Thursday, 11 May 2017
Appropriation Bill (No. 1) 2017-2018; Second Reading
This is a budget and a government that wants to bury its past and rewrite its history. The Liberals want Australians to forget four wasted years in which wages growth has hit record lows, unemployment is up, underemployment and casualisation are at record highs, living standards have stagnated, inequality has widened. This budget is an admission of guilt, a signed confession. It is proof that the Liberals have frozen this nation and hurt our economy. And now they have the nerve to come in here and talk about fairness and opportunity.
There is nothing fair about making middle-class and working-class Australians pay more while millionaires and multinationals pay less. There is nothing fair about a $65 billion giveaway for big business while you are cutting $22 billion from Australia's schools. There is no opportunity in the Liberals' war on young people—their education, their penalty rates, their chance to buy a first home. This budget fails the fairness test and it fails the generational test. It does nothing for families' cost of living and, where it seeks to imitate Labor policies, it fails miserably.
There is a powerful difference between my united team and this divided, out-of-touch government. Our policies are the real deal because they spring from our values. They were not cooked up in a panic to try and neutralise a political liability. And the great irony of this budget is that, while it does not measure up to our values, it does not keep faith with traditional coalition values. It is a budget of big government, higher tax and more debt. In fact, it is a budget devoid of values altogether.
But make no mistake: this is not a Labor budget. A Labor budget would protect penalty rates, not cut them.
A Labor budget would fund schools properly, not rip money away.
A Labor budget would invest in universities, not jack up fees to discourage working-class kids from going to university.
A Labor budget would respect pensioners, not tell brickies and nurses that they have to work to 70 before they get the pension.
A Labor budget would level the playing field for affordable housing, not protect tax breaks for property investors.
A Labor budget would protect workers in labour-hire firms, not give their employers a tax cut.
A Labor budget would close the gap, not cut $500 million from Indigenous services.
A Labor budget would rescue TAFE, not cut courses and close campuses.
A Labor budget would invest in renewables, deliver an emissions intensity scheme and take real action on climate change, not just pass the problem onto the next generation. A Labor budget would stand up for middle-class and working-class families, instead of taking their money in raised taxes and giving it to millionaires and multinationals in reduced taxes.
And a Labor budget will always protect Medicare. This means reversing the unfair Medicare freeze immediately. The truth of this budget is that the Medicare freeze remains in place and will not be fully eradicated until 2020. Every day between now and then Australians will be paying more for their health care than they should be. In the past four years the Liberals have cut Medicare, taxed Medicare and tried to privatise Medicare. Now they want to pretend it was all a misunderstanding—not because they have changed their minds or got the message but because they are trying to save their own skins.
The thing about this Prime Minister is he only discovers his heart when he feels fear in it. He does not believe in what he is doing. The people behind him do not believe it either. Australians do not trust a word he says on Medicare. It is the most basic question in politics: who do you trust? Who do you trust to protect Medicare? Is it a Labor Party that knows Medicare speaks for who we are as a country, for the idea that the health of any one of us matters to all of us? Is it the Labor Party that built Medicare and saved Medicare or a Liberal Party which has spent 34 years trying to dismantle Medicare as we know it? As for the so-called Medicare guarantee, the only guarantee with the Liberals and Medicare is this: as soon as they get another chance, they will cut Medicare.
Labor will not stop the Liberals' new tax on the banks, but we are deeply sceptical of a banking culture that takes every opportunity to hit customers with higher fees and charges. And we are worried that the weakness at the core of this government will turn a $6 billion tax on the banks into a $6 billion charge on every Australian with a bank account or a mortgage. The big banks know they can run right over the top of this weak Prime Minister. He is giving them a levy with one hand but a tax cut with the other and a free pass on bad behaviour.
I will give them a royal commission. It will be a proper, considered examination of the results of the accepted economic power of the banks and how to respond. Let me make this clear tonight: if the banks pass on a single dollar of the government's tax to Australian families then that should be the end of this Treasurer, this Prime Minister and this whole government because their weakness will be there for all to see.
The government would love Australians to believe they are doing something on housing. But they are not reforming negative gearing and capital gains. We are. They are not undoing the tax breaks which give every investor a head start and every option, but we are. They are not serious about tackling the crisis in housing affordability. We are.
Let's look, though, at the one new idea that housing in this budget—a poison pill in the superannuation well, just to make houses more expensive. The sad lesson of First Home Owner Grants is that any extra cash in the pockets of people looking to buy is eaten up by price rises. When you study the detail you see that this program offers microscopic assistance for young people. If you divide the cost of this program in the budget by the number of first homes sold each year, the government, with great fanfare, is allocating $565 for each home. What a joke! What an insult. It will not even cover the costs of the removalists. This is not a solution; it is false hope for people who do not have rich parents. Labor will not support this cruel hoax. But we will deliver on our plan for affordable housing, driving the construction of 55,000 new homes over three years and creating 25,000 jobs every year. We will commit to more public housing including for women and children fleeing family violence.
I am pleased to advise, Mr Speaker, that since budget night Labor has already identified $1 billion of government measures that we will not support, and savings that go back to the bottom line. The United States has killed off the Trans-Pacific Partnership so why waste $162 million of taxpayer money to try and revive the deal? Unlike the Liberals, we will not spend $40 million of taxpayer money on government advertising congratulating ourselves on our own tax policy. We will not waste $300 million paying the states for regulatory reform they should be doing already. We will not support setting aside $170 million for a divisive plebiscite nobody wants when this parliament should do its job and get on with making marriage equality a reality in Australia. There are some government measures that we will support: we welcome the overdue changes to the Family Court because no survivor of family violence should be cross-examined by the perpetrator, and, of course, we support the new initiatives to support our veterans.
On Tuesday night the government's massive tax giveaway for multinationals did not actually get a mention. Today we found out why. Last year, the Prime Minister's 10-year handout for the top-end of town was estimated to cost $50 billion but, on July 1, this cost will blowout to $65.4 billion. This is a recipe for fiscal recklessness on a grand scale. It is a threat to Australia's AAA credit rating and, therefore, a threat to every Australian mortgage holder. The only defence that the Liberals have mounted is that it will lead to an increase in workers' wages. Now, on the government's own numbers, we are talking about an extra $2 a day in 20-years' time! These are the crumbs from the Prime Minister's policy table: $65 billion for big business and $10 a week for workers in 2027. There has never been a more exciting time to be a multinational in Liberal Australia, and the giveaways for the top-end of town do not stop there.
This Prime Minister is so determined to deliver a tax cut for millionaires that he has declared mission accomplished on budget repair. He is not renewing the deficit levy so that he can deliver a marvellous tax cut for high-income earners. But this year's deficit is 10 times bigger than the Liberal's first budget predicted. Tonight I make clear that Labor will not support spending $19.4 billion on the wealthiest two per cent of Australians.
The Liberal's new income tax increase will affect every Australian right down to an income of $21,000. A worker on $55,000 will pay an extra $275 a year. For someone on $80,000, it is an extra $400 a year. When wages growth is anaemic, when insecure work is on the rise and when the cost of essentials and energy continue to increase, Labor cannot support making people on modest incomes give up even more of their pay packets, especially when this budget goes out of its way to give taxpayer money to millionaires and multinationals.
We will back the government's 0.5 per cent increase in the Medicare levy but only for Australians in the top two tax brackets. Costings from the independent Parliamentary Budget Office show that our plan will deliver more revenue than the government over the medium term without putting the burden onto families on modest incomes. This is a fair and responsible way forward and this is a promise Labor makes to 10 million Australians tonight: we will do our level best to protect you from the Liberal Party's tax increase.
Let me be clear about the National Disability Insurance Scheme. Labor did not just create the NDIS; we fully funded it, we budgeted it, and Treasury confirmed it. And after three years of Liberal cabinet leaks questioning the cost and the value of the NDIS, we will not have our commitment challenged by those opposite. Working with Jenny Macklin, Julia Gillard and, more importantly, tens of thousands of people with disabilities and their carers to design and deliver the NDIS is one of the great greatest privileges of my parliamentary career. I will never forget the promise that we made to those elderly parents of adult children with severe and profound disabilities, awake at midnight anxiously wondering who will love and care for their child when they no longer can. For me, for Labor, the National Disability Insurance Scheme is an article of faith. Labor fully funded it in government, we will fight for it in opposition and we will never see the people who rely upon it go without the money they need.
Taking money off the middle class and spending it on millionaires is not tax reform. But there are ways to make our system better. Too many multibillion-dollar multinational companies who do business in Australia avoid paying tax in Australia. That is why Labor will close the loopholes that let big companies shuffle money around the world to hide the true state of their books. Our plan will deliver an extra $5.4 billion to the budget bottom line over the decade. That is what we mean by budget repair that is fair.
But multinational companies are not the only ones exploiting holes in our tax net. In 2014-15, 48 Australians earned more than $1 million and paid no tax at all, not even the Medicare levy; instead, using clever tax lawyers, they deducted their income down from an average of $2.5 million to below the tax-free threshold. One of the biggest deductions claimed was the money they paid to their accountants, averaging over $1 million. Those individuals are not just counting cards in the casino, they are bringing in their own dealer and their own deck. Loopholes for millionaires means middle Australia pays more. That is why a Labor government will cap the amount individuals can deduct for the management of their tax affairs at $3,000. This affects fewer than one in 100 tax payers and will save the budget over $1.3 billion over the medium term. The days of earning millions and paying nothing are over, no matter who you are.
The same goes for anyone minimising their tax by hiding money in offshore tax havens. Panama, the British Virgin Islands and the Caymans have become a refuge of choice for trillions of dollars in global wealth. Labor will introduce a new set of laws to target those who aggressively minimise their tax and leave the heavy lifting in our tax system to the middle class and working class, who cannot pick and choose their tax jurisdiction. There is only one reason people hide their money in tax havens, to avoid paying their fair share here. So instead of beating our chests about welfare crackdown 9.0 and setting robo-debt collectors loose, Labor will get tough on the people who earn and owe big dollars—that is fair.
The next time the government lectures Australians about fairness or debt and deficit, consider these decisions: they are ignoring negative gearing and capital gains—that is $37 billion; they are letting multinationals and tax minimisers off the hook—that is$36.7 billion; they are giving the top two per cent of Australians a tax cut—that is, $19.4 billion; and they are clinging onto their handout to big business—that is $65.4 billion. This is $128 billion the Liberals could use to pay down the debt and deficit without holding the NDIS hostage, without cutting schools or jacking up uni fees, and without increasing taxes on the middle- and working-class people of Australia.
The budget fails the test of the fairness, but it fails the future too. Bob Hawke and Paul Keating changed Australia from industrial museum to a modern, outward looking, competitive economy. Australia cannot live off their legacy forever. We need to set a new direction. Amid the burgeoning opportunities of Asia, Australia's future lies in human capital—in skills, education and training. The scale of India and China is like nothing we have ever seen. To win, it is about being clever. The alternative—the low-skill, low-wage road—only leads to a low-growth future. Fundamentally, our future prosperity depends on investing in education and training. We do not just want to compete with our neighbours; we want to create value in our relationships. To do that, we have to bring something with us: our education, our skills and our people.
The terms of trade measure the gift of global growth. It is the luck that the world gives us when countries pay for the things that we dig out of the ground, but we cannot rely on that alone or forever. The luck we make ourselves is called a clever society. It is called education and training. It is how we carve a comparative advantage for our industries. It is how we boost productivity, create jobs and increase wages. It is by putting a premium on our human capital and helping our people move up the production and services learning curve, whether that is architecture; engineering; health care and aged care; agriculture, farming and food; or advanced manufacturing. But this opportunity will not last forever. Unless we aim to be the best in the world, then we are selling our future and our young people short. If Australia does not think big, we will end as small.
Building a rail line to move freight from Brisbane to Melbourne is a valuable idea. But educating a generation is how we will prevail in our changing world. That is up to government and to individuals: a government creating opportunities in schools, universities, training and apprenticeships; and individuals then making the most of these opportunities. Great education should start when you are three and four years old and be available to you throughout your whole life. When every country in our region has made education the No. 1 priority, Australia cannot afford to slow down, to compromise or to settle for second place or second best.
Yet at the very moment that the hallmark of a new Australia should be creativity, skills and education, the Liberals are cutting money from the lot: $22 billion ripped from schools and $4 billion from universities, making Australians pay more for a degree and faster, and nothing for TAFE and apprenticeships but cuts. The Prime Minister used to talk a lot about innovation, but we cannot be an innovation nation unless we are an education nation. This budget is worse than a handbrake on our national potential. It actually drags us back in the global pack. Every time we settle for second best in education, it gets harder for us to catch up.
Three years ago, having promised no cuts to schools, the Liberals ripped away $30 billion. Last week, they told the parents and students of Australia to be grateful that they are now only cutting $22 billion. To borrow a comparison from a former Prime Minister, who is politely following this debate, it is like the arsonist turning up after the fire and expecting a thank you. In the Labor Party, we believe every child in every school deserves every opportunity for a world-class education. There are 2½ million students in our great public schools and 1.3 million students who go to a Catholic or independent school. We understand that parents who pay their taxes to Canberra have a legitimate expectation that some of that money will be reinvested in their children's education. We understand on this side of the House that not every parent who send their child to a local Catholic parish primary school is wealthy.
Look at the mess that the government has made of this policy. You have to ask: whatever happened to the Liberal Party that once supported choice in education? Of course, there is no genuine choice if our public schools are underfunded and students and teachers go without the resources they need. I do not want Australian schools in the middle of the pack. Labor wants Australia to have the best public education system in the world—the best. The kids deserve nothing less.
That is why tonight I can promise that a Labor government will restore every single dollar of the $22 billion the Liberals have cut from schools, right down to every last cent: better schools, better results and great teachers that are properly paid. Tonight, I can confirm that Labor will oppose the Liberal cuts to universities, the increase in student fees and the change to the repayment threshold that hits women, Indigenous Australians and low paid the hardest. We will never cheat hardworking young Australians out of the chance to get a degree, because we believe that a university education is an opportunity you earn, not a privilege you inherit.
When my brother and I were growing up, Mum and Dad always told us that we could choose to learn a trade or go to uni and they would support us either way. I suppose that is what you get from being raised by a teacher and a fitter and turner. And as the Prime Minister I will give the same promise to young Australians. Whether you choose university, TAFE or an apprenticeship, the government of Australia that we lead will give you every chance to be your best.
This begins with a new focus on training Australians instead of importing skills. So far, all the government has done about exploitation and rorts in the work visa system is rename 457 visas and yell at us. Their much-hyped changes only affect eight per cent of visa holders. I congratulate the Prime Minister on getting tough on foreign antique dealers and foreign goat farmers! We just need to do a little bit more than that. That is why Labor will train more nurses, cooks, carpenters, carers, electricians here at home and help them fill the jobs we know that our country needs.
And here is a free tip for a government looking for a policy: workers will believe you are fair dinkum about stopping visa rorts when you have independent labour market testing. Otherwise, don't bother wasting their time; they are busy working.
In the last three budgets, Liberals cut $2.8 billion out of training. Australian apprenticeship numbers have fallen by 130,000. And on Tuesday night another $600 million was cut. A Labor government will reverse the government's new cuts to TAFE and training. We will reverse the trend towards privatisation, because it is time to put public TAFE right back at the centre of our vocational training system. And tonight I pledge that a new Labor government will allocate two out of every three dollars raised of public vocational education funding to public TAFE.
And after years of Liberal neglect campuses in our regions and outer suburbs have fallen into disrepair. Some have even closed. It means locals cannot access the courses they need in the communities where they live. That is why Labor will create a new $100 million Building TAFE for the Future Fund to renovate the classrooms, the workshops, the kitchens and the ag science centres. We will deliver world-class facilities for a world-class training system. And this rebuilding work will begin where it is most needed: in areas of high youth unemployment around the country.
Now, rebuilding TAFE goes hand in hand with backing apprentices. That is why a Labor government will make a new rule: the one-in-10 rule. For every major infrastructure project funded by the Commonwealth, one in every 10 people employed must be an Australian apprentice. That means, when we invest in public transport for our cities: Cross River Rail in Brisbane, Western Sydney rail link, Melbourne Metro, AdeLINK, Perth METRONET; when we back the good local projects, like the third crossing over the Shoalhaven north of Nowra or better water security for Townsville; when we make sure that Victoria finally gets a fair share of funding it deserves; when we modernise and build our energy network with new pipelines and updated interconnectors; and when we develop the north for tourism infrastructure, we will also be investing every time—every time—in Australian jobs and Australian apprentices.
Labor will hire Australian and will buy Australian too, maximising local content in Australian steel in our infrastructure and delivering Australian gas first-priority to support blue-collar manufacturing jobs in Australia.
There was a time when the public sector was one of the biggest employers of apprentices, but contracting out and privatisation have undermined this. To turn this around, Labor will apply our one-in-10 rule to government business enterprises like the National Broadband Network, Defence procurement, the Australian Rail Track Corporation. We will work with government departments to improve apprentice and trainee recruitment.
Labor will always back good programs that lead to good jobs. As shadow minister for Indigenous affairs, I am pleased to announce that we will double the number of Aboriginal and Torres Strait Islander rangers. I, like many here, have seen the pride that comes from wearing the ranger uniform—people working for this country on their country and their waters, combining the latest environmental science with traditional knowledge. These rangers benefit the environment, tourism and develop new enterprises. It is a privilege to support their work.
A Labor government will set the example on job creation, but we are going to need help from business too. Tonight I ask the employers of Australia: take on an apprentice. Step up your commitment to training our future workforce and join us in this national effort. Your company will benefit and the nation will too.
The government have said that this is a budget for better days ahead. What they mean is better days for millionaires and multinationals, better days for property investors and tax minimisers, better days for the big end of town but bad news for battlers. The Prime Minister has said that this budget is about helping Australians realise their dreams—unless you are a working-class kid who dreams of going to university or a small-business owner dreaming of a proper NBN or a young couple who dream of owning their first home. This Prime Minister of many words has learned a new one—fairness. He says it as often as he can. But repetition is no substitute for conviction. Fairness is not some slogan you can borrow. It is not a domain name that you can register. It is not a shelf company where you can strip out the assets and keep the brand.
This is not a Labor budget and it was not a fair budget because we are not you, and you will never be us. Fairness is not measured by what you say; it is revealed by what you do. There is only one party in this parliament that believes in fairness and delivers it—fair funding for education, fair protection for Medicare and the safety net, a fair deal for Australians with disability, a fair chance at a job, a fair wage at work including penalty rates, a fair start in the housing market, a fair deal for the generation that follows us, taking action on climate change, equal pay for women, tackling inequality, closing the gap, building a country as generous and as courageous as Australians themselves. Prime Minister, if this the best you can do, your best is not good enough for this country. Building a country to achieve better days ahead needs a better government, a fairer government, a Labor government for all Australians.
House adjourned at 20:03