Ms Anna Burke (Speaker) Share this | Link to this | Hansard source

I have received a letter from the honourable member for North Sydney proposing that a definite matter of public importance be submitted to the House for discussion, namely:

The failure of the Government to deliver an economic and fiscal plan to return the Budget to surplus in its 2012-13 MYEFO statement.

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—

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

I am sorry that the Treasurer has not deemed it fit to debate the economy in this place. We warned that this would happen; we have been saying it for months and years. When the government brought forward the Mid-Year Economic and Fiscal Outlook to October, for only the third time in the history of MYEFO, we smelt a rat. The two previous occasions on which MYEFO has been released in October, barely five months into the financial year, were with the announcement of an election pending in November. Those were the only two times. And noting that MYEFO is a document produced by the Treasurer and the Minister for Finance, rather than the Treasury and the Department of Finance, we were highly sceptical and we were understandably cautious. MYEFO has been released in November on seven occasions, five times in December and only twice previously in October—and now they bring it forward.

And then we worked it out. Oh, what a coincidence! We discovered that the mining tax receipts were going to be lodged with the Australian Taxation Office, on the other side of Canberra, at exactly the same time as the government was publishing this document. What a coincidence! Get out of here! How did that happen? The government said it had revised the mining tax number from $3 billion down to $2 billion. Old Swannie knew the questions were coming but he still did not get the numbers right. But we will let him off the hook for a brief moment because there are much bigger fish to put on our hook.

The government said it was going to get to a surplus of $1.1 billion. How? By fiddling the books. Labor is great at fiddling the books. The Health Services Union was good at fiddling the books. Charges have been laid against a former president of the Labor Party, suggesting that there may have been some fiddling of the books. And now we have got the Treasurer of the Labor Party fiddling the books. He is doing that by moving money between years—that is the time honoured trick. Of course, if you are a director of an Australian company you would probably go to jail for that. But, never mind, he is the Treasurer of Australia. Then he brings $2 billion of the Future Fund into the budget to deliver him over $417 million this financial year. And then he goes and raids the superannuation accounts of everyday Australians to get another $500 million. He does a fiddle here and a fiddle there and, hocus-pocus, we have got 'a promised surplus'. It is now 'a plan to have a surplus', according to the Prime Minister. It was 'a 'commitment, it was 'a promise' and it was 'a guarantee'. And then we had a little charade with the government saying it was 'a determination'. 'Maybe we'll get there; we hope to get there; goodness knows, we might get there; no, we're going to get there.'

Bob Baldwin (Paterson, Liberal Party, Shadow Minister for Tourism) Share this | Link to this | Hansard source

Thomas the Tank Engine!

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

It is a scene out of Thomas the Tank Enginesomething that I, with young children, am all too familiar with. But the evidence of this government's incompetence knows no bounds. We have heard it all before. They promised they would have computers in schools for $1 billion. Well, that was $2.2 billion and the dollars have not finished. They said they were going to have a green car fund, and they did not have a green car fund. They said they were going to send $900 cheques out to people—and they sent over 18,000 cheques to dead people to stimulate the economy! They put pink batts in people's homes. Homes burnt down and there were tragic deaths associated with it, and then they had to spend billions of dollars trying to fix the problem. They had $500 digital set-top boxes put into pensioners homes—when Gerry Harvey said he would personally do it for $199. We have had it all before. Nothing stretches the imagination with this government. As one of their own members said to me last night, this government will go down in the annals of history as a memorable government. And I said, 'Amen, it will be memorable.' The only problem is that the Australian people are paying a price for a government that is deceiving them with words, misleading them with actions and, at the end of the day, undermining consumer and business confidence with their own incompetence.

Remember the mining tax? We will never let Labor forget the mining tax. This tax was originally going to raise over $11 billion in two years; in fact, at one stage it was meant to be $23 billion over four years. And then it was reduced. 'Sorry, Kevin lost his way. We're going to have to get rid of Kevin.' 'I will negotiate a new mining tax,' the new Prime Minister, Julia Gillard, said. 'Put down your weapons; stop your advertising; come to the table where we can negotiate.' I would love to negotiate with Julia Gillard; I would love it. The Malaysians negotiated with Julia Gillard. They ended up sending 3,000 people here and, in return, got 600 people and over $300 million. How good is that for negotiating with the Prime Minister of Australia! But then along came the three most significant iron ore and coal companies in Australia, two of whom are among the most significant mining companies in the world—they negotiate with China and throughout the region with the most aggressive negotiators in the world—and the Prime Minister says: 'I'm going to take Wayne Swan into these negotiations. I'm going to take old Swannie in. There's no negotiator like Wayne Swan. He's the best. He deserves a gold medal in the negotiation Olympics.' So in goes the Prime Minister, to negotiate with the three toughest negotiators in the commercial world, with Wayne Swan by her side and Martin Ferguson on the other side. When they came out they said, 'We've done a great deal.' When the miners came out they said, 'We can live with this tax.' All of a sudden the alarm bells went off. The miners said it was a pretty good deal. I thought, 'Hang on, what's "a pretty good deal"?' Do you know what a pretty good deal is? Zero tax. That is a pretty good deal!

I have heard of all those stories about expenditure blow-outs, about promises made and not delivered, but I have never heard of a tax that does not raise money. Not even the Greek government has heard of a tax that does not raise money. This government has set a new public policy benchmark right across the world: a tax with no money. But it gets better.

If the tax has no money then everyone is asking the question, 'Well, what happened to the rebate for the royalties paid to the states?' And we hear from the mining companies and we hear from everyone else that in fact the royalties are rebatable. So not only is this tax so far, to the best of our knowledge, not delivering a dollar; the government has a liability to pay the miners money. This is a tax where the government pays money rather than receives money. Now that is a second-year benchmark in public policy that this government has delivered and it is writ large.

I go back to the words of the original architect of the reform. Dr Ken Henry, who is a decent man, said along the way that the mining tax would be important for helping to redistribute the wealth. But Dr Henry on 16 July this year said:

And the obvious question it—

the mining tax—

raises is one that I dare not ask, really—

and then he asks—

which is whether it's worth bothering at all.

Just in case anyone thought they understood the mining tax, he went on to say:

… there's no way the public could possibly understand what has actually been legislated either—

with the mining tax. The problem is that the government does not understand what has been legislated with the mining tax. We understand it. We understand that the mining tax was a false dawn. The problem is that this government committed over $15 billion of expenditure against a tax that does not exist—$15 billion in schoolkids bonuses, regional infrastructure funds, superannuation increases, concessions to small business. They are running around the country talking about redistributing the wealth of the mining boom, but there ain't no wealth.

And why? Because of the sheer incompetence of this government and the deliberate deceit in their words and their sneaky little actions in bringing forward a document to avoid telling the truth to the Australian people about the state of the budget. It is consistent with all of their actions, consistent with all of their words—the Labor Party does not tell the truth. They come in here and cry crocodile tears about budget cuts and job losses in Queensland and then they cut the education budget. They say that they are going to provide billions of dollars to the Gonski reforms. Not a dollar exists. In fact, they are cutting education.

They cry crocodile tears about the funding of health in Australia, which in the last year alone for everyday Australians has gone up over seven per cent. The ABS identified on Thursday that one of the key reasons for the increase in the cost of health was in fact the government's own previous actions to try and close down private health insurance support in the budget. The ABS, the most unpolitical of organisations, is there saying government policy has caused the cost of health in Australia to rise by over seven per cent and in the last quarter to rise significantly, and that is because of the government's policy changes on private health insurance. Not to be outdone, this government then goes and takes a further $1.1 billion out of private health insurance.

Did you notice that before MYEFO they had all of this feigned concern for low-income Australians? One million Australians earning less than $24,000 a year are private health insurance policy holders, and this government has now announced a further new policy that is forevermore going to continue to increase private health insurance. Their complete contempt for private health insurance is best displayed by the way they treat their own private health insurer, Medibank Private. They have taken out $800 million in special dividends over the last three years, including this year alone—$250 per policy holder out of Medibank Private to try and shore up their fake surplus.

This is a government that will reach into any pocket. Previously, we know, they have raised taxes with complete indifference to the impact on prices and the costs of goods, complete indifference to the welfare of the nation—carbon tax, flood levy, alcopops tax, changes in so many areas. There have been 27, in fact, new or increased taxes. They do not care. They see your money as their money. But, what is worse, just a few months ago the Labor Party introduced over $5 billion of retrospective taxes. So, not sick of hitting people with new taxes now, they go back and hit people with yesterday's taxes, where they lawfully pay the taxes because the Labor Party has run out of money. Then they borrowed money, which is future taxes. They borrowed from the Australian people. They give us this line about how the Labor Party collects less as a percentage of GDP in tax than the previous coalition. We did not borrow money, because borrowing money is future taxes. If the Labor Party do not understand it then their ignorance shows no bounds.

The problem is the total lack of honesty, the total deceit from this mob, the contempt they hold everyday Australians in. Because Labor has no core principles. They do not understand that every dollar borrowed is a dollar that has to be paid back with interest. And they do not understand that when they increase taxes they hit everyday Australians. Labor, at some point, sometime in the future, must tell the truth, because ultimately bad Labor governments are going to be caught out.

David Bradbury (Lindsay, Australian Labor Party, Assistant Treasurer ) Share this | Link to this | Hansard source

I am pleased to be able to contribute to this matter of public importance. I will restate the subject of it, because it may not have been possible to glean that from the member for North Sydney's contribution. The topic for discussion is:

The failure of the Government to deliver an economic and fiscal plan to return the Budget to surplus in its 2012-13 MYEFO statement.

We heard from the member for North Sydney a range of criticisms about the timing of the mid-year economic statement. I think it is worth putting a few facts on the record. I hope that the weight of facts can overpower the sheer force of hot air that we have heard from the other side. I will ensure that this debate is graced with at least some facts.

In terms of the question of timing, the absolute hypocrisy of the member for North Sydney may have dawned on one or two members in this chamber. The last time I debated him in a matter of public importance, in the last sitting week, the topic was that the government should urgently update its forecasts. That was just a few weeks ago. It was such a significant matter—he should go back and review the videotape. Obviously on that occasion he strayed as far away from the topic as he has today. He came into this place and said, 'The government needs to urgently update its figures.' Guess what—we did. It is called the Mid-Year Economic and Fiscal Outlook. We handed that down just over a week ago.

The member for North Sydney says, 'The government rushed in and released it earlier than we would've expected.' That statement might have an ounce of credibility if this was not the same bloke who last year ran around the country saying the government released it too late. On that occasion we released it on 29 November, and his principal criticism was, 'You can't go and release the mid-year statement when there are virtually no sitting weeks of parliament left, because we need to make sure this plan of yours is subject to some parliamentary scrutiny.' Hello! This is the second last sitting week of the year. If this is too early, the member for North Sydney needs to tell us exactly when he thinks is an appropriate time to hand down the mid-year economic statement.

When the member for North Sydney was in government and he and his colleagues introduced the Charter of Budget Honesty, they set out the requirements for the mid-year statement. This mid-year statement complies with the Charter of Budget Honesty. We did not hear any reference to the Charter of Budget Honesty from the member for North Sydney in his contribution because not only did he fail to comply with the requirements of the Charter of Budget Honesty at the last election but he has absolutely no intention of doing so at the next election.

We all recall the $11 billion black hole at the last election. His policies were costed by people he called his mates—he said he got mates rates. Whatever he got, he either really got his money's worth or he got completely ripped off, depending on what he was really trying to do. The people that costed and audited his policies—he said that they audited them—were found to have an $11 billion black hole. The accounting firm were reprimanded by the professional body and the member for North Sydney, the member for Goldstein and the Leader of the Opposition were exposed for having gone to the election with a shonky set of costings. They thought they were going to slide through. But what happened? No-one had the numbers after the election, and there was a period of negotiation. The Independents, in their wisdom, decided that they would make sure they got the policies costed. Mind you, they would already have been costed if the coalition had observed the principles that they had had set out for years. They had been coming into this place for years and saying everybody must kneel at the altar of the Charter of Budget Honesty, but they did not do it. At the first opportunity, they would not do it.

We heard the member for North Sydney talk about the timing of this MYEFO. Let me talk about the history of the timing of some of the Mid-Year Economic Statements handed down. Let's look at the so-called 'golden years' of the Costello reign. In that period, two MYEFOs were handed down in October, one on 15 October 2007 and one on 17 October 2001. We are hearing that October is too early, yet Costello did it twice. Let's have a look at some of the other dates. There was a MYEFO handed down on 21 December 2004—that was a Christmas present, was it? Santa delivered that one, and he decided to make sure it arrived just in time! There was a bit of bad news in that one. That is why they held it back and released it just on the eve of Christmas. If that is the standard you want us to observe, come on, challenge us to do it. I tell you what: we won't, because we believe it is important that the Australian people have access to this information in a timely way. There were Mid-Year Economic Statements handed down on 15 December 2005 and then 20 December 2006. How much parliamentary scrutiny did those get subjected to, being handed down in December, on the eve of Christmas?

That is the hypocrisy of those opposite, the same people with their shonky costings exposed from an $11 billion black hole. If it stopped there, you might at least come to the conclusion that they have reformed, they have seen the error of their ways. But we know they have a $70 billion black hole. The member for North Sydney has gone on breakfast television twice to tell us that and the member for Goldstein will tell anyone that will listen. Along with all of the other shortcomings of the member for North Sydney and the member for Goldstein, they do not talk, but they do talk about each other—that's for sure—to anyone that will listen.

We handed down our Mid-Year Economic Statement, containing, across the forward estimates, $16 billion worth of responsible savings measures, to ensure that we are able to chart a pathway back to surplus. There is a forecast surplus of $1.1 billion in the current year, and that surplus is forecast to increase across the forward estimates. As part of this we announced a whole series of significant structural changes to the budget to make sure that it will be fiscally sustainable over time.

And you would have thought that, given all the chest-beating that we saw when the member for North Sydney went over to the UK—he gave his speech on the age of entitlement, big man that he was!—he was going to clamp down on the age of entitlement and to undo all the middle-class welfare of the Howard years. He said that on Lateline. He was going to undo all of the damage that was done by the largesse of the Howard years.

Then he had an opportunity, when we handed down this Mid-Year Economic statement, where we said that we were going to trim the baby bonus for the second child and for subsequent children. We are not taking it away but will reduce it to $3,000 for child 2 and beyond, except if they are multiple births. You would have thought that a decision of this nature would have the wholehearted support of someone who purports to have some interest in the long-term fiscal sustainability of our budget. But instead the member for North Sydney came forward and started likening this to the one-child policy in China. When he was asked about this on Insiders, he said: 'Hang on a minute. Never before in the history of Australia has a family been penalised for having subsequent children.'

I might be missing something here, but I do not think $3,000 payments are a penalty. They are called bonuses; they are to support people in those situations. He went on to say, 'Never before have we treated the first child differently to subsequent children.' He must have forgotten about the first-child tax offset that his government, when they were last in government, introduced back in 2000-01. For those of you who may not have looked at the detail of the act or the policy behind it, I reckon the first-child tax offset may have been about the first child! And if it was about the first child and the subsequent children were not entitled to it then I reckon that, in government, the opposition may have just done exactly what he reckons no government in the history of this country has ever done. Once again, he is being very sloppy and very lazy when it comes to his details.

The opposition talk about our commitment to a surplus. One of the biggest threats to a surplus is the coalition, because every time we come forward with a sensible savings measure they want to play politics. They know it is not easy. If you want to get the government on a sustainable footing—if you want to do what the member for North Sydney said has to be done, and that is to trim away some of the largesse of the Howard years—then sometimes you have to make some decisions that are not easy. But in opposition they take the low road every time. They oppose these things. They whinge; they whine—there is no shortage of hot air from the member for North Sydney—and then, when it comes to the crunch, they either quietly wave these measures through or vote against them. But you never, ever hear them say that they will come forward and reinstate these things, because they will let us do the hard work. They are happy to let us do the heavy lifting, and they think that their moment in the sun is not far away. I will tell you what: the Australian people will demand of them a little bit more hard work than we have seen. They will demand a lot less of the sloppiness and a lot less of the laziness and little bit more hard work.

When it comes to the surplus, the opposition talk about the surplus as if a coalition government will automatically return the budget to surplus. You would have thought that from listening to the member for North Sydney. But when they have been asked about whether or not they are prepared to commit to returning the budget to surplus, what do they say? The Leader of the Opposition says, 'We'll do it as quickly as possible.' The member for Goldstein over here says, 'It just depends.' That sounds a little bit more equivocal. The member for North Sydney says, 'We'll do it as soon as possible.' He did not say, 'as quickly as possible'; he said, 'as soon as possible'. That is not too bad. Senator Abetz says, 'Hang on a minute. I'm not in the business of making extravagant promises.' So do they intend to return the budget to surplus or not?

The member for North Sydney came in here and he was talking about 'this high-taxing government' increasing taxes and retrospective taxes. Well, there is only one party in this parliament that has a plan to increase corporate taxes. It is a $12 billion monster parental leave tax, and the architect was none other than the Leader of the Opposition. Remember, he went into the party room, and we know that the opposition hated it. Look at the member for Goldstein; he is shifting uncomfortably in his seat, because they hate it. Think about this. If the Labor Party were proposing to increase corporate taxes on $3,000 of the biggest companies in this country by 1½ per cent so that we can fund a social expenditure program they would be saying, 'It's a return to the socialist ways of the Labor Party!' When the Leader of the Opposition proposed the tax they were not happy, so he went into the party room and said, 'Sometimes it's better to ask for forgiveness than permission.' They might have granted him forgiveness on that occasion but one gets the sense that they are running out of patience with his constant requests for forgiveness ahead of permission. One gets the sense that that is the case.

Why is that the case? It is not because they are taking a stand on any great principle, but some opposition members actually get out there and talk to people in their communities, and they are sensing the same thing that so many members of this place are sensing: that the Australian people are sick and tired—they have had a gutful—of the reckless negativity of this bloke. Never before have I seen a leader's standing in the polls dragging so heavily on a party's standing as what we have seen with the Leader of the Opposition. I am no genius—I will be the first to admit that—so I am not the only one who can see that. There must be people on the other side of the chamber who can see it as well. That is why the members in the chamber have conveniently started looking at their shoes at this point in time: they do not want to make eye contact because they know the truth of this. The Australian people have worked the Leader of the Opposition out. They have decided that his reckless negativity is not what this country needs in the future.

The Australian people are looking for a plan for the future. And on the weekend the Prime Minister set out a plan for our future—for how we can take advantage of the dramatic changes that are occurring in the global economy, bringing so much opportunity for prosperity to our doorstep. But it will not just land in our lap; we are going to have to work hard to achieve it. And we have a plan to do that.

Meanwhile, not only did those on the other side not come into this place and ask any sensible questions about MYEFO, or tell us which measures they intend to support and which ones they are going to oppose, but they did not even ask us a question about the Asian century, our plan or what we intend to do. The only contribution they can make is to say well, you have not committed enough money to it. The people that are jumping up and down saying this is a government that spends too much money are now telling us 'you have not committed enough money'. We have sensible plans and we will deliver them. (Time expired)

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

Wouldn't you know it? This happens every time. I seem to follow the Assistant Treasurer, the member for Lindsay, every time we have a matter of public importance, which gives him an opportunity to defend the position of the government. He did not spend one second defending any position of the government. It was just another exercise in cheap shots, anecdotes and all the rest. As usual, he scurries off. It is a fruitless exercise but it does reinforce the point about this whole debate—that is, that the failure to outline a plan to return to surplus in MYEFO is yet again just another symbol, another example of the failure now for many years to present any sort of vision, any sort of road map as to where they are taking the country. That is why there is a crisis of confidence in Australia. That is why people are saving like there is no tomorrow. That is why businesses are sitting on, in many cases, very healthy balance sheets. There is no confidence about investing in this country and it largely stems from the absence of leadership.

There is failure, from the Prime Minister down, to articulate what this government will do not just to deal with the problems but to set us up for the opportunities. How can adding $257 billion of debt to Australia—and growing—be consistent with the rhetoric we heard over the weekend about Asia? We have the minister responsible for Asia now in the House. How can Australia properly take advantage of what should be a miraculous, spectacular three decades—in my view—if we are burdened with the highest debt this country has ever had? If you add federal and state debt together, we have nearly half a trillion dollars of debt and it is growing. There is nothing in the MYEFO or in the budget before it which shows that this government has any idea, has any prospect, has any concept of how it is going to take Australia to a better place. On 30 August this year the Australian Financial Review wrote a telling editorial in which it observed:

… going forward, the budget is facing a black hole of colossal proportions and Labor has no strategy to deal with it.

That is what the community thinks. Here is a government now with a black hole of colossal proportions. This is after, by the way, years of growth. Farmers will tell you that if you have a bunch of good seasons in a row then you put hay away for when you need it, when the bad season comes.

This government keeps telling us about trend growth and we do know that we have had the biggest mining boom and 150 years. Compared with the rest of the world, we are so blessed yet we have a debt going through the ceiling; we have a government with a colossal black hole. We saw not one thing in the budget which suggested how this government would pay for $120 billion of commitments that it floated are going to be made in the years ahead.

You watch at the next election the National Disability Insurance Scheme. The government will claim credit for having introduced it. We are so far away from it that it does not matter. It is a con on the Australian public but, most importantly, on the most disadvantaged people in our community. They are being misled to believe that it is just around the corner, that it is funded and that it is deliverable. This government has no moral fibre. To go out there and mislead people in this way is a disgrace, an absolute disgrace. It is because, as the Financial Review said, Labor has no strategy to deal with it, none whatsoever.

We saw nothing from the member for Lindsay. The Assistant Treasurer, would you believe, had 15 minutes to quietly and confidently articulate a case for the plan they have got to deliver a surplus. What did we hear? Nothing but cheap shots straight out of the Labor-union book of how to play politics. It is a game to them. It is game of politics, it is not about using politics to get in good policy. It is about playing with people's minds and with policy to deliver politics and power. That is the objective.

This absence of a plan or strategy that the Financial Review spoke about and the growing colossal black hole that the Financial Review also spoke about on August 23 are not new developments. The failure of this government to outline a plan to return Australia to surplus has been with us for some time as have the growing consequences. I am not normally in the habit of quoting myself but I thought it would be instructive to remind people of what we on this side of the House and so many others over the last two or three years have been saying. It is instructive to go back and see what the nature of this debate was two years ago. I quote from a speech I gave on 16 February 2011. Right back then they were making cast-iron promises about a surplus in 2012-13 and it helped them get through the 2010 election.

They forecast nirvana. They forecast these things and then, when they do not happen, say, 'We've had to deal with some setbacks.' A 150-year high in terms of trade—what a setback that was! That was really bad luck! A 350 per cent increase in commodity prices—oh, shock, horror! How bad is that, to have to deal with those sorts of problems! I feel so sorry! But to go back to what was said nearly two years ago:

Any "illusory" surplus in 2012-13 ignores the spending commitments being made during the boom times that still need to be met when the boom tapers off and revenues fall.

We were talking about terms of trade coming off—not collapsing but coming off—two years ago. But what did the government do? It ignored this advice. I went on to say:

On top of that, several leading economists claimed last week that a potential $7.4bn black hole existed in the mining tax forecasts due to the "highly risky" revenue stream.

Here we are: leading officials, leading business people and leading economists were warning two years ago that this mining tax was not going to deliver a cent. But the government blithely went on. They have been beating their breasts. They have been lying and obfuscating and misleading the population again and again and again.

Craig Emerson (Rankin, Australian Labor Party, Minister for Trade and Competitiveness) Share this | Link to this | Hansard source

Mr Deputy Speaker, I rise on a point of order. Consistent with the standing orders, I seek a withdrawal of the claim that this government has been lying. We know that the man who is at the dispatch box himself has a $70-billion black hole. He might tell the truth about that.

Bruce Scott (Maranoa, Deputy-Speaker) Share this | Link to this | Hansard source

The member for Goldstein will withdraw the word.

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

I withdraw. The minister opposite talks about black holes. Again, I refer the minister to 30 August—a $120-billion colossal black hole. We are not saying this; this is an analysis by the most respectable financial paper in the country.

In that same speech I went on:

As a consequence of the blowout in the structural deficit, the cloud over the amount and volatility of the mining tax revenue and the potential collapse of revenue if the terms of trade drop … Swan and Penny Wong must guarantee full disclosure of the estimated structural deficit in this year's budget papers.

Well, of course, all of that is what we have seen in the last two years. The government has not responded to any of it. We have a government that has no direction and must be gone.

Bernie Ripoll (Oxley, Australian Labor Party, Parliamentary Secretary to the Treasurer) Share this | Link to this | Hansard source

It is a pleasure, once again, to speak on these matters of public importance—although they are the same matter over and over and over, and you would think that the opposition would just be a little bit more creative and come up with something that was a little bit more innovative in terms of the things they are trying to say. But if their only claim coming in here to speak on this matter of public importance is that we do not have a plan, then how sad it is for the opposition. Is this the new brains trust of the Liberal and National parties? Is this all they have left to offer? They may criticise us for the plans we do have; they may make some critique of that. But to say that we have no plan I think is a little odd and a little strange.

We are still waiting to see what their policies are in a whole range of areas. We want to not only see the policies but see them costed properly. We want to see them handed over to the office of budget honesty to see what we can actually make of what the opposition is proposing for the future of Australia.

But let us go to some of the key facts and see what this economy actually looks like. The rest of the world and we are going through some difficult times; there is no question about that. Since the GFC hit the world, we have all had to make some pretty tough decisions and weather some fairly tough circumstances. And that is exactly what we have done as a government. Since we were elected to government in 2007, this Labor government has made all of the tough calls, all of the tough decisions, to make sure we have plans in place. We have put the right budgets and spending in place to make sure that we support the economy and support jobs. We have made sure that people still have work to go to. We have made sure that business can stand on its own feet, with the assistance of government in the right areas, to make sure that we still have a strong, decent economy. That is a good position to be in. We are in a good position in this country.

When people get together for a barbecue and discuss things then, yes, they will have a bit of a complain about where the economy is at, and, yes, it could always be better, there is no question. But when you ask them the central question: 'If you could pick any economy in the world, if you could pick any place to be, where would you rather be?' The answer is, 'Right here.' Because they understand the tough times that we have all gone through, and they understand the work that this government has done to make sure that we still have a good economy—an economy that is still performing well by anybody's measure.

But let us have a little look at where this opposition was not so long ago. I can recall, back in the Costello and Howard years, the so-called 'greatness' of that particular government—and, in the fullness of time, maybe we will see just what that 'greatness' really amounted to. I also recall that there was one thing that was really significant about that period in history, and not just for Australia but for all our neighbours, for every OECD country, and for the world. We were experiencing a global boom, beyond any proportions anyone had ever seen before—so much so that some economists were talking about redesigning the parameters of the charts, because everything only ever pointed up back then.

In those days, they used to call them the 'rivers of gold' that flowed into Canberra. It used to rain gold bars. And there was a deliberate tactic of the then Treasurer, Peter Costello, in those boom years of gold bars just raining down on Canberra, to always underestimate just how big the surplus might be, how much would be left over no matter how much they spent, because they knew there was always just a bit more revenue coming in the front door. So it was really easy. I reckon I could have picked just about anyone to be Treasurer in that period of time, and they could have basically just kicked back a bit and waited for the rivers of gold to deliver the revenues, and then spend like there was no tomorrow.

There are some really good facts about the biggest spending, biggest taxing government in Australia's history—and that was called 'Howard and Costello'.

No-one questions that. There is no economist in this country or internationally who questions that.

Then a GFC came along, and so we had to make some tough choices in very tough conditions. That is when you get tested; that is when you measure things; that is when you start to look at what is happening to others besides you. We might live on an island, but we ain't one. We live on a small planet. Every single neighbour, every single OECD country, every single one of our trading partners has experienced some of the most difficult times in memory; in recorded times. They talked about it being the greatest depression since the 1930s. It was maybe even harder than that. What we did was to take some very tough decisions to make sure that we did not go down the path of Greece, Spain, Europe or, for that matter, the United States.

Over on the other side, you will only hear one mantra. This matter of public importance is not about a plan, fiscal rectitude or doing the right thing by the economy—it is not about any of that. It is the one plan that they have called on in this House every single day since the last election, which is, 'Let's blow this place up, let's run down the economy, let's oppose everything, no matter how important it is to the national economy, for opposition's sake.' They even opposed a stimulus plan, a plan to make sure that this economy kept going forward. That is there strategy: oppose everything; oppose every plan. Then they come in here and say that we do not have a plan.

But there is something even worse. You do not have to dig too far. Just scratch the surface and the very thin cheap paint that is the veneer of the coalition—the Liberal Party and the National Party—and what do you reveal? One strategy; one plan. 'One-trick Tony' does not have resonance for nothing, because all they want is an election. Every day they pray for an election. If they can get one in quick enough, they just might win. Forget about trying to do something for the economy; forget Australians; forget business; forget about trade; forget about all of the things that we have to do to balance the budget.

What we ought to be talking about this in place, and what we come in here to discuss, is what our plans are and what we have put into place. We have spent money where it needs and deserves to be spent. In our schools to provide school halls and science labs and more teachers for our students. We are making sure that when the young people in this country are competitive. And they are not competing against the boy or girl down the street, but with the boy or girl from Indonesia, from China, from Europe or from the United States.

When they talk about us having no plan, have a look at the Asian century white paper, a plan that looks to the future and shows us where we need to be. When they talk about us having no plan, have a look at the Intergenerational Report and the work that we have done in terms of meeting the challenges outlined in it. We have looked at the things that we will have to do in the future. Most people might be frightened by the fact that today there while in 1970 there were seven people in the workplace for every person aged over 65 today there are just five. But in 2050 there will be only 2.7 people in the workforce for every person aged over 65. That is scary enough on its own, so we ought to do something about it today. That is what we are doing. What is even more frightening is that there will be twice as many 65-year olds. And there will be four times as many 85-year olds.

Everything that this government has done has been focused on delivering for the economy today while looking to the future. If those opposite want to talk about plans, bring in your plans. Tell the Australian people what you plan—aside from the usual thing that we hear, which is just Work Choices. The solution to everything, apparently, is to make it harder and harder for people to keep a job.

Let me tell you a little bit about our economy and where we are at today. We have an economy 11 per cent larger in all terms than when we took government. The numbers show that there are better conditions today than when we took government at the end of the Howard-Costello era, an era in which it rained gold bars—an era in which you had to go out wearing one of those steel helmets so that a gold bar did not hit you in the head and you had to wear your trunks when you went outside because of the rivers of gold that flooded into this place.

We have had solid growth, with faster growth in this economy than in any other comparable advanced economy. We have low unemployment. Yes, unemployment is always too high—of course it is. But I tell you what: at 5.4 per cent, I would rather have this unemployment rate than any other in the world. We have had an exceptional jobs growth record, with 800,000 jobs created since Labor came back to office, despite the rest of the world shedding 27 million jobs. We have contained inflation. We have kept it within the normal target band. It is at 2.5 per cent through the year to September. That is important for families and for people trying to just get by.

There is a low cash rate, 3.25 per cent. That is historically low. We have managed to bring down interest rates—which is important in this type of an economy—six times since we have been in office. Those on the other side took it up 10 times, while at the same time Howard and Costello were telling people that interest rates would be lower under a coalition government than at any other time in history and lower than under Labor. But that turns out not to be true. We have the figures at hand right now and everyone knows it. We have strong investment.

Apparently, this is a bad economy and a bad country. If you listen to these guys you would think that they want to flog the place off and move elsewhere. They just do not like Australia. The more I hear, the more I am starting to get the flavour of what they are on about: they just do not like Australia, they do not like this economy and they do not like the fact that Labor is doing a good job and are going to balance the budget. (Time expired)

Tony Smith (Casey, Liberal Party, Deputy Chairman , Coalition Policy Development Committee) Share this | Link to this | Hansard source

After that performance, I am not sure where to begin. I will give the parliamentary secretary one bit of credit: he can certainly talk. He can make it up as he goes along but he knows enough in his heart of hearts that the one thing that he cannot say is, 'This government guarantees a surplus.' We did not hear the Assistant Treasurer say that he would guarantee a surplus, we have not heard the Treasurer guarantee a surplus and we cannot get the Prime Minister to guarantee a surplus. And that is because the big drift has begun. The MYEFO was released last Monday. It is not even two weeks old—it is eight days old—and already the big drift has started. They are starting to pave the way to once again walk away from a guarantee of a surplus. They cannot say today that they guarantee that surplus. But they have guaranteed it in the past; they have given numerous guarantees.

The only guarantee from this government that the Australian people can rely on is that any guarantee is a guarantee that this government will break their word. Any guarantee is a guarantee that the position will be reversed. We have had surpluses guaranteed. We have budget outcomes guaranteed. We have had budget deficit projections guaranteed. But the one thing that we know about this government is that as soon as they say the word 'guarantee' you can be sure that they will walk away from it.

We have seen it on the carbon tax and now we are seeing it on their guarantee of a surplus. The shadow Treasurer outlined early today in this parliament how on 150 occasions the Treasurer has given a rock-solid guarantee about his surplus. But we only have to look at the history of Labor's rock-solid, solemn forecasts. Let's have a look at them.

Craig Emerson (Rankin, Australian Labor Party, Minister for Trade and Competitiveness) Share this | Link to this | Hansard source

What about the rolled-gold guarantee?

Tony Smith (Casey, Liberal Party, Deputy Chairman , Coalition Policy Development Committee) Share this | Link to this | Hansard source

It is normally at this point, Deputy Speaker Scott—and you are often on duty when this happens—when we get to the heart of Labor's fiscal credibility and to the detail of what they have actually done, that the minister is always on duty and, like a robotic lawnmower, he starts yapping. He is like a remote-control lawnmower over wet grass. It happens every time. I say to the parliament—and I do not like to reveal these secrets—that we find it mildly irritating, but his cabinet colleagues find it insufferable. I have discovered that this is not just a tactic for this parliament. This is an uncontrollable urge from the minister opposite to babble constantly, 24-hours a day. As I start recounting Labor's fiscal record, the babbling will start again, like it is remote controlled.

Let's go back a couple of MYEFOs, to December 2010. Is that okay? Do we have your agreement to talk about your MYEFO solemn commitments in December 2010? This is a couple of years after the global financial crisis. This is after the last election. Let's have a look at what the solemn prediction was for the size of the budget deficit for the 2011-12 financial year, the financial year that ended just a few months ago: $12 billion. Six months later the budget was brought down: $22 billion. In December of last year: $37 billion. And we got the final budget outcome a few weeks ago: $44 billion. From $12 to $44 billion—missed by how much?

Opposition members: Missed by that much!

We are told that the budget will be in surplus by $1.1 billion. So, from a Treasurer who solemnly promises a $12 billion deficit and delivers a $44 billion deficit, we get the idea that he can have the precision of the best marksman in the world, all of a sudden, and deliver this surplus. The Australian public never believed it. If the Treasurer was competing in an archery contest the only safe place to watch would be on TV. The Australian people have seen this time and time again.

But we can go back right to the very first days of this government to see their form. I want to go back to the very first budget. The shadow Treasurer has rightly pointed out all of the fiddles and the manufacturing to try to produce this flimsy figure. He has been through the mining tax—that MYEFO document deliberately timed not to reflect the mining tax, because the amount collected was zero. As the shadow Treasurer has rightly pointed out this is the first tax we can think of that collects no revenue. The Henry review said that the lowest yielding tax in Australia was, I think, the queen bee levy. But, no, now we have the mining tax that collects zero. This is the pub with no beer. It is the steakhouse with no steak. The very day that that figure was coming in, the zero figure, the Mid-Year Economic and Fiscal Outlook was released, so that it would not reflect that zero. That is why it was released. There are so many fiddles in all of the budget figures and the shadow Treasurer and the shadow minister for finance have outlined them in detail.

Not only does this government have form but from their very first days in office they have been intent on fiscal deceit—from their very first budget. The first budget brought down by the Treasurer, in 2008, invented a new term. I will quote. He was talking about a surplus he inherited back then from Peter Costello.

It is a surplus built on substantial savings of $33 billion over four years, including $7 billion in 2008-09 alone.

After the budget was handed down, financial commentators and economists were interested to know that the term 'savings' had been redefined. Savings did not just mean expenditure reductions. It also meant tax rises. But it was just suddenly redefined by a Treasurer who began his first days with fiscal deceit and has continued to do so every day from them on.

The next year, when the Treasurer took the budget into deficit, he delivered a budget speech that did not mention the size of the budget deficit. There was a budget deficit that was not in the budget speech. Think about what a budget is. At the end of the day it is a whole pack of books, but they all add up to one figure: a surplus or a deficit. And he could not mention it in the speech. From then on the deceit of this government has grown and grown.

What we are seeing in this House now is another invention from this government. They will cover it with fiscal fiddles. If this government were ever able to produce a surplus, there would be more fudge in the figures than in Willy Wonka's entire chocolate factory. And the minister there reminds me of the TV kid. Remember that character? He also yabbered along constantly. He was the one with the painful parents and he yabbered on incessantly.

The minister knows in his heart of hearts that this is a government with no fiscal credibility.

Every promise that is made on the fiscal front, every guarantee, is broken. And it is replaced with another promise in the future years.

And now they have started the crab walk away from their surplus commitment. Those opposite know in their heart of hearts that this Treasurer will never produce a surplus. He has produced only deficits; he will never produce a surplus. In the meantime, he will fiddle every figure he can in the budget. He will do all he can to try to maintain this falsehood. But you need only look at his record for the 2011-12 year—the year just gone. Over two years, 12 went to 22 to 37 to 44, and all of a sudden he says he is the most expert sniper in the world. (Time expired)

Craig Emerson (Rankin, Australian Labor Party, Minister for Trade and Competitiveness) Share this | Link to this | Hansard source

I table a document. The shadow finance minister was talking about budget black holes. He was asked about his $70 billion black hole: 'It's not like a furphy.' He said: 'No, it's not a furphy. We came out with that figure, right?'

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

It was an interesting experience listening to the member for Casey. He trivialised, he derided, he abused, he insulted, but at no stage did he deliver any sound economic data or facts. It was all a joke for him, something to have a laugh about—and it was interesting watching the members of the opposition laugh along with him. For me, that shows that the economy and the management of our economy is a joke to the opposition; it is something you laugh about.

This MPI will demonstrate to the Australian people why the member for North Sydney—the shadow Treasurer—should never be Treasurer. It also demonstrates—and the contribution of the member for Casey also demonstrates—that the opposition should never sit on the government benches. It just does not understand economics, the economy and how to manage it. The opposition is an economic disaster zone, and it has at no stage demonstrated any fiscal credibility.

That is contrary to the government. The government has had some strong economic achievements, and the mid-year review shows that the Gillard government is on track to return the budget to surplus. I know it disappoints those in the opposition. They do not want the budget to return to surplus. But the fundamentals of the Australian economy are strong despite global turmoil. The opposition should be proud of the performance of our economy, but instead they like to talk it down, talk it down, talk it down. We have solid growth, low unemployment, strong investment and contained inflation—very strong economic indicators that I never hear opposition members talking about. It shows that our economy is one of the strongest economies in the world, and it is able to sustain and withstand all the economic pressures from overseas.

Delivering a surplus gives the Reserve Bank maximum room to cut interest rates. When I talk about interest rates I think back to the times when the Howard-Costello government sat on the government benches. I remember interest rate increase one, two, three, four—right up to 10—and members of the Howard junta arguing that the Howard government would always keep interest rates lower than a Labor government would. Those on the other side are probably hanging their heads and trying to shuffle away from that, because there have been six interest rate decreases under the Labor government.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

Have they acknowledged them?

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

'Have they acknowledged them?' the member for Moreton asks. Well, I never hear anything about that these days. And if anything is said about it, it is always put in a negative light: talk it down, talk it down, talk it down. A family with a mortgage of $300,000 is paying around $4,500 less a year, something I think benefits the families I represent in this parliament. And the responsible savings made by the government have led to the biggest increase in age pension and paid parental leave in history. My electorate is an older electorate, and I know that the pensioners I represent in this parliament live in trepidation of the Liberal Party—the opposition—gaining control of the government benches. They know that means they are going to have payments ripped away from them, just as the families that live in the Shortland electorate and other areas know that the opposition plans to destroy the Schoolkids Bonus. That will hurt 1.3 million families, and in the Shortland electorate 8,500 families will be punished if there is a Liberal coalition government sitting on the government benches. At the same time, they will not reinstate the education tax bonus, and they will slash $600 a year in extra family tax benefit payments from 1.5 million families in Australia and from 16,000 families in the Shortland electorate.

A little bit of honesty here: the plan from the government is to continue strong economic growth; we will continue to step up to the plate in very tough economic times; and we will make the hard decisions that need to be made, whilst at the same time maintaining strong employment. Employment has been mentioned in this debate. We have an unemployment rate of 5.4 per cent, which is the envy of countries throughout the world. When I look at the MYEFO forecast for jobs, last year in the budget 500,000 jobs were created against a forecast of 175,000—performing above the forecast.

It always surprises me when I see the shadow Treasurer make his appearances on TV. It is quite obvious that he has only read half the papers. He does not bother to get all the facts; he does not bother to let truth stand in the way of what he is about to say. The Australian people are really waking up to him. They are really beginning to understand that he yells and blusters and speaks loudly but he delivers nothing. He has no vision; he has no plan. He talks about the plan that the government has to reach a surplus. The MYEFO statement looks at apprenticeships and targets to areas of high need. On the baby bonus change, his comments were just ludicrous—

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

Comparing it to China!

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

Comparing it to China's one-child policy! I can say that, in the Shortland electorate, the change to the baby bonus has been well received. Everybody knows that the costs you incur for the second and subsequent children are nothing near the level that you incur with the first child. It is just not good enough. People know that what the shadow Treasurer is saying is totally fallacious.

He talks about capping the growth in private health insurance rebates. That is part of a plan. Company tax payment changes are part of a plan. Changes in the defence area, higher education, looking at lost superannuation, self-managed funds levy reform, visa application charge increases—all part of a plan. But what plan does the shadow Treasurer have for Australia? I would say he has a plan that is very similar to the government in New South Wales: ripping money out of education, ripping money out of hospitals, attacking those people who look to government for support.

The shadow Treasurer and the opposition have no real plan. Their only real plan is to talk down the economy, to say no, to be negative and under no circumstances at all to put forward a real plan that will actually mean they have to tell the Australian people the truth and deliver— (Time expired)

Wyatt Roy (Longman, Liberal Party) Share this | Link to this | Hansard source

Last year, and again this year, I rose in this place to put a very simple question to the Treasurer. I wanted to know when the Treasurer would bring the budget back into surplus and when this federal Labor government would be able to pay off the massive debt that it has accumulated in just four short years.

After the Treasurer used his time to call me a dole bludger, and whatever other personal insults that he could come up with to dodge answering the question, the Treasurer revealed that he did not have an answer for the Australian people. He could not say what this government's plans were to bring the budget back into surplus. Given that, in my lifetime, the Labor Party has never delivered a budget surplus in this place, it would seem to me that the Labor Party's addiction to wasteful spending and mismanagement is no way to manage our nation's finances.

It did not take long for the Treasurer came back to his talking points. In the budget the Treasurer handed down in May he made an unequivocal promise to the Australian people: he promised that the government would deliver a budget surplus in 2012-13. His words were: 'This budget delivers a surplus this coming year, on time, as promised, and surpluses each year after that'. Well, based on past experience, with school-hall rip offs, Pink Batts and set-top boxes, we on this side of the House were a little sceptical that the Labor Party could deliver a budget surplus. Our suspicions have continued to grow with each new project blow-out and new promise adding to the Labor Party's $120-plus billion budget black hole, not to mention the numerous changes to the carbon tax—and, most remarkably of all, a tax that does not even raise revenue: the mining tax.

But, despite our suspicions on this side of the House, we were prepared to wait and see what this Labor government came up with in its Mid-Year Economic and Fiscal Outlook. We were prepared to be surprised, but instead have been disappointed. The Treasurer has delivered exactly what we have come to expect from the Labor Party in the MYEFO. The Treasurer's adamant promises from last year, 'We'll be back in the black by 2012-13' mean little.

Last week we saw the release of MYEFO, and with it we saw a complete failure of the government to deliver an economic and fiscal plan to return the budget to surplus. The Treasurer revealed that this Labor government have no plan for the future, and it is clear that they are making up the rules as they go along, cooking the books to hide the true state of the budget. MYEFO revealed that the only certainty with this Labor government is more waste, more mismanagement, more debt and more taxes. If you too have wondered, like me, why the Labor government seemed to rush to deliver a MYEFO last week, you only had to wait a few days to hear the Treasurer announce to the Australian people that the mining tax that he and the Prime Minister personally negotiated had raised not one cent. Let me make this point very clear: the Treasurer told the Australian people in his budget update that he expected to collect $2 billion from the mining tax this financial year. And then a few days later we find out that this tax has raised not one cent.

This Labor government is unique. Only this Labor government could introduce a tax that raises no money yet increases Australia's sovereign risk profile, adds a record level of red tape for business and still hangs as a threat over successful mining companies. This is the stuff of fiction. In Yes Minister, we saw a hospital that did not have patients. Here in Canberra we have our very own version of this drama. We now have a tax that does not raise revenue.

This Labor government had me a little confused, like so many Australians. I had to go back to my office and pick up a copy of the Macquarie Dictionary, a dictionary that is often spoken about in this place, to try and find some answers. According to the Macquarie Dictionary, a tax is a 'compulsory monetary contribution demanded by a government'. It would seem to me that the Treasurer has a bit of a dilemma. He can come clean with the Australian people and admit his complete inability to manage the nation's finances and resign in the most honourable way, or he can pick up the phone and give those pesky academic types at the Macquarie Dictionary a hard time about their definition of a tax. Only this Labor government could introduce a tax that raises no money but increases Australia's sovereign risk and adds to the pile of red tape facing businesses. Only this Labor government could design a tax that not only fails to raise revenue but adds an additional $120 billion-plus to the government's great big budget black hole.

When this Labor government was elected, it inherited a $20 billion surplus and $70 billion worth of net Commonwealth assets. Now we see that in 2011-12, under this Labor government, net debt reached a staggering $147 billion, and the government's own modelling indicates that this figure will remain virtually unchanged for years to come. The answer to this challenge is not new taxes. It is not more wasteful spending. I would like to take this opportunity to share with the House a quote from a pamphlet from 1916 that was passed on to me by a local small business owner:

The coalition has a better way. As a nation, our path to greater prosperity is greater economic growth, the restoration of sound public finances, lower taxation with less government intervention, increasing productivity and closer engagement with Asia. We in the Liberal Party already have a strong record on fiscal management. We have done it before and we can do it again. A re-elected coalition government will restore hope, reward and opportunity to all Australians.

The answer to the problems facing our nation is not to make unfunded promises to the people of Australia. In its MYEFO, the government has ripped $1.6 billion out of health and $3.9 billion out of education—failing to fund Gonski reforms or fully fund the National Disability Insurance Scheme. The answer is not to gouge private health insurance holders either. In a last ditch effort, the government is ripping $1.1 billion of out of private health insurance measures, with $700 million coming out of private health insurance rebates. The answer is not to lose control of our borders, at a cost of more than $1.2 billion this year alone.

The coalition has a real plan that will bring the budget back into surplus. We will cut the waste and the mismanagement that has become endemic in this government. We will abolish the carbon tax and the mining tax. We will put our nation on a path to greater prosperity by encouraging greater economic growth, restoring sound public finances, lowering taxation with less government intervention, increasing productivity and closer engagement with Asia. We will once again restore hope, reward and opportunity to all Australians.

This Labor government fails to see the truth. The solution to this budget crisis is to eliminate government waste and mismanagement. As soon as those opposite come to terms with this fact, they will have some chance of doing the right thing by the country's taxpayers. Until this Labor government comes to realise this, Australian taxpayers will fund inefficient, wasteful government programs and their cost blow-outs. The fact is: under this Labor government, I will be a very old man by the time I see a Labor government budget surplus!

Mike Symon (Deakin, Australian Labor Party) Share this | Link to this | Hansard source

There being no further speakers, the discussion is concluded.