community. There are projects like the Bodangora wind farm, near Wellington, which is in a relatively isolated area and, I believe, there is now the opportunity for that project to go ahead. It will more than likely happen. With the wind farms, it is important that the needs of close neighbours are taken into account, and that they are placed where they can get maximum draw-down on the wind, but do not cause problems for nearby neighbours.
While we have the minister and the shadow minister in the chamber now, I would like to commend them both for coming to an agreement on this. The statements made by previous speakers in here from the Labor Party, blaming the uncertainty in the industry on the coalition government, are certainly incorrect. That uncertainty will now be behind us and we can get on with the job at hand. I commend the bill to the House.
I move:
That the question be now put.
The question is that the question be put.
The question now is that this bill be read a second time.
A division having been called and the bells having been rung—
As there are fewer than five members on the side for the noes in this division, I declare the question resolved in the affirmative in accordance with standing order 127. The names of those members who are in the minority will be recorded in the Votes and Proceedings.
Question agreed to, Mr Katter and Mr Wilkie voting no.
Bill read a second time.
by leave—I move amendments (1) to (4), as circulated in my name, together:
(1) Title, page 1 (lines 2 and 3), omit "and the Renewable Energy (Electricity) Regulations 2001".
(2) Clause 3, page 2 (line 11), omit "(1)".
(3) Clause 3, page 2 (lines 15 to 17), omit subclause (2).
(4) Schedule 1, Part 4, page 13 (line 1) to page 15 (line 2), omit the Part, substitute:
Part 4—Wood waste
Renewable Energy (Electricity) Act 2000
1 At the end of section 17
Add:
Wood waste
(6) Despite anything in regulations made under subsection (3), wood waste does not include waste, or a product or bi-product, that is or is derived from biomass from a native forest.
I will not detain the House. I spoke to them in my contribution to the debate on those amendments.
The question is that the amendments be agreed to.
I will be brief also. The amendments that have been moved by the opposition do deserve some consideration in detail. I presume they are in relation to biomass from native forests being excluded from the renewable energy target. That is not the opinion of the government.
Honourable members interjecting—
Member for Lyons, just one moment. Could those members who are still carrying on a conversation please return to their places in this chamber or leave the chamber quietly and allow the member who is on his feet to be heard in silence.
I appreciate that; thank you indeed, Deputy Speaker. Biomass is, indeed, a very important part of the renewable energy target, particularly in my state of Tasmania. This was a federal Labor policy from 2007 until as recently as November 2011. The former member for Lyons, Mr Adams, at the time was the chair of a committee which, even as recently as October 2011, voted in support of the very measures which the Labor Party are now trying to remove from the renewable energy target. It is gross hypocrisy.
The support comes from an astounding array of quarters. I remember very well 19 June 2013. Why do I remember it very well? It was my birthday, and I took the time out to drive all the way down to Hobart to listen to a fellow by the name of Professor Andreas Rothe, who had been doing some work. He is from the German University of Applied Sciences Weihenstephan-Triesdorf in Freising, Bavaria. Professor Rothe estimates that as much as 3.3 million tonnes of biomass could be sourced for bio-energy from sustainable forestry in Tasmania. He gave an excellent presentation. There were a number of people there, including Peg Putt. And there were others there eagerly listening to what he had to say. And what he said made sense.
I also might draw to the attention of those who have remained in the chamber a publication put out by the World Wildlife Fund, the WWF: 'Biopowerswitch! A biomass blueprint to meet 15% of OECD electricity demand by 2020'. If I may be indulged to quote from this, it refers to the threat of climate change. It says:
If we really want to prevent catastrophic climate change, we will have to make radical alterations to the ways in which we generate energy. One major solution lies in the contemporary, cutting-edge use of the oldest fuel known to man—wood.
Woody biomass—also known as biomass from forestry and farming—has the potential to become a major source for future electricity and heat production. By utilizing modern and efficient technologies, biomass offers a source of clean energy that can gradually replace coal and other fossil fuels, bringing environmental benefits, supporting rural development and creating new employment opportunities.
If it pleased the opposition, I would be very happy to table the research paper entitled Current and potential use of forest biomass for energy in Tasmania, published by Professor Andreas Rothe, Martin Moroni, Mark Neyland and Matthias Wilnhammer, and also the document entitled Biopowerswitch!—a biomass blueprint to meet 15% of OECD electricity demand by 2020.
Leave not granted.
The other point I would like to make in conclusion is that this is supported by the ALP in Tasmania. This is supported rightly by the ALP in Tasmania. They are in absolute conflict with their federal colleagues. I call on the member for Franklin in particular to stand up for her state, because this is important for Tasmania. The science on climate change is in. It is documented here before us. This is a no-brainer. I call on the Labor Party to examine their conscience. This was their policy between 2007 and 2013. I call on them to reconsider the position on which they are advocating now.
I must start my contribution by expressing my disappointment at the fact that this debate has been truncated. It is a very important issue. There has been a lot of negotiation going on for a very long period of time. I would particularly like to congratulate the shadow minister. He has been vigilant in ensuring the best possible outcome can be achieved. Labor have been long-time supporters of renewable energy. Renewable energy is the energy of the future. Renewable energy is about jobs of the future. Renewable energy is about the 21st century. I welcome the fact that we finally have reached an agreement, because the indecision and the uncertainty that has surrounded the RET for such a long period of time has led to loss of confidence in the industry and loss of jobs. Australia was ranked fourth in the most attractive places to invest in renewable energy and is now ranked 10th. It is disappointing that it has taken so long to reach the point we are at night, but it is important to note that we have now and it is important that we move forward.
I support the amendment that is before the House. I disagree strongly with the previous speaker. I do not believe that it is the right way to go to include the burning of native woods. We need to have the renewable energy target without that. Just to give you an idea of how popular renewable energy is, I heard the member for Parkes speaking earlier, saying that the reason that people are using less electricity is that they are turning off their power. I disagree strongly with that. The Shortland electorate has embraced renewable energy, but not as much as other electorates have. It is the 107th out of 150 electorates. In the Shortland electorate alone, there are around 5,000 homes that have solar. I was speaking to people in a business in my electorate—a large not-for-profit organisation—and they told me that they are about to install rooftop panels and it will cost them $100,000. Going forward, they will recoup that within two years because it will reduce the cost of their electricity and any excess will go back into the grid.
Renewable energy is something that as a nation we should embrace. Australia is one of the countries in the world that is in the best position to take advantage of renewable energy. It is jobs for the future. It is a smart approach to energy and it solves a number of the problems that this parliament has grappled with over the years. I commend the amendment to the House. I support the fact that we now have finally agreed on a RET target. I look forward to it passing through both houses of parliament and look forward to the amendment being successful.
I do not have the time to add cane fibre to the wood waste, which is a very similar argument. But I commend the government on protecting the principle, which was laid down by the Prime Minister, that, if the government has agreed and people have changed the goalposts, then it is very unfair. The goalposts should not be changed when someone has outlaid serious amounts of money. So I commend the government on what they are doing from that point of view.
As an ex-energy minister in Queensland, when I handed over to the socialists in 1990, we had the cheapest electricity in the world. I find now that I am the socialist in Queensland, not the ALP. The price for electricity was then $670 a megawatt and it stayed at that price until 2001, until deregulation. All the wonders of the free market came in and, under the wonders of the free market, we are now paying $2,460. It is a furphy for the government to say that that comes from renewables and all those things. The hypocrisy of the Labor Party, talking about the poor people! Heavens to Betsy! You have taken the cost of generating power from $30 a megawatt hour to $140 a megawatt hour. And I was on the committee of this parliament that had those figures put before it again, again and again. So they most certainly have contributed to that, but it is a very small contribution. It might account for $60 or $70, but it does not account for $2,400. It is the free marketeers, with their dock system, who can take all the credit for that.
If I had the time to move this, I would—and it should be in this amendment—bagasse from sugarcane fibre. You squeeze the sugar out, you turn the sugar into ethanol. The proposed power station, which is a huge ethanol plant south of Charters Towers and on the Burdekin River, the Upper Burdekin Irrigation Scheme, will reduce Australia's electricity emissions by one per cent. Just one single project will pick up half of the entire northern grid. Half of the power for the one million people who live in North Queensland will be picked up one single renewable power station, which does not put any pollution into the atmosphere at all. I represent the Barrier Reef, but I do not go along with global warming. However, there is a problem that arises in the oceans and that needs to be addressed.
Brazil now uses ethanol for 66 per cent of transport and if it is done the modern way that reduces carbon emissions by 72 per cent. So the answers are there. Yet the decision of the left-hand side and the right-hand side of this parliament is to send $25,000 million a year to Middle Eastern oil producers, instead of sending it into rural Queensland to enjoy petrol prices. America is now, by a long way, the biggest ethanol producer in the world. Americans are paying 62c at the bowser. We are paying 142c at the bowser. The Brazilians, last time I looked, were paying 67c at the bowser, not 142c.
So why aren't we doing it? Why are we having this huge argument here about RETs, which are absolutely ridiculous. The amount of reduction is negligible. And I speak with great authority, because I won a science prize for putting in the first stand-alone solar system in the world. It was in the middle of nowhere and solar energy is relevant in the middle of nowhere. It is most certainly not relevant when you put it on a roof in the middle of a big city. It takes your costs up straight through the roof! I applaud the government from that point of view, but I most certainly do not applaud them for the free-market policies which they and their political opponents enjoy and which has skyrocketed the electricity charges, from $670 to $2,460, in Queensland in the space of one decade, when they were static for the 10 years before that.
Again, I finish by saying the RETs and the agreements that were entered into by Mackay Sugar— (Time expired)
I am pleased to make a brief contribution to the debate on the Renewable Energy (Electricity) Amendment Bill 2015. I support the amendments and therefore support the bill in its amended form. I would like to pay tribute to the great work that has been done by the member for Port Adelaide and the member for Brand in working with the Minister for the Environment to ensure that we actually reached this point. Because for the last 18 months there has been a capital strike in the renewables industry. Australia has moved from being in a position where we were one of the most favourable places on earth to invest in renewable energy, to being in a position where next to no investment has gone into large-scale renewables.
It matters to an area like mine, which is going through a massive transformation and investment in renewables. Investment in jobs of the future and in the manufacturing that will support them is absolutely critical. In New South Wales there are over 4,500 jobs in this sector. BlueScope Steelworks are investing heavily in combining their world-beating Colorbond product with solar-energy-capturing technology to ensure that the one panel can both cover the roof and collect the energy that can be converted into electricity. It is this sort of investment which the former Labor government was supporting, together with the great work being done at Wollongong university, which will ensure that manufacturing has a future not only in my region but in this country. The program is actually working. We cannot stick our heads in a bucket of sand, as many would like us to do. I support the bill, I support the amendments and I think if we are able to get over these road bumps that we currently have, large-scale renewable energy in this country has a very bright future indeed.
So there is no misunderstanding, I want to make it clear that I oppose the substantive bill, the Renewable Energy (Electricity) Amendment Bill 2015, because lowering the renewable energy target is a bad decision. It is not in the best interests of the environment and it is not in the public interest. We should be aiming for a much-increased renewable energy target. We should be doing everything we can in our power to put this country on a pathway to a much greater reliance on renewable energy. That is in the public interest and it is in the best interests of the community.
I will support amendment (4). On the face of it, burning forest waste is a good idea if it can be done in high-technology, modern furnaces to create power. That makes sense. But there is a problem. And my position is heavily informed by the experience in Tasmania where somewhere once had a bright idea that we would chip forest waste and sell those chips for cash and that would be a helpful supplement for cash flow for the forest industry. But of course, before we knew it, woodchips became the reason for forestry. Before we knew it, they were clear-felling vast swathes of some of Australia's most precious forests, chipping it and sending it overseas to make paper. So, in other words, I have no confidence in the regulatory environment. I have no confidence that a move to burning forest waste for energy production will not very quickly become the reason for forestry operations. So, on the face of it, burning forest waste makes sense. But when you live in a place like Tasmania where a succession of governments over many years have abused the use of forest waste and have turned it into the reason for cutting down some of our most precious forests—given my experience in my home state I will support this amendment and for the foreseeable future I do not think that burning forest waste for energy is something we can put our trust in.
It is great to be able to put a few things on the record in relation to the Renewable Energy (Electricity) Amendment Bill 2015 and its impact on my home state of Tasmania. I thank people for allowing me to have that opportunity. As people would be aware, Tasmania has approximately 86 per cent of renewable energy at any time. We have approximately 1,500 to 2000 people employed in renewable energy jobs in Tasmania. So it is already a very significant industry in Tasmania. We have several possible wind farm projects—Cattle Hill, Robbins Island, King Island and Granville Harbour—and I would hope that at least one of these projects will now be able to go ahead because of the Renewable Energy Target being agreed to.
Approximately 50 per cent of Tasmania's electricity is used by just four big companies—Bell Bay Aluminium, TEMCO, Nyrstar and Norske Skog. These industries are emissions-intensive and trade-exposed industries, so I am particularly pleased that both sides of politics have agreed to exempt these businesses, ensuring the workers at Bell Bay and other major industries in Tasmania are safe. I want to thank in particular the shadow minister for environment, the member for Port Adelaide, and the shadow minister for industry for their support for these jobs in my home state of Tasmania.
We have also seen the government suddenly raise with Labor at the last minute the issue of including biomass in the Renewable Energy Target. This is a real furphy. Labor does not support biomass—that is, the burning of native forest residue—in the RET. But let me be very clear that that does not mean we do not support the future of the forest industry in Tasmania and the possibility of biomass in that future. As I have said publicly and as I say to my constituents, I have not been lobbied by anyone in the lead-up to, or since, the last election on the need for biomass to be included in the RET. I have not seen a viable project for biomass in Tasmania. I am not aware of any biomass projects that would see employment in this sector in Tasmania.
I will work with our shadow minister for forestry on the future of the forest industry in Tasmania, the role biomass might play, what support it would require and what supports for industry Labor may be able to provide. This issue has been a smokescreen in Tasmania to disguise the fact that the state Liberal government is currently sacking forestry workers after it said it would save the industry in Tasmania. It has recently told more than 50 forestry workers they would be sacked, and also the head of Forestry Tasmania has confirmed that it may need to sell off things to keep the industry afloat in the state because it is in big trouble. The Liberal government said they could save the industry, and they have not.
For the reasons indicated in my previous speech, for the reasons outlined in our election policy, the government will not be supporting the opposition's motion. The reinstatement of native forest wood waste as an eligible fuel source for the Renewable Energy Target will be on exactly the same basis as was there under the Labor Party until November 2011. The stringent conditions which were in place under the ALP will be replicated in exactly the same form. Having said that, I wish to thank all of the speakers in this debate. I particularly wish to thank the opposition spokesperson on the environment, the member for Port Adelaide, for his cooperation during the course of the negotiations. I commend all the people who have worked towards this deal, whom I outlined previously, and I thank all parties.
The question is that the amendments be agreed to.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Budget day 2015 was a great day for my electorate of Ryan. It was a great day for families, with the announcement of the new, simpler childcare subsidy package that will mean families with household incomes between $65,000 and $170,000 will be around $30 a week better off when it comes to accessing child care. It was a great day for older Australians, with the government confirming that we will not sign up to Labor's punitive tax on hard-earned superannuation income. But, above all, it was a great day for the 13,000 registered small businesses in my electorate and, in particular, those which have an annual turnover of less than $2 million per annum.
These bills turn the Treasurer's budget night speech from words into deeds. They seek to reduce the company tax rate from 30 per cent to 28.5 per cent for companies with an aggregated turnover of less than $2 million from the income year commencing on or after 1 July 2015. These bills also ensure that the maximum amount of franking credits a small incorporated business will be able to distribute each year will not be reduced in accordance with the reduced tax rate. This means that small incorporated businesses will still be able to distribute franking credits to their shareholders at the same 30 per cent rate as large companies can. The effect of these changes will be that, from 1 July 2015, Australian small businesses will enjoy the lowest rates of company taxation seen in Australia since 1967, 48 years ago.
This bill will create a two-tiered corporate tax system, and the coalition makes no apologies for this. Our policy is clear and unambiguous, which is more than can be said for Labor. In recent weeks, they have demonstrated once again why they cannot be trusted when it comes to small business policy. Take this contribution from the member for Oxley and shadow minister assisting the leader for small business. You would think that, of anybody in the Labor Party, he would really be on the pulse with what small business wants, and yet he is quoted in a media release from 6 May 2015 as saying:
The Liberal's plans to put in place a two-tier tax system in next week's Budget will only serve to smash business confidence ever further.
But, barely two weeks later, the Leader of the Opposition in his budget reply speech directly contradicted the member for Oxley by committing the opposition to match the coalition's tiering of the company tax. Yet again, this shows that Labor have no consistency when it comes to small business policy, probably because they do not truly understand it.
As this bill demonstrates, we are unashamedly a pro-small-business party. As a party and as a government, we believe that small businesses are the key drivers of Australia's economy, underpinning growth and innovation and providing jobs for millions of Australians. As the only party who truly understand small business, we know that small businesses face particular challenges with cash flow and with competition with larger businesses. Times are tough for small business, and as a government we need to do all we can to incentivise small business to grow, to invest and to employ more Australians.
This bill now gives me the further opportunity to discuss what I consider to be the most broadly welcomed measures introduced in this budget—or, indeed, in any budget in recent memory. I am talking about the announcement that small businesses will, from 7.30 pm on 12 May 2015, be able to immediately deduct from their tax business assets valued at up to $20,000. To say that this has been well received would be an understatement. Industry groups have been lining up in support: the Australian Chamber of Commerce and Industry, the Council of Small Business Organisations of Australia, the Chamber of Commerce and Industry of Queensland, the New South Wales Business Chamber, Business South Australia, the Institute of Public Accountants, the Chamber of Commerce and Industry Western Australia, Independent Contractors Australia, the Australian Food and Grocery Council, the Australian Industry Group, the Business Council of Australia and the National Retailers Association—the list goes on and on, each organisation more supportive than the last.
The reason for this is simple. Members will know that I ran my own business for many years prior to entering this place. Ask any small business person what is the biggest day-to-day pressure faced by their business and chances are that the words 'cash flow' will be on the tip of their tongue and placed high at the top of their list. Cash flow is a constant challenge. It is what keeps business owners up at night. Many small businesses lack the scale or the credit history to be able to access significant credit lines. In a business where cash flow is tight, owners will be reluctant to invest. Investing in capital equipment to grow the business ties up cash, and until now the part that could be claimed back in depreciation took several years to flow. With this budget, small businesses will be able to claim it back immediately on each and every purchase up to $20,000. That means up to $5,700 back, immediately, per transaction. In my electorate of Ryan I am already hearing from businesses who are taking advantage of the changes in this budget to bring forward investments that will grow their businesses. Following the budget, the Treasurer and I visited one such business—Briki Espresso and Gelati Bar, in the suburb of Ironside. There we met—
Debate interrupted.
Last year, 378 organ donors gave 1,117 Australians a chance at a new life. While this is a positive result, it simply is not enough when we consider that around 1,500 people are on the Australian organ transplant waiting list at any time. People are often on this list from anywhere between six months and four years. Regrettably, a lot of people will die waiting. Now, for the first time since 2009, we see a downturn in organ donation rates across the country. In the first full year of this government, organ and tissue donations fell by 3 per cent.
A recent, much publicised resignation of a very popular television personality from the Organ and Tissue Authority has drawn attention to the very distressing state of organ donation in this country. The government is planning yet another review into this area, ignoring the fact that strategies established by the previous Labor government, including the formation of the Organ and Tissue Authority, resulted in almost a forty per cent increase in organ donations over the previous five years.
The recent decline is not a coincidence, but the result of a number of poor decisions made by the current government. The decision to merge the Organ and Tissue Authority with the National Blood Authority was short-sighted and served as a distraction for the hard-working staff of those organisations. In addition to this, the government's $57 billion of cuts to public hospitals means that resources are simply not available in hospitals, where they are needed, and this has also contributed to the falling donation rates.
We do not need another review of the system. We need to stick to strategies that have proven to be effective and that have worked. And certainly, we need to work at a community and family level to raise awareness. In the past I have worked together with a Cabramatta GP, Dr Phan Giang Sang, to increase organ donation registrations in our local community. Dr Sang has written two books on the importance of organ donation, particularly focusing on the way various cultural and religious groups view the issue. In 2012, Dr Sang, in his own practice, registered 32 organ donors. This actually represented ten per cent of the nation's organ donation numbers for that year, and potentially saved hundreds of lives, considering that every single donor can transform the lives of 10 or more people.
Clearly, various communities across the country need to be encouraged to work with local experts and their residents to raise awareness and drive up donation rates. It is also critical that families come together and discuss the important issues, particularly their wishes with respect to donations, with their loved ones. Despite an individual deciding to become an organ donor, their family still has to be asked to give consent to a donation, if the situation arises. Talking about organ and tissue donation with loved ones can be difficult, but it is certainly a conversation that is worthwhile and will have a profound effect on organ donation rates. One in three Australians do not know that their family member has consented to organ donation. It is difficult to think about this once a family member has passed away. A discussion would make saying yes that much easier for a family member, and minimise the sense of doubt and, possibly, regret. Organ donation is a gift of life, and one that should be taken very seriously.
This issue is very close to my heart, given that a friend of mine, Debbie Roberts, was faced with a very tough decision after she lost her daughter Rebecca in 2002. Her decision was made a little bit easier because Rebecca made her intentions about organ donation very clear. As a result of her family honouring Rebecca's wishes, two people benefited from receiving a kidney, and another two people benefited from receiving Rebecca's corneas. Their lives have been profoundly enriched because of Rebecca's wonderful gift. It is a gift that all Australians should consider giving, as their decision today can mean the difference between life and death for another Australian tomorrow.
I have the honour of representing the electorate of Solomon, which, aside from being one of the most gorgeous parts of Australia, is home to some six thousand members of the Australian Defence Force. I am also chair of the coalition's Backbench Policy Committee on Defence and Veterans Affairs, a role that I am very proud of, particularly given the fact that my electorate is home to four major defence bases: the Larrakeyah Barracks, the Defence Establishment Berrimah, the RAAF Base Darwin, and, of course, Robertson Barracks.
For these reasons I take a keen interest in defence matters, especially those that relate to the welfare of those I have responsibility towards. Since 2001, ADF personnel, including thousands of Army, Navy and Air Force personnel from my electorate have served with distinction in Afghanistan on both Operation Slipper and its successor, Operation Highroad. Recently, as part of the Australian Defence Force Parliamentary Program, I was offered an opportunity to visit Afghanistan to see firsthand the fantastic work our Defence personnel are doing in the region. I want to say, right from the beginning, that my while my visit was a short one, it was, as far as possible, a safe one. I got to have a peek behind the curtain at what our troops have to endure in the theatre. I will not pretend for a minute to be able to relate to those who have endured tour after tour of several months duration. I have never had to endure the fatigue, the cold, the heat, the fear, the isolation from loved ones that our men and women in uniform endure. And of course I have never suffered any injury or seen comrades in arms injured or killed. It was an absolute privilege to meet the men and women of our Defence Force who are deployed in the Middle East region. I would like to mention a couple of people who have Territory links: Private Laura Sabbert, Corporal Aaron Birrell and Corporal James Rosengrave.
Despite the dangers they face, despite their duties and their responsibilities and despite the climate and isolation, they all maintained a very good sense of humour and of course a very professional manner, and I was honoured to spend a little time with them. I was able to make a small contribution to their sense of humour and maybe even cure a little bit of homesickness by presenting some Territory care packages, having lugged them all the way from Darwin. I was delighted to present a number of copies of What a Croc!, which you have seen here, Madam Speaker. It is a collection of the best headlines from the NT News, the best newspaper in the country. l was also able to give out a few Tim Tams. The troops knew that these special care packages were for Territorians, and all of a sudden there were a lot of Territorians! NT News editor Rachel Hancock and deputy editor Matt Williams were very pleased that their What a Croc! has now gone international and that the books were hand delivered, and they were pleased with some of the pictures. So I think now we can start a special care package for our troops overseas so that they can buy copies of What a Croc! from NT News online, and I think we should send them over to our troops over there.
It is very easy in this safe and comfortable work environment to make decisions. My time in Afghanistan has shown me the faces of those who will be affected by the decisions we make here. It has reminded me that for every resolution this parliament makes on national security there are some very brave, highly skilled men and women who have to turn these decisions into reality. So, in the last few seconds I have I want to place on record that I commend the fantastic work our Defence Force personnel do, not only in the Middle East but everywhere. They make us very proud, and I do not think there is one person in this parliament who is not proud of the wonderful work they do.
Continuing on from where I left off in the budget debate, the budget proposes providing $5,000 million. Well, there is a bit of licence involved in that statement, since in fact in the life of this parliament it is $1 million, not $5,000 million. As much as I love our honourable Treasurer, our honorary North Queenslander, Mr Hockey, with all due respect, a promise to do something when you are not the government is no promise at all. But let us be positive about it and say that it is an expression of interest by the LNP to move in that direction. And we would very much hope that the ALP—we had a very positive attitude from Prime Minister Rudd on these issues as well—that both sides of the parliament go ahead with no confrontation but with an air of working together.
If every station or property in the northern half of Queensland were allocated 200 hectares of irrigation land, at the present moment all they would have the right to do would be to pasture cattle. They have a right to graze cattle. They do not have any ownership rights—and you as an ex-lawyer would appreciate the difference, Madam Speaker. There are no rights in rem; it is only rights in personam. But if they are given 200 hectares of freehold irrigation title, that is worth $2 million, and it would greatly help a lot of these people to survive in their current situation. But infinitely more important: the great Freddy Tritton, one of the great pioneers of irrigation in northern Australia, and his son, Corbett—who may even go on to greater heights than his father—and I worked out that 80 per cent of the stations are on a stream that flows every single year. So, every single one of those cattlemen can get enough water to do 200 hectares of irrigation. That would drought-proof the northern half of Australia.
It gives me no joy, but I have a picture of Australia, and I have left it downstairs, with both Victoria and Cape York Peninsula marked in red. They are of identical size. Cape York Peninsula and Victoria, in area, are of identical size. There are two huge differences between the two. One has three times as much water as the other one. Cape York has nearly three times as much rainfall as Victoria. And one has 4.2 million head of cattle, while Cape York has a little tiny 140,000 head of cattle. What is going wrong here?
I had the pleasure of sitting with the Minister for Agriculture, and he said that the problem is title deeds. Yes, that is part of the problem, but the second problem is access to the irrigation water. It has been the policy of both sides of this parliament that we cannot touch any of North Queensland's waters. Well, we have more than half of Australia's entire rainfall run-off, and of the 230 million megalitres run-off, we are using only 1.3 million. By world standards, the average usage is 20 per cent. On the Murray-Darling we are using 30 per cent. In North Queensland, we are not using any of the water at all. But if you do, the scheme is on the Coleman and Norman.
We need 30 1,200 hectare blocks of irrigation land to be able to provide a smooth highway for our beef cattle into Indonesia. Instead of going back to Townsville, which is ridiculous, heading 2,000 kilometres in exactly the wrong direction, they can go straight out through the gulf. We need to facilitate that. We will eliminate drought. Well, you can never eliminate it; you will still get pain. But you can green chop on the 200 hectares and you can run 2,000 or 3,000 breeders so you can live to fight another day. All of this grand vista of opportunity can be awakened.
In the mid-west towns, particularly Hughenden, Richmond and Julia Creek, the populations have dropped to one-third of what they were 30 or 40 years ago. We can restore those populations and make them prosperous little towns— (Time expired)
I rise tonight to welcome the Abbott government's measures that will update the Australian Citizenship Act 2007 to ensure that dual nationals who engage in terrorism can be stripped of their citizenship. The Minister for Immigration and Border Protection will be able to exercise these powers in the national interest where a dual citizen betrays his or her allegiance to Australia by participating in serious terrorism related activities. This is a modernisation of an existing power that has been in place for many years to deal with people who join a foreign force fighting against Australia. This is to update that to deal with the modern world of terrorism.
These new powers are absolutely necessary and an appropriate response to the rising terrorist threat which will bring our laws closer to and in line with those of the UK and our other 'five eyes' partners. When you look at the different jurisdictions and what is in place in the United Kingdom and in Canada, which is just about to take the assent of royal law, and in New Zealand, which has the capacity to strip citizenship, and of course the United States, which has a system for dealing with people who fight with foreign armies, revoking citizenship under certain circumstances, it is absolutely the case that we should regard citizenship in Australia, in the words of Theresa May, the Home Secretary in the United Kingdom, as a privilege and not a right. Regardless of how we gain our citizenship, it is an extraordinary privilege with rights and responsibilities for all of us.
All Australians will have been concerned and disappointed to see hundreds of Australian citizens travelling to the Middle East to fight with terrorist organisations. The hideous crimes they are committing, the inhumanity, barbarism and very serious nature of what they are engaged in in setting up a quasi-state with the sole purpose of destroying other countries and other states mean we need new approaches to tackle new threats and, of course, we need to modernise our laws. The government is simply modernising our laws to ensure that those people engaged in this absolutely abhorrent activity are kept overseas and not returned to Australia when we have no capacity to deal with their radicalisation and their absolute crimes against all of humanity. The Prime Minister has also announced that the government will launch a national consultation regarding the privileges and responsibilities of Australian citizenship.
Since 1949, we have understood that Australians with dual citizenship who fight for a country at war with Australia forfeit their citizenship. So I would simply say to those people who are constantly asking, 'What about this legal argument, or what about the legal argument?' that, in the current age, there should be no difference in how we deal with this issue to how we deal with people who formally sign up to fight against us with foreign countries. Just because it is a terrorist organisation, we should not think that it is any better than signing up for a country at war with Australia. In fact, there are many arguments to say that it is much worse because they are not governed by international conventions and they are not signatories to any form of human restriction or decency. Indeed, it is much worse and it requires a much better solution to deal with it.
The consultation that the government has announced is welcome. The Prime Minister has announced there will be special envoys travelling the nation to ensure that we have social cohesion and that everybody has an input into new laws and on the best approach to take to ensure that people are not returned to Australia. I have consulted broadly with my community and I have certainly spoken with many people around the country. It is absolutely overwhelming from the community that they do not want to see Australian citizens who are fighting with ISIL or Daesh or involved with terrorism in the Middle East to be returned to Australia under any circumstances. It is completely and utterly unanimous in our community. It is one of those rare issues which unites almost every single person.
Something I would also call upon the government to think about taking further, perhaps raising it at the United Nations, is the concept of introducing statelessness. I would be happy to strip people who have engaged in terrorism in fighting with organisations such as ISIL and Daesh of their citizenship. I have said this loudly and publicly because I believe international conventions also need to modernise themselves to deal with the reality of what is happening in the Middle East. We have a new threat unlike anything we have faced before. It is an existential threat to our civilisation. It is a direct assault on our values. It is very clever and modern, and it needs to be addressed in a clever and modern way. It is something that the government and future governments can take up with the United Nations—all civilised countries working together to ensure the problem of extreme radicalised terrorists who are doing nothing but seeking to kill other human beings and destroy our civilisations are dealt with adequately.
That is why I believe this measure that the government is introducing that will update the Australian Citizenship Act 2007 to deal with dual nationals who engage in terrorism and strip them of their citizenship is absolutely the right measure for the times. It is something that we in this place should all be able to support. I thoroughly endorse it to the House.
I rise to give what is now an annual update on young leaders in my electorate of Gorton. Last month I had the great pleasure of awarding 10 of the brightest and most community minded young people from Melbourne's west with a Gorton Young Leaders Award. I established the Gorton Young Leaders Awards program in 2009 to recognise the achievements of exceptional young leaders in my electorate of Gorton. Now in their sixth year, the Gorton Young Leaders Awards recognise local young people who have shown an exceptional commitment to public service in their final years of secondary college, specifically through involvement in voluntary work, student leadership or community service.
This year we had 10 winners, former year 12 students across five schools, recognising them for their achievements during 2014. I am proud to be able to acknowledge the commitment these young people have shown to their education and their community and to recognise each of them as future leaders. The achievements of these winners have again spanned a range of worthy causes. Many of the winners were school captains or held leadership positions within their schools. They also led school committees and school working bees. On top of that, this year's winners undertook important work in the community, including: raising money for the Royal Children's Hospital and for homelessness programs, volunteering at Sunshine Hospital and creating artwork for the hospital's geriatric ward; and mentoring and coaching young athletes.
The winners of the Gorton Young Leaders Awards for 2015 are: Sarah Gonzalez and Patrick Puyat from Melton Christian College; Jade Nguyen and Adele Warrington from Copperfield College; Julia Sansone and Julien Johnson from Catholic Regional College, Melton; Kimberley McBain and Liam Richards from Melton Secondary College; and Nancy Gater and Ryan Sutcliffe from Staughton College. The winners—not to mention their families, friends and schools—should feel very proud.
I am certainly proud we have such talent and upstanding representatives of Melbourne's west. It was great to have a cup of tea with the winners, their families and the principals of these schools to discuss the work they had done and their plans for the future. Indeed, in conversations I had with these now young men and women, we talked about not only their futures but also the future they saw for their community. It was an enriching experience, I think, for them—certainly for their families—and what was really important about the event was we had in attendance those schools that recommended, to me, the bestowing of this particular honour upon them.
I assure my constituents and the schools within my electorate that we will continue with this recognition. We think there are too few opportunities for young people to be formally recognised in this area. Of course, we have sporting achievements that should be recognised. We have academic excellence that should also be formally recognised, and it is important in terms of who might continue onto further education. Whilst many of these young people have those achievements, they also have a focus on their local communities. I have just mentioned the contributions they made in raising money, in mentoring young people, in providing support for older Australians. It is a testament to them, to their families and, indeed, to the schools at which they have been students.
It was a great event. I was happy to present the winners with certificates and a small prize, during what was an inspiring morning. Speaking to these winners I know they all have bright futures ahead of them. I look forward to keeping in touch with these young people as they progress. I am very confident, given what I have seen and having spoken to these young men and women, that they have great futures ahead. They will do themselves and their communities proud. Too little recognition is given to such efforts of young people and, on occasion, the media sometimes reflect upon young people in an adverse way rather than focusing on those young people who do such great things at such an early age. So I feel happy to be able to acknowledge these young men and women of my electorate. I will ensure to do the same next year.
I rise to speak about the dreaded scourge that is ice. Geelong is set to take up the ice fight on the national stage, with a Geelong Region Ice Summit to be held at GPAC, the Geelong Performing Arts Centre, this Friday. I am very proud to be convening this summit in conjunction with the Geelong Advertiser and radio stations Bay FM and K-Rock.
I am very pleased that the Assistant Minister for Health, Fiona Nash, will speak at the summit along with a number of local experts, including Superintendent Daryl Clifton, who has been a very important part of our fight, against this dreaded drug, locally.
The summit is being held in partnership with the National Ice Taskforce. Very importantly, all community feedback from the Geelong Region Ice Summit, which incorporates all people wanting to come to the summit from right across Corangamite, will be provided to the National Ice Taskforce in the lead up to the Taskforce's interim report to Council of Australian Governments in mid-2015. The summit is a very important opportunity for our community not only to have its say but also to provide feedback directly to the National Ice Taskforce.
That said, I want to particularly commend the incredible work that has been done in my community by so many groups—local sporting organisations and community groups—to combat this dreaded drug. One particular organisation is the Greater Geelong Community Collective Effort on Substance Abuse, which has run the Our Town's Ice Fight and done an amazing job, because the very strong understanding is that unless everyone comes together, with one message, bringing together education, awareness, prevention and rehabilitation, we are not going to defeat this drug.
I particularly want to mention Daryl Clifton, who I referenced before; Chris Faulkner, from the Department of Human Services Barwon Area, West Division;·Paul Kelly, Director, Paul Kelly Creative, representing the committee for Geelong; and Kate Bibby, Director, Barwon Health, Communications & Marketing. Through the Greater Geelong Community Collective Effort on Substance Abuse they have played a very important role.
The Commonwealth government is working with states and territories to develop a National Ice Action Strategy to tackle this dreaded drug. The National Ice Taskforce and its secretariat will work closely with government, agencies, expert groups and the community to examine existing efforts to address ice and to identify opportunities to improve education, health, law enforcement and other policies to combat the impact of ice in the community. So, tackling ice, which is harming so many communities, is, I am very proud to say, a top priority for this government.
I want to particularly reference the Geelong Advertiser's recent ice series, which has played an important role in elevating our regional challenges onto the national stage. Reporter Mandy Squires has done a superb job. She has passed on to me a letter she received from one mother who will be attending the summit—I will not reveal her name as she wants to remain anonymous. She writes, in part:
The fact is my daughter would be alive today if there were compulsory detox. As I have already stated, the rehabilitation facilities in Geelong are a joke.
She asks:
Do the politicians, health workers et cetera want these families to live in a permanent hell visiting a headstone in a cemetery every day, instead of a hug?
This is a mother who has been traumatised by the death of her daughter.
I have supported many in the community who are looking for more funding for long-term drug rehabilitation beds. There are some extraordinary organisations doing some wonderful work in this area. I have spoken to the assistant health minister about it and I have very much placed it on her agenda.
I do want to refer to the Salvos and many other great organisations, including also Foundation 61, which have done a great job in providing rehabilitation. I am very proud of the work our government is doing. I urge all in the Corangamite community to attend the summit this coming Friday, and to contact my office if they wish to do so.
It being 9:30 pm, the debate is interrupted.
House adjourned at 21:30
On Saturday 23 May, it was my pleasure to be at the celebration of 40 years of the existence for the Ella Centre in Haberfield. This centre undertakes extraordinary work on behalf of some of the most disadvantaged people in the inner west. It was my great honour to speak about the Ella Centre's commitment to taking care of some of the most vulnerable in our community. It was good to welcome the new chief executive officer, Philip Coller, and to be in the presence of the board, including the chair, David Pigott.
The Ella Centre was once the Methodist church in Haberfield. It opened its doors as a community centre in 1974. It received set-up funding from the Whitlam government and later a very generous donation from Henry Ella, which helped create a trust fund. Since then, the Ella Centre's passion for social justice has ensured support for people with disabilities, dementia, older people and carers—as well as for those simply struggling to get by. The Ella Centre continues to make a significant difference in the everyday lives of people across the inner west. It has played a historic role in our community and is a constant reminder that, when we look out for each other, everyone benefits.
This is a community based organisation that is embedded in the local community of Haberfield. People from all walks of life were at this function in Haberfield in order to pay tribute and make a contribution towards the future activity of the Ella Centre. People made donations for specific purposes, including providing support for people with disabilities. I congratulate the Ella Centre for its tireless work over the last 40 years and I wish those at the centre all the best for the many years to come.
I am honoured to be speaking in parliament today to recognise the 40th anniversary of His Eminence Archbishop Stylianos, the primate of the Greek Orthodox Church in Australia. His contributions to the church have been exceptional and his longstanding efforts in publishing academic research are proudly acknowledged and received by my community of Barton. It is an understatement to say that there is overwhelming admiration for Archbishop Stylianos. The archbishop has devoted his life to unravelling theology in the Orthodox context, opening up new frameworks and insights to questions of religion. He began his first study at the Theological School of Halki, Constantinople. Upon graduating and being ordained to the priesthood, he received a scholarship to complete postgraduate studies in systematic theology of religion in West Germany. Rather than moving and studying his doctorate at a prestigious Western faculty, he broke the traditional mould and submitted his doctoral dissertation in 1965 in Greek to the theological faculty of the University of Athens.
He has never wavered from his Greek heritage, with most of his works being published in Greek. This was considered an active resistance to conformity in academia at that time. It is now understood how precious language is in preserving an initial idea or tradition in a modernised and multicultural society, but His Eminence's works were published in Greek in a time where language was a barrier, with the risk of work being overlooked and unacknowledged. Despite this, His Eminence stuck to his origins and created recognition of his world-renowned theological works in his native Greek language. It has paved the way for heritage to be respected and for native language to be seen as legitimate in an academic world. Many of his works, including poetry, have been translated into bilingual editions—an exceptional milestone in recognising his bold origination.
His Eminence was unanimously elected Archbishop of Australia, arriving in Sydney in April 1975. His main focus currently is in educational leadership roles as dean and founder at the St Andrew's Greek Orthodox Theological College. More recently, in 2014, the University of Crete in Rethymnon, his home town, awarded him an honorary doctorate. The archbishop has always been a prominent figure in the church realm, but his community achievements in Sydney are also notable, in particular his involvement with aged-care services and providers such as St Basil's and the Estia Foundation of Australia.
With many other achievements still unmentioned, his contributions are endless—with over 130 parishes to his name, 40 collections of poetry, and countless research articles and numerous books and journals. He has always had undivided dedication to society and the Church. He has excelled in every area, with his strong character of faith being the key to his accomplishments, and it never fails to inspire. His leadership as archbishop for 40 years is something that I am really proud to relay on behalf of the Greek Orthodox Church in Australia and as the federal representative of Barton. His sense of generosity to his community is a beacon of light that will never fade.
Last Saturday about 4,880 people turned up at Traeger Park in my hometown of Alice Springs, Central Australia, to attend a football match between Port Adelaide Power and the Melbourne Demons—one of the AFL-scheduled matches played in the Northern Territory. For the record, Melbourne, unfortunately for them, fell shy of Port Adelaide by 61 points. But the real winner of course, as always, was the community of Central Australia. Those almost 5,000 people travelled from all parts to attend this football game and enjoy the experience of Traeger Park on a beautiful Saturday afternoon.
The local football club, the Alice Springs Redtails, forged close links with Port Adelaide, with Port undertaking to assist the Redtails in developing a governance structure and a concise business plan whilst also giving Redtail players an opportunity with a preseason game against the Port Adelaide SANFL Magpies.
I said many people came from all over, and they did—they came from northern South Australia, from the Pit Lands, the Ngaanyatjarra Lands and from as far as Kintore and Nyirripi in the west. The Nyirippi residents were particularly prominent at the ground. For the Nyirippi residents to attend this game they had to travel a 500-kilometre return journey on a dirt road, their community being 440 kilometres north-west of Alice Springs. They were conspicuous by their presence at the southern end of Traeger Park. They are 100 per cent Melbourne Demons supporters and formed a cheer squad decked out in the red and blue colours to rival any other AFL club.
People of all ages in Central Australia appreciate when a big-city event comes to town, whether it be the footy or a major concert—it is exciting; it creates a buzz. For the youngsters, the opportunity to have a kick, handball or photo opportunity with Melbourne players like Jesse Hogan, Jeff Garlett, Jake Spencer, Heritier Lumumba or Nathan Jones, or Port players like Jay Schulz, Angus Monfries, Justin Westhoff and Chad Wingard, to name just a few, is a dream come true. I know that the mums and dads and the entire AFL fraternity of Central Australia enjoyed every moment of the weekend. Melbourne's Christian Petracca, along with fellow Demon Jack Trengove, conducted a clinic with 200 school-aged children in the Hermannsburg committee, 130 kilometres west of Alice Springs. He summed it up when he said:
Giving back to these people is something I will hold quite close to my heart. It really is something special. … It is good for us to see a different part of Australia.
Congratulations to all involved. Thanks to the AFL, the Port and Melbourne clubs, the NTFL Central Australia, the Alice Springs Town Council, the countless volunteers and all those people who came from across Central Australia to attend this great game.
Thank you very much, Member for Lingiari. You and I do not agree on much, but that is something that we do agree on. That is great news for Central Australia. I wish that they had events like that when I lived in Alice Springs.
A
Our No. 1 issue is the 25 per cent youth unemployment in Shepparton. This program gave a voice to some of our young people who are doing it really tough but who are triumphing. I mention in particular Denah Coonerty, who talked about the fact that she will be the first in her family to have completed year 12, and she is so proud about that. We were proud with her. She almost dropped out in years 8 and 9, when her attendance level was down to 20 per cent, but she pulled herself back. As she said:
No one forces me to go to school every morning, I have to do that myself. No one makes me dinner every night. I just push myself.
And she does. She has aspirations to further education after she, as we fully expect, triumphs in her year 12.
Then there was Ebony Nelson, a young mother, who again left school when she was very young. She came originally from Kyabram, a nearby town. She has a young daughter. She aspires to a really good life for her daughter. As she said:
… I don't want to struggle with money every week to get her nappies or just have essentials in life.
Ebony is back in training, with her little girl. She is doing a great job as a young mother. We all commend the work she does.
We had our multiculturalism on display and triumphing. We had young people from Iraq talking about the multicultural sporting teams, which are fantastic. We had a young man so proud that he is now a shift manager at McDonald's. We talked particularly about the agricultural career opportunities. It was a shock to see how many of our unemployed young people did not understand the opportunities that agriculture offered in our community for not just jobs at the lowest level but careers that could be extraordinarily interesting and remunerative. I want to thank SBS for taking a careful and I think sensitive approach to a very serious problem in my community. I also want to thank the young people who participated.
Today I wish to raise the growing concern about some of the building products that we have in our country that fail to meet Australian standards. There has been an increase in reporting of this in the media. It is definitely something that I am hearing about from local manufacturers in my electorate. I am hearing the concerns that they have about cheap imported products, specifically from China, being dumped on the Australian market. In some cases these products are being used inappropriately. They do not meet Australian standards and they are being used in buildings, particularly high-rise buildings in the city of Melbourne.
I want to take a moment to highlight some of the media reports which are exposing and asking questions about this serious issue. One report in The Australianand it is something that most people would be concerned with—was that building authorities have admitted that they are powerless to determine how many skyscrapers are riddled with cheap, highly flammable aluminium cladding that has already killed apartment dwellers overseas. So, even our authorities admit that they do not know how much of this product is being used.
Of course, these reports come after the terrible fire that occurred in an apartment dwelling in Docklands. In this particular incident, cheap aluminium cladding from China did not comply with Australian standards. It was blamed for the rapid spread of fire, which took less than 11 minutes to spread to the top floor. After an investigation, the fire authority said it was the result of an un-extinguished cigarette. So, yes, there was fault, but the point is that the fire started on the eighth floor and reached the top floor within 11 minutes. They blamed the quality of the cladding as the fault.
This is a serious issue that I believe we should call on the government to look into. I believe that we need to monitor this and have a robust regime in place around antidumping. We need to ensure that products coming into this country do meet Australian standards. What these cheap products do is undercut our local industries. Being from an electorate that is still manufacturing, I am concerned that cheap products that are being dumped on our market not only put lives at risk and the property values of these apartments in Melbourne and elsewhere at risk but they are also putting manufacturing jobs at risk.
I call on the government to strengthen our antidumping regime, to strengthen compliance and to make sure that these cheap products are not being dumped on our markets.
Madam Deputy Speaker, let me take you back to 1770 when Cook's crew first set foot upon the rugged and exotic shores of Australia.
We all know the story of Captain Cook landing in Botany Bay, but less well known is what happened after he left and sailed north. In a mariner's worst nightmare the ship Endeavour ran aground on a shoal of the Great Barrier Reef late in the night on 10 June 1770—it is not too long from now, actually, when it happened. She limped ashore and was beached in a sheltered inlet for repairs at the site which is now the vibrant regional centre of Cooktown.
There, Cook and his crew met with the local Aboriginal people, the Guugu Yimithirr, documented over 200 new species of plants and made the first recorded European sighting of one of our country's iconic emblems, the kangaroo. It is also acknowledged as the place where the first act of reconciliation actually occurred. It is a significant chapter in Australia's 40,000-year history, and one that the Cooktown Re-enactment Association is passionate about promoting. After all, if Cook's ship were unable to be repaired or had sunk, how would this have changed the course of our country's history?
The Cooktown Re-enactment Association was formed in 1959 by a group of locals who decided to re-enact the landing of Captain Cook on their shore, to attract more visitors to the community. The event is now an annual festival, one which I am excited to be attending this coming weekend, when Ricky Ashworth and his team of scurvy sailors will take on the roles of Captain Cook and his crew.
I congratulate the association for actively promoting Cooktown's history in a new and innovative way. They are fundraising to sell Cook souvenir spring water. I am hoping that all visitors will buy a bottle and help spread the word about Cooktown.
In April this year well-known local historians Alberta Hornsby and Loretta Sullivan travelled to Melbourne to present a lecture on the historic event at Melbourne University. They also received support from the Australian National Maritime Museum in Sydney, which runs the HMB Endeavour replica program. I am very much looking forward to the grand opening and launch of the '48 Days of Shared History' mural project on this Friday, with 13 murals by the highly-talented local artist, Jane Dennis, depicting the 48 days spent by Captain Cook and his crew on the Endeavour Riverin 1770.
It is certainly a very exciting time for Cooktown, and I am pleased that it is starting to receive the recognition that it well and truly deserves. I have to say that what is great about the Cooktown re-enactment and also the festival that they have there over the Queen's Birthday weekend is that there is great participation by the local Indigenous population as well as by the broader local population. It is a celebration for all in Cooktown, and I certainly embrace the way in which they are able to bring the community together in a very exciting and sometimes very novel way. I encourage anybody to go to Cooktown for the long weekend in June. Please jump on up. It is easy to get to, you will have a great time and you will not forget you have been there.
Last Saturday night I attended two outstanding surf club presentations in the electorate of Shortland: the Hunter Surf Life Saving club branch is a fantastic, very active branch, and it has a very good history of being one of the premium branches within the state. It has over the last season had 24 after-hours rescue responses, 68 ambulance calls, 391 rescues, 19,165 preventative actions, 59 first aids and 687,450 beach attendants, with 71,500 volunteer patrol hours—quite fantastic.
Swansea Belmont Surf Life Saving Club is a club with 697 members, with 287 juniors. It has 10 trainers and five assessors. It completed seven rescues, 123 preventative actions and 12 first aids, closed the beach five times and performed 4,654 patrol hours and volunteering worth $93,080 to Lake Macquarie City Council. It also organised a cracker ironman and hosted the Lake Macquarie Games.
Belmont Swansea has been a fantastic club. Over the years it has hosted both state and national titles. It has a very experienced group at its club. They are very dedicated people who have been involved with their club for a very long time. I thank the MC, Chad Griffith, my next-door neighbour, who did a fantastic job on the night.
Caves Beach Surf Life Saving Club has 626 members, 220 juniors and a very impressive 27 cadets, 16 trainers and seven assessors. It completed 22 rescues, 2,794 preventative actions and 49 first aids, closed the beaches 20 times over the season and performed 5,987 patrol hours, worth a massive $120,000 to Lake Macquarie City Council. It is a very strong, united club, a family club. There are up to three generations of members at that club from the same family. They perform well on the beach and perform very well as far as safety is concerned. It organises the ocean-beach swim and participates in many events throughout the Hunter region.
Congratulations to these outstanding surf clubs.
In the days preceding 3 May this year the whole Hastings Valley, Port Macquarie and the mid-North Coast had been lashed by storms and tempest commonly known as leftovers of an east coast low. By the morning of 3 May, however, the skies had opened, sun was shining and Ironman Port Macquarie rolled on for the 10th time. This ultimate endurance event involves over 1,200 athletes who compete in a gruelling race on one of the most scenic yet hard courses in Australia: a 3.8-kilometre swim, a 180-kilometre bike ride and a 42.2-kilometre run. It is the 10th year that Ironman Australia has operated in Port Macquarie, having been in Forster-Tuncurry before that, and this is the 30th anniversary in Australia.
The community literally comes alive during race weekend. Over 2,000 residents of the Hastings Valley and people north and south give their time to support the event through volunteering which is led by a dedicated local organising committee. I would like to place on record my personal thanks and congratulations to them and compliment them on what a wonderful event it was. The local organising committee is chaired by Mike Reid, who has done it for many years, and he was ably assisted by vice chair Greg Laws, Vanessa Gray, Dr Bill Lancashire, Dr Jen Law, Sue Reid, Lyndal Harper, Rob and Jan Crombie, Ian Barber, Fred Axford, Tony Wright, Tim Atherton, Kristy Whiting, Janine Beusnel, Leanne Armstrong, Paul Jones, and Deb and Stu Ward.
But they could not have done it all by themselves. There were 2,000 volunteers, as I mentioned, including an amazing water-safety team from the local surf-lifesaving clubs. In fact, they would have to be the safest water-safety team of all the ironman events in the world. You were as safe there as you would be anywhere else; and, considering it was in a flooded river, that was amazing. There were volunteers in the medical tent and in the massage tent. There were street directors and people handing out supplies of water and other drinks. Everyone gets involved.
I would like to compliment all of Hastings Valley and the Port Macquarie region for their continued support. This event brings roughly $4 million a year into the Port Macquarie economy. If you multiply that over 10 years—with the same sorts of figures for the Forster-Tuncurry economy in the years before that—it is an amazing event. My thanks to all those involved in volunteering for and supporting this wonderful Toyota ironman event.
Tucked in behind the industrial precinct of Breakwater in my electorate is a remarkable structure, the Ovoid Sewer Aqueduct over Barwon River. This is a structure which was commissioned by the Geelong Waterworks and Sewerage Trust. It was built by Edward Giles Stone and his partner, Ernest Siddeley. It is 756 metres long, consisting of a series of trusses which cantilever from 14 concrete corniced piers. It was built between 1913 and 1915, which means that this year is the centenary of the construction of the Barwon ovoid sewer aqueduct. It is a piece of construction on an absolutely grand scale.
This was a design that was inspired by the Firth of Forth Bridge in Scotland, which had been constructed about 25 years before. It was an early and innovative use of reinforced concrete, but it was done on a grand scale, using the Considere system. Dr Miles Lewis, an associate professor of architecture at Melbourne uni, once stated:
The aqueduct is internationally significant and was one of the most extraordinary engineering structures in Australia.
It is structure which is very much based on innovation, on a grand scale. It comes from an innovative city and it is in the tradition of James Harrison. It is hardly viewed by anybody. You can see it as you as a drive on the Barwon Heads Road down to Barwon Heads.
In 1992, the aqueduct was decommissioned, and since then it has fallen into a state of disrepair, which is tragic in its own way. We are told—and I think this is right—that it would cost millions of dollars to restore it. It is a sewer pipe, which is obviously no longer used, and there is a walking path on top of it. But there is now the enduring question of what to do with this incredible structure.
A start, in my view, in this the centenary of the structure, would be to make a walking track along the stretch of land on the northern side of the Barwon River—which is managed by the Corangamite Catchment Management Authority—to the left of the aqueduct itself. Interpretive signs could be placed along that trail so that people get a sense of what it is. The more people who see it, the greater the chance that we can reimagine a fantastic future for it.
There is a looming threat to retirees in my electorate of Eden-Monaro. They are threatened by a multipronged attack on their retirement savings by the Australian Labor Party. As of the latest census, there were some 43,984 people over the age of 55 in my electorate. That is 32.5 per cent of the population of Eden-Monaro and compares with only 25.6 per cent for the nation as a whole. So Labor's attack on retirees is a dagger at the heart of a sizeable proportion of the people I represent in parliament—an attack on their incomes. Many constituents have already raised their concerns with me. So what is the threat to the people in my electorate? Two weeks ago, Labor's shadow Treasurer confirmed that Labor intends to 'fix' the superannuation system with a big new tax.
But first a little history lesson. I remind the House that Kevin Rudd, before the 2007 election, said that there would be no change to super—'not one jot, not one tittle'. But they broke their word. In fact they increased taxation on super by just short of $9 billion. In particular, Labor sought to add a new tax on earnings on super above $100,000. After all that, in 2013 they promised that for five years they would not make any changes to super. That was a promise by the then Labor Treasurer who is now the Labor shadow Treasurer—the member for McMahon. Now they are at it again.
In 2015, amongst other proposals, Labor has announced they would reduce their previous policy of a $100,000 income threshold to a new tax on super above just $75,000. This will affect, by some estimates, more than 300,000 retirees, many in my electorate. They have also said that they would not index those thresholds, affecting thousands more Australians as the years pass by and inflation brings the effective threshold down every year in real dollar terms. So much for the 2013 promise of a five-year moratorium on changes!
However, that 2013 promise of no new changes is not even their most recent one. The Leader of the Opposition said as recently as 22 April this year:
… these are the final and only changes Labor will make to the tax treatment of superannuation.
That sounds like a strong assurance, doesn't it? But less than one month later, in May this year, the shadow Treasurer said at the Press Club:
What we have flagged is that we are still doing work on other aspects of superannuation policy.
So there is obviously more to come. Indeed they are also explicitly flagging attacking the negative gearing that thousands of retirees rely on. Labor have made a calculated gamble, based on an appeal to the politics of envy, to target these retirees to fund the vote-buying spree that the Leader of the Opposition announced in his budget reply speech. They should not be allowed to do it.
In accordance with standing order 193, the time for members constituency statements has concluded.
Yesterday I was talking about small business and some of the great benefits that small business received in this year's budget—in particular the instant tax write-off. We know that the instant tax write-off will encourage small businesses to go and spend, which will create confidence within the economy. Now is the perfect time for businesses to look at their business plan and for small sole traders and partnerships to look at investing in an income-producing asset and at hiring more staff. I am very pleased that the government has introduced this $20,000 instant tax write-off.
But the budget is not just about small businesses, families and pensioners; it is also about the environment. In this budget we are continuing our strong record of supporting environmental sustainability. We can be a nation that values its environment, not through wasteful, costly and useless measures like a carbon tax, which hits the people who can least afford it through their electricity bills, but through practical measures like the Green Army projects that are currently rolling out around the Petrie electorate.
In this budget we have also seen the Minister for the Environment sign off on a historic ban on the disposal of capital dredge material in the Great Barrier Reef Marine Park. We inherited five major proposals from the Labor Party to dispose dredge spoil in the marine park, but since coming into government we have reduced this to zero. Now we have formally approved an amendment to the Great Barrier Reef Marine Park regulations to put an end to this century-old practice once and for all. The ban applies to all past and present permits and future applications for capital dredge disposal. This will help reduce accumulated pressures on this vast and spectacular ecosystem and also aid in improving the reef's health and resilience.
The threat posed by Daesh is reaching out to Australians, as we recently saw in the Sydney siege. This is not the time to neglect our Defence Force. The government will continue to invest in the Australian Defence Force. What we saw previously under the Rudd-Gillard-Rudd governments was a $16 billion cut, a $16 billion reduction, in defence spending as a percentage of GDP. Defence spending went to its lowest level since 1938. The 2015 budget is part of the Commonwealth government's plan to build a strong and prosperous future for all Australians. In this budget, we will continue to make a significant investment in the safety and security of all Australians. We are continuing our commitment to increase defence spending of two per cent of GDP and build on the promise to provide Defence with a stable and sustainable funding growth path. Labor's mismanagement led to 119 defence projects being delayed, 43 projects being reduced and eight projects being cancelled—risking critical capability gaps. The Australian defence industry shed more than 10 per cent of its workforce because of budget cuts and deferrals, procrastination and a lack of opportunity for local suppliers. Not only is the coalition government prepared to invest in the skills and knowledge base of the Australian naval shipbuilding industry; it is also prepared to commit to a long-term investment to make sure this important industry employs a future in Australia and these critical skills are maintained.
It is through hard work and through working together that Australians achieve economic success. When you strengthen the economy, businesses succeed, families have less pressure burdened upon them and jobs are created. Small businesses were let down by Labor, and families were facing the consequences of uncertainty in employment and job insecurity. Now is the time for the people in my electorate of Petrie and all around Australia to embrace the incredible opportunities our nation has to offer.
The 2015 budget is about small business, growth confidence and opportunities. It is about increased opportunities for families, for parents to get back to work. It is about increased funding for the majority of pensioners. It is about a better environment, and the coalition has a strong record on the environment. It is about ensuring that our Defence Force is stronger and more productive and that we have got cutting-edge equipment for our ADF men and women. Finally, it is also about returning to surplus. We are the only party that has a plan to return the budget to surplus. We all know that we cannot continually spend more than what we earn every year. I look forward to implementing this strong plan, along with the government, over the coming months and years ahead.
I rise to speak on the Appropriation Bill (No. 1) 2015-2016. The modern economic era in Australian history—and I speak with some pride in saying that my book on the history of Australia was a best seller—started with the deregulation of the wool industry. Mr Keating, lauded as the 'world's greatest Treasurer', deregulated the wool industry. At that point in time, wool was the biggest export earning item for Australia; it was bigger than coal. Wool was worth six thousand million dollars a year, whereas coal was 5.9 thousand million dollars a year. To completely destroy what was the economic base of this nation for 170 years was a fairly remarkable achievement by the great deregulator, the father of market fundamentalism, and the other advocates of extremist zealotry of the free market in this place. That is how they started their procession of disasters.
We look, over the next 12 months, to the loss of the motor vehicle industry. When the Holden motor car came out I was only a little fella. My daddy walked around the car about seven times and he said, 'This is made in Australia. This is Australian.' That we could build a motor car! In my history of Australia it occupies nearly a 10th of the book. This was one of the greatest achievements of the Australian people.
The other great achievement was the Snowy Mountains scheme, which is still one of the 27th leading engineering achievements in world history. This parliament closed down one-third of it. The ALP and the NLP voted unanimously to flog it off to a foreign corporation. But God bless the Australian people. My history book was called 'An incredible race of people'. We rose up in rage, anger and fury, and the government got so terrified and a little bit enlightened from a decent fellow—John Howard, the Prime Minister, who was a big enough man to reverse his judgement. But it was only the people of Australia that reversed that decision. The 30 per cent taking and destruction of the agricultural production has gone and it has not been returned.
When I was a young fella we bought our motor vehicles in Australia; 62 per cent of them were Australian made. We bought our whitegoods in Australia. The fridge in our home was Australian made. Our air conditioner was Australian made. Our stove was Australian made. Our washing machine was Australian made. The television was Australian made. When computers first started, believe it or not, we produced some computers. Our clothing was Australian made. Our family owned a number of clothing stores and at the clothing store that I was involved in almost all of our clothes were Australian made. Furniture was made in Australia.
In 2002, almost all of our petrol came from Australia. We sent $1,000 million overseas to buy petrol and diesel in 2002. This year we will send $25,000 million overseas. We are going to have to find $16,000 million to buy our motor cars and our spare parts from overseas. How much money has Australia got to buy something from overseas? This is pretty simple. I am one of the few people in this place that makes money out of my own business acumen, my own energies and my three businesses I created out of absolutely nothing; there was nothing there when I started. So I speak with great authority from my own private experience and, of course, I was the minister that introduced prawn and fish farming in Australia. I will talk about that a little bit in a moment.
Where are we going to get the money to buy all of our motor vehicles, all of our whitegoods, all of our clothing, all of our furniture and all of our petrol? Talking about food, if we take out two elements, live cattle and coarse grain—you cannot eat live cattle and you cannot eat coarse grain, obviously—you are left with the food element. Actually, we are importing now almost as much as we are exporting. In actual fact, we are 50 per cent dependent, if you like, for our food from overseas. At the present rate that is a 125 per cent increase in imports every 10 years and only a 28 per cent increase in exports. You do not have to be Albert Einstein to work out that we will be a net food importing country. So we have no petrol and now we have to get our food from overseas, as well as our motor vehicles, our clothing and our whitegoods. Where are we going to get the money to buy these things? We were told we were going to get it out of iron ore and coal.
I have just had my 70th birthday so I have been around for a fair while. I have been in business for myself since I was 23 years of age. This is the first time in my entire life that there has been nothing happening. Every single year of my adult life the coal industry surged forward. The Queensland government built 3½,000 kilometres of railway line, each year opening up more and more coalfields. In the last 25 years there has not been one kilometre of railway line built—not one kilometre. So the coal industry now has to rely upon old, worn-out coalmines. They are old, they are worn out and they are non-competitive. Unless the railway line is built into the new fields, the Galilee coalfields, then that industry will continue to die. It has already shed 15,000 jobs in Queensland, and there is not a town in Queensland that is not feeling the hurt.
Mr Keating announced this free market and said that we were going to be a free and open economy. And I remember this very vividly, because in those days I used to switch my radio on and listen to the news—I do not anymore, because it is too depressing—I thought: 'Is the man mad? How can we compete against the Asian countries? The average income there is under $5,000 a year. How can we possibly compete?' People say that wages are too high in Australia. Well, what is the solution? To go down to coolie wages, is it, of $5,000 a year? I thought: 'Is the man mad? There are only two things that can happen here. Our wages must fall to their level, or we close the industries.' I thought that it was an either-or proposition, but I found out that it was not an either-or proposition—it was both. We are now seeing our wage structures going down, and we are watching our industries close down. We have scored the double!
But that is not the end of the madness. When history books are written of this century—I wrote my history book of the last century—they will record that these were the worst governments in this country's history. That is saying a lot, because the people that left us completely unarmed before the pending Japanese invasion of Australia have a lot to answer for, as do the people that drove us into the Depression. Australia was driven into the Depression and never worked itself out. We never figured out that we had to expand the money supply; we listened to an idiot called Sir Niemeyer, from the Bank of England, instead of listening to our own Treasurer, Edward Theodore, who had the solutions.
There is a lot of competition as to which is the worst government, but the governments of the last 25 years or, arguably, 30 years have cold-bloodedly destroyed each of these industries. Each of these industries has been destroyed by government action. What was the government action? In the case of the wool industry, it was deregulation. In the case of the prawn and fish farming industry—which should be worth $10,000 million a year—it was the greenie movement. They imposed conditions upon us which nowhere else in the world has to meet, and we cannot possibly meet them and compete. In the motor vehicle industry, it was the removal of tariffs and the high Australian dollar—clothing, whitegoods and furniture, similarly. In food, let me be very specific, it was the removal of tariffs. If every other country on earth has a 39 per cent tariff subsidy regime and you have four per cent, clearly your food industry is going to close down. Do you think that our farmers are 32 per cent better than the farmers in the rest of the world?
I have only been overseas for about nine days, but two of those days were spent on what they call a cattle ranch, in America. I tell you what, you would want to get up very early in the morning to compete against them. We got up at four o'clock in the morning with an axe to smash the ice. Their industry is very similar to ours; I was amazed that their station properties were about the same size as ours. They had no grass; it was the middle of winter. We have no grass at the end of the year. But they have distillers grain from the ethanol industry, so they can get through their dry period. During our dry period, our cattle just die because we cannot afford to feed them anymore. We are up against 39 per cent versus four per cent. It is impossible to compete against that.
We have only two people to sell to on the home market. This is the only country in the world in this situation. The Americans are screaming because Walmart and their other competitor have 23 per cent of the marketplace. Heavens! Woolworths and Coles have 90 per cent of the marketplace. That is not my figure, by the way; that is the ABS figure for 2002, and I am using Woolworths's and Coles's own figures for their market growth, and the AC Nielsen series figures. So that is not a figure plucked out of the air.
The third issue is the dollar. This is rather curious, and this is probably the most important thing. We once had a political party called the Country Party, and it defended the interests of the exporters and, to some degree, the manufacturers, because they compete against imports. So the dollar was crucial. As Doug Anthony said to me as a very young person: 'Don't worry about subsidies and tariffs; we don't worry about that. What we worry about is the dollar.' In his last year parliament, I think it was, he said to the Australian public, 'You bring down the dollar or I'll bring down the government.' McMahon had announced a revaluation, Menzies had announced a revaluation and he did not listen to McEwen, so McEwen threw him out on his head. He was eight years in the wilderness before he came back in again. This taught them a very salutary lesson. The Liberals learnt from the actions of the Country Party.
Now, we do not have a Country Party and so now we have interest rates that are at 2.7 per cent—the average for the last two years. That sounds pretty low, doesn't it? Well, it is pretty low until you compare it to the rest of the world, that has 0.2 per cent! Now it looks very high indeed. In fact, it is nearly 1,000 per cent higher than the rest of the world.
We are out of step on food—subsidies and tariffs; we are out of step on interest rates; and we are out of step on Woolworth and Coles—the Americans scream because they have 23 per cent, their big two. Where are we in step with the rest of the world?, I said to my son when he was very young, 'It is not very clever: take a bashing once, son, but not twice. You just figure out how he bashed you and you do it back to him, right?' It is the same with trade and business. If someone is beating you, you find out how he is beating you and you beat him back. But we belong to some sort of numbskull organisation called the Parliament of Australia. History will record that this place was responsible for the destruction of each of these industries.
I am going to help Mr Hockey out here—and I speak with authority because I was the second-ranking minister in the Queensland government, which was easily the most successfully-performing one, economically. Even our worst enemies said we were the economic superstars. We ran Queensland on $8,000 million a year. The Liberals skite about being 'small spenders'. They could not run it on $51,000 million a year! We were running it on $8,000 million and they could not run it for that. And the bunch of brainless in the ALP could not run it on $49,000 million, but they looked pretty good after the Liberals had finished and taken it to $51,000 million.
What did they spend it on? They spent it on tunnels. Let me quote Robbie Katter. My son is a member of state parliament. He asked, 'What did you spend the money on? You spent it on tunnels in Brisbane. You are the most tunnelled city in the world.' We were told there was no money for the budget next year. He said, 'We spent $5,000 million for another tunnel. What do you get for that? A few thousand people get home 10 minutes earlier to watch the television. That is a big return!' Why have they not build a railway line into the Galilee coal fields and created 20,000, 30,000 or 40,000 jobs?
If you move to ethanol, there is a $25,000 million benefit to the Australian economy. If you say that all government vehicles are to be Australian made there is a $16,000 million benefit to the Australian economy. If you build the Galilee rail line there is a $7 billion-a-year profit to the Australian economy. If you give us a fair start in prawn farming, the same as everyone else in the world, there is $10,000 million for the Australian economy. There is $4,000 million in the fertiliser industry if we get a reserved resource policy—and you will have no fertiliser industry if you do not. You will probably have no steel or aluminium industries either. If we proceed on the water development schemes for northern Australia we will get an $8,000 million benefit out of the cattle industry and 70,000 jobs.
If you applied a 10 per cent customs duty to everything coming into the country that would give you $35,000 million to spend. And I strongly suggest that you spend that in helping young people to have children. If we go towards what is a proper birthrate, where we can replace ourselves and stop being a vanishing race as we are at the present moment, then each of those babies that are born will generate one job in the Australian economy. That is 700,000 jobs, Joe, and $50,000 million that you can fix up your budget with. Listen to me, please. (Time expired)
I would like to point out to the member for Kennedy that I am actually a member of the Country Liberal Party, so there is some heritage there.
I rise to speak on the Appropriation Bill (No. 1) 2015-2016 and related bills. In 2010, when I was elected as the representative for Bennelong, I likened it to the moment of joy when you are selected to represent your country, and then one second later you realise there is a serious responsibility. You give a vow to serve these people and in some ways you enter into a marriage; you inherit a lot of children, grandparents, parents, working people and all the challenges that a family can present you with, and you do your best to recognise the problems and find solutions.
Recently, I attended, during National Volunteer Week, our regular celebration of what you would have to refer to as the heart and soul of Bennelong. There were 300 certificates given out to people who volunteer and give their time for people who are in need. The volunteers are headed by Helen Crouch, who is an absolute treasure and a leader of this organisation. Again, it was a joy to recognise and celebrate the contribution that these people make. Another event that I have been to recently was a creation of the Ryde District Historical Society, who have put together a book, with some support from our government, called Ryde Goes to War 1914-1919. Ryde was a small, almost a farming community in 1914. There were 3,400 homes and 2,000 men and women went to war. Some 400 did not return. This book has assembled the records of all of those and some 200 biographies. Sitting, as I do, with my partner in crime, Louise Markus, she inquired whether her grandfather was in this book. We followed that up to find that TH Tyrrell, Louise's grandfather, not only went to war but also came back, and he shared that good fortune with two brothers. Louise was able to see where he had lived and where he had worked and to have confirmed her family tales.
In another moving event, I went to the launch of a book put together by Dr Robert Creelman. Again, it touched our group of representatives here, because the book was largely the story of Harvey Bawden, who is the father of the member for Murray, Sharman Stone. Harvey is now 91. He is the only survivor of a Lancaster bomber that crashed over Germany in the Second World War. Two of the crew died on impact, others survived and some were killed by marauding locals incensed by the bombing. Harvey survived, albeit with great wounds, and on this day there was a lot of pride. I am sure Sharman had pride for her father and her father certainly had pride for Sharman.
Recently, the budget has gained a great deal of notoriety. Last year's budget also gained notoriety but not always for the best reasons. This year, it is celebrated. One of the first things that we did when taking office, albeit in opposition, was to recognise the aftermath of the global financial crisis and the impact that it was having on small businesses, particularly in our villages. So we set forth and started a campaign called Bennelong Village Businesses campaign to help small businesses operate in villages for the difficult circumstances they were facing because of the economic downturn and the tough competition they were getting from the major supermarkets. We sought to get them discounts in advertising, which we were successful in thanks to the Weekly Times, who gave a 33 per cent discount, and we sought to encourage them to work together to collectively bargain. I am pleased to say that in the past couple of weeks, when we have launched our Bennelong village of the month at West Ryde, this budget has been so well received. We have had business after business tell us of their joy, their anticipation, and their optimism at the true benefits that are coming from the tax reduction and the ability to write-down a $20,000 investment.
Interestingly, in this period of time, homes need maintenance. I had had some maintenance done to my home by three different groups; I guess I had neglected it in recent times. I would call them 'Tony's tradies'. An interesting group of men, who came but—unlike other times where I have lived in the past—did not price the client but priced the job. I felt that I got great value and very high quality work done—and they left the place cleaner than when they found it, which might not have been that difficult. We have plans for our Ryde group of Tony's tradies. We are trying to assemble them so that they can take their pricing of the job to other parts of Sydney, and maybe we can help them expand their opportunities in other parts of Sydney through our BVB initiative.
Another situation we saw early on in going to schools was that a number of kids in this very diverse cultural area of Sydney were being left off the playing field. They were not being able to engage with other children, because they were not interested in playing those sports. This was a distressing thing to see—to see kids left off; not that they did not get to play the game, but they were left out of making friends through the activities of sports. I spoke to Hugh Lee, who is the head of the Asian Australian Association of Bennelong, about an idea that I had developed to put table tennis tables in all of the schools—not necessarily for the sake of playing table tennis, but to get an activity that children of all ethnic backgrounds could participate in and have fun and make friends. This has been an extraordinary success. Through the generosity of Hyundai, which gave over $100,000, we have been able to put table tennis tables in all 40 schools. Kids from all schools play in an internal competition within their schools and then they come and play in the Bennelong Cup later in the year, with over 200 kids competing in ELS Hall on the one day on some 26 tables. It is a great sight. It is a distillation of our multicultural society, and there are nothing but smiling faces. The results seem to be secondary.
This competition also accompanied the development of the Bennelong Cup, which is played at the highest level between nations in the region—China; Korea, Japan and Malaysia is joining us this year. In the year of the Anzac centenary, Australia and New Zealand will play together as Australasia, as we did at the beginning of international competition in Davis Cup tennis. We are looking forward to playing. That will be played on 12 November here in the Great Hall, with the very best table tennis players in the world competing for their country. As friendships are made on the school ground around a table tennis table, so are the friendships made between these players and between our countries.
Another issue that we became aware of was the difficulty in finding work for people with disability. As patron for Achieve, in discussions with Anne Bryce, we came up with an idea based on the Bennelong area having once been market gardens. There seemed to be a lot of land that was left over, and people just endlessly mowed it for no good reason. We came up with the concept of again having commercial market gardens in this area where land is available, but for the purpose of giving people with disability work and ownership of a business. We thought that we could encourage people who are retired and looking for active recreation and socialisation and maybe some purpose in life and marry these two groups of people together. This concept has been really well received. I went to Duncan Gay, the minister for roads in New South Wales. He was gracious and found us land. Now we are going through that red tape that you have with local councils to get a development approval to plant our first gardens at Kemp Road in Ryde. The marriage, I am here to report, is going well. We have our trials; we have our tribulations, but most of all we have great joy when we work together.
In the budget we have just seen, Tony Abbott and Joe Hockey have broken their promises to the families of Geelong—promises that they would not hurt them. This budget in so many ways hurts the people of Geelong by severely cutting the household budgets of Geelong. We have seen $80 billion cut from schools and hospitals in 2014 budget and re-affirmed in the 2015 budget. The inequity of $100,000 university degrees, which were put in place in 2014 budget and which remain a part of this year's budget. It creates an impossible situation for Deakin University: in effect they have to choose either providing courses that are accessible to the people of Geelong—and thereby forego the revenue that would come from higher fees to fund its research activity—or charging higher fees and thereby creating courses that are less accessible to people from Geelong who would then have to travel to places like Ballarat or Melbourne to attend university. This is an impossible situation to put Deakin University in. As I have said on many occasions, when you look at great Australian regional cities what you find within them is a great university. There is no more important institution to the future of Geelong than Deakin University. This is a budget which hurts the future of Deakin.
Geelong has gone through a difficult period over the last couple of years with decisions by both Alcoa and Ford to take their operations out of Geelong. Both have been pillars of the private sector economy in Geelong for decades—Ford had been manufacturing cars in Geelong since 1928 and Alcoa had smelted aluminium there for more than 50 years. Those decisions came as an enormous economic shock to our community. Alcoa's decision was a particular shock because its transition happened much more quickly than that of Ford. The 900 people who were employed at Point Henry are no longer working. In the aftermath of that decision everyone expected that there would be some form of adjustment assistance provided by this government to the City of Geelong, as there has been to other regions when an economic shock of this kind has occurred in the past. The Labor government provided assistance when Ford made its decision back in 2013—on the very day of that decision Labor put up $15 million. That money is now part of a fund of more than $25 million, which is helping to create jobs in Geelong. It is not a long-term solution, but adjustment assistance is an important transition measure when a city goes through a phenomenon of this kind.
We have seen a complete and stubborn refusal on the part of this government to provide a single cent of adjustment assistance to the people of Geelong in the aftermath of Alcoa's decision, and that is re-affirmed in this year's budget. Again, there is not a cent for Geelong to recover from that decision.
According to the Department of Employment, Geelong's unemployment rate stood at 7.2 per cent as of April this year. That is higher than the national average. Something like 18 per cent of Geelong's youth are unemployed and now seeking jobs. By every measure this has been a budget that does nothing for the future of the people of Geelong. By the government's own test, this is a budget that has failed. We see that spending is up considerably; we see the deficit is up considerably; and unemployment is going to rise considerably. This government has failed the tests that Labor set for it, as well as the tests that it set for itself on coming into office. It begs the very real question now: what does the Abbott government stand for, when it is prepared to spend in this way and to create deficits of this kind?
This budget was, at the end of the day, about one person's job, and that was the Prime Minister's. It was a political document. It was not a document about the nation's interest. It was certainly not a document about Geelong's interest.
In looking at a matter more specifically within the budget, I want to talk a little bit about the defence industry in Geelong and Geelong's desire to play a bigger role within our nation's defence industry. It is a sensible and clever play for Geelong to try to move into this space. The defence industry is a high-tech industry often with high-tech manufacturing as a part of it. When you look at the future for Geelong, our future has to be in the space of innovation, in research, in high-tech manufacturing, in climbing the technological ladder—doing things in Australia, in Geelong, that you cannot do anywhere else in the world, competing on the basis of knowledge and quality as opposed to competing on the basis of price and low wages. That is why we need to move down a more high-tech path, and in that context the defence industry is a great industry for Geelong to pursue.
There are many advantages about Geelong in terms of its ability to participate within the defence industry. We do have, as I mentioned earlier, a fantastic university in Deakin which does incredible work particularly with composite materials. The carbon fibre research centre at Deakin University which was funded by the then Rudd government is the highest tech carbon fibre research furnace in the world. It really is asserting Geelong as the centre of a future carbon fibre industry in this country. There is also great robotics research done at Deakin that is relevant to the defence industry. There is, of course, by virtue of all the manufacturing history that we have had in Geelong, a skilled workforce ready to play its part. We have great organisations like the Gordon TAFE which are there ready to do whatever retraining is necessary.
Perhaps most critically, we have to the north of Geelong perhaps the best transport and logistics land in the country—a place where Highway 1, the national rail gauge, an airport and a seaport all converge within just a couple of kilometres of each other and there there is land which can be used to do transport and logistics, all of which is highly relevant to any defence industry plan. So this is a great opportunity for Geelong and specifically the LAND 400 project, which is about building the new state-of-the-art Army land vehicles and is a particularly good opportunity to get into the defence industry space. This is a $10 billion project for our nation. It is about updating our land capabilities, and positioning Geelong to have a part of that future is, I think, really important and definitely the kind of thing that Labor would want to support given our history within the automotive industry and given that the design part of Ford's business will remain in Geelong beyond 2016. There are obviously synergies associated with that.
Having made those observations about the significance of the defence industry and the significance of LAND 400, we see from this Liberal government and indeed the Liberal mayor in Geelong a group of people who are prepared to talk a pretty big game but, when it actually comes to delivering runs on the board and doing things on the ground, we have seen absolutely nothing. We saw the Liberal Mayor of Geelong on the front page of the Geelong Advertiser in July last year in front of his Australian flag, brandishing a toy machine gun in front of a fake armoured personnel carrier, talking about how wonderful LAND 400 was going to be. We saw the member for Corangamite dressed up in her military gear inside a tank at Puckapunyal on the front page of the Advertiser in February of this year. There is no shortage of media releases and photoshoots which the Liberals and Geelong will go to to promote this; but, when it comes to actually delivering this project, we have seen nothing. This budget gives us no line of sight at all about future investments in the LAND 400 project in Australia and specifically in Geelong. It is important to make the observation that there is just a sense that we have seen the Liberals peddling some false hope in Geelong, because this is about climbing the technological ladder and this is about a high-tech play going into the next decade. Indeed, Dr Roger Lough made this observation at a research dinner last year:
Don't look at it from a replacement to the car manufacturing side of things but look at it as a way of expanding the intellectual … capacity of Geelong …
We need to bear in mind what this is about, but, that said, I think LAND 400 is of critical importance to the future of Geelong. Under Labor, first pass on this project would have occurred in April of last year. That was deferred and so we have seen the project slip out and first pass did not occur until the beginning of this year. In Senate estimates just this week we have heard about further slippage in the LAND 400 project. Whereas the tenderer was expected to be chosen in early 2017, there seemed to be comments made yesterday that now that may not happen until 2018. What we see under the Liberals here in Canberra and with the Liberals in Geelong is LAND 400 slipping back. The idea being promoted was that we were going to see this project produce jobs in Geelong as soon as possible—that is something Labor wants to see happen. But, while we see that big game being talked in Geelong, we see very little action on the ground indeed.
We see that also in respect of the LAND 121 project. Again, I think some false hope has been peddled here. We had the Liberal mayor visiting Canberra in recent months and talking with people in this building, as well as in the Geelong Advertiser, about the prospect of bringing forward the scheduled review of the LAND 121 project from 2018 back to this year, 2015. This was with a view to working with Mercedes to see a consolidation of their business in Geelong—which would have created a couple of hundred jobs—on the basis that the LAND 121 project review would be brought forward to this year. On 7 March this year we had the Liberal mayor on the front page of the Geelong Advertiser talking a really big game about the prospects for LAND 121 and the jobs that would be created by bringing it forward. We saw him up here in Canberra, at ratepayers' expense, seeking to lobby whoever would talk to him—but what was the outcome of all that effort? I can tell you the outcome of that in this budget is that nothing has been brought forward. We will not see the LAND 121 project being brought forward in such a way that would put Mercedes in the game and would allow those jobs to be created in Geelong.
Once again, a whole lot of photo shoots, a whole lot of big talk on the part of Liberals in Geelong and in Canberra, but when it comes to delivering on the ground, delivering jobs in Geelong, we see absolutely nothing. By contrast, what you have had from Labor over the years is a diligent, a methodical and a concerted attempt to position Geelong into the defence industry. Chemring was the beneficiary of a $1.8 million grant out of the Geelong Region Innovation and Investment Fund when Labor was in power and a further $3.7 million grant under the Priority Industry Capability Innovation Program when Labor was in power, which has been really critical in developing what was perhaps our biggest defence industry player in Geelong today.
Quickstep, a manufacturer of high-grade carbon fibre composite components which are able to be used on the Bushmaster, received a $1.76 million grant through the Geelong Region Innovation and Investment Fund—the fund I referred to earlier that Labor set up when Ford made its decision to leave Geelong. This is exactly the kind of grant which is creating jobs in Geelong, exactly the kind of grant which cannot be made by virtue of no money having been provided to Geelong as a result of Alcoa's decision.
At a state level, Labor has put the Defence Procurement Office in Victoria, which is going to be based in Geelong to position Geelong at the centre of Victoria's defence industry future. On the part of Labor you see action when it comes to putting Geelong within the defence industry. On the part of the Liberals you see nothing but photo shoots and hot air.
It is a pleasure to rise to speak about the 2015 budget and the appropriation bills of the government in response to this year's budget. It is always interesting to follow the member for Corio talking about defence expenditure and Labor members speaking about defence expenditure. This budget, of course, goes a long way to restoring Labor's most significant cuts to the defence budget—in fact, the lowest level of GDP expenditure in defence since 1938—under the previous Labor government. So whenever Labor members rise to speak about the defences forces or expenditure in defence it is important to remind them that, even with significant forward investment into the defences forces this year, we are only recovering to about 1.9 per cent of GDP. This government, of course, is committed to growth in the defence expenditure over the forward estimates, restoring and repairing the budget from Labor's severe cuts to our defence forces—the worst since 1938 in terms of the level of expenditure.
The 2015 budget is a budget that boosts jobs, growth and opportunity for all Australians, and it is no different in my electorate of Mitchell and in my state of New South Wales, where we are seeing a Liberal state government returning New South Wales to the top of the economic indices in our country. We have investment in roads and rail, co-sponsored by the federal government, of course, importantly in Western Sydney and south-western Sydney, with the firm decision of the Prime Minister to build a second airport, a Western Sydney airport, for Sydney, which is being built with infrastructure up-front 20 years prior to the operation of the airport. It is a clever way to do it—a federal government that believes in investing in the infrastructure up-front for the community, making sure the roads are in place, the infrastructure is in place, well ahead of the growth of the airport and the first runway operating within 10 years.
We see in this budget the most significant investment in our small business policy of a federal government since Federation. The instant asset write-off policy of $20,000, a real instant asset write-off policy, is something that is universally being acclaimed by the small business sector and the business community in Australia as the single best policy for small business in our history. It is easy to why, because small business can now go out with confidence and invest, grow, use the money to get that extra piece of infrastructure or equipment for their business, claim the money immediately, return it to their cash flow and get on with delivering a profit for their business. Labor like to speak about their own instant asset write-off policy, which of course was at a level of $5,000. They did not understand that $5,000 is not enough for a small business to really get the key infrastructure upgrade that they need. The benchmark of $20,000 is being seen as the single best policy since Federation for small business. If you understood small business at all, Member for Griffith, you would know that $20,000—
Ms Butler interjecting—
A small business person in the Labor Party? You have really missed your calling if you are a small business person. You are in the wrong party. You would be welcome to transition any time if you believe in small business. You can also vote for this great Appropriation Bill with confidence, knowing that we support your family's small business with a $20,000 instant asset write-off. For the first time we are creating a two-tiered company tax rate. I am sure your small business family will tell you that is the best policy idea that you could come up with in the federal government. You could step up and follow this with some welcome endorsement of the government's policies and say, 'Thank you for doing it.' You could also lobby your leader, the Leader of the Opposition, and tell him that if we could get these measures through the Senate quickly, businesses could invest with confidence. It is disturbing to see that accountants have been saying to some small businesses, 'Please don't do this until the legislation is passed.' That is what some accountants have been advising businesses out there.
There is that lack of confidence, that lack of certainty and that lack of commitment from the Labor Party, and we have got the last of the Mohicans over here, the member for Griffith, who is the only small business advocate within the Labor Party—the last of the Mohicans. You should put a movie together about your struggle within the Labor Party for small business. I have never met someone in the Labor Party from small business. You should get a badge or something. It would be good if she spoke to her leader and said, 'Pass the small business measures straightaway.' If they went through, small businesses could make those investments with confidence. You know that and we know that. All we need is the support of Labor in the Senate. It will be very interesting to see how quickly they expedite those measures in the Senate or whether they are subject to committees or delays. It will be interesting to see whether your comrades in the Greens—your friends and colleagues that you support so much in the Senate and that you work so closely with—adopt your very pro-small business view. I really welcome that we have a small business person in the Labor Party. It is a great development and we should let off some fireworks.
This budget also has the Supporting Australian Families package—a $4.4 billion funding boost. These are very important reforms. I commend the Minister for Social Services, Scott Morrison, the member for Cook, who is running a nannies trial for child care. Families will receive a subsidy of a percentage of the fixed hourly rate of $7 per hour per child, for a maximum of 50 hours per week. Eligibility is based on family income and available only to families on incomes below $250,000—something I am sure members opposite can agree with. It will support the employment of about 4,000 nannies. It is for shift workers and families that have children with a disability. It is a trial. I think it is very good that the federal government is trialling this. There has been a lot of talk in this space for a long time.
An opposition member interjecting—
Qualified nannies? Absolutely. For 2,000 years of human history, we have had people who have been able to look after children—your parents, your grandparents. That has been the way human society has evolved for 2,000 years. They did not need a union to be able to do that. They did not need to be registered or certified by the union. They did not need to be a member of a union to be able to look after children.
An opposition member interjecting—
They have been able to do that job by themselves without your interference for most of human history. A nanny is a very good idea for a person who is a shift worker, because they cannot access traditional child care. They cannot go into the childcare centre during operating hours and say, 'I need to use this service.' They are working at that time. They work irregular hours and shifts, but they still need child care. That is what this nanny trial is about. It is also about families that have children with disabilities, which often means they have complex needs. They may have requirements outside the norm, requirements that are not standard.
Of course there is a benchmark that has to be met when government money is being disbursed. But equally we have to recognise the available parenting and childcare skills and not put onerous requirements on them. That would create a problem and prevent us from going ahead with a nannies program. A nannies program is a very good idea. Flexibility in child care is a very good idea. The future of this policy area is flexibility. The future is recognising that you cannot impose one set of rules on every family or every family structure in this country. You have to have multiple approaches, including nannies and other mechanisms. The government's trial in this space is, I think, a very forward-looking idea. It is a good investment and I think we are going to see some good results that will surprise some of the nay-sayers in the opposition. It will help us move to a flexible model for the delivery of child care, which is something that has been lacking. Certainly the previous Labor government spent a lot of time making child care less affordable.
Another feature of the budget that I think is exceptionally important is the $1.2 billion investment in new funding for national security, building on the $1 billion we announced in the previous year's budget. We have of course extended operations in the Middle East, in Iraq in particular but also in Afghanistan and the broader Middle East. This requires extra procurement through the Defence budget. But there is also money to restore the capability of our security agencies to do their job—restoring capability that was lost due to the funding cuts made by Labor to many of our national security agencies, including Customs and Border Protection. The rate of container inspections in Australia was reduced, which is now seen to have been a major error of the previous government. Other border protection agencies were also cut under Labor—at a time when the terror threat was increasing, at a time when we needed our border protection and customs agencies to be better resourced. Security is a prime function of government. One of the first functions of government is to protect the nation and keep it secure. Without these agencies being well funded, without that funding being well targeted, without those agencies being able to do the job at the level we need them to do it at, we have more illegal goods entering the country and more criminal activity, and we become more susceptible to terrorism. The previous government's cuts to the funding of our national security agencies had a range of implications. This government's $1.2 billion investment in this year's budget goes a long way towards restoring some of the damage done by the previous government.
The most important element of this year's budget is the credible pathway to surplus that has been established. This is not a government which puts out rhetoric claiming to have delivered a surplus when we have not—as we know the member for Lilley was so found of doing. During the last government, the then member for Lindsay famously put out a budget newsletter to his electorate telling them that he had delivered a budget surplus. I think the electorate told him what they thought of him at the last election after he told them that there was a surplus when there was no surplus.
Most importantly about that, we have seen—
Your government's surplus, Alan!
I will speak to our government's surplus. We are on a credible pathway back to surplus—very credible.
Ms Butler interjecting—
I think the key word there is 'credible'. You would be very interested to know, Member for Griffith, that we are reducing the deficit each and every year from $35.1 billion down to just $6.9 billion. What always amazes me about the Labor Party is that they come into this chamber on the appropriation bills and say, 'Oh, the debt, the deficit: you've doubled the debt; you've doubled the deficit,' when they well know that when they were in government they locked in government expenditure. Government expenditure was growing at an unsustainable rate. They continued to promise the world and not fund it. They made promises in education that they could never fund beyond the forward estimates. There was simply no money. They made promises in relation to the National Disability Insurance Scheme, without allocating the money. Whenever you make promises but do not allocate the money, you really are not making a legitimate promise. It is on the never, never.
Of course, what the government is left with, what we inherited when we came to office, is a substantial debt and deficit. In fact, it is the largest single debt that any Australian government has ever inherited in the shortest space of time—six years. Considering the position the previous Labor government started from—
Ms Butler interjecting—
We warned you in the global financial crisis not to spend as much as you did. We actually told you that you were spending too much. You were spending too much. You did spend too much. The rate of stimulus was out of all proportion with what was needed in Australia. It is easy to spend it when it is not your money. It is easy to spend it when you do not earn it. It is easy to spend it when you have no intention of paying it back.
This government is fiscally responsible. We are on a credible path to surplus. Over the forward estimates there will be a $7 billion deficit. We will still be in deficit—that is absolutely true—but we can look any Australian in the eye and tell them that we have taken government debt left to us by Labor, a deficit year on year, down to a $7 billion deficit. That is pretty good progress, considering that the iron ore price continues to drop, leaving a revenue shortfall—which, of course, the former government was so keen to speak about—and it is at a time when the global economic outlook is quite poor and revenue is falling. So it is good progress to reduce the deficit to $7 billion over the forward estimates. And that is before we get to the point of starting to pay down Labor's debt, which, of course, is a whole new proposition in itself. We are borrowing every day $100 million just to fund the ordinary services of government—but, of course, for Labor that is not a problem. There is no spending cut that they approve of and no spending that they do not approve of. They want to keep spending and they do not want to make any cuts. It is easy when it is not your money. It is easy when you are borrowing it. It is easy when you have got no intention of paying it back. That is very, very easy. What a job to be given! People in this country would love to be in an organisation that can borrow money at will, spend it anyway they like and have no intention of ever paying it back. Nobody could operate like that. No business, no family, no budget structure in this country could sustain a Labor Party approach. I think every Australian inherently understands that. Every single Australian understands that.
Ms Butler interjecting—
I will take that interjection. The member for Griffith says that this debt is cheaper than equity, or she is making a point that you can use debt to finance various projects. That is absolutely true. But if you spend $667 billion of debt—
Ms Butler interjecting—
And what do you have to show for it, Member for Griffith? What is it? Do you have a new defence force? Do you have new submarines? No, you don't.
Ms Butler interjecting—
Yes, it is a $676 billion deficit. We could have 100 submarines for that price. We could have a whole Joint Strike Fighter fleet funded. We could have every piece of critical infrastructure in the country funded. Yes, the trillion-dollar backlog in infrastructure in Australia would almost be completed with that level of debt. Was that what was funded by the previous government? No. Can the member for Griffith give me in five seconds a list of things that were funded with that debt? Of course not. You racked it up. That was what was really wrong with the previous Labor government. You racked up debt, you racked up deficits but you had very little to show for it. That, of course, is the biggest problem that we have got, because if you do infrastructure that is enhancing for the economy, if you are financing things that make a difference, that is absolutely right. But this government was left with a debt and deficit legacy like no other—and we are taking steps to fix it in this budget.
So I fully support this appropriation bill. We are reducing the size of government over that period from a high under the previous Labor administration. Given the fact that we have been left with the worst set of numbers that any government has ever been given, it is pretty rich of members of the former government to look at us and say, 'Why haven't you fixed it?' Well, why haven't you helped us to fix it? They are the people now blocking the solution, and they are the people who created the problem. So why don't they come to the party? Either help us fix the problem or get out of the way.
I am glad for the opportunity to address the Appropriation Bill (No. 1) 2015-2016 and related bills and the budget they underwrite, because there are a number of measures within the government's plan that are of great concern to me and to the people I represent.
In broad terms, this budget fits the government's established practice of making a big noise about fiscal responsibility yet doing virtually nothing to demonstrate that responsibility, and then producing a lot of harm and uncertainty on the way through. In many areas, this budget reinforces the disappointment and negative impacts delivered in last year's budget.
In the case of Indigenous affairs, for example, the cuts of more than $500 million last year persist, and are exacerbated by uncertainty involved in the government's Indigenous Advancement Strategy. This runs against the national imperative and is contrary to the rhetoric of the Prime Minister in terms of the urgent need to do more in closing the gap between Indigenous and non-Indigenous Australians.
Kirstie Parker and Mick Gooda, co-chairs of the Close the Gap Campaign, expressed concern that the impact of last year's cuts have not been acknowledged or reversed. They noted:
The nation wants continued focus and action to close the unacceptable health and life expectancy gap. We need bold policy initiatives supported by long-term investment in Aboriginal and Torres Strait Islander health.
The same can be said in relation to policy and programs that cover pensioners and the unemployed.
The Salvation Army released data from the latest economic and social impact survey on 27 May that showed couples with no children on Newstart allowance were living off only $9.57 a day after accommodation expenses. From the survey of more than 2,400 people it was found that 56 per cent of respondents said their financial situation was worse than last year, 78 per cent of respondents in private housing were experiencing extreme housing stress, 62 per cent of parents could not afford an internet connection and 43 per cent could not afford to give children fresh fruit or vegetables daily. There is nothing in this budget that goes to ameliorating this kind of serious disadvantage.
In some areas this budget provides fresh disappointments. At a time when the Australian community is seized by the importance of addressing domestic violence, the government has totally missed the opportunity to provide meaningful resources or programs to achieve change. It is true that any government's first obligation is to ensure safety and peace for its citizens, but it is wrong only to trot out that line in respect of an overblown threat of harm from terrorism, when harm of much larger scope is occurring on a widespread basis in Australian homes, done by Australians to one another.
The only budget spend in this regard is a contribution of $16 million to an awareness campaign that will cost $30 million. Not a single one of the nine critical areas of funding identified by family violence experts has been provided the resources necessary to see change—the resources that are needed to provide shelter, advice, counselling and legal assistance. Renee Carr, executive director of Fair Agenda, responded to the budget by saying:
Last night was a test of the government's commitment to dealing with Australia's domestic violence crisis, and it's a test they failed.
As reported in The Sydney Morning Herald, we know that thousands of women are being turned away each year from crisis centres and refuges. We know that thousands of women are turned away from community legal centres and that thousands of calls to domestic violence hotlines go unanswered. Karen Willis, executive director of Rape & Domestic Violence Services Australia, has said that they need $2 million to ensure that one in four calls do not go unanswered.
At the risk of being howled down by those who believe that any criticism, however reasonable, of our approach to the threat of terrorism marks you as some kind of soft-hearted traitor, it is ridiculous that the government is applying $1.2 billion to meet that threat and only $16 million—or a bit more than one per cent of that amount—to address a scourge that kills a woman in Australia every week. It affects one in three women over the course of their life and it is the leading cause of death, disability and ill health in women between 15 and 44 years of age.
Good government requires a focus on substance, not surface, and if we are serious about reducing harm and violence there are several areas of much greater concern than terrorism per se. Of course, we need to be wary of the potential for such acts and properly resource our law enforcement and intelligence agencies. But when we take the imperative to protect our citizens and residents from harm seriously, we cannot apply such a disproportionate focus on terrorism when much more frequent and harmful kinds of violence are being ignored and neglected.
What the Lindt Cafe siege showed is not a failure to deal with a potential terrorist but rather the failure to deal with a man who perpetrated serious domestic violence and, to some degree, the failure to take account of a person who was likely suffering from a mental illness and who had a history of strange behaviour. I am very sorry that this budget further perpetuates the government's inclination to beat the national security drum while failing to combat more immediate and harmful dangers in our society.
Another area of fresh disappointment is the decision to take $100 million, or 15 per cent of the total budget, out of the Australia Council for the Arts. There has been no justification for this cut, and it flies in the face of the reform process the Australia Council has undertaken, the outcomes of which were announced, with the responding strategic plan launched by the current Minister for the Arts.
The decision to pull more than $105 million into an arts fund that will be run by the minister and the federal arts ministry is not based on any review or analysis that indicated the need or value of such a move; nor was it done on the basis of any consultation with the Australia Council or the broader arts sector. It would appear to be a politically motivated decision aimed at giving the minister the unstructured and unsupervised power to reward friends and pick winners—perhaps a grand opera cycle by Andrew Bolt or a set of interpretive dances about the ways in which data retention is good for one and all!
The point is that what should be out of the question in an independent process could potentially be approved solely at the discretion of the minister. This is terrible decision-making and it will impact heavily on Australian arts and culture. The minister himself has previously argued that art will always provoke debate, saying:
… that's why we have an arms-length and peer-reviewed structure for the allocation for the funding.
Now he has altered that sound practice.
The Australia Council will lose more than 25 per cent of its discretionary funding outside the support provided through its major programs. In response to the surprise cuts, it has already been forced to announce the cancellation of the ArtStart, Creative Communities Partnerships Initiative and Artists in Residence programs.
In this budget, our international development assistance is further hammered, with aid to Africa slashed by 70 per cent, abandoning the Labor government approach of being prepared to help people in the poorest and most disadvantaged nations.
The Minister for the Arts and the Minister for Foreign Affairs, rather than safeguarding the interests of their sectors of responsibility—whose best performance and function you would think they would understand, represent and support—instead appear to be presiding over their ransacking. With friends like these, who needs enemies?
On a similar theme, this government's approach to retarding creativity and innovation, it is sad to see the ongoing uncertainty around the operation and support of Australia's cooperative research centres. Sadly, this is entirely in keeping with the Abbott government's tendency to hamstring scientific research in Australia. Previously, it has been cuts to the CSIRO, with $111 million chopped out over four years, in addition to reduced funding for the Australian Research Council and the Australian Institute of Marine Science, among others. Taken all together, the Minister for Industry and Science has presided over $3 billion of cuts to science, innovation and industry programs.
In Senate estimates yesterday, it was confirmed that, in the health field, the Abbott government has cut $600 million from drug and alcohol, mental health and chronic disease services. Of course, the Treasurer did not think to mention these cruel and counterproductive cuts during his budget speech.
There was not even one mention of climate change in the Treasurer's budget speech, which is bizarre in itself, but of more concern is the fact that, through this budget, government spending on climate change measures is being halved, from $1.35 billion in 2014-15 to $700 million in 2015-16. Specific cuts have been made to the National Landcare Program and the National Low Emissions Coal Initiative. The electorate I represent wants to see action on climate change; it wants to see Australia make rapid progress towards a low-carbon economy and take advantage of our natural conditions and our human capital, when it comes to science and innovation, by developing world-leading renewable energy and energy efficiency technologies.
Other matters that did not rate a mention in this budget but that are of enormous concern to the Australian community are affordable housing and urban public transport.
The electorate I represent is not interested in overheated rhetoric about terrorism and cybersecurity; it wants to see real action on domestic violence, social disadvantage, affordable housing, public transport, mental health, and climate change. The electorate I represent is happy to consider sensible reform in areas like superannuation, capital gains tax, negative gearing and corporate tax avoidance, in order to improve our capacity as a nation to invest in the things we share: health, education, the environment and essential community infrastructure like public transport. This budget unfortunately staggers on in a kind of pale imitation of last year's budget. It is timid and ineffective on the question of a path to surplus and it does nothing to chart a path towards a fairer, smarter, healthier, more creative and more sustainable Australia.
Last year I began with the iron law of economic history as laid down by Niall Ferguson, the great Harvard economics historian, and as relayed through the history of the Medicis, the Ottomans, through so many different empires—from the Spanish and others—and that was the simple point: those societies, those states, those nations that live beyond their economic means will ultimately suffer an enormous reckoning. To put it another way, to paraphrase Charles Dickens's Mr Micawber, if you spend more than you have, the answer is simple—unhappiness.
In the end, the idea that we can perpetually spend more than we have, more than we earn, leads to a fundamental problem: the generation that expends is engaged in intergenerational theft, and their children and their children's children will pick up the bill, and they will pick it up in the form of lower living standards, greater pressure and fewer funds to achieve the things that are important. In other words, as each family knows, as each business knows, if we do not budget prudently now, the reckoning that shall come in the future will not necessarily be borne by us but by those that come after us, and that I would think is a matter of deep regret for each member of this House.
Where there have had to have been difficult choices in recent budgets, that is because there were bad choices in previous budgets. It is a very important thing to understand. Having lived through the Home Insulation Program, foreseen, forewarned and sadly having to pick up the pieces, I can recognise that there are profound social consequences of bad policy. Right now, we are going through the process of compensating the businesses that suffered from the Home Insulation Program. I personally talked with, met with and finalised compensation for many of the families. Indeed, we dealt with all of the families of the four young men who were involved with the Home Insulation Program. The grand point here being: bad choices lead inevitably to hard choices, and that is the great historical situation in which we find ourselves.
Fortunately, we have made hard choices, and that means that we are able to better manage our circumstances. We can see the decline in the budget deficit from $36 billion to $26 billion to $14 billion to $7 billion over the out years, and then heading towards a long-term sustainable position. This comes against a budget which we inherited which, over its previous six years, had gone from a surplus of $20 billion to deficits of $27 billion, $54 billion, $47 billion, $43 billion, $18 billion and $48 billion, by my recollection. What does that mean? It means that we went from a position of profound national economic security to profound expenditure. Of course there were external events, but what was extraordinary was the degree of inbuilt ever-growing expenditure beyond the capacity of the budget to meet it, which had been left as a legacy when the Rudd and Gillard governments were voted out. That inbuilt expenditure was enormous.
So, to the extent that we are going through the process of bringing Australia back to a sustainable economic position, it is also important to understand that we have had $90 billion of write-downs over the four years of the current forward estimates in revenue. That means, had we not made the changes we did, not only would we have not been able to have made the reductions; we would have been an additional $90 billion worse off than the budget papers now indicate. So it is the comparison with the counterfactual, not just the absolute, which is critical here. We have closed that $90 billion and we are making real reductions in the annual deficit. That is an extremely important intergenerational legacy, a fundamental intergenerational legacy.
When you look around the world, whether it is Greece or Ireland or Iceland, whether it is Italy or Spain, whether it is the example from Asia or from Latin America, in the end time catches up with everybody who spends more than they have. In the case of families and businesses, it is earlier. In the case of nations and budgets, it is later. But the iron law of economic history, as outlined by Niall Ferguson and so many others, is inevitable. If you indulge beyond your means, no matter how worthy the seeming cause, in the end you will have disrupted that cause. You will have left a legacy which is unsustainable and unattainable in terms of allowing future generations to experience the same outcomes. Where there have had to have been hard decisions, I repeat, it is because previously there were bad decisions.
Having said that, I think we have achieved an extraordinary outcome in this budget. I want to address it briefly from the perspective of my own electorate of Flinders, with regards to the Roads to Recovery program, something that is of extreme importance in a semirural electorate. Across the councils that I represent we have seen a double payment—more than $8.1 million across the electorate: for Bass Coast Shire, $1.33 million; for Cardinia Shire, $2.34 million; for Casey city, $2.12 million; for Mornington Peninsula Shire, $2.29 million; and for French Island, which is unincorporated, $38,000, and that will assist, I hope, in grading and maintaining the central spine on that road.
Through the $1 billion National Stronger Regions Fund, which deals with national infrastructure projects in regional areas, I am absolutely delighted that the Casey Cultural Precinct, or Bunjil Place, just outside of my electorate admittedly, received $10 million in the budget. It is an area that effectively encompasses both the seats of Holt and La Trobe. It is a tremendous outcome for the City of Casey. The Commonwealth money should leverage state money. I call on the state to match or exceed the Commonwealth's funding, as well as to support the great work of the City of Casey. This cultural precinct, I hope—and it is something I will work towards—will be a brilliant architectural outcome and a magnificent community asset.
I would like to see, whether it is the National Gallery of Australia or the National Museum of Australia, whether it is the National Gallery of Victoria or the Museum Victoria, place some of their holdings in the Casey cultural centre as a Victorian regional precinct. Each of these institution holds far more in their stocks than they are able to display for the public. That additional holding should be available. I would like to work with each of those four institutions to find one that will establish a regional outpost, or regional centre, in this magnificent, new Bunjil Place. That, for Casey, one of the fastest-growing precincts in Australia, would be a wonderful vote of confidence and a real destination maker.
In addition, the Stronger Communities program, announced in the budget, will provide $150,000 a year over two years to fund small capital projects in local communities. I will be establishing a local community advisory panel, which will operate in exactly the same way as the panel for the Anzac Centenary grants, and they played a tremendous role in advising on critical projects. Soon enough we will be calling for panel members, and soon after that we will be calling for projects.
Against that background, at the end of the day, the heart and soul of this budget was about jobs both for families and created by small businesses. Elsewhere, the small business package has been covered. But for the thousands and thousands of small businesses in the electorate of Flinders, the instant asset write-off is something which they have talked to me about each and every day that I have been in the electorate since the budget.
The tax deductions for small businesses are of tremendous merit, as is the recognition of sole traders and unincorporated entities. These have received a great deal of positive approval. At the end of the day this budget is about giving people the chance to be their best selves by giving them the chance to employ, and by giving them the chance to be employed. For that, I commend the budget and I commend the general direction of giving the future generations the best chance to live the life of their choice.
I just listened to the member for Flinders with interest, and I want to pick up on one point he has made. He referred to the intergenerational theft. As Minister for the Environment perhaps he should consider his government's lack of action, and his personal responsibility in that as Minister for the Environment, with respect to the intergenerational theft of our lack of a response to the issue of climate change.
As I have said on other occasions, the budget reflects a government's priorities and its values. Budgets do not lie, and the figures within them speak for themselves. Last year's budget, the 2014-15 budget, exposed the Abbott government's values, its election spin and its true agenda. It also exposed a government that could not be trusted, that was arrogant and out of touch, and that clearly lacked compassion.
The Australian people showed their discontent after they quickly learnt about the government they had elected. Indeed, only earlier this year, we saw that the Prime Minister, and, I suggest, the Treasurer, hold onto their jobs by their fingertips. As a result of that, the 2015-16 budget, as contained in the Appropriation Bill (No. 1) 2015-2016 and cognate bills, has a very clear objective. Its objective is to secure or save the job of the Prime Minister and the Treasurer and to win back political goodwill that was lost as a result of the government's 2014-15 budget.
The centrepiece of the 2015-16 budget is the policies relating to small business and child care changes. However, when one digs deeper into those policies and looks beyond the government's media spin in respect to the budget, what we continue to see is a budget that is filled with unfair and heartless policies. Indeed, it is those policies that underpin this budget. It is a budget that the government has tried very hard to sell as one that is good for Australia. Yet, simultaneously, we see that the government's own messaging has had to be changed. In fact, they have made a 180 degree backflip with respect to their debt and deficit rhetoric, which they had clung to for six years whilst they were in opposition. As soon as they came into government, within in a very short period of time they have had to do a complete backflip on that, as we saw in this year's budget. The hypocrisy of that flows right through to everything else we see in this budget.
Concerningly, this is a budget that has no plan and no vision for the future. Indeed, the government's spin has not fooled the Australian community broadly, and it certainly has not fooled astute business leaders or economic analysts. We have seen that even since this budget business confidence continues to fall. Only last week there were reports of capital expenditure across the country declining quite significantly. Capital expenditure, as we all know, generates economic activity throughout the country. And there have been other reports that point to similar trends.
Clearly, the government has not won back the confidence of the Australian people. The problem with this budget is this: if the budget does not have a vision and a strategy for the future of Australia, and if the budget deficit continues to be at levels that are unacceptable—and the fact is that this government has been in office for almost two years—the government can no longer continue to point to the past government and blame all of the woes on the past government. It has had plenty of time to change direction as a result of implementing, supposedly, policies that would work better. The truth is that the government is unable to do that. But if the economy continues to remain weak, as it is, then what happens is that unemployment rises, hardships continue to increase, small and medium businesses struggle, and tax receipts fall and then we see the Abbott government, by necessity, having to impose more unfair cuts on the broader community. Unfortunately, those unfair cuts, inevitably, add to the suffering of the most vulnerable people in this country, as we saw them attempt to do with their 2014-15 budget. Even worse, we have seen in this budget some of the measures that the Abbott government clearly understood were not popular and clearly understood that the Australian people were not going to support rebadged in a different way. The attacks on the pensioners that we saw in 2014-15 have been recrafted. Now, instead of doing away with the indexation change that the Abbott government wanted to implement, what they have come back with is reducing the limit on the assets that pensioners are allowed to hold before their pension gets cut. The truth of the matter is that that is going to take away $2.4 billion from pensioners over the forward estimates—that is the bottom line. That is $2.4 billion that most pensioners would spend in this country and add to the economic stimulus that they would have been able to do had those funds not been cut.
We see that also with the Medicare tax that the Abbott government wanted to introduce and all of its different versions of it. Yes, they appear to have sidelined that, but what they are going to do now from this budget is freeze the MBS payments to doctors. The net effect of that is that doctors will get less money from the Commonwealth for their service and in turn it will force them to put up their costs to their patients when they come through the door. It is a backhanded way of bringing in a Medicare co-payment. But probably the most pretentious spin of all in this budget is about the changes it wants to make to the childcare rebate and the pretence that this government cares about young families It wants to pay for those changes once the child gets to six-years-old and above by taking away the family tax benefit B payments that are currently available to families. In other words, we will give you a bit more money in the early years—this is what the government is saying to families—but we will take it away from you in a few years' time. In other words, you are going to pay, you the families, for this so-called beneficial change that we are bringing in. In my view, that is blatant deception because every child will grow through its early years and eventually turn six-years-old.
There are other matters about this budget which are deeply concerning. Some of the most unfair parts of the 2014-15 budget have been carried over into this budget: the $1.3 billion of pensioner concessions; the cuts made to the states, forcing them to impose additional costs on the people of their respective states; the nearly $1 billion dollars of cuts to local government as a result of freezing the Financial Assistance Grant program to local councils across the country; the $80 billion of health and education cuts—and I believe that the health cuts have had another $2 billion added to them; the $500 million cuts to Indigenous programs; the further cuts to Australian foreign aid, taking Australia's foreign aid spending to 0.22 per cent of GNI, which is, I understand, the lowest level on record. Then we have had the billion dollar cuts to schools and apprenticeships funding and another billion dollars of cut to industry assistance programs. These are all still in this budget. The people of Australia have to wear all of these cuts. And then we turn to the additional new cuts that the Abbott government has made in this budget and the 80,000 women who are likely to lose eleven and a half thousand dollars of paid parental leave. This was brought in as part of the legislation five years ago. I have never heard a word of criticism about it but all of a sudden these women are accused of double dipping. If the government members genuinely believe that they are double dipping, why did they not raise it five years ago when the legislation was first discussed and debated in this place? Then we have $125 million of cuts to the child dental benefits scheme; $144 million of cuts to the Medicare Benefits Schedule for child health assessments; $69 million of cuts to dental and allied health for our veterans; plus another $20 million of cuts to dementia and aged-care funds. The point I make about all those cuts is that they go to the heart of families in this country. They are direct cuts on the weekly budget of families across this country. One that has not attracted much media attention is that fees for partner visas in this country, under this government, have gone up from $3,000 to $6,865 over less than two years. Those are partner visas—in other words, families trying to reunite and come together. It is totally unfair.
Then we also move on to the young people of this country and the 22- to 24-year olds that are being told, 'Instead of getting Newstart, you will be put on youth allowance and you will have $48 per week cut from your income'. Families are being told, 'We will freeze the family payment rate for the next two years'. Again, that is going to heart of hurting families in this country. This is not a family friendly budget. Indeed, this is not a family friendly government. The spin about childcare assistance and small business support is nothing but a smokescreen.
I want to turn briefly in the time that I have to how this budget affects South Australia. It is clear to me, and to many South Australians, that the Abbott government have little regard or concern for the people of South Australia. In their first year of office, they took away the supplementary local road funding of $18 million a year. Then in the same year, in their supposedly big infrastructure package of $50 billion, South Australia received $2 billion of that, which represents four per cent of the national infrastructure spend. I heard today the member for Grayndler talking about the fact that in this year's budget $360 million—I believe it was—was cut even out of that. Then we have $650 million cut of out of the water buyback program, which was directly targeted and put in the budget to assist with ensuring that the water flowed to South Australia and to restoring the extra 450 gigalitres of water that South Australians had asked for as part of the agreement. That was done away with as well.
But it goes further than that, because they are not just happy to hit South Australia with those cuts; this government that have turned their back on South Australia with respect to assistance to the auto industry. They took that assistance away from the auto industry, and we saw the collapse of the auto industry across Australia as a result. That, in turn, decimated what I call the Edinburgh Parks precinct of northern Adelaide, where many of the car component firms had established their businesses. They are all winding down as a result of Holden's closing in the next couple of years. On top of that, we get a massive hit to South Australia, because the government will not commit to the pre-election promise of building the 12 submarines in South Australia.
So when you put all that together, it is understandable that the South Australian government is saying to the federal government, 'It is time that you did the right thing by South Australia, because your policies are directly hurting the people of South Australia in a way that perhaps no other state is being hurt.' I say again: the federal Liberal members from South Australia in this place need to show some backbone, stand up for the people of South Australia and stand against the cuts that the Abbott government are bringing in, which they know directly impact on the people that elected them to this place.
In respect to South Australia, I know that the health cuts that are being proposed will take away some $655 million over the next four years. The failure of the government to commit to the Gonski education reforms means that South Australia will be particularly hard-hit. It will be hit worse than other states, because it was in years 5 and 6 that South Australia was going to pick up most of the Gonski funding. So when you then go to CPI increases on your funding, South Australia starts with a much lower base than it would have if the Abbott government had committed to the Gonski funding. So it will be particularly disadvantaged. This point was very much made to me last week when I met with several of the principals of the schools, when they were here in Canberra.
I said from the outset that this is a budget with no vision and no strategy. I contrast that with the response from opposition leader, Bill Shorten, in the budget reply speech that he made on the Thursday night. Certainly, he has not announced all of Labor's policies, and nor would I expect him to. But what he made clear was that the future of Australia rests in a government that has a long-term strategy, a government that looks at the young people of this country and what is required to ensure that they too have a future, and a government that actually has a plan—not just a one or two-year election plan—but a plan for a future of the nation. This budget simply does not do that.
I am pleased to rise tonight to speak on Appropriation Bill (No. 1) 2015-2016 and cognate bills, a day after Western Australia Day. I hold the member for Makin in high regard but I would disagree with many of his comments, because over the two proceeding periods of this parliament his government had the opportunity to remedy many of the issues he raises in this chamber. In that sense, there are matters that should have been addressed that the Abbott government is now left to clean up and address in order to develop the strong economic base this country needs.
Western Australia Day is a day to celebrate all things West Australian. We have a lot to celebrate being in WA, particularly after this budget, which has a lot in it for WA and Hasluck to celebrate. Like everyone in this House, I was here on the Tuesday night that the budget was delivered and could not wait to get back to my electorate of Hasluck to talk to people about how the budget would benefit them and our region. That Sunday I went to the Midland Markets. For those of you who are not familiar with the great state of WA and the electorate of Hasluck, Midland is located to the east of the Perth CBD and in the northern end of my electorate. Midland is home to a rapidly growing population and a strong small business community, but that is evident right across Hasluck. When I visit the Midland Markets each month I speak with a lot of the small-business operators, who consistently tell me how each day, each week could be the last for them.
It is tough out there for small businesses. That is why when I visited the Midland Markets on the Sunday after the budget, I was thrilled to have small-business owners from the region approach me and tell me that because of this budget and our Growing Jobs and Small Business package, they have renewed confidence and the ability to, in many cases, expand their capacity, which means more jobs, more businesses and a stronger local economy.
The Growing Jobs and Small Business package is unprecedented and has been welcomed by small businesses on the ground. We know that small businesses are the engine room of the economy and this is particularly true for Midland, and indeed across Hasluck. That is why the package is not just great for small businesses but for the local economy and local region. This means that Hasluck will thrive due to this coalition budget.
The Growing Jobs and Small Business package includes for small businesses with annual turnover under $2 million a 1.5 per cent tax cut for incorporated small businesses, and for unincorporated small businesses a 5 per cent tax discount, up to $1,000 a year. This means that small businesses will have more money to spend on their businesses. In addition to this, small businesses can now claim an immediate tax deduction for each and every asset purchased up to $20,000 each. A hairdresser in Midland was telling me that due to this initiative she is now able to purchase new chairs and equipment for her premises—a real impact on the ground, where it matters most. I cannot see a better way to assist small businesses to get ahead. As a result of this new investment, the hairdresser was telling me that she will consider hiring a new apprentice. These measures have flow-on effects throughout the local community. Small businesses will also be supported through depreciation write-offs.
Because we know the positive impact small business has on our local community, we want more people to take the leap of faith and start a small business. It is a risk to start small businesses and that is why we are helping start-ups by cutting red tape and making it easier to start a business, and by allowing start-ups to immediately deduct professional expenses for starting their business.
As you can probably tell by now this is a budget for the future, preparing us as a nation for the challenges ahead. In that vein, another key initiative for the future is the recent announcement that the coalition government will support the establishment of the Curtin medical school in Midland. Since my election in 2010, I have been fighting for the people of Midland to establish a university campus in their region. The eastern suburbs of Perth have been underserviced for far too long. When I was first elected it took a student in Midland over two hours on public transport and over an hour on the road to travel to the nearest university campus. This is simply unacceptable. That is why I am committed to fighting for better access to tertiary education in Midland and why I am thrilled that it is a coalition government that has delivered this to the people of Midland.
The Midland medical school will offer a five-year direct entry medical program and will select and train students to deliver better health outcomes in the regions that need it most. Sixty Commonwealth-supported medical places will begin in 2017 and will ramp up to 110 new places per year in 2022. I must acknowledge the tremendous support of the WA state government, led by Premier Colin Barnett, and Curtin University who are funding the infrastructure to host the school. Many people have worked towards this positive outcome and I must thank and acknowledge the Hon. Alyssa Hayden MLC, City of Swan, Swan Chamber of Commerce, the Hon. Christian Porter MP and the numerous stakeholders and activists on the ground that have been fighting for a university in Midland since the 1980s. The medical school is good for Western Australia and good for Hasluck.
The naysayers out there want WA to have fewer medical practitioners and GPs per capita than every other state. Having worked in the health system, I am cognisant of where the gaps are within both the urban regions of the Perth metropolitan area but, more importantly, out in rural WA where there are many doctors on 457 visas. They want us to have the highest reliance on overseas-trained doctors in the country and they want us to remain at the status quo, which is a current doctor shortage of 950 doctors. This is simply unacceptable and that is why the coalition is planning for the future, planning for the health needs of the future. The WA state government also recognises this and will fund adequate clinical training places, including internships and specialist training places—debunking the myth that there will not be training places for these new medical graduates; there will be.
Conveniently, the Midland medical school will be situated across the road from the new Midland public hospital, set to open in November this year. The students at Midland and those across Hasluck will soon have access to a new educational pathway and opportunity to study higher education that they did not have before. As I said before, this is good for WA, good for Hasluck and good for our future.
I have spoken about Midland and it would be remiss of me focus on just that area of my electorate. This budget benefits the entire region of Hasluck through the record investment in infrastructure. Deputy Speaker, if you come to Hasluck there is construction going on everywhere—construction to make our roads safer and to ease congestion in the region. The major projects in Hasluck include: $18 million for the Nicholson Road grade separation in Thornlie, with $8 million allocated in the next financial year; $612.4 million for Gateway WA Perth Airport and Freight Access or, as I like to call it, the gateway to Hasluck, with $139.5 million allocated next financial year; $36 million for the Roe Highway-Berkshire Road grade separation, with $8.2 million allocated in the 2015-16 budget; and $10 million for the Lloyd Street upgrade, which is on track to be completed at the end of this year.
Through the coalition government's nationwide infrastructure program we are creating thousands of jobs, reducing travel times and boosting economic growth. In WA overall, the government is investing $5.2 billion to 2019-20 in infrastructure, which is a record investment. They are the big projects, but many more local roads are set to benefit from the budget. Hasluck's local councils are set to benefit from the government's doubling of the Roads to Recovery program next financial year. Over $6 million is being invested in local roads.
This budget is the next step in our plan to build a stronger, more prosperous future for all Australians. Unfortunately, the legacy of the Labor government is still lingering—a legacy of debt and deficit. We are cleaning up the mess and, through the budget, we are reducing Labor's deficit from $48 billion last year to $7 billion in four years. I do not want my children or their children to be burdened with the debt of an irresponsible Labor government. That is why we need to ensure that everyone who can work is working and that welfare is used properly by those who actually need it. Welfare is not a right; it is a privilege, and I want to make sure that all of our welfare system is sustainable now and into the future. Those on the other side are no longer the working party; they are the welfare party. Such a shame.
We need to support those who can work into jobs and support those who want to work. Our new childcare subsidy will help families get into work and stay in work. Working families with incomes between $65,000 and $170,000 will be around $30 a week better off, and families earning around $65,000 or less will receive a subsidy of 85 per cent of their childcare fees up to an hourly cap. With the child care safety net, lower income families will still get access to early childhood learning even if they do not meet the activity test. In addition to this, we are also trialling new ways to support families, giving more choice and more access.
Children should be safe in the playground and should not be exposed to any unnecessary risk posed by contagious diseases. As a former health department executive, I am particularly pleased that the coalition government introduced the no jab, no pay policy. Parents who do not immunise their children will not receive childcare subsidies and family tax benefit part A supplements, with only a few exemptions. As a parent myself, I know how practical and positive these measures will be for families with young children.
This budget is responsible, measured and fair. This is evidenced in other budget measures such as pension certainty with increases twice a year, record funding for hospitals and schools, helping farmers doing it tough dealing with drought and, as I said before, support for small businesses and job seekers. We are also ensuring that we keep Australians safe through our national security and border protection measures.
Those on the other side of the House need to approach this budget in good spirit, stop playing politics and start constructively working not only to improve the budgetary fiscal position of this nation but also to support the jobs, growth and opportunity of the future.
The consistent feedback that I am getting on the ground is that this budget is what is needed. It is what will make a difference for the long-term future of our nation. Australians understand that we all need to work together, we all need to contribute to the future of this great nation and governments should get out of the way of their opportunity to succeed.
Those on the other side are out of touch with everyday Australians and the people of Hasluck. Time and time again they showed that they do not have a plan for their future; they just want to increase taxes and repeat the waste and ineptitude of the Rudd-Gillard governments. I will continue to fight for the future security of our nation and will not rest in the face of such negativity and short-sightedness from the Labor Party.
It gives me great pleasure to support the appropriation bills, and I commend the bill to the House.
The budget is a great opportunity for the government to reset and to focus on the problems that ordinary Australians are facing, and never was there a greater opportunity squandered than when the Treasurer stood up before Australia a little over a fortnight ago and delivered his second budget. After a year and a half of overpromising, underdelivering and absolute downright deception, what we have seen is another lost opportunity for the people of Australia and for this government to do something to help the people who really need it. They have failed in their fundamental mission. They have failed in the test that we set for them, and that was to deliver a budget which was going to kick-start economic growth, drive employment, deal with unemployment, boost confidence and get back on track. Instead they have delivered a budget which does none of those things, increases debt and increases deficit. So it has failed the test that they set for themselves, but it has also failed the test which we set for the government, and that was to deliver a fair budget.
There are many people in my region who are forgiven for thinking that the Treasurer needs a map to find his way down to the Illawarra, because there is little evidence within the budget that they know the region exists. This is a time when the people of the Illawarra were looking for some assistance and for some recognition of the struggle that they are facing. Two weeks ago the Australian Bureau of Statistics released its latest unemployment data. People picked up the local paper and saw emblazoned across the front page 'Unemployment hits 9.4 per cent'. You may not be aware of it, but this is the highest rate in over five years, from a Prime Minister who said unemployment was going to be his No. 1 priority. They like to say that they are a government of work, not welfare; the truth is that they are a government of neither, because the jobs are not there for the Illawarra—9.4 per cent unemployment—and there is no hope of any strategy to turn it around in this budget.
Let's contrast this to the steps that we put in place when we were in government. Labor understands the needs of regions like the Illawarra and like the electorate of Throsby, which I represent. In going through the global financial crisis, we understood the pressure that the region was going to face. We put in place stimulus measures which ensured that people remained in jobs but also that much-needed infrastructure projects were attended to. We brought forward what would probably have been in normal times around a decade's worth of infrastructure spending, whether that was on school infrastructure, civil works projects, works at the university or other nation-building projects. We put those things in place.
We put in place a local employment coordinator. The Illawarra was designated as a priority employment area because of the higher-than-average levels of unemployment. A coordinator was in place to connect job seekers with job opportunities and to ensure the people who were looking for work were actually ready for work and had the skills and ability to meet the needs of the labour market. If you think that you are a party of work, not welfare, then one of the things you would have done is said that position is absolutely critical, but in one of their first decisions they defunded those local employment coordinators. There was no priority for helping people in struggling regions—particularly areas of high youth unemployment—in coordinating that work and ensuring people found their way from school to work, from unemployment to work.
In fact, they have gone even worse than that. In our last budget Labor made provision for some major infrastructure projects within the Illawarra. I have in mind in my own electorate and my colleague the member for Cunningham's electorate the Maldon-Dombarton rail link, a critical piece of infrastructure. Labor wanted to harness the excitement of the private sector to invest in this project by putting up over $50 million worth of seed funding to get started on a public-private partnership to get that crucial piece of freight rail built to join the inland rail network to the port of Port Kembla. And what does the government do? It cancels the funding. The project has not gone ahead.
We can contrast this government's cuts to higher education with over $150 million worth of capital works which were put in place in the University of Wollongong alone to ensure that that institution was fit to change to educate the workforce of the future.
Everywhere you look throughout the Illawarra, whether it is schools, whether it is hospitals, whether it is TAFE, whether it is the university, you can see an attitude of either neglect or indifference to the situation facing the Illawarra. But, if there were an area needing attention—if there were an area where the government needed a pivot, if you like, to stop, reconsider and change direction—it would be in the area of health. I want to talk on two areas in particular.
At the 2014 budget, in relation to primary care, the cornerstone of the government's budget strategy was a fundamental alteration to the way that Medicare rebates and GP visits are dealt with. The first part was a $5 co-payment which would have costed consumers close to about $3 billion over four years. The second part was a freeze on Medicare rebates, which meant a cut of around seven per cent between 2014 and 2018. According to the Medical Journal of Australia, the cost of that measure alone would have been about $8 a visit by 2018.
The government has dumped the first part of that proposal—for now. They have changed their strategy, not their minds. The health minister has confirmed this. They have dumped the co-payment—the dreaded GP tax—but they remain committed to the second part of this radical re-alteration, and that is the freeze on the GP rebates. As I said, over $8.40 per visit will be the net impact of this by 2018.
So that was the first part. The legacy of those decisions is to render many medical practices financially unviable. There will be parts of Australia—and particularly in regional and rural Australia—where medical practices will simply not be able to survive because of the impact of these freezes on Medicare rebates. Doctors in these areas know that they are simply unable to pass the costs on to their patients, because the patients cannot afford them.
So the first legacy of last year—we were looking for some change in this policy but it simply does not exist—puts a big question mark over the economic model which drives GP practices around the country. If you say you are interested in doing something about small businesses, well here is a small business which is crying out for some help. It is a small business which provides an absolutely critical service in over 12,000 places right throughout the country and there is no salvation on the horizon.
The second area in the last budget went to hospital funding. Deputy Speaker, this is an area which I know your own state government in Victoria has been highly critical of. In fact, the last two Victorian governments have been highly critical of decisions taken by the federal government in relation to hospital funding. We need to go back a few years to understand the importance of this. Under the previous government an agreement was reached—a hard-fought agreement—with all the states and territories. It effectively broke the cycle of the periodic healthcare agreements, where states and territories would come cap in hand to the Commonwealth, seeking an increase in their funding for hospital costs, and put in place a rational formula which dealt with the increases in hospital costs and which built in a sustainable formula upon which states and territories could do health system planning well into the future.
One of the first decisions of the Abbott government was to tear up the health and hospitals agreement with the states and to restrict Commonwealth funding to CPI funding plus growth. Now, as anybody who knows anything about health system funding, health price increases are always significantly in advance of general CPI increases. The net effect of this decision is that we have built in unsustainability into our hospital systems around the country. Over the next few weeks, as state and territory treasurers are standing up around the country delivering their budgets, they will either have to find cuts and savings from other areas of their budgets—which means cuts to other state services—or they will be cutting their health and hospital funding to accommodate the federal government's cuts. Those are $57 billion worth of cuts. Instead of reversing this decision, it has actually been built in and added to in the budget bottom line.
In the week after the budget the Minister for Health made a great song and dance about an agreement that she has reached with the pharmaceutical industry, including the Pharmacy Guild of Australia. She said that the result of this agreement was going to be that the Commonwealth and people who were seeking to get their prescriptions filled in pharmacies were going to get access to cheaper medicines. Well, nothing could be further from the truth.
It is true that within the medicine and Pharmacy Guild agreement that the government has achieved savings. But those savings have not been passed on to the consumer. At the same time the government introduces a bill to give effect to the pharmacy agreement and the medicines agreement in the House of Representatives, over in the Senate, in the other place, there is a bill, which you are still committed to, that will increase the cost of pharmaceutical benefits to all Australians—an increase of up to $6—and restrict access to the PBS safety net. The net effect of this is that, far from helping health consumers, you will be paying the medical and pharmaceutical companies less for the drugs, but you will be charging the consumers more for them. You have to ask yourself: how is that fair? You will be paying the pharmaceutical companies less for the drugs that we are purchasing through the PBS, but you will be charging the consumers more through the increased co-payments and the restriction in access to the safety net. These are just a few of the cuts and the inconsistencies that we saw in the government's first budget that are reinforced in this budget.
When families hear the government say the word 'fair', they know they have to beware. Entrenched in this budget through a range of cuts, through independent modelling, we have seen families who can afford it least slugged with cuts. A family with a single income of around $65,000 a year and two children will be, on average, $6,000 a year worse off by 2018 under the measures built into this budget. A single mother with an income of $55,000 a year and two children will be around $6,100 a year worse off. This is just an example of where the government failed to use this budget as an opportunity to atone for the sins of its first budget, to reverse direction and to put in place the measures that the country really needs.
Thankfully there is an alternative. In his budget speech in reply, the Leader of the Opposition set out the beginning of a plan which deals with putting in place a fair tax system, tackling loopholes in superannuation, putting in place measures which will crack down on multinational tax avoidance, ensuring that we have an education system which is fit for the future, and encouraging innovation through a $500 million new smart investment fund which will back great ideas that we think are out there ready to innovate and build the new industries and the jobs of the future. There is an alternative. The government has missed an opportunity, and the people of Australia will not miss the government when it comes to the next election. (Time expired)
The member for Throsby talked about lost opportunity. If he were speaking to his small businesses in his electorate, he would know that they think it is Christmas. They think the instant asset write-off, or the tax cut, is fantastic news. They are incentivised. They have gone out there and purchased. They are looking at investing. He talked about fairness. If he has talked to families needing child care in his electorate, he would know that they are more than happy with the extra support that they will be getting from the government. We heard before from the member for Makin, from my state of South Australia. As usual, he talked about the unfunded promises of billions that were not there, the revenue that was never accounted for and the usual story that Labor cannot manage money. I will come back to that later in my address on Appropriation Bill (No. 1) 2015-2016 and related bills as to how the federal government is supporting South Australia in this budget. Labor, as usual, reverts back to their planning system, their command economy that failed Europe—Eastern Europe in particular—so many years ago, that has been discredited. Stalin would be very pleased with what Labor propose and with what we hear from Labor.
Let's go on to some positive news about what we propose. This year's federal budget has been a huge boost for small businesses in my electorate. I have spoken to countless small business proprietors and heard firsthand the benefits this will have for them. From plumbers buying cement saws, to painters buying paint guns and cafes expanding and redeveloping, small businesses in Hindmarsh are looking to take advantage of the opportunities that the federal government has provided to them. Recently, when the Treasurer, the Prime Minister and the small business minister came through my electorate, this was the constant message for the small businesses—the cafes, the retail shops—that talked with them as they toured through. This budget will grow jobs. South Australia has the highest business taxes in the country and South Australian businesses are crying out for help. They are not getting that help from the state Labor government as they continue to tax businesses, whether that be through the emergency services levy or the payroll tax. But we have listened to small business concerns, we have acted and we are implementing the assistance they need from us. Business SA has come out strongly in favour of the budget and has said:
The Budget has delivered a much needed boost to small business through targeted taxation measures. It is clear that the Government is focused on the task of growing the economy by supporting small business to grow and help create new and sustainable jobs.
The new $5.5 billion Growing Jobs and Small Business package will help small businesses invest more, grow more and employ more. This is the biggest small business initiative in our nation's history. The government is committed to ensuring Australia is the very best place to start and grow a small business. We have heard before how important small businesses are—the engine room of our economy; 96 per cent of all Australia's businesses are small businesses, employing over 4.5 million people. As our economy changes, the role of our small businesses will be even more important. With the economy in transition we are freeing up small businesses to create new jobs.
The budget delivers $3.25 billion in tax cuts for small business and $1.75 billion in accelerated depreciation measures in addition to the benefits Australian small businesses are gaining from the abolition of the carbon tax. Recently we heard from a cafe who said that their electricity bills had decreased by around 15 per cent—another great story from the abolition of the carbon tax. From 1 July 2015, the government will cut the annual company tax rate for almost 800,000 incorporated businesses with annual turnover up to $2 million by 1.5 percentage points to 28.5 per cent. From 1 July 2015, the government will also provide a five per cent tax discount for over 1½ million sole traders, trusts and partnership structures which are unincorporated businesses with annual turnover up to $2 million. We are ensuring that no-one in small business does not have the ability to benefit from these measures. One of the greatest initiatives is tax deductibility, up to $20,000, for new equipment and investment in goods. This is a substantial increase from the previous $1,000 threshold. Australian small businesses will have the lowest company tax rate for public and private companies since 1967. This is significant and will only further stimulate their ability to go out and expand.
The Growing Jobs and Small Business package also includes measures to reduce red tape and regulatory impediments. This is one of the major focuses and objectives of the government and I know, being part of the Prime Minister's Deregulation Taskforce and working with my colleagues, that we are getting results here—around $2 billion in unnecessary red tape, a major hindrance to businesses, has been removed. Entrepreneurships and business start-ups will immediately benefit from the ability to deduct professional expenses incurred when a business is begun, such as legal expenses on establishing a company, trust or partnership, rather than writing them off over five years. This will provide immediate cash flow benefits for small businesses. Streamlined business registration processes will make it quicker and simpler to set up new businesses. The government will remove obstacles to crowd-sourced equity funding to help promote small business access to finance. These are all important initiatives—as are the employee share scheme provisions I spoke about last week. These measures will help encourage investment, innovation and the start-up of new businesses. These initiatives will help the next Atlassian, Cochlear or Westfield—and every success story in Australia starts as a small business.
Since the government was elected, around a quarter of a million new jobs have been created—but there is more work to do. New measures will focus on making job seekers more employable, reducing the costs of taking on new staff, and bringing job seekers and job providers together. The government is investing close to $7 billion to establish jobactive to improve the quality of services delivered to job seekers and employers.
We are also delivering a $331 million Youth Employment Strategy, an $18 million National Work Experience program and changes to Restart to make it easier for small businesses to receive government support when they employ older workers. One of the great things about this budget is the $4.4 billion Jobs for Families package to give parents more choice and opportunity to work. It delivers on our commitment to support families by making child care simpler, more affordable, more flexible and more accessible. I have worked on this previously with the member for Corio. I am sorry, I should have said the member for Corangamite. I doubt the member for Corio would have been so accommodating.
Over the last two years I have visited childcare centres and also undertaken a survey with parents using child care. Affordability was one of the major issues, and this is something that we have addressed in this budget. We know that families are faced with costs when parents decide to return to the workforce. This package gives families greater choice. In terms of practicalities, it focuses on families with an income of between $65,000 and $170,000 per year who will be around $30 a week better off. Families on less than $65,000 per year will receive ongoing access to early childhood learning and can be eligible for additional financial support through the childcare safety net. Focusing on lower and middle income earners is where fairness comes into play. That is something Labor fails to acknowledge.
The government is also trialling new ways to support families, a home care, or nannies, pilot program to help shift workers such as nurses, police—men and women—and those in rural and regional areas who find it difficult to access mainstream childcare services during normal office hours.
The budget also delivers $840 million over two years for preschool programs. I know, through having children that have recently gone through the early childhood years, how important those years are in a child's development. I have worked hard with my colleagues and also the relevant ministers to get this outcome. This is good news for children, families and preschool providers.
The government is also working to fix Labor's mess in the area of defence. After years of cuts, the federal government remains firm on its commitment to increase defence spending to two per cent of GDP within a decade, building on our promise to provide defence with a stable and sustainable funding growth path. Ongoing reform means that defence will be able to invest smarter and where we can find cost savings they will be reinvested in our defence forces. This is in stark contrast to Labor, which ripped around $16 billion from defence, reducing defence spending to its lowest level as a percentage of GDP since 1938. We are repairing this damage. We are investing in areas of defence to have a strong and sustainable industry.
We also announced last month that one of the options being considered is the feasibility of a continuous build strategy for naval shipbuilding, which would sustain a shipbuilding industrial base and avoid the peaks and troughs currently being experienced. I know, through talking with the defence sector, that back in 2011 a decision had to be made by the then Labor government in order to negate job losses in the defence sector around Australia in terms of shipbuilding.
South Australia, my state, is set to benefit from the government's investment in defence, and I will go through a few examples. The government has already invested over $1.7 billion in support of personnel costs, equipment and services and facilities in South Australia. Some of the major projects outside of defence shipbuilding in terms of submarine maintenance and support, and also the air warfare destroyer, which amounts to $1 billion alone, include around $60 million to support the maritime patrol aircraft at RAAF Base Edinburgh, $34 million to support Enhanced Land Force construction works at the Cultana Training Area, and $11 million for the construction of facilities for the Joint Counter Improvised Explosive Device Capability at Woomera.
The member for Makin—all South Australian federal members would be interested in these points—should note that the Commonwealth government is providing increased funding to South Australia across many areas. Over the next four years, Commonwealth funding for South Australia will increase in each and every year, rising by 30 per cent, or $2.4 billion, over the forward estimates, bringing the total Commonwealth spending in South Australia over that period to just under $40 billion. In terms of specific percentage increases, that is a 36 per cent increase in GST revenue, or $1.8 billion, over four years and a 19 per cent increase in funding for hospitals, or $208 million, over four years. I am sure the member for Throsby would have similar or higher increases in terms of dollars in his state of New South Wales. But, no, Labor cry out for more money which is unfunded. In terms of education, something very close to my heart, there is a 26 per cent increase in schools, or $280 million over four years. Infrastructure will receive $2 billion, including millions of dollars for South Road—which borders my electorate—including the $1 billion North-South Corridor program along South Road. Even under the South Australian Premier's calculation of GST receipts, South Australia will receive an additional $600 million—a massive benefit for my state of South Australia.
In closing, South Australia is doing well from this budget and so is Australia. This is a good budget for Australia, a good budget business and a good budget for families. We are heading in the right direction and the people of Australia know that. I commend this bill.
It gives me pleasure to rise to speak on Appropriation Bill (No. 1) 2015-2016 and related bills before us today. The 2015 budget delivers for Tasmania as it delivers for the people in my electorate of Lyons. The Jobs for Families package will give parents more choice when work-family commitments are being balanced. Low- and middle-income families using the childcare system will be $1,500 per year better off as a result of the initiatives in the budget. From 2017 families on a combined income between $65,000 and $170,000 a year will be $30 a week better off as a result of the Jobs for Families package. As the member for Hindmarsh also mentioned, the introduction of trialling nannies will be of great benefit to people working in the police force and the fire department and people working unsociable hours in the agricultural space. This will provide an enormous opportunity, as well as potentially being able to drive down the cost of child care, which went up enormously under the previous government.
The big-ticket item—and this is certainly the feedback that I am getting from my electorate—has been the small business package. Some would describe it as a game-changer. Here is a government, finally, that is prepared to give back small business some of their own money. We should never forget that the taxes which government is charged with spending come from the dollars that were earned by people paying income tax or small businesses paying tax. We know that many of these are family businesses and we know that they will spend this money better to grow business and create jobs in regional Tasmania than any government could ever do. We welcome the Labor Party's support to back small businesses across Australia. The damage done, though, to small business under Labor was extraordinary. They do not 'get' small business and they do not 'get' independent contractors; we do on this side. I spent a lifetime working with farmers, many of whom are indeed small businesses.
Going back a couple of weeks, it was the Saturday morning after the budget was delivered and I happened to be in the town of New Norfolk in southern Tasmania. I had my little brochures and I was taking the information there, not quite knowing what the response would be. As I walked up the street and started going into the hairdressers, the cafes and the other small businesses up the main street, I very quickly realised that the word had got around. They were absolutely overjoyed, particularly with the instant asset write-off, which I will touch on in a minute.
Mr Tehan interjecting—
Indeed. We have the lowest tax rate in 50 years for small business—28½ per cent, down from 30 per cent—thank you, member for Wannon—has been very much welcomed. But, of course, only a minority of small businesses are incorporated. For the unincorporated businesses, we will see a five per cent deduction—that is for 1.7 million small businesses around the country. The deduction is capped at $1,000. There is, as I mentioned, the accelerated depreciation to increase the threshold for immediate deductibility, from $1,000 to $20,000, and doesn't small business love the instant a write-off.
In the agricultural sector, farmers—who are so important to Tasmania, so important to our country, so important to my electorate of Lyons—absolutely welcomed the immediate deductibility for water infrastructure, fencing, fodder storage and conservation with the three-year depreciation schedule that has been included in this budget.
Small business employs 4.5 million Australians; 96 per cent of the businesses in our country are small businesses. As the Prime Minister often reminds us: this was the best budget ever for small business. Can I also remind my electorate particularly that funding for health in the state of Tasmania over the four years of the forward estimates from budget 2014-15 goes up by nearly 35 per cent. That is an extraordinary amount of money; despite what those on the other side say—out into the never-never. The figures that were never put down in black and white—we cut spending. The facts are that, over the forward estimates funding for health in Tasmania has gone up, as has funding for schools. In fact, funding for schools in the state of Tasmania—Madam Deputy Speaker, you will be astounded to know—has gone up by 37 per cent—
How much?
37 per cent, Member for Wannon. If you listened to those on the other side, and some of the media indeed, you would believe that funding for education had been cut. But in fact these were figures out in the never-never. These were never figures that were committed; these were Labor promises on the magic pudding—or, as we have discovered in more recent days, the money tree.
In the time that is left to me, I want to go over a few of the highlights that I would like to put on the record about the last year and the work that I have done along with my colleagues—the member for Braddon and the member for Bass. The three of us worked collectively to deliver some outstanding results for our state, I believe—not least of all, the $203 million to expand the Tasmanian Freight Equalisation Scheme to include exports going through the Port of Melbourne. This is our highway to the world.
We all know that Tasmania can produce high-quality products, high-quality goods. But it was not a level playing field that we were competing on. The expansion of the Freight Equalisation Scheme, which was first introduced by a Liberal government. It was Malcolm Fraser's government in the 1970s that first introduced the Freight Equalisation Scheme and it was the Abbott government that has put another peg there to make the scheme equitable for Tasmanian primary producers, exporters and manufacturers. It has indeed been welcomed.
Can I also mention the $60 million that has been committed for the Tasmanian Irrigation tranche 2 projects. There are five around the state; three of them are in my electorate of Lyons. I think particularly of the Southern Highlands scheme. It has been oversubscribed as far as water sales are concerned, which reflects the confidence that is growing within the agricultural space in Tasmania.
I mention the Swan River scheme on the east coast, which will be a high-value scheme that will be growing viticulture and horticultural products there and expanding the opportunities for jobs in that part of Tasmania, in what is traditionally a very dry part of my state as well.
Finally in Lyons is the Evandale or North Esk irrigation scheme, based at Dalness, just outside of Evandale. This will allow more intensive cropping—grain production, poppy production—and possibly even dairy production in that part of the state; reliable water, 95 per cent secure.
I think the other story, though, is also the infrastructure spending that we have seen. In my electorate I think particular of the Bridges Renewal Program. We were very fortunate indeed in my electorate. The Northern Midlands Council received a $922,000 contribution for the new Westmoor Bridge on Powranna Road between Cressy and the Midland Highway. If I might describe it to you: there are three extraordinary businesses that are based on one end of Powranna Road. I think of Tasmanian Quality Meats, the Regional Exporter of the Year in 2013; I think of Petuna Seafoods, which has its hatchery there; and I think of Burlington Berries. Between them, the three businesses are employing an enormous number of Tasmanians. They are growing businesses and they are wonderful businesses, and it is this sort of investment in infrastructure, in collaboration with the Northern Midlands Council—and I thank Mayor Downie for joining me when we announced this funding—that is the sort of thing that builds the productive infrastructure that our state of Tasmania desperately needs.
There were two other bridges as well, on the Esk Main Road at Avoca, on a state government owned road, and also further down the Esk Main Road at Fingal. This is about allowing, for example, cranes to access the east coast of Tasmania without having to do pretty well a lap around the state. So there is $3.3 million for those two bridges on the Esk Main Road.
We have also heard much about the Roads to Recovery Program funding that has been doubled this year and will be doubled again next year. Substantial amounts of money are going into local councils there to be used at their discretion as they see fit to upgrade local roads, which benefits small businesses and households in my electorate and allows councils to get on with the constant job of upgrading and maintaining roads in those municipalities.
I have the privilege of being the chair of the Tasmanian roads black spots committee. I congratulate the work done by Donald Howatson from the Department of Infrastructure, Energy and Resources in Tasmania. There is an outstanding list of projects. A number of those have been successful in the electorate of Lyons. I recently had Assistant Minister Jamie Briggs in my electorate at the Perth Primary School there. Anybody could see the dangers that are occurring at drop-off time, where mums are coming to drop off their little kids at the primary school in a cul-de-sac and there are kids and teachers walking here, there and everywhere. A rather modest contribution of $50-odd thousand dollars from the Commonwealth government will rectify this and will make it much safer for mums picking up and dropping off their kids.
In the time left to me I will mention the solar community fund. This has been a $300,000 rollout around my electorate. I am very pleased to say that the beneficiaries included the New Norfolk District Football Club, the Gagebrook Community Centre, the Bagdad Community Club, the Sorell RSL Club, the Tasman Civic Centre at Nubeena, the Oatlands RSL Club, the Bicheno Golf Club, the St Helens Healthy House, the Longford RSL Memorial Club, Aged Care Deloraine, the Port Sorell Men's Shed and the Deviot Community Association hall.
There have been a number of other projects over the last 12 months that I would like to mention as well. In particular I was very pleased to announce $820,000 which went to the Inland Fisheries Service. In my electorate, there is Lake Crescent and Lake Sorell. The Inland Fisheries Service have done an amazing job. People said it could not be done, but through persistence and through science they have been able to eradicate carp from Lake Crescent. The next job now is Lake Sorell. It is an outstanding piece of work. I have never seen such commitment as that shown by these people, who are so keen and committed to the work that they are doing. I was very grateful for Minister Hunt's support of something that I advocated very strongly for.
The other day it was a privilege for me to open the Dunalley community hall. This was a tragedy that occurred during the 2013 bushfires. I realise that it was a commitment by former Prime Minister Gillard and the former member for Lyons Dick Adams. It fell to me to open this, but I wanted to mention the $250,000 to what is the benchmark for community halls—I will say that, Member for Wannon. This is an amazing building that will bring together the performing arts and the RSL club, which I know meets there, and many other community activities in what is a wonderful, wonderful facility. I congratulate them on it.
In the ACAR round last year, we were successful in the Corumbene Nursing Home, again in New Norfolk, which received just over $1 million worth of funding for not only aged-care places but also a capital grant. Tandara Lodge Community Care at Sheffield in North West Tasmania also received $995,000 for their capital grant to expand the facility there, and there was $130,000 for Toosey Aged and Community Care in Longford for 15 home care packages.
It has been a year of delivery. We are delivering. I believe, with the support of my colleagues the member for Bass and the member for Braddon, we are delivering for our state of Tasmania. It is a pleasure—it is a privilege—to be representing the wonderful communities that make up my electorate. I will continue to work as hard as I can. I have not had time in this contribution to mention the Centenary of Anzac grants. There were numerous ones around my electorate. I will continue to fight hard for the people and the communities that make up this amazing electorate that is the electorate of Lyons.
Mr Deputy Speaker, it is a pleasure to see you here in the chamber. Can I also commend the member for Lyons for his excellent speech. The way he is representing his electorate and delivering for his electorate is quite extraordinary. The people and the constituents of Lyons are being well and truly looked after by their wonderful local member.
As I am sure the people of Wannon are by the member for Wannon.
Thank you, Mr Deputy Speaker. I do my best also to try and represent, to the best of my ability, the people of Wannon.
Once again it is a pleasure to be here tonight to talk on this cognate debate on the five appropriation bills. It gives me a chance to talk about what the budget did for the electorate of Wannon but also what it did for the nation and what it did for your wonderful electorate as well. It is a budget which delivers for the nation. It really contrasts how a coalition government delivers for Australia with how the Labor Party failed to deliver for the nation. It is important, as we approach the midway of our first term in government, that we look at that and we start to contrast. Those opposite are over there reading their books. They are not interested in debating the appropriation bills. They are more concerned with fiction than with fact. I can understand why they would be more concerned with fiction than with fact. If you look at what was in the budget reply speech, I would be a bit worried about the fiction and the facts as well. I do not think the Leader of the Opposition's mathematics on STEM was all that good. I think he might have left off a few zeros. I think there was a little bit of a concern that he might not have understood that what he was talking about on STEM came with a $2.25 billion cost figure. He had the facts and the fiction a little bit confused, and that must be very concerning for those opposite. But enough on that.
What was this budget about for the nation? That is what the Australian people want us to focus on. The first clear message out of the budget was that the government remains committed to returning the budget to surplus as soon as possible—and I will just farewell the member for Lyons, who is leaving us, and once again commend him for his wonderful contribution. The budget at its heart was about returning the budget to surplus as soon as possible, because the fundamental premise of this government is that we have to live within our means. We saw six years of some of the most reckless spending that you are ever likely to see when the Labor Party was in government between 2007 and 2013, and once again it has been left to the coalition to fix the mess that Labor gave us—and that is what we are doing.
The budget will slowly head towards surplus over the forward estimates. That is something that I think is incredibly important, because we cannot assume that good times will roll on forever. We cannot assume, in the current economic climate, that we will not be buffeted again. We have to ensure that we have put the protections there so that if some ill-headwinds blow our way we are prepared to combat them and we have the economy in a state in which it can deal with them. That is why it is so important that we live within our means.
We have done this. We have been able to head the budget into surplus, even though we have seen a write-down of $52 billion in tax receipts due to what has happened with the iron ore price. This is the largest fall in the terms of trade in over 50 years, yet we are still on a trajectory to get the budget back to surplus. This is an achievement. I see those opposite raise their heads from their book of fiction, and it makes me a little bit curious, because it reminds me of a budget speech given by the then Labor Treasurer, Wayne Swan. As I recall, in four forward estimates he promised a budget surplus, yet he was never able to achieve it. The budget speeches in which he promised four surpluses in the forward estimates will go down as the greatest pieces of fiction this parliament has ever witnessed. It probably will not be quite as interesting as whatever the honourable member opposite is reading at the moment, but it was one of the greatest acts of fiction we have seen in this place.
But the government is not about that. We want to see the budget deficit narrow from $35.1 billion, or 2.1 per cent of GDP, in 2015-16, to $6.9 billion in 2018-19, or 0.4 per cent of GDP. How are we doing this? This is the important aspect of it. We are putting constraints on spending. That is what those opposite could not do, but that is what we are determined to do.
When you listened to the budget-in-reply speech from the Leader of the Opposition, spending announced already totalled $52 billion, and, after the budget reply spending spree, they now have a $58 billion black hole. That means that in his speech the Leader of the Opposition was blowing $200 million a minute. I know my good friend sitting opposite remembers a certain appearance on Sky channel where I mentioned the quote from Jerry Maguire: 'Show me the money.' This is Bill Shorten's jerry maguire moment. Come on, Bill, show us the money. Until you can do that, the Australian people are never going to take you seriously. In the budget-in-reply speech, once again he could not deliver. His jerry maguire moment disappeared—$200 million a minute in spending, but when it came to 'Where's the money coming from?', Bill Shorten could not answer and will not answer. In the next 18 months, as we lead up to the next election, let's put the warning in there: Leader of the Opposition, we are going to hold you to account on this issue. On a daily basis we are going to ask you where the money is coming from. As you have heard, there is no magic pudding. There is no money tree in the Parliament House garden. You actually have to be able to produce the figures and show us where the money will come from. Until you can do that you have no credibility.
What else was in the budget that was important? The small-business package obviously was incredibly important. This budget was not only about making sure that we are getting the budget back into surplus, but it is also about encouraging small business, the absolute engine room of our nation. Small business represents 96 per cent of all businesses in Australia, and most coalition members, in one form or another, come from a small business background. We get small business. We understand it, and we understand how important it is. We understand how important it is that small business invests, that small business employs and that small business provides confidence into the economy to help the economy grow.
What are we doing for small business? Obviously, for those businesses that are incorporated, there is the 1½ per cent tax cut for those with a turnover under $2 million. There is a discount of five per cent, up to $1,000, for the 1.7 million small businesses that are unincorporated. Once again, we understood that if you are going to have a package for small business in your budget, you have to understand that you have incorporated small business and you have unincorporated small business. Once again, the Leader of the Opposition showed us that he does not understand this. He talked about some potential tax cut which Labor might provide, maybe in a bipartisan form, of five per cent to those incorporated businesses; he did not even talk about unincorporated small businesses. It was just complete fairyland stuff.
The budget delivers the lowest small business company tax rate since 1967. I do not know whether Mr Deputy Speaker Irons will remember this, but 1967 was when Richmond broke their premiership drought of over 40 years. It was great to see the tigers win the flag, but 1967 is quite some time ago now. That was the last time that the small business company tax rate was lower. We are providing accelerated depreciation arrangements to small businesses and primary producers. We are simplifying depreciation rules in the tax law in order to increase the threshold for immediate deductibility from $1,000 to $20,000. The small businesses and farming community in my electorate have welcomed this with open arms. The fantastic thing about it was it meant that these small businesses and farming businesses could access it immediately. It came in once the budget was announced: budget night—bang—'You can take advantage of this'. I can tell you that I have been around my electorate going into small businesses and talking to farmers; they are excited about this potential, and they want to act on it.
Farmers are also able to immediately deduct all eligible capital expenditure on fencing and water facilities. Fodder storage assets will be deductible over three years. Once again, this is the coalition recognising the important contribution that farming makes to our nation. Not only that, we are backing up what we have done with the free trade agreements with South Korea, China and Japan. We are saying to farmers: 'We want to make life easier for you, we want to put a bit more money back in your pocket and we want you to be able to capitalise on these three wonderful free trade agreements which are going to set up not only our agricultural sector but our services sector for now and into the future.'
Of course, Mr Deputy Speaker Irons, as you are well aware, there is the families package as well. It is a terrific families package focused on child care and making sure that more people can get access to child care, and that will help those people access the workforce. We, on the side, believe that the best thing that you can do for people is make sure that they have a job. We are not like those opposite, who are quite happy to encourage welfare dependence; we want to make sure that people are out there working.
There were also significant contributions in this budget specifically for projects in my electorate, such as the Grampians Peaks Trail. That will be a wonderful tourism trail and encourage tourists from all around the world, and there is $10 million to complete that. People will be able to walk from the southern end of the Grampians to the northern end of the Grampians, staying, camping and just having a wonderful tourist experience. I am looking forward to walking along part of the proposed trail on this coming long weekend, when I will be entering the Serra Terror. We will be walking 80 kilometres over two days through the Grampians to raise money for the local Dunkeld community. I am very much looking forward to that.
There was the Port Fairy waterfront development of $1.425 million. That will be a wonderful project to give a new uplift to the Port Fairy waterfront, and I look forward to working with the local council there to see that development. There was also, importantly, funding for roads and funding for other important assets in the electorate.
I must commend the Treasurer for this budget because he has been able to combine two significant things. Firstly, he has been able to start dealing with the debt and deficit legacy that we have been left by those opposite. Secondly, he has also been able to set up this budget to give confidence to the Australian community, and especially to the small business community, that we believe in you, we believe in your enterprise and we believe that you can grow our economy to help it prosper—and not only help it prosper but ensure that the families and individuals of Australia continue to prosper because that is what this budget is all about, it is all about people.
If my memory serves me well, Roger Dean, Paddy Guinane and Dick Clay were members of that famous 1967 side.
Mr Deputy Speaker, your memory serves you extremely well—Roger 'The Dodger' Dean was the captain. You are a good man.
It is always good to follow my good friend the member for Wannon, especially on such a cold night in Canberra. His stories of dedication to both his football club and his electorate always warm my heart. I rise to speak on Appropriation Bill (No. 1) and related bills. Before I get into my speech I want to drill down a little bit on some detail that the member for Wannon used in his speech. The Labor Party proposed to spend $80 billion more than us on health and education. They do not want fuel excise, which is worth $19 billion. All of these figures are over 10 years. They want to increase foreign aid by $16 billion over 10 years. There is a $58 billion black hole in what was announced in the budget reply speech. That is over four years—and I do not know if we have modelled that yet—but let us apply simple mathematics and apply a factor of 2½ and make it 130 or 140—you are approaching $250-$300 billion. They very conveniently move between four-year and 10-year time frames. Forward estimates are always so unimportant when in government because they put everything outside of those but so important to them in government so that they cannot have exposed the breadth and depth of the gap in their financial figures, modelled over 10 years. On the flip side, they model the revenue of proposed tax increases, so-called reform, in 10-year multiples. If you drill down that figure of $250-300 billion, we have $14 billion which will come from superannuation tax changes that they are proposing and tax increases.
Effectively for the first time in our country's history we will now run two systems of tax indexation—one for when you are working and one for when you are retired. Excellent, a fantastic initiative! It seems to me the more progressive the taxation systems, the better we all will be—not! Then they have $9 billion from taxing multinationals. There is this net sum total of $23 billion, and, like the member for Wannon, I do look forward over the next 12 to 18 months hearing from the Leader of the Opposition and his crack team—that were there for the six years of the debacle that we inherited—how they will fund over 10 years the further $220-$250 billion on the back of an envelope. Of course, the sad part is that, as the Minister for Social Services so beautifully said, they reach into the bucket, but the problem is there is nothing in the bucket, they have emptied the bucket. I am surprised we have a bucket left.
I think they tried to sell it.
They probably did. All that said, it is always good to follow my good friend, especially on a cold night in Canberra. I am delighted to speak on these bills. The key to the 2015 budget in the electorate of Reid is that it focuses on families and small business. Reid is a young electorate, with an average age of around 33 or 34. Families are obviously very important. It is not a big home of major industrial and retail hubs—strip shopping centres dominate the landscape, from Auburn to Drummoyne. Obviously small and family businesses dominate the landscape. As the Prime Minister has said, this budget will deliver jobs, growth and opportunity in a way that is responsible, measured and fair. It is the next step in the coalition government's plan for long-term changes and fixing the mess that we inherited.
We have achieved many good things in the first 20 months—250,000 new jobs since the election; retail sales and new dwelling approvals are at record levels; and deficits over the forward estimates are reducing each and every year, from $35.1 billion this financial year to $6.9 billion in 2018-19. Particularly exciting for both me and many people in my electorate are the measures within our Growing Jobs and Small Business package. More than anything, this budget is about building jobs and supporting our family and small business sector. The new $5.5 billion Growing Jobs and Small Business package will help small businesses in my electorate to back themselves, take on bank debt, grow more and employ more people. Be in no doubt, this is the biggest small business initiative in our country's history, and I am proud to be part of the government that is delivering for small and family business. None of us in this place should ever forget that 96 per cent of all Australia's businesses are small businesses, employing over 4.5 million people and producing over $330 billion of our nation's total economic output.
This budget delivers $3.25 billion in tax cuts for small business and $1.75 billion in accelerated depreciation benefits, in addition to the benefits Australian small businesses are already gaining from the abolition of the carbon tax. From 1 July 2015 this government will cut the company tax rate for up to 780,000 incorporated businesses with annual turnover of up to $2 million by 1.5 per cent, bringing the rate down to 28.5 per cent. Providing incorporated small businesses with a reduced rate of company tax will improve small business cash flow and assist them to grow and compete more effectively with larger businesses and—here is the kicker—create jobs. From 1 July 2015, this government will also provide a five per cent tax discount for over 1½ million sole traders, trusts and partnership structures which are unincorporated businesses with annual turnover of up to $2 million, capped at $1,000, through their end of year tax return. Reducing the tax payable by small businesses will allow them to retain more earnings for reinvestment. Investment is important as it leads to existing output being produced at a lower cost, and the new and improved ways of doing business improve our nation's productivity. As a result, higher investment can lead to higher employment and wages over time.
Of course, most celebrated by small business owners throughout my electorate is the measure that allows small businesses with turnover below $2 million to claim an immediate tax deduction for every asset they acquire that is valued up to $20,000 for business purposes—a substantial increase from the previous $1,000 threshold. Assets that cost $20,000 or more can be grouped together and depreciated at 15 per cent in the first year and 30 per cent every year thereafter, and should the value of this pool fall below $20,000, at the end of that financial year during the same period, the pool itself can be immediately deducted. Small business in my electorate has warmly welcomed these changes. I had the Prime Minister there a couple of weeks ago at a local restaurant—200 small business people, with 24 hours notice, out to a database, wanted to come and say thank you. The message was received loud and clear by the Prime Minister.
Also included are measures to reduce red tape and regulatory impediments that hinder small-business growth. Changes to the fringe benefits tax system will expand the exemption for work related portable electronic devices, both phones and tablets. Reforms to capital gains tax rollover will enable small business to change the legal structure of their business without making it a CGT event. This government will consult on potential changes to the Corporations Act to reduce compliance costs and make it easier for small proprietor companies to raise new capital.
In addition, this package of measures will encourage business start-ups and entrepreneurship. Start-ups will be able to immediately deduct professional expenses incurred when they begin a business, such as legal expenses on establishing a company, trust or partnership, rather than writing them off, as was historic, five years. This will provide immediate cash flow benefits for small businesses. And it is not rocket science; the hope is that they will reinvest in their business and create more jobs.
Streamlined business registration processes will make it quicker and simpler to set up a new business. A single online registration site will be developed for business registration, including company registration, and from 1 July expanded tax concessions for employee share schemes will make it easier for small start-up companies to attract and retain the skills and talent they need to grow. My electorate of Reid has over 19,000 small businesses and these measures will help encourage investment, innovation and the start-up of new businesses, which will help Australia's economic future. The businesses in my electorate recognise this and members of the opposition should as well.
However, I am not confident that members of the opposition will recognise this, because Labor's attitude to small business is well known. We should never forget that in July 2000, when he was Labor leader, Kim Beazley acknowledged that the Labor Party is not the party of small business. In a frank confession, Mr Beazley admitted: we have never pretended to be a small business party. The Labor Party has never pretended that.
After six years of Labor, around 519,000 jobs were lost in small business—that is, 1,544 each week. Labor had six different ministers in five years—a measure of how little real commitment it had to the sector. Our small business minister, the man of the moment, is not only the same man that we went to the election with and had through opposition but also now a member of cabinet. That is a measure of how important we find this sector to be.
Families are also a key focus of this budget. Here we deliver a $4.4 billion Jobs for Families package to give parents more choice and more opportunity to work. We are delivering on our commitment to support families by making child care simpler, more affordable, more flexible and more accessible. We understand that families are faced with costs when parents want to return to the workforce. This package gives those families greater choice.
A fact of modern day life is that having two parents in paid employment has become a necessity for most families because of changes that have taken place in our society and economy over many years. This government will invest an additional $3.5 billion over five years reforming childcare assistance to establish a new and simpler Child Care Subsidy from 1 July 2017. This Child Care subsidy will provide assistance to meet the cost of child care for parents who are working, looking for work, training, studying or undertaking any other recognised activity such as volunteering.
Families using child care in 2017 on family incomes of between $65,000 and $170,000 will be around $30 a week better off. Families on incomes of less than $65,000 per year will receive ongoing access to early childhood learning and can be eligible for net financial support through the childcare safety net. This is great news for the families of Reid.
A simplified Child Care Subsidy will also replace the current Child Care Benefit, Child Care Rebate and Jobs, Education and Training Child Care Fee Assistance programs. This simplified subsidy will include, amongst other measures, the introduction of a single means tested Child Care Subsidy for all families, subject to a new activity test for up to 100 hours of subsided childcare per fortnight, paid directly to approved care service providers to make it easier for families. Families on incomes under $185,000 will no longer have a cap on the amount of subsidy they receive whilst a cap of $10,000 per child will be established for the total value of subsidies for families on incomes of $185,000 and above. These measures will deliver significant reform, putting downward pressure on childcare costs, and stand in stark contrast to the inflationary system in place under Labor, which saw childcare fees increase by over 50 per cent between 2007 and 2013.
Our nannies pilot is an exciting program, recognising that modern families work in different ways. It is a new initiative and I look forward to seeing how families in Reid take it up and how it works. This government wants these families to be able to choose to work. We do not want that choice denied because of complex, inflexible and unaffordable childcare arrangements. The budget also delivers $840 million over two years for preschool programs. This will ensure families in my electorate of Reid can continue to access up to 15 hours of preschool education a week.
This budget also supports the senior members of our community by making the aged pension fairer and more sustainable. These changes mean that more than 170,000 pensioners with modest assets will have their pensions increased by an average of $30 per fortnight. It is clear to everyone that we have an ageing population, and this budget seeks to put us on a sustainable path so that we can continue to support those who have built our great nation.
We are also looking to support small capital projects in our local communities right across the country. Electorates across the country will receive funding of $150,000 per year over two years to support projects that deliver clear social benefits. It will empower people on the front lines who are providing incredible service to their communities to achieve even more. It is a great example of how government supporting those who work on the front lines, improving communities in tangible ways, can work.
These measures outlined in these bills provide the next step in our long-term economic plan. It is a budget that recognises that government does not create jobs; business does. It is a budget that recognises that small business is the backbone of our economy and that families and our elderly need to be looked after. It is a budget that recognises that those great people who work on the front lines of our communities are in the best position to identify what government should allocate spending to.
I commend these bills to the House.
I am pleased to have the opportunity to rise on this year's Appropriation Bill (No. 1) 2015-16. I wanted to address a couple of subjects during my speech.
The first one I wanted to touch on is Commonwealth funding to South Australia. Residents of Boothby—residents of South Australia—will have seen any number of taxpayer funded ads coming from the South Australian government, and I would like to set the record straight on Commonwealth funding. It is a simple fact that over the next four years the total annual Commonwealth funding to South Australia is increasing by around $2.4 billion including GST. Despite tight budget conditions, the Commonwealth is increasing annual funding to South Australian hospitals by 19 per cent over the next four years on top of growth of 12 per cent in 2014-15. That is a $208 million increase over the next four years. We are also increasing funding to South Australian schools by 26 per cent over the next four years on top of growth of seven per cent in 2014-15. That is an extra $280 million for South Australian schools.
In addition to that extra money for schools and extra money for hospitals, we are investing $2 billion to build the infrastructure of the 21st century for South Australia. That includes $944 million for the upgrade of the north-south road corridor and also $232 million for the Goodwood and Torrens Junction rail upgrades. These are some of the benefits that South Australia is seeing from the budget.
I wanted to speak on a particular local issue because, at the same time that the South Australian government is receiving more money than ever before for their hospitals—they are seeing their hospital funding going up by 19 per cent—the response of the South Australian government has been to close hospitals. This has been particularly felt in my electorate, where they have made a decision to close the iconic Daw Park Repatriation General Hospital. This is a 300-bed local hospital. It employs 1,250 staff. The South Australian government are shutting it down, selling the land, walking away and vacating the site.
Despite what the state government says, everyone knows that this is a cost-cutting exercise. There are currently 300 beds at the Repat. Under the Weatherill government's proposal, when the Repat is closed, 55 rehab beds will be added to the Flinders Medical Centre. So they are taking almost 300 beds out of the southern suburbs. David Pope has said that there are 41 clinical services at Repat and they simply will not all fit into the Flinders Medical Centre.
I will give you an example. We have the National Bowel Cancer Screening Program. It is a very good program, and we would like more people to do it. If you have a positive test, it does require follow-up by colonoscopy. At the moment, the Repat is providing the role of doing the overflow colonoscopies from Flinders Medical Centre. When the Repat is closed, what will happen to that extra work? This is an important part of the follow-up from the National Bowel Cancer Screening Program.
What we see is a net loss of anywhere between 180 and 250 beds, and that is a big drop in the number of beds. The opinion of my electorate has been very clear: they would have preferred to see the hospital upgraded rather than closed. The Australian Medical Association has warned that other hospitals do not have the capacity to absorb the extra workload, because they are already overstretched. When you look at the fact that hospital funding is going up 19 per cent and there has been a 36 per cent increase in GST funding over the next five years, it really does make local residents wonder why the state government has not continued to upgrade the site. Over the last decade, the federal government has given South Australia tens of millions of dollars to fund new facilities at the Repat. For that matter, they have spent some of their own money as well. Most recently the federal government invested $40.3 million to fund 20 brand-new subacute beds at the Repat. These are state-of-the-art facilities. They were only opened last year. The irony is that, within six months of them opening, the Minister for Health announced that the hospital would be closing, and now those beds and that facility will be sold to the highest bidder.
The new fourth-generation rehabilitation clinics, the recent rebuilding of ward 18—these are very modern facilities at the Repat. State Labor continually says that this is an old, run-down facility. That is not true. When you walk through, you are amazed by how good the rehab facilities are. There are old buildings there, and many of them are used for office space, not for clinical work.
Last year, the Repat provided more than 136,000 outpatient consultations across a broad range of specialist clinics. The clinics treat conditions like heart disease, sleep disorder and arthritis. That equates to more than 2,600 South Australians getting help as a Repat outpatient every week. Also last year, a quarter of all orthopaedic and neurological elective surgery performed in Adelaide was done at the Repat. It also plays a very important role, as I said before, in those overflow colonoscopies from Flinders, which is a critical step in the National Bowel Cancer Screening Program.
Not only has the Commonwealth government spent tens of millions of dollars at the site; but Flinders University has as well. One of the frustrating things about this closure has been that all the partners—the Commonwealth government, Flinders University—have been investing significant money at this site. The Repat is a major site for clinical placements for Flinders University students. Something like 60 per cent of health science students at Flinders University will rotate through the Repat. Flinders University researchers based at the Repat have attracted more than $75 million in research funding.to South Australia.
I could go on and on about this, but it is very clear that this is one case where the state government is not interested in the opinion of the local community. I have had listening posts, we have done surveys and we have run petitions, and it is very clear that my constituents do not want to see the Repat close. More than 80,000 people have signed a petition calling on state Labor to keep the Repat open.
As I said before, the Repat has seen many upgrades over the last decade, and everyone else had been working on the basis that we would continue those upgrades rather than shut down such an important part of our health system.
I next want to turn to one of my pet projects, which is the Darlington upgrade. I have had a longstanding interest in the upgrade of South Road and particularly in the upgrade at Darlington. I first started lobbying for funding for this eight years ago during the Howard government. It was an idea that was originally proposed by the major motoring organisation of South Australia, the RAA.
The government is strongly committed to the north-south corridor, and we are giving the South Australian government $162 million over the next year to get construction moving on this important project, including $82 million for the Darlington upgrade.
The Darlington upgrade—and the north-south corridor more generally—is a great example of what can be achieved when the state government works with the federal government. We see the South Australia Minister for Transport and Infrastructure, Stephen Mullighan, working with the federal government, with Assistant Minister Briggs, instead of constantly picking fights with us, as some of his colleagues like to do.
In that plan, what has happened is that a good plan has been improved—through consultation and through the expert advice from traffic engineers—for the same investment. The previous design only gave motorists coming off the Southern Expressway access to the non-stop motorway, but this new design allows motorists coming from Flagstaff Road and Main South Road to also access the motorway and avoid three sets of traffic lights. That involves something like 15,000 commuters every day. So I welcome that revision to the plans.
For my electorate, this means that constituents living in Aberfoyle Park, Flagstaff Hill or anyone who uses Flagstaff Road will see a much improved and smoother commute, whether they are going into the CBD or even if they are just going to the inner southern suburbs.
The government has a strong commitment to the north-south corridor and the $620 million Darlington project in particular—to the extent that we have funded 80 per cent of this cost, or $496 million. Normally, we would expect a 50-50 split with state governments. But, even though we had to drag the South Australian Premier and the South Australian Treasurer kicking and screaming into this project, we did; because we deliver on our election promises, and our election promise was very clear in 2013. We were committed to the Darlington upgrade.
Contrast that with the previous government. They had been promising to upgrade Darlington since 2007. They promised it in 2010 and they never delivered. This is an important investment in South Australian jobs and economic growth. It will support about 370 jobs a year during construction. It will reduce travel times and it will boost freight efficiency. We expect some further announcements coming up over the next month or two. A shortlist of tenderers will be announced and a major contract will be awarded later this year. Major works are expected to commence by the end of the year, with construction to be completed by the end of 2018.
They are some of the important projects that are being delivered in the electorate of Boothby. I commend the Treasurer on a very sensible budget. This budget has a focus on small business, on families and on really supporting pensioners. I think it is very telling that the opposition attack on the budget faltered after a few days; they have already moved on to other issues.
The support for small business has been very well received in my electorate. I had Bruce Billson visit, and we were able to talk with small businesses at the Marion Shopping Centre. We found a high level of awareness about the changes, specifically the accelerated depreciation change and the five per cent reduction in taxation up to $1,000.
Similarly in child care, we reformed the delivery of child care so that now there will be a childcare subsidy which will cover, for lower income families, 85 per cent of the cost of childcare, tapering down to 50 per cent on higher income families. This budget is good for small business. It is good for families, and ultimately it will be good for jobs.
I rise to speak on the appropriation bills, and how they will help build a strong, safe and prosperous future for all Australians. The government has delivered a budget for families by providing a $4.4 billion Jobs for Families package that will give more than 1.2 million families more affordable access to quality child care and early childhood learning, especially for low- to middle-income families.
There is a budget for education that increases Commonwealth funding for schools across Australia by $4.1 billion, a 27.9 per cent increase from 2014-15 to 2018-19.
It is a budget for states, in particular my home state of New South Wales, increasing total annual funding over the next four years by around $5.6 billion. New South Wales hospitals will receive 25 per cent more funding on top of the growth of 12 per cent in 2014-15. Schools in New South Wales will have their funding increased by 26 per cent over the next four years on top of the growth of 10 per cent in 2014-15.
It is a budget for infrastructure, with the government investing $15 billion to build the infrastructure of the 21st century for New South Wales. That includes a $2.9 billion Western Sydney Infrastructure Plan that will dramatically reduce travel times and boost productivity in my electorate of Macarthur. It is a budget for rural communities, in particular farmers and farm businesses in drought-affected areas across Australia, who will receive more than $400 million in targeted support. This budget is for small business, providing a $5.5 billion Growing Jobs and Small Business package that delivers $3.25 billion in tax cuts, which means Australian small businesses will have the lowest company tax rate since 1967, as well as $1.7 billion in accelerated depreciation measures.
It is a budget for families, providing a $4.4 billion Jobs for Families package that will give more than 1.2 million families more affordable access to quality child care and early childhood learning, especially for low- to middle-income families. This budget is the beginning of our children's future. The actions we take today will have a long-term legacy for our children. This budget will directly help young families in ensuring that mums can return to work almost immediately after their children are able to be in a childcare service. The 2015 budget has delivered on the government's commitment to support families by making child care more affordable, accessible and flexible for parents. The family package will provide greater choice and opportunity for parents in Macarthur who want to re-enter the workforce by delivering more affordable access to child care and early childhood learning. The coalition understands that child care plays a pivotal role in parents being able to re-enter the workforce. The government is committed to investing $3.5 billion over five years on childcare assistance for families.
I recently had the pleasure of hosting the Minister for Social Services, the Hon. Scott Morrison, in my electorate of Macarthur. We visited Pied Piper Kindergarten in Campbelltown and Bambinos Kindergarten in Oran Park to meet with parents to discuss how the Abbott government is improving the childcare system by providing quality early learning for low-income families and disadvantaged and vulnerable families in my electorate. Children are our future, and early childhood learning is crucial for a child to reach their developmental targets. We want to ensure that our children have the best possible, strongest start in life, which is why the government is investing $843 million in 2016 for preschool programs right across Macarthur and Australia.
We also need to encourage parents to re-enter the workforce so that more people are contributing to our wonderful country and the economy. Now, thanks to the Abbott government, more parents are able to work and receive affordable access to child care and early childhood learning. Parents in Macarthur will now be able to maintain high quality standards for their children. The government is also committing over $400 million in the new inclusion support program. The program will benefit parents in Macarthur and across Australia who have children with additional needs to access child care much more easily. Families need our support more than ever. With the government's commitment, families will be better off.
In this budget, we have also taken positive steps to create a healthy operating environment for the two million plus small businesses in our country. Small business is the backbone of our economy and must be supported by the Commonwealth. Since the coalition came to office, around a quarter of a million new jobs have been created. But we recognise that there is always more we can do to improve the economy. It is through the responsible actions of the coalition government that Labor's debt and deficit have now been cut in half. The coalition is now able to focus on providing Australians with better services and more opportunities for economic growth and development.
The government is reducing the tax rate for more than 90 per cent of incorporated businesses with a turnover under $2 million. These small businesses will have their tax lowered from 30 per cent to 28.5 per cent, and unincorporated businesses will get an annual five per cent tax discount up to $1,000. By the government doing this for small businesses, cash flow will improve and their capacity to participate in the economy will increase. Small businesses in my electorate will also get an immediate tax deduction for any new asset up to $20,000. In Macarthur, the growth centre of south-western Sydney, small business provides the bulk of employment. Nationally, over 95 per cent of businesses are small businesses. Small business is vitally important to Macarthur's success as a region and Australia's success as a nation.
I had the honour of hosting Assistant Treasurer Josh Frydenberg in my electorate last week. We had the pleasure of speaking to many small business owners in Macarthur. There is no doubt that small businesses are at the forefront of Australia's jobs and growth. We want to guarantee that Australians with small businesses can continue to develop and grow, to create jobs and build a thriving economy that inspires business confidence. By our continually helping small businesses to become profitable and viable, small businesses will be getting on the front foot by creating more jobs for the people of Macarthur and Australia. We all know that the men and women of Australia with small businesses are the main force driving a strong economy. We need the men and women of Australia to take risks and develop new products and new business ideas. We need to attract new customers and create new markets. On the back of the success of small businesses, the economy will thrive as more jobs are created, and we will be building a safe and wealthy future for all Australians.
The youth unemployment rate in Macarthur was 13.2 per cent in April 2015. The coalition is committed to supporting young Australians to find jobs, and the $330 million Youth Employment Strategy will see the 13.2 per cent youth unemployment rate in Macarthur decrease over time. The Youth Employment Strategy will take a work-first approach to Australia's youth, and the program will assist over 19,000 job seekers a year with job development and skills within the workforce that many young Australians need.
Last week I also had the pleasure of having Assistant Minister for Employment Luke Hartsuyker in my electorate of Macarthur visiting small businesses and speaking with small business owners and apprentices. It was a great opportunity for the assistant minister to speak with the people who employ the youth of Macarthur. These business owners understand the trouble that youth go to in finding jobs, and they feel the need to do their part and employ these valued young Australians and give them an opportunity that other employers may not. They, too, acknowledge the fact that the youth unemployment rate in Macarthur is too high. While speaking with many apprentices and young Australians in my electorate of Macarthur, we found that the consensus is that it is very hard to find employment. Many employers want experience, but how can you get experience if no-one gives you the opportunities to get it? Our budget is all about opportunities.
Panarottis Restaurant in Campbelltown and Clintons Toyota in Narellan take on many young Australians for work experience and as apprentices. These two businesses understand the struggles that youth in my electorate of Macarthur go through in trying to find a job. There need to be more businesses out there following in the footsteps of the small businesses in Macarthur willing to take on young Australians for work experience and as apprentices. As I mentioned earlier, small businesses provide the bulk of employment in Macarthur and Australia. We met with the youth who were completing a work experience course at Panarottis Restaurant in Campbelltown and apprentices at Clintons Toyota in Narellan, and all of them are grateful to their employers for giving them the opportunity to gain the relevant experience needed for future employment.
Youth not only in my electorate but in all electorates across regional Australia are finding it hard to get experience. The coalition's $330 million Youth Employment Strategy will deliver intensive pre-employment assistance to young job seekers—something that the Labor government was unable to do.
The Abbott government has committed $50 billion in road upgrades in every state, and my electorate of Macarthur is currently receiving major infrastructure upgrades. $293,000 has been announced for my electorate of Macarthur to fix dangerous black spots on local roads. Camden, Rossmore and Wilton are all receiving upgrades where major black spots were found. These black spot projects are projected to save an additional 13 lives and prevent over 650 injury crashes over 10 years.
Another major investment for infrastructure upgrades in Macarthur—never seen in the Macarthur region in the history of parliament—is for the upgrades to the Bringelly Road, which is a $509 million project; to the Northern Road, which is a $1.6 billion project; and to Elizabeth Drive, which is a $1.25 billion project. That is 80 per cent funded by the federal government and 20 per cent funded by the state government, with a total of $3.6 billion being spent over the next 10 years to deliver world-class transport connections for south-western and Western Sydney.
An honourable member interjecting—
Absolutely—and never seen before in the history of parliament. We have definitely got the infrastructure Prime Minister. The Bringelly Road upgrade will support around 400 jobs—
An honourable member interjecting—
with approximately 4,000 direct and indirect jobs created during the 10 year Western Sydney infrastructure plan. This will mean more job opportunities for the youth of Macarthur.
I heard the member for Werriwa having a bit of a whinge, but he has never seen it before himself and obviously should be proud of what is happening in the Macarthur region, in and around Werriwa. The large majority of people employed in Macarthur have all spent several hours commuting to and from work. The upgrades that Macarthur is receiving will not only save lives but also will give many workers a better work-life balance and less time on the road. Obviously, this major infrastructure is leading to the Badgerys Creek airport and, in turn, will create another 30,000 jobs for the people of western and south-western Sydney—something that Labor could not deliver.
Another outstanding investment that will cut travel times for people employed in Macarthur is the Narellan Road upgrade, which is another $100 million project that is much needed in my community. That is being jointly funded by the state government, fifty-fifty. So that is another $100 million for the people of Macarthur—unbelievable!
This much-needed investment demonstrates the coalition's commitment to improving infrastructure in the south-western Sydney growth corridor. Together, we are working with the New South Wales government to provide the road infrastructure that Macarthur residents deserve and need. The coalition will also be investing $1.9 million to upgrade Argyle Street in Camden that runs through Camden town centre, as well as the Camden Valley Way corridor and the Macarthur Road intersection upgrade. There is another couple of million dollars there.
All levels of government are delivering the infrastructure that Western Sydney and south-western Sydney so badly need to develop and grow. This has never happened under the previous government. In six years of Labor I did not see a cent, not one cent, spent in Macarthur. Macarthur has been neglected for too long and now Western Sydney, south-western Sydney and Macarthur residents will benefit from the greater investment and jobs growth.
I am pleased to say that Macarthur has received funding from the Abbott government for various issues in the community. The funding received will build economic growth and development in the Macarthur region, as well as much-needed funding for community groups and organisations.
Drugs and alcohol are major issues not only in Macarthur but also right across Australia. The Odyssey House McGrath Foundation and the St Vincent de Paul Society drug and alcohol treatment services in Macarthur are now able to offer long-term treatment and rehabilitation as a result of the government extending funding. That was not in Labor's forward estimates either.
The federal government will also be paying over $2 million in my electorate of Macarthur to Campbelltown City Council, Liverpool City Council and Wollondilly Shire Council for the Roads to Recovery program that will assist councils with local road funding where it is most needed. Our councils rely on Roads to Recovery funding to ensure that the best local roads are delivered.
Funding has also been extended to my electorate of Macarthur for Giant Steps Sydney: Beverly Park special needs school, Campbelltown and Sylvandale Foundation, Rosemeadow to deliver services under the Outside School Hours Care for Teenagers with Disability, OTD, program. The previous government did not put money in the forward estimates for that. This funding extension is great news for the people of Macarthur with disabilities and carers as they will be able to continue to access these wonderful services.
Indigenous communities across Macarthur will also benefit from a $7.5 million investment in primary and preventative health care. The Tharawal Aboriginal Corporation will have their funding extended for another three years, thanks to the Abbott government, which Labor forgot to do. With this funding they will be able to continue to deliver important information on health care and treatment right across Macarthur. We will continue working hard for the community to ensure that vital services are delivered to those who need them the most.
A division having been called in the House of Representatives—
Proceedings suspended from 20 : 02 to 20 : 20
Through this fair and responsible budget, and through the success of the government, the people of Macarthur, young and old, will be better off. Families, small businesses and young Australians will benefit from this positive and confident budget that has been delivered. I congratulate the Treasurer, the Hon. Joe Hockey, on a wonderful budget. When I walk down the streets—Argyle Street in Camden, Queen Street in Campbelltown—I actually see a spring in the step of the local community. They have really enjoyed this budget that has been delivered. I am looking forward to working with my local members, Jai Rowell, the member for Wollondilly, and Chris Patterson, the member for Camden, and local mayors from the Macarthur region, Lara Symkowiak, Paul Lake and Col Mitchell, in delivering the infrastructure of the 21st century and delivering positive outcomes for our communities into the future.
I thank the member for Macarthur for a wonderful presentation. I think it was remarkable.
They say a week is a long time in politics. That must be why it is hard to envisage just how far we have come since a year ago. On coming into government, we inherited $123 billion of deficit from our friends from the Labor Party. We saw how this resulted in a decline in business confidence, rising cost-of-living pressures and endless media reports of doom and gloom, particularly in my electorate of Leichhardt. After an admittedly tough budget in 2014-15, in the past 12 months we have looked down the barrel of lower commodity prices, falling revenue and weaker-than-expected global demand for our Australian products. But, despite all these odds, the tide has certainly turned. We are now on track to bring our deficit back to $82 billion over the next four years. We are on track to bring Australia's bottom line back—in time—to surplus.
So today I would like to focus on some of the measures in this 2015-16 budget that will mean the most to my constituents in Leichhardt. The measures in this year's budget are concrete evidence of this government's commitment to the development of northern Australia. There were 42 recommendations in the Pivot north report, and a number of these have already been taken up prior to the launching of the white paper. One of them is the $101 million for the Northern Australia Beef Roads Fund. This is a recommendation that we made, recognising that the beef roads right across northern Australia—or the development roads, as they were called—built 50 or 60 years ago, no longer have the capacity to carry the vehicles of today. The vehicles are too wide, too long and far too heavy, and this road network is shut down for a long time during the wet season. These roads are really the arteries of the heart of northern Australia. This is a first investment in upgrading these roads. Rather than just starting in an ad hoc manner, we will be using the CSIRO to analyse where the priorities are and where we can get the maximum return for the investment. We will start at that point and work our way through.
Two other key highways that have been recently announced are the Hann and the Gregory highways. The Hann Highway, from my perspective in Leichhardt, is critical. It will be a parallel highway to the Bruce Highway, cutting significantly travel time and distance from the Atherton Tableland and Cairns to Melbourne. More importantly, it will give access 365 days a year, basically giving us a flood-proof route to Melbourne, which is critical, because it does not matter what we spend on the coastal highway; there will always be an issue in relation to extreme flooding. This, of course, will alleviate that and it will be very much welcomed not only by the Etheridge and the Flinders Shires, but also by my area in Cairns—by Advance Cairns, the Chamber of Commerce and others who have been calling for this for a long time. It will be of significant benefit to us.
Tuberculosis has been another ongoing challenge for us, and I have been talking about it in parliament for a long time. The budget has offered a $15.4 million investment and a vital opportunity for James Cook University, which hosts the Australian Institute for Tropical Health and Medicine. There are two funding streams: one is for $6.9 million to build Australia's primary research capacity, funding projects focused on priority diseases, including dengue, malaria, Hendra and multi-drug resistant tuberculosis—all these tropical diseases that are of such concern. Another $8.5 million will commercialise research in new tropical therapeutics and diagnostics undertaken in Australia. It is a very important investment and it is a down payment, if you like, into tropical medical research.
Another area that I have been raising serious concern about over the last four and a half years is the skyrocketing and unaffordable price of insurance in Northern Australia. It is great to see that $2.1 million has been allocated to establish the Northern Australia Insurance Premium Taskforce. This will identify the best way that government can invest and support the residents of Northern Australia in bringing back to parity and affordability insurance across the region. The intention is to have the recommendations handed down by November this year. I applaud this decision because it is the one thing that will stop any opportunity for development in Northern Australia. If we do not have access to affordable insurance, we are in all sorts of trouble. I also applaud the setting of a timeline for when we will see some change.
There was also $3.7 million allocated for the development of a new infrastructure project pipeline. This will inform us of the priorities identified in the Infrastructure Australia's Northern Australian infrastructure audit as to where we can start to invest to get the maximum benefit and to prioritise those projects. The money will go to areas where we know we will get the maximum benefit.
Another change was Amending the Zone Tax Offset to exclude fly-in fly-out and drive-in drive-out workers. People who are eligible for this tax offset must bring their families into these communities and live there. If they want to remain in metropolitan areas, they will not be entitled to it. It is an important way of getting people back into remote communities.
There was also a most significant $5 billion concessional loan facility, which is aimed at increasing private sector investment in port, water and pipeline infrastructure across Northern Australia. To me, this presents opportunities for projects like the Nullinga Dam, the O'Connell Creek Water Storage Project, Urannah Dam, Cloncurry Dam, Elliot Main Channel and others. There is an opportunity to source some money through this project and that in turn will accelerate the development of these projects that are critically important for the development of the North. In feedback on the development fund, the CEO of Advance Cairns, Mark Matthews, said:
It is a clear and positive indication of the Federal Government's recognition of the important role that [Northern Australia] has to play in the nation's growth and their commitment to supporting development in the region.
I certainly endorse those comments. Organisations can start to apply from 1 July 2015 for access to the first tranche of this funding, which is $388 million. The development of northern Australia is a 20-year plan. This is certainly a down payment for that. It was disappointing to see that the Queensland state treasurer, Curtis Pitt, did not quite seem to understand the concept of these concessional loans as being part of the overall white paper when he came out criticising and saying, 'Oh, it should have been grants rather than concessional loans.' He needs to understand that this is something that a state government could actually access and that it is not too late for that to happen, rather than using the excuse of cost as a reason not to go ahead with the dredging of the Cairns inlet. He could, in fact, look at accessing some of these funds to be able to start the Cairns port dredging project, which is critically needed for the long-term development of Cairns.
On the small business package: of course, we know that small business is the engine room of our economy. In the past we have had very high rates of business failure in Cairns. It was the highest in Australia at one point, together with our very high unemployment and the highest youth unemployment in mainland Australia. This budget recognises that our economy changes and that the role of small business will be even more important. Tax cuts for over two million Australian small businesses will help to drive investment in employment. Australian small businesses now have the lowest company tax rates since 1967. Small businesses can now fully and immediately deduct every asset they acquire that is valued up to $20,000 for tax purposes, a substantial increase from the previous $1,000 threshold. This can be used for new tools, home computers, vehicles, kitchen equipment, machinery or whatever.
Linda Smart, from the Village Herb Farm in Kuranda feels that small business is the often-forgotten industry in Australia. She is very happy that they are being recognised in this year's budget. The comment from Linda was:
Anything we can get back that allows us to put more back into our business and employ more people is appreciated. It's also productivity benefits — we can spend money on technology, or other things to improve our business, sooner than we would have otherwise.
Of course, this feeds into the opportunity to employ more people.
Information will also help businesses to capitalise on the new free trade agreements with South Korea, China and Japan. An example of this is a local success story. In March, MSF Sugar in Gordonvale shipped 52,000 tonnes of Brand 1 high-polarity raw sugar to Japan for the first time. MSF CEO, Mike Barry, told me that they could not have accessed this Japanese market with their premium product without the FTA. The first shipment was considered to be so significant that Japanese officials flew to Cairns to celebrate the event. The government's Growing Jobs and Small Business package will create the right conditions for Australian small businesses to thrive and grow.
The budget also continues our government's commitment to stronger communities by focusing on building the infrastructure we need. There was additional money there for the Bruce Highway, with $31m for the Cairns Southern Access Corridor stage 2—the widening of Robert Road to Foster Road; money for the Cape York Regional package was confirmed—the $208.4 million, with $48 million to be provided in 2015-16; and, of course, there was nearly $3 million continuing for the Torres Strait sea wall project.
There was close to $10 million for upgrades to local roads and bridges. This included a double payment for councils under the Roads to Recovery program. There was funding for upgrades to remote airstrips, vital to maintaining connections with our regional communities. And, of course, there is the Stronger Communities Program, in which every electorate, including Leichhardt, will receive $150,000-odd a year over the next two years to contribute to small capital works projects. We often come across projects that could use a kick-start grant of between $1,000 and $20,000, and I am certainly looking forward to consulting with communities as to we where we can support on that.
Another area that we are very much involved in is in removing the uncertainty on pensions for veterans and families by making sure that increases are in line with the highest indexation measures possible. This is going to be great news for 2,344 Leichhardt residents. The age pension will continue to increase twice a year at the highest-available indexation rate, and the family home will always be excluded from the pension assets test.
The revised childcare subsidy will see medium- to low-income families better off, and we will be trialling new ways to support families using pilot nanny programs to help shift workers, for example, access affordable and appropriate care. We are ensuring, of course, that nobody misses out on receiving a period of paid parental leave. There is $20 million to renew the National Drugs Campaign, focusing on young people and their parents and seeking to raise awareness of the harm caused by illicit drug use, particularly ice.
As I said earlier, it is amazing just how far we have come in a year. This budget reflects our responsible, measured and fair fiscal policy. Nationally, our economic plan is working. Growth is up. Jobs are up, with nearly 250,000 new jobs since the election. Retail sales are at record levels, as are new dwelling approvals. Locally, there is confidence in the far north, where there is news that construction has started on stage 1 of the $400 million Aspial seven-tower development; the EIS for the $8 billion Aquis integrated resort and casino project has been approved; and renewable energy projects such as Mount Emerald wind farm and Local Energy solar projects can progress now that the RET has been sorted.
It is a very, very positive time. I am excited, and there is only more to come, with the release of the white paper later this month. We have a vision for where we want to be. We have a plan for how we are going to get there. Let's bring it on.
It is an absolute delight to speak on Appropriation Bill (No. 1) 2015-2016. The 2015-16 budget is good for Brisbane, it is good for women, it is good for families, it is good for the environment and it is good for the country. I congratulate the Treasurer on a budget that has delivered new hope and confidence to small businesses and families. But I do not envy him his job, which has to rate as one of the most difficult in the country. Having to deal with inheriting a set of books drowning in debt after six years of Labor being in office, with gross debt projected to rise at the time to $667 billion and with $123 billion in cumulative deficits does not sound like my ideal job description. But that is the mess, the Labor mess, that the Treasurer was asked to fix, and that is exactly what he is doing—and we are on our way to a surplus.
But who better to take on this important job than someone who grew up in a small business family? That is very much something that the Treasurer and I have in common. The Treasurer started working in his family's small business, sweeping floors. My parents promoted me straight to customer service as an eight-year-old, spruiking the price specials on the size 9 frozen chickens. Growing up in a small family business taught me the value of hard work. It also taught me that real initiative and the real wealth generation in this country come from the men and women who run small businesses, who are prepared every single day of the week to have a go. That is why the government's 2015 budget is historic, it is unprecedented and it is a game changer, with our Growing Jobs and Small Business package, the biggest economic recognition of the sector in Australia's history.
The new $5.5 million Growing Jobs and Small Business package will help small businesses in Brisbane invest more, grow more and employ more people. It will help employers in Brisbane create jobs and assist Australia's unemployed, particularly unemployed youth, to build on those skills to get into work. Ninety-six per cent of Australian businesses are small businesses. They employ 4.5 million people and they produce over $330 billion of our nation's total economic output.
At the heart of the Growing Jobs and Small Business package are tax cuts for more than two million Australian small businesses that will help drive much-needed investment and employment across our economy. The $20,000 asset write-off is a fantastic initiative. That is why 30,000 small businesses in my electorate of Brisbane applaud this budget—businesses like Dolci Sapori, whose owner Aladino Pozzobon will now be able to refrigerate his van. He already has another van but he has one that is not refrigerated. He will be able to expand and deliver more of his beautiful Italian sweets to all of the coffee shops and restaurants that he supplies. He is very excited about taking his business to that next level.
As a result of this package, almost overnight business and consumer confidence has been transformed. This is the message that I am getting everywhere I travel. When I talk to my constituents, whether they have a little coffee shop on the corner, a deli, manufacturing business, IT business, health business or restaurant, they are all terribly excited by this small business package. To this point, the Chamber of Commerce and Industry in Queensland, which is based in my electorate, was absolutely delighted with the budget. It was delighted that the budget recognised that small business is the backbone of the economy. CCIQ Director of Advocacy, Nick Behrens, said the budget had firmly placed responsibility for job creation at the feet of small business through the $5.5 billion Growing Jobs and Small Business package. More specifically, Mr Behrens said that this federal budget will materially benefit many people—
A division having been called in the House of Representatives—
Federation Chamber adjourned at 20 : 41