Russell Matheson (Macarthur, Liberal Party) Share this | Link to this | Hansard source

My question is to the Prime Minister. Prime Minister, I have been contacted by a constituent concerned about the flood tax. He is a police officer under the age of 60 who is due to retire in the next financial year. His flood tax liability on his lump sum taxable superannuation payout is $6,500. Did the Prime Minister realise that people under the age of 60 who happen to be retiring next financial year would be slugged so heavily, or is this just a cup of coffee a week?

Julia Gillard (Lalor, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I thank the member for his question. What I would say to the member is that we have structured the flood levy through the taxation system, so the taxation system obviously does work. It looks at what people earn during a financial year and consequently it is calibrated with income. That is the right thing to do. That is how we structure burdens in our society. We structure burdens on the basis that people who have the capacity to pay more should pay more. In making that design of the flood levy, we did it deliberately so those with additional capacity would pay more.

What I would also say to the member is that it does seem to me, as we look at these questions from the opposition, a little bit odd indeed. What people may think, watching this debate, is that we may be looking at two alternate packages to fund the recovery and rebuilding that is necessary around the nation. But, of course, that is not true. There is the government’s $5.6 billion package: savings, deferrals and asking Australians for a contribution, with that contribution calibrated against income. So higher income earners pay more. People who earn less than $50,000 a year do not pay anything; people earning $60,000 a year pay less than a dollar a week—

Joe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | Link to this | Hansard source

Mr Hockey interjecting

Julia Gillard (Lalor, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

and people like the shadow Treasurer, who is interjecting at the moment, pay more—as they should.

Christopher Pyne (Sturt, Liberal Party, Shadow Minister for Education, Apprenticeships and Training) Share this | Link to this | Hansard source

Mr Speaker, I rise on a point of order. The Prime Minister was asked whether she realised average taxpayers would be slugged in this way. If the answer is no, she should say no and just sit down.

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

In the framing of questions it would assist, if people want the answers to be confined and directly relevant, if they contained less argument. If those who are framing the questions want me to tighten up on the argument, I am happy to do so. The Prime Minister has the call.

Julia Gillard (Lalor, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

Thank you very much, Mr Speaker. I was talking about financing rebuilding the nation: the government’s package of $5.6 billion, including the levy, versus an alternative that simply does not stack up. Indeed, so fragile is it that it is opposed by the Deputy Leader of the Opposition, and members of the backbench have been out saying that they do not support elements of it. So the only proposal before the parliament to rebuild the nation—

Opposition Members:

Opposition members interjecting—

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! The Prime Minister will resume her seat while I give some guidance to those who need it—obviously, because of my sometimes fragile control of English! If the question goes on to talk about the cost of cups of coffee, it widens and allows me, I think, to allow debate. I am simply saying to those who frame questions that if they want me to be in the position to narrow the responses, they could assist me by narrowing the questions. The Prime Minister has the call.

Julia Gillard (Lalor, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

Thank you very much, Mr Speaker. So there is only one package before the parliament to rebuild the nation. How has the levy been designed? It bears design characteristics like those of the East Timor levy proposed by the Howard government. This is the East Timor levy that the Leader of the Opposition supported.

The member has raised with me the question of superannuation, and I can advise him of the following. Lump sum superannuation payments for over 60s from a taxed superannuation fund are exempt from tax and are also exempt from the levy. This covers the vast bulk of superannuants, but people should talk to their superannuation fund about whether a particular payment is untaxed. Can I also say to the member who has asked the question and members opposite that at some point they are going to have to face the decision here. When playing the politics is gone, will they stand up for the national interest? I am being criticised today for not enough exemptions—

Russell Matheson (Macarthur, Liberal Party) Share this | Link to this | Hansard source

Mr Speaker, I rise on a point of order on clarification. The question was asked in relation to superannuation payments for under 60s, not over.

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

The Manager of Opposition Business sought, amongst other things, a point of order on the basis of direct relevance. I have ruled on that. People may not like my ruling. The Prime Minister has the call.

Julia Gillard (Lalor, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

Thank you, Mr Speaker. I am being criticised for not enough exemptions, but the member for Maranoa said this morning that he had been asked by someone in Barcaldine, ‘Look, if it is one in, all in, why are some people exempt?’ and he is criticising us for too many exemptions. It just goes to show that this is the opposition all over the place again. It just goes to show that criticisms brought to this parliament are all about the politics and not about the interest of Australians. At some point the opposition need to make a decision. Do they stand for the national interest or just for their political interest? We can see the shallow answer on display today. (Time expired)