Clare O'Neil (Hotham, Australian Labor Party) Share this | Hansard source

) ( ): It is a pleasure tonight to make a contribution on the fuel indexation and excise tariff amendment bills. They give effect to a very important decision that Labor has made today, and I want to take some time this evening in the House to explain the rationale behind what has occurred and what these pieces of legislation give effect to.

Today, Labor has agreed to compromise on a tax proposal that was put forward by the Abbott government, one that has been baked into the various budgetary documents that they have produced since announcing that decision about a year ago. We have done this with some critical conditions. The most important one is that we have said that the revenues that have been collected under this tax need to go into local government and be put to local roads funding, and I will talk a little bit about the importance of this priority. The critical thing at the outset to understand is that we believe that we have been able to turn what was a bit of an attack on motorists, to be frank, into something that is going to be in part beneficial for motorists and at the same time for local governments. We have seen really good support today from the Australian Local Government Association, who has come out strongly backing Labor's decision.

I want to start with a central principle in this discussion that has guided a lot of Labor's decisions about how to manage what have been fairly consistent proposals to increase tax or to increase the burden on ordinary Australians. Labor does not believe that the fiscal issues in this country should be borne, in general, by ordinary Australians. What we need to remember is that when the Abbott government were elected the first two major things they did as a government were to give a tax break to the biggest polluters in this country and a tax break to big mining companies. Then we saw the Abbott government go on a tirade around the nation preaching debt and deficit disaster and going on and on about all the problems that have been caused, supposedly by us, when the first two big policy initiatives of the government were to give tax breaks to the biggest companies operating in Australia.

What we have seen since is a more or less constant attempt to push that burden onto ordinary Australians. We saw in the last budget, very disappointingly, about 17 new or increased taxes. That was despite a promise made at the last election that there would be no new taxes. It sounds a little bit unbelievable given the rhetoric and everything the government says, but this government is actually the highest-taxing Australian government since John Howard was Prime Minister of Australia. That is probably not what you would think because this is not what we hear from those in the government, but the facts show us that very clearly and it is important that Australians understand this.

Given the principle I have laid out here about where the burden of this issue should lie, you could imagine that when we initially heard about the proposal to increase taxes on fuel we were very opposed to this initiative, and it is an opposition that we have kept up for some time. But, coming to this point in the budgetary cycle, Labor has really faced what has been a Hobson's choice. The government has essentially said that, were Labor not to agree for this legislation to go through the House, the taxes that had been collected under regulation would be returned to fuel companies—essentially the fuel companies that Australians buy petrol from. Clearly, this would be completely unacceptable to motorists around Australia and clearly it would be unacceptable to Labor. One of the things that all of us in politics understand is that you get pretty good at making lemons into lemonade. That is why Labor has agreed to the proposal before us, but with these critical conditions that will ensure that we meet some other important objectives that Labor believes in while we go ahead with this excise increase.

I spoke a bit earlier about one of the conditions of the agreement that we have made with the coalition government. The critical point here is that this proposal has been agreed to on the understanding that this $1.1 billion flows directly back into local government and, in particular, supports them in the difficult task they face in maintaining local roads around Australia. Beyond the rationale I spoke about of the tax burden, I think this does show quite a deep commitment that we on this side of the House have to local government. I am a former local mayor and a former local councillor. I was on council at the City of Greater Dandenong for three years. Having had that experience, I am critically aware of the role that local government plays.

I also know that money for local governments is tight. They do not have the same revenue options that state and federal governments have. We also know that, when you add it up, local governments in Australia are responsible for an incredibly large array of activities. It is roads and it is footpaths and all of the things that we know about, but it is also things like local community groups and neighbourhood houses that dot all of our neighbourhoods, and the different services they provide like local arts, writing, theatre, community groups and all those sorts of things.

I have been on a metropolitan council, but I know that the task faced by regional and rural councils is of a completely different order of magnitude. That is because they have a much narrower tax base. A local government that looks after a hundred small towns has to deal with a hundred community halls and a hundred local swimming pools and a hundred of all of the other things that we might have three or four of in a big metropolitan council with a much wider and a larger range of people who can pay rates. I remember attending lots of local government seminars when I was a councillor. You would often hear really incredible stories about local government CEOs who had to play very different roles in their local council because they just did not have the staff that they needed to fulfil all of the activities. One that sticks in my mind is a local government CEO who, on his way home, had to go and shut some critical gates in the community that shut off community facilities at the end of each night. Despite the very hardworking CEOs we had at the City of Greater Dandenong, you would not see a task like that on their lists.

We know that these councils are managing regional facilities on a shoestring. In addition, these rural councils are often servicing areas of really significant need. In rural and regional Australia there is a higher incidence of poverty than we see in many of our big cities and the average age of the population outside of the cities is higher than in the cities. So we see these small councils with lots of different facilities and also communities that need quite a lot of care.

This issue facing local government—the funding gap between the funding they are able to raise themselves and the various responsibilities they have—is particularly stark when we look at the issue of roads. There are 670,000 kilometres of roads that are run and monitored by local governments around Australia. That is about 760 times the difference between Melbourne and Sydney, if that brings it to a more tangible magnitude. We know that 75 per cent, by length, of all the roads in Australia are monitored and managed by local government. One of the recent reports on the state of roads in rural and regional Australia found that 11 per cent of all roads are in poor or very poor condition. That is from an Australian Local Government Association survey. So again we can see that local government has this really significant responsibility, and it is just not able to keep up with the infrastructure backlog.

We are all playing the bipartisanship game today, but it is important to note that local governments have not been assisted by various decisions made by the government since they came to power. As with other areas, they talk a very big game about local government but when we look at the numbers there have been massive reductions to funding for local governments, in the form of cuts to financial assistance grants. And those cuts have affected councils all over the country. Thinking about my electorate of Hotham, the city of Glenaire was promised financial assistance grants for the council, but that promise was ripped away when this government was elected. We see that reflected right across the country.

In just the first year of office, the Prime Minister cut $925 million away from communities through cuts to local government. Considering all the things I have discussed in terms of the big responsibilities of local government, those cuts were really the last thing they needed. Again, we hear big talk about roads and the importance of infrastructure investment in this country—cutting $1 billion from local governments was not going to get us any closer to managing the infrastructure backlog faced by our local councils.

I want to speak a little bit about Labor's approach to infrastructure, which has very much guided the compromise we have reached with the coalition to ensure that additional funding goes into local government. All of us on this side of the House speak pretty frequently about our commitment to public transport. It is a very real and very serious commitment. The Rudd and Gillard governments spent more on public transport investment than every other Australian government—put together—since Federation. This is really important, because the money that is being put forward here in this legislation is not going to go to public transport, and I just want to make it clear that we understand that. It is certainly not reflective of stepping away from a commitment to public transport. We are fiercely in favour of that, and I say that particularly as a Victorian.

We saw in the last state election a bit of a referendum—as the Prime Minister called in—on the East West Link. We saw the people of Victoria being very clear that, instead of a big road that very few people in the community actually wanted, they wanted investment in public transport infrastructure. And Labor is very keen to help them achieve that.

We saw some other important reforms to infrastructure under the former government, which I want to highlight while I have the floor this evening. One of the really important things Labor did was put infrastructure right at the top of the national priority list. Because of the incredible work of the member for Grayndler when he was infrastructure minister, Australia moved from being one of the lowest-spending countries in the OECD to being the highest-spending country on infrastructure in all of the OECD.

When you go around Australia—as we all get to do as members of parliament—particularly in local communities, there is rarely a person who does not know Albo and his fierce commitment to funding good public transport that cities want and to funding roads of national importance.

One of the critical things that the member for Grayndler was able to do as infrastructure minister was make some really important moves towards taking the politics out of infrastructure funding decisions. Infrastructure is of course probably the most famous example of pork barrelling—you hear about 'bridges to nowhere' and those sorts of things—that is just making light of a very serious point, which is that these projects can be so politicised and they are worth really significant dollars. One of the important things that the last government did was put a really good framework around infrastructure decisions through the establishment of Infrastructure Australia.

In the Leader of the Opposition's budget reply speech, we heard about some really important initiatives that Labor wants to put forward, if we form government again, to continue that important process of depoliticising infrastructure decisions. These decisions are too important—too important to our national economy—to be just the play-thing of whoever is the Prime Minister of the day. Some of the things that the Leader of the Opposition talked about were, for example, trying to bring some semblance of bipartisanship into the approach, and to provide more independence to Infrastructure Australia. I would contrast that with the approach we have seen on the other side of the House, where, for many months—I think, more than a year—Infrastructure Australia was actually without a chair. That really tells us everything we need to know about the seriousness with which they take the independence of these infrastructure decisions.

There is so much more that we could talk about in this important reform. We have not talked about the employment implications of the decision that Labor has made. And that is key, because this is about $1.1 billion flowing right into local communities and building construction projects that are of local need. Let me just say that Labor has made what was a really significant impost on Australian motorists into something that we see will benefit them and local communities, and benefit local governments. I am very pleased today to support the legislation before the House.

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