Ed Husic (Chifley, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Treasurer) Share this | Hansard source

Why are we here? Why are we debating this? Why are we talking about this move? What we are faced with here is a situation where, before the last election, the coalition, when in opposition, were making all sorts of commitments about what they could do. They believed that the budget did not face a revenue problem; it faced what now Treasurer Joe Hockey calls a revenue forecasting problem. They believed that they could go into an election where they did not need to raise taxes and did not need to cut spending further than the commitments raised; that confidence in the economy would be supercharged by the election of the coalition government; and that everything would repair itself. Then, having made repeated promises that they would not introduce new taxes and would not lift the total tax take—they believed that taxes would be lower under them and kept creating the impression that this would be the case—they went back on their word in the most dramatic fashion.

The coalition's first budget in government saw a number of announcements made that went completely contrary to what was being promised at the election. An impression was being deliberately generated in the minds of the voting public as they went to the ballot box in September 2013 that this would be a government that would not raise taxes, everything would be rosy and they would be able to repair the budget in a way that would not impact on people. For instance, in August 2013 when the now Prime Minister was asked whether he would manufacture a reason to go back on his word, he repeatedly said, 'Absolutely not.' He said that those commitments were rock solid and that the state of the budget would not be used as an excuse to break promises. Yet the 2014 budget did that, and this government has had to recoil from the deep-seated, fiery reaction by the public that they had been misled. There were a number of commitments made in that first budget, including a re-introduction of indexation, and the government tried to make a virtue out of it. They tried to say they needed to make a tough decision, that this was important for budget repair and that was why they were doing it.

We have to fast-forward to the point where we are confronted with this situation. I am here with my colleague from Western Sydney, the member for Parramatta, and another Western Sydney colleague is sitting as the Deputy Speaker, the member for Hughes, and we know full well that in Sydney people-movement is a hard and challenging thing. A lot of people rely on vehicles. A lot of people are stuck in vehicles for an extended period of time, in major motorways in Western Sydney—the M5, M4, M7 and M2. They sit there for long periods of time. A lot of people, particularly the key decision makers in the Abbott government, do not appreciate this situation for one moment, because they are not stuck in the type of traffic that our constituents have to deal with every day. They chew up a lot of petrol. They chew up a lot of money using tollways in Western Sydney as well. So costs are a big issue. These are the types of voices we brought to the debate when the Abbott government decided to introduce indexation of fuel—fuel taxation. But we are now faced with a situation where continued opposition would not see that money go back to struggling motorists, because a gargantuan exercise would have been required to identify the purchases made by individual consumers since the 2014 budget, track down those motorists and provide the rebate. What would happen is: it would go to oil companies. And no-one in the general public thinks for a moment that those poor, struggling oil companies need extra revenue handed to them in a bumper cheque from the Australian government. It is ridiculous to suggest that should happen. This is a situation manufactured as a result of deceit, frankly, by the Abbott government, suggesting that they would not need to introduce new taxes, suggesting to people that they would not be hit by new levies. The reality is that that is exactly what has happened. From our point of view, the choice we are confronted with is: do we pay oil companies? Frankly, that is ridiculous. So we as an opposition, instead of having the ludicrous situation where money is handed to oil companies, have come up with this compromise. I understand that people do not want to pay more for fuel. I have already made that reflection a few moments ago. But if there is something that can be done to improve roads—particularly in regional Australia, and particularly in the big regions like one of the fastest-growing regions in the country, Western Sydney—then we should definitely look for it.

There will be motorists who will begrudgingly accept the logic that says: we will pour money—in this case over a billion dollars—into improving roads. I, along with my colleague the member for Greenway, am a representative who sits entirely within the Blacktown local government area. It is a huge council. It is the biggest council in New South Wales and, I think, the third biggest in the country. We both grew up in this area and we have seen vast tracts of rural land transformed into housing estates right before our very eyes. This council has a massive infrastructure backlog as a result of a variety of decisions, some taken at a state level, to change the way infrastructure levies are paid on new housing and the way in which infrastructure is financed. It puts pressure on councils and they rely heavily on financial assistance grants from government.

We had a double whammy with an increase in fuel indexation at the same time as financial assistance grants to local government were cut. These grants are used by government in part to build new infrastructure in areas to maintain or improve existing infrastructure, but the grants have been massively cut. In Blacktown's case, Blacktown council saw a $6.7 million cut over four years to its financial assistance grants. This was a massive hit at a time when the then Liberal-controlled Blacktown council was cutting services. For instance, in Mount Druitt the local pool was being shut down. The modest level of assistance that was being provided to pensioners who were ratepayers was being eliminated. You saw all sorts of services being squeezed and new levies being introduced by the then Liberal-controlled Blacktown council. And, on top of that, they had to contend with a federal coalition government cutting the level of assistance to them. So we have a situation now, as a result of what Labor has sought, and the government has agreed to, where we have an additional $1.1 billion in Roads to Recovery funding for regional roads being used as part of the compromise to pass the government's re-introduction of indexation. This is undeniably good news for regional and local roads. When you consider, as I reflected a few moments ago, the cuts to local government and the devastating impact on economic activity—particularly in regional areas where unemployment is high and many regions are currently experiencing youth unemployment at over 20 per cent—this boost will stimulate regional economies and help generate much-needed jobs, and it is a boost for vital infrastructure. So if we can see some sort of assistance from the freezing of local government assistance grants for over three years, which represented $925 million being cut from communities over three years, we can see potential for assistance to local government in a very meaningful way.

Local government, for example, currently has a $15 infrastructure deficit. This funding boost that has been extracted by the opposition will be critically needed in regional areas and has been welcomed. The Australian Local Government Association estimated that 11 per cent of roads managed by councils were in a 'poor or very poor condition'. It is worth bearing in mind that councils themselves manage close to 700,000 kilometres of roads, which is about 75 per cent of all roads by length. Bear in mind that the federal government will not fund many federal roads. In Sydney I cannot name any that are being funded other than roads around the second Sydney airport.

And, by the way, there is much crowing from the coalition about the roads they are building around this airport, but all these roads will do is funnel more traffic into already congested roads. They will funnel it into the M5, which the constituents of the member for Hughes use. They will funnel it into the M4 and into the M7/M2, and these roads are already choked. You can go in at peak points in the day, and these roads that are supposed to operate much more smoothly and carry a lot more traffic are not doing it. So this roads package that we keep hearing about from the coalition is nothing more than providing a funnel for higher volumes of traffic into already deluged motorways. There is no move by this government to fund new road infrastructure that is critically needed—for instance, the M9, which would run roughly parallel to the M7 in Western Sydney. None of that!

So the federal government is not funding new roads. The federal government certainly will not fund state roads. If we are already having an active debate about whether or not they will maintain support for funding schools or health care and hospitals, it is hard to believe that they will fund state roads. So the logical area where they can make an impact through this type of compromise that has been reached is through local government to ensure that some of the infrastructure backlog that is causing great concern to local government is in part addressed.

Look at the way some of this has been received—for instance, the Australian Local Government Association today putting out a statement welcoming the proposed $1.1 billion in extra funding to Roads to Recovery. They say they 'strongly support the proposal today by the ALP to direct the revenue from the first two years of the fuel excise indexation, estimated to be $1.1 billion, towards additional Roads to Recovery funding for local government.' The President of the ALGA, Mayor Troy Pickard, said, 'We applaud the opposition's focus on local government and their recognition in this policy initiative of local government's important role in developing local economies and creating jobs through projects funded through the Roads to Recovery program.'

Cynics on the other side would say, 'Of course the ALGA would welcome $1.1 billion in additional funding,' but, frankly, who could deny them the positive reaction that they would have to this type of announcement, particularly when, as Mayor Pickard said, 'This initiative is particularly welcome at a time when local government is under financial pressure following the decision to freeze the indexation of financial assistance grants, costing councils an estimated $925 million in the period to 2017-18.' So for them this is an important boost.

As I said, there will be those who, no matter what, will not support an increase in taxation. You can understand why that exists. This government that has undertaken a massive breach of promise in the 2014 budget has maintained some fairly vicious cuts to schools and hospitals in the 2015 budget. For those people who were under the belief that the Abbott government would not increase taxes—it did so 17 times in this new budget, by the way—and who feel misled: we certainly understand your anger. But, as I also indicated in my earlier comments, there will be those motorists who begrudgingly accept that, if this is going to happen, if it can improve roads and see better outcomes particularly in congested major cities like my constituency, part of one of the fastest growing regions in the country, they will potentially accept that and will understand it.

But we are trying to ensure that we do not see valuable government revenue go into the bottom line of already strong balance sheets of oil companies. Instead of providing money to oil companies, let's make a meaningful contribution to improve infrastructure in this country, particularly through local government, which has a massive infrastructure backlog. Let's see the money directed there, let's see some potential benefit to local roads and let's ensure that this is a meaningful investment for local economies, stimulating them at a time of high unemployment and making sure that we can boost economic activity in their area and provide a benefit for motorists. I certainly commend the opposition's position in this matter.

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