Stephen Parry (Tasmania, Liberal Party) Share this | Link to this | Hansard source

A letter has been received from Senator Moore:

Pursuant to standing order 75, I propose that the following matter of public importance be submitted to the Senate for discussion:

The Abbott Government's budget of broken promises.

Is the proposal supported?

More than the number of senators required by the standing orders having risen in their places—

I understand that informal arrangements have been made to allocate specific times to each of the speakers in today’s debate. With the concurrence of the Senate, I shall ask the clerks to set the clock accordingly.

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

What we will see this evening is a budget of broken promises—broken promises on tax, broken promises on health, broken promises on education and broken promises on pensions. During the election campaign, the now Prime Minister could hardly make a public comment without mentioning taxes. At a doorstop on 6 August 2013 he said:

Taxes will always be lower under a Coalition government.

At another event, on 9 August 2013, he said, and I am quoting directly:

The only party which is going to increase taxes after the election is the Labor Party.

Two days later, when he was asked specifically what taxes he proposed to raise, he said:

The only party that will raise taxes after the election is the Labor Party.

Wrong. All wrong. Running through tonight's budget will be increases in taxes. Running through tonight's budget will be new taxes and new charges.

What do we know so far? We know that income taxes are going up. We know that petrol prices will go up, with the government set to do a deal with the Greens to increase fuel excise. Where are all the cries from Senator Abetz today? Every time an Australian goes to the petrol station, they are going to be slugged thanks to the Prime Minister. We know that every time someone sees a doctor they will be slugged with a GP tax. We know that when someone goes to a hospital they will be slugged with a hospital tax. We know that every time Australians get their wallets out Prime Minister Abbott's hand will be in there, too, taking his cut. So much for Mr Abbott's pre-election promise to run a no-surprises, no-excuses government.

Let us have a look at some more pre-election quotes from the Prime Minister.

A coalition government will keep the current income tax thresholds …

Wrong. Here is a quote:

… no one's personal tax will go up …

Wrong. Here is another one:

What you'll get under us are tax cuts without new taxes.

Wrong again. None of these quotes is ambiguous. There are no weasel words here. No, the weasel words are coming now. We have heard a lot of weasel words in recent weeks—weasel words like those of the Prime Minister in his appearance on the Neil Mitchell radio show, and weasel words like those telling Neil Mitchell that hitting Australians with higher taxes would not be a broken promise. This is what the Prime Minister said:

I think if there was a permanent increase in taxation that would certainly be inconsistent with the sort of things that were said before the election.

How about the Treasurer on Channel 9 on Sunday?

We never said we were going to never change a tax or alter a tax.

Perhaps Mr Hockey and Mr Abbott did not talk to each other during that election campaign, or he did not see Mr Abbott on any of the TVs every single night. Weasel words are what we have before us today and we will be hearing lots more of them in the coming days, as the coalition scrambles to explain all of the Prime Minister's broken promises.

How about another quote from the Prime Minister, this time from the day before the election. Here it is: 'No cuts to education, no cuts to health, no changes to pensions, no change to the GST and no cuts to the ABC or SBS.' The only promise in there so far that is not going to be broken tonight is 'no change to the GST'. But let's not take Mr Abbott at his word on that one; let's take them one by one.

Education is set to be cut. The pre-election unity ticket, as Mr Abbott described it, on Gonski has been ripped up post election. Young Australians will be paying more for their higher education and they will have to repay their HECS sooner. As I have already outlined, if you want to go to the doctor, under the Abbott government you will have to pay a GP tax. The universality of Medicare, one of the great Australian institutions, is being trashed by the Prime Minister and the coalition. Only a couple of months ago in February, the Prime Minister claimed he was not going to bring in a GP tax. Just in February he told the parliament, 'There is no such tax planned.' Tonight he will deliver it. Medicare Locals are said to be axed, despite the Prime Minister's pre-election promise that they would not be touched. I have it here in black and white: 'We are not shutting any Medicare Locals.' There will be cuts and closures for Medicare Locals tonight.

On pensions, we know that the pension age will be increased to 70. Mr Abbott really is in favour of working till you drop. It has never been truer than tonight—we will see that Australians will have to work till they drop. We are seeing reports of changes to the indexation of pensions. Before the election, it was 'no changes to pensions'. After the election, it is less money for pensioners and work till you drop. Yet again, another broken promise. It is not over the top to suggest that the cigar-chomping Treasurer and the Minister for Finance do not have a clue about what it is like for a brickie, a nurse or a cleaner to work until they are 70. For the brickie, for the nurse and for the cleaner this budget is all pain and no purpose.

We know that the government's attacks on the ABC and SBS will continue with both organisations set to face the budget knife. I wonder how the coalition partners, the Nationals, the doormats, are going to feel about regional radio services being in the firing line thanks to their Liberal Party colleagues. The Nationals are continuing their tradition of rolling over and not standing up for their constituents.

This will be a budget of broken promises. This is a government that made so many promises that it is just becoming one big rolling broken promise. They are a government of new and increasing taxes. They are a government of cuts. They are a government that have deceived Australians. They are a government that will hurt hardworking Australian families. This is not the government that they promised they would be. This is not the 'no surprises government'. This is not the 'no tax increases government'. When all of those opposite, possibly even including yourself, Acting Deputy President Fawcett, get your speaking notes tonight, you will not be quoting any of those statements from the now Prime Minister before the election. You will not have them on your sheets. You will be standing here trying to pretend it is all somebody else's fault. You dodgied-up the numbers for the deficit and this is your excuse for these cuts. (Time expired)

Simon Birmingham (SA, Liberal Party, Parliamentary Secretary to the Minister for the Environment) Share this | Link to this | Hansard source

I congratulate Senator Conroy and the Labor Party on their crystal ball. I congratulate him on his capacity to know what is in tonight's budget and to so roundly condemn it before he has even seen it. But I condemn rather than congratulate Senator Conroy and the Australian Labor Party for the mess they have left, for their management over the last six years and for the reality that the circumstances we seek to address in tonight's budget are largely of the Labor Party's making as a result of their own neglect, their own mismanagement, their own waste and their own failure to deal with the challenges Australia faces not just in the next couple of years but in the next 10, 20, 30 and 40 years, well into the future. Australians voted at the last election, having heard the now Prime Minister say on no fewer than 30 occasions that, as a government, we would end the waste, we would stop the boats, we would build the roads of the 21st century and we would get the budget back on track.

Jacinta Collins (Victoria, Australian Labor Party, Shadow Cabinet Secretary) Share this | Link to this | Hansard source

You missed a few, Simon.

Simon Birmingham (SA, Liberal Party, Parliamentary Secretary to the Minister for the Environment) Share this | Link to this | Hansard source

Exactly those four commitments were given in exactly that way, Senator Collins, time and time again on no fewer than 30 occasions during the election campaign by the now Prime Minister. That is exactly what our government are seeking to do and that is exactly what tonight's budget will continue to do. We have already been working to end the waste and tonight's budget will provide further demonstration of a government committed to having a public service and a level of government expenditure that deliver what is required but does so as efficiently and effectively as possible.

We have implemented policies to stop the boats, and stop they have. We are building the roads of the 21st century, and we will see tonight more detail on those infrastructure promises, our delivery of those roads. In particular, in my home state—and our home state, Mr Acting Deputy President Fawcett—I warmly welcome the indication that we will proceed with two stages of upgrades over the next four years to the north-south connector to the South Road. And we will see delivery of the Darlington Upgrade Project and the Torrens to Torrens upgrade; vital infrastructure that will improve both the productivity and the lifestyle of so many people in South Australia.

Most significantly on this budget day, tonight Australians will see that we are honouring that commitment given to get the budget back on track. They will see that we are taking hard decisions; decisions that we take no pleasure in making but that we make because they are the right decisions for Australia's future and that we make because they honour our commitment to get the budget back on track. It will stand as a stark contrast to the six years of hollow rhetoric that we heard during the six Labor budgets are preceded this one.

Let us go back over that rhetoric and the associated outcome. In 2008-09 Treasurer Swan stood up and said in his budget speech:

… it is a surplus built on disciplined spending, …

The outcome was not a surplus but a $27 billion deficit.

The next year, in 2009-10, he said about their savings that:

They will put us on the path to surplus by 2015-16.

That year, he handed down a budget deficit of $54.5 billion.

The next year, in 2010, and again in his budget speech, Treasurer Swan said:

… a strategy that will see the budget return to surplus in three years time, …

That year, he delivered a $47.5 billion deficit.

The next year—the fourth of the Swan budgets—in 2011-12, he said:

We will be back in the black by 2012-13, on time, as promised.

That year he delivered a $43.4 billion deficit.

In the fifth of the Swan budgets, in 2012-13, he said:

This budget delivers a surplus this coming year, on time, as promised, and surpluses each year after that, …

It resulted in an $18.8 billion deficit for 2012-13, the year, of course, that he first promised that we would be back in surplus by.

And then, for the 2013-14 financial year, when Treasurer Swan handed down that budget—his last budget—he said:

This budget sets a sensible pathway to surplus, …

The projected outcome according to the Mid-Year Economic and Fiscal Outlook statement is a $47 billion deficit.

In every single one of Wayne Swan's budget speeches he spoke about delivering a surplus or returning to surplus. And on every single occasion it was nothing more than hollow rhetoric. On every single occasion it resulted in more deficits, and deficits as far as the eye can see. The previous government delivered five record budget deficits. They turned a $20 billion surplus into $191 billion worth of cumulative deficits and, indeed, the projections under MYEFO are for a further $123 billion in deficits over the next four years. And without change to policy settings, Australia will see gross debt grow out to $667 billion. Of course, this is unacceptable; of course, things have to change and, of course, we have to take action to deliver on our commitment to get the budget back under control.

Tonight's budget will include a range of policy measures. There will be short-term measures that have an immediate impact to try to bring down the projected deficits over the next few years. There will be medium-term measures and there will be long-term structural measures that deal with the great challenges Australia faces in tackling an ageing population and a declining proportion of the population in the workforce—challenges that, if left untackled as they were by the previous government, will create significant problems for the next generation of taxpayers. They will find that there are around 30 per cent fewer taxpayers to support a greater number of non-working Australians.

We could, like the previous government, be driven by polls and driven by focus groups. We could do that, and not take the hard decisions, but we will not shirk those hard decisions. We will make sure that we take them so that future taxpayers do not have to take even harder decisions. Because that is what we have seen overseas: when you ignore tough decisions, let deficits blow out and continue to balloon into greater debt and even greater debt, eventually you do not get to take decisions that just change the way entitlements or policies work in a very graduated and careful way. You suddenly find you have to take hard, rash decisions—like cutting the actual level of pension entitlements instantly. That is not the circumstance that we want to see any future Australian government put in, and that is why we will take the difficult decisions now for the long-term future of Australia.

It is why we will get on with delivering a budget that is fair and that gets the budget back under control. I want to make this important point, because Senator Conroy spent some time on it: a budget that does reduce the tax burden for Australians. This budget will do that. This budget will ensure that there is less tax take than would otherwise have been the case. The reason for that is because we are fulfilling our commitments to get rid of bad taxes, like the carbon tax and the mining tax. The average Australian household will be better off as a result of the suite of budget measures that we are introducing. They will be better off to the tune of some $550 per annum as a result of the abolition of the carbon tax. These are meaningful changes that will make the cost of living better for Australians.

People will not always welcome every other measure that is in the budget, but taken in its totality—as people will be able to do after tonight, rather than act like Senator Conroy did on a whole lot of speculation—people will be able to see a plan for a stronger Australia; an Australia that delivers a fair outcome from this budget and sets it up for a prosperous economic future. (Time expired)

Richard Di Natale (Victoria, Australian Greens) Share this | Link to this | Hansard source

Paul Keating once said that when you change the government, you change the country. On the eve of the first budget, those words have never been more relevant. The Abbott government has already—to use the Prime Minister's words—stamped its authority on nearly every aspect of Australian life, whether it be winding back action on climate change, demonising refugees, challenging the independence of the ABC or dismantling laws that protect Australians from racial vilification. In a few short months, this government has changed the very fabric of Australian society. In recent months there has been a lot of talk about debt and deficit, and about the ongoing budget emergency. No claim has been too outrageous. If you were to believe the rhetoric from the Treasurer, we are on track for a disaster to compare with the Great Depression or with modern-day Greece; we are a country that is on track to default with our debt; and we are an international pariah with a Third World economy.

Last year the Treasurer went as far as to say, 'The cupboard is bare; there is no money left in the till.' He effectively declared the Australian nation bankrupt. I understand that in politics perception is everything—I get that. In this piece of theatre, the nation's finances are effectively being used as a political bludgeon. While it might serve the government's purposes, it is a piece of political theatre that does not serve the country well. Federal budgets have an enormous impact on people's lives: whether you can go to the doctor, whether you can afford a decent education for your kids; what happens to someone if they become unemployed; and whether people are going to have enough for their retirement are all issues that are dealt with in the nation's budget. The government believes it is necessary to outsource those tasks to big business, that these are questions for the market, not the government, and that lower taxes and lower spending are the only pathway to prosperity. Despite all the evidence to the contrary, these are articles of faith for the coalition.

We have a very different view. It is a bit more nuanced and it does not fit into a three-word slogan but it is a vision that says everybody, regardless of the size of their wallet, regardless of whether or not they were born with a genetic disease deserves access to decent health care. It is a vision that says every kid in this country should get a decent education. It is a vision that says we need to protect our natural environment and we need to get on with the challenge of tackling climate change.

We understand that sometimes markets work well and are the best way to achieve these tasks. We also understand that there is often a role for government. Far from being inherently evil, taxation is the price we pay for a civilised society. Taxes are health care, taxes are education, and taxes are trains and roads. How much we tax matters much less than the quality of our tax spend. The difficulty for the coalition is that when you get beyond these simple slogans and sound bites and you put these competing visions to the Australian community, what you discover is the current government's agenda is deeply unpopular. It is unpopular because it benefits those with wealth and privilege ahead of ordinary people who rely on those services. And that is why those opposite have had to tell this misleading story about the nation's economy. It is why they created the piece of political theatre that was the National Commission of Audit. To get the answers they wanted, they hand-picked the actors—effectively a Who's Who of corporate Australia—and they wrote the script. The script goes something like this: 'We've got a structural deficit. The only way we can fix it is by drastically cutting government expenditure. We've got huge debt. We've got to reduce it urgently and we've got to make deep cuts.' The best place to start, of course, is on those services that Australians rely on—health care, education, supports for people with disabilities.

The Greens established an inquiry into the Commission of Audit, because we would not buy the lie. We heard evidence through that inquiry from academics, from unions, from economists and from business groups across the country, and they told a very different story: that Australia's debt crisis is a fabrication; that Australia's level of public debt is amongst the lowest in the OECD; and that, far from being a crisis, we have an economy that is the envy of the world. Those experts challenged the falsehood of Australia's high taxation levels. Far from being an economy that is shackled with high taxes, our tax take as a percentage of GDP is low by world standards and well below the OECD average.

What we heard was a simple proposition: it is not how much you tax; it is what you do with those taxes that matters. That brings us to those public services that we deliver in the form of universal health care, in the form of education, in the form of supports for people who are down and out and in the form of supports for people who have disabilities. We have learnt that we deliver those services very efficiently. When it comes to health care, we have one of the most efficient healthcare systems in the world as a proportion of GDP. We spend about nine per cent of our GDP on health care. Compare that to the US, which spends double what we spend and gets much worse health outcomes. Yet, in this budget, on the back of the recommendations from the Commission of Audit, we have a prescription for a US style health system. If ever there was a triumph of ideology over evidence, this is it. When you look at our Public Service, what we see is that, following years of public sector cuts, there is no more low-hanging fruit. Cuts to the Public Service mean cuts to services, pure and simple.

That is not to say we do not have long-term challenges; we do. Over the next 50 years, we will have challenges that we need to start addressing. But the Senate Select Committee into the Abbott Government's Commission of Audit inquiry heard very clearly that if we do have a structural problem within the budget, the problem is on the revenue side of the equation, that we have had inadequate investment in infrastructure, in training and in education, which are the real long-term threats to our global competitiveness. If we simply cut services we are doing nothing about the underlying structural problems within the Australian economy. Just recently the Secretary of the Treasury, Martin Parkinson, expressed a similar view, that if we are going to meet our commitments to provide these critical services we cannot ignore the issue of government revenue. And what better place to start, if we are serious about the end of the 'age of entitlement', the end of corporate welfare, than by abolishing the huge handouts that go to rent-seeking industries in the economy? What about the cheap fuel that Gina Rinehart and the mining industry get in the form of the diesel fuel rebate? Rather than investing billions into the private health insurance sector, why not invest that directly into public health? Let us have a big debate about the issue of tax concessions in this country like the huge concessions that go to superannuation and other sectors of the economy. It might not appear on the annual budget figures, but we do know that these enormous tax expenditures cost us billions and strip money away from the services that Australians want. If we are serious about addressing these long-term challenges, we cannot afford to ignore the huge handouts that go to big business and other areas of the economy that do nothing except widen the huge gap in this country between the haves and the have-nots.

In the end the budget is about this simple proposition: what is the measure of a decent, caring society? What is it that defines the Australia that we want to live in? In the view of the Greens it is straightforward. We want a quality healthcare system that everyone can afford, not just those people on high incomes. We want every child in this country to be able to access a decent education and to further their prospects through universities. We do not want to see a huge gap between the rich and the poor and we want to see our natural environment protected. We do not subscribe to this dog-eat-dog agenda of this government. We do not want a world where it is everyone for themselves and where if you are lucky enough to be born into wealth and privilege, good luck to you, you deserve more of it and, if not, tough luck. That is why we will be here fighting every minute of every day to make sure that these changes in the budget that affect ordinary Australians do not see the light of day.

Mehmet Tillem (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak on this matter of public importance. There can be no more important issue than tonight's budget. I am not quite sure what the budget lock-up is all about today, because the government have already told us they are going to break their election promises. Using the Commission of Audit as cover, they will break their promises on health, they will break their promises on education and they will break their promises on no new taxes. They also promised that when it came to education funding both sides of politics were, to quote the member for Sturt, 'on a unity ticket'.

This government has taken all of eight months to break its word to the Australian people. Quite simply put, it will betray the Australian people. Government is about priorities and we will see tonight that this government's priorities are about ripping the heart out of families, universal health care and education. Those who will be hit hardest are working families, the socially disadvantaged and the elderly. These are the people who need to have trust in their government to put them first. Working families are set to be slugged with an increase in their fuel bills while having family tax benefits stripped away. This comes from a government that before the election said it was committed to easing cost-of-living pressures. Its promises to the Australian people were hollow.

They have now shown their true colours, at the expense of ordinary Australians. Increases in the cost of petrol will affect ordinary Australians more than any other group. Taking the kids to school, doing the shopping, going to the footy on the weekends—these will cost more under the government, and at the same time tax concessions in the form of family tax benefits will be stripped away. These initiatives were designed specifically to ease the pressure on working families' budgets. Families will be betrayed in this budget. How can deliberately hitting the hip pocket of families help? How does that show any level of understanding for the pressures they face every day? It is becoming clearer and clearer every day that the rhetoric of those opposite before the election was just empty words. Those opposite believe that they owe people nothing and that they can get away with breaking their promises to minimise cost-of-living pressures. Those opposite promised they would ease the squeeze on family budgets. This will be a broken promise tonight.

In the budget tonight, in the firing line is the health system. Bulk-billing is good public health policy. It encourages people to seek out primary care through their GPs when in need of medical consultation rather than burden hospitals. The values which underpin the arrangements of bulk-billing through Medicare are that health care should never be determined by how much money you have in your wallet. We live in a community where quality health care is made available to all citizens. It is a vital part of our social wage that has created a fairer, healthier, more productive and more cohesive community. Yet this government is determined to wind back bulk-billing of GPs. This budget will see the introduction of a fee-for-service component when ordinary Australians visit their local doctor, and we know that once this government sets in train a system of co-payments for GPs this will be the beginning of the end for Medicare. The government believes that access to health care for all Australians is a privilege and not an entitlement. The co-payment system set to be introduced will only funnel more Australians into hospital emergency rooms. This policy will increase the strain on our hospitals, making them more expensive and less efficient to run. Those doing it toughest in our society will be hit harder than most. Wealth should never dictate the right to access quality health care.

But nothing can expose this government's class war on ordinary Australians more clearly than the axe to education that will most likely be brought down in tonight's budget. What we can expect tonight are cuts to skills and hikes on student loans. We have a skills shortage in Australia, yet this government has decided that support for vocational learning is no longer a priority. Instead, it has become a target for the ruthless commitment to cutbacks and twisted priorities. Australian families whose children wish to embark on a trade will no longer receive the support they did under Labor. Indeed, it has been reported in Fairfax papers today that this government intends to abolish Commonwealth incentive payments to apprentices, worth $5½ thousand each. These payments were designed to assist apprentices as they begin their journey of gaining accreditation in a given trade. But, under this government, apprentices and their families are on their own. Governments should be here to assist and help the aspirations of ordinary citizens, not place roadblocks in front of them and discourage them.

Another nasty floated in the lead-up to the budget has been an increase on interest payments made on student loans. The success of our loans system is that debts accrued by students are financed at low levels of interest. Raising these interest payments will once again affect those less able to afford them. Students have to study for longer than ever as youth unemployment squeezes school and university leavers. Now not only will students have to study for longer than ever but, under this government, they will also have to pay more than ever.

Australians will be forced to work longer than ever and will have their access to pensions restricted. Australians who pay their taxes year after year will no longer be afforded the social wage that should be the hallmark of a prosperous society. After being knocked from pillar to post year after year by the actions of this government, Australians will wind up being tossed onto the social scrapheap. This government does not care about ordinary Australians. It is a government that will be judged as a government that broke promise after promise after promise—'No new taxes, no cuts to health, no cuts to education, no changes to the pension.' The silence in this chamber is astonishing, with no-one here to defend the government and its broken promises.

The Liberal and National parties have pontificated for too long in this chamber about the virtues of trust and honesty—and today we will see that the cupboard is bare. They embarked on a strategy of slogans and mistruths at the time of the election in order to get elected and in less than eight months what we have seen is a complete reversal. They will talk about budget bottom lines. They will talk about a crisis—which they have imagined. They will talk about the need to get the bottom line back to where it should be. The reality is that this government will be judged and should be judged on its broken promises. These broken promises will be remembered by pensioners, those who go to their doctor and those who go to university. They will be remembered by every single Australian who was given a commitment by this government and who have now been let down.

Today the government have been exposed to the Australian people for what they are. Tonight they will be shown as an untrustworthy government whose broken promises are endemic of their ideological opposition to fairness for all Australians.

David Bushby (Tasmania, Liberal Party) Share this | Link to this | Hansard source

Like my colleague, Senator Birmingham, I do find it curious that those on the other side seem to have an in-depth knowledge of what we are going to hear about tonight.

Mehmet Tillem (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

We read about it.

David Bushby (Tasmania, Liberal Party) Share this | Link to this | Hansard source

You've read about it? Well, you have done very well. I have a copy here of the Treasurer's budget speech and I am going to read some excerpts from it. I am sure you will find this very interesting. I will just read a few bits and pieces. I quote:

Our predecessors had Australia on a path of deficit and debt to the next century.

Make no mistake, this path would only make future choices harder, future possibilities bleaker and rob Australians of the future opportunities they deserve.

Our Government could not stand back and ignore the problem. Although we did not create it, we will take the responsibility to fix it.

The measures I announce tonight will reduce the underlying deficit by around $4 billion this year and $7.2 billion over two years. These measures will balance the budget over the term of this Parliament. These are the net effect on the budget bottom line after the introduction of new policy to meet the Coalition's election commitments. These measures represent a historic turnaround in Commonwealth finances.

The speech goes on to say:

Mr Speaker—

and that is a hint there, 'Mr Speaker'—

you don't turn around a nation's finances, a nation's future without making some hard decisions. But if we avoid the hard decisions now they are only going to get harder in the future.

The tightening measures have to be fairly shared. We cannot expect those who rely on pensions and allowances—low income earners—to bear the cost. So we are asking high income earners to make a contribution and business to make its contribution too.

The measures are balanced, strong and fair.

Of course, that Treasurer speech is not the speech that will be delivered tonight. It was speech that was delivered by the member for Higgins in respect of the 1996-97 budget year. But it is a speech that could be delivered tonight, because the words of that speech very accurately reflect the challenge that we face now—that being that, if we do not address the challenges that we currently face in our fiscal position, the consequences down the track will be far more severe, as Senator Birmingham mentioned in his comments.

During the 2007 election campaign I was travelling around campaigning with my colleagues in the Senate team. We went to a restaurant and we met a waiter, and the waiter said to us, in the context of the then election, that he saw the two major parties in this way: 'When things are good and you feel like you've got a bit of money and it's all very comfortable, you throw a party and you invite everybody around and you drink and you eat and you trash the house and you make a huge mess, and you wake up the next morning and you've got a massive hangover and the house is horribly trashed and it's a real mess, and you look around and you say, "Well, the Labor Party threw a good party, but we need to get the Liberals in to clean it up."' I think that is what we saw in 1996. We had to get John Howard and Peter Costello in to address the mess that was the legacy of the Hawke-Keating years—particularly the Keating years. And it is what we see now, with the budget that we are facing tonight. We have got a horrible fiscal mess following the party that the Labor Party threw with reckless abandon, spending money on things that just do not deliver any outcomes for the people of Australia, and leaving a huge fiscal hole that needs to be plugged. And tonight that is what we will try to do. We will actually deal with the mess that Labor left us.

This is not something that we want to do. The decisions that will be in the budget tonight—and, unlike the Labor Party, I am not completely au fait with what we will hear tonight, and I look forward to hearing it—represent the bitter medicine that is needed to avoid further consequences of the disease that Labor left us. They are not something that we necessarily want to do. But this is something that we were elected to do. We were elected to fix this problem.

We would much rather have inherited a situation like the Labor Party did in 2007 where we were in surplus on an annual basis, we had money in the bank, and things were very comfortable. That is one of the main reasons why we compare so well with other countries now: we started so far ahead of them. There are other reasons, but that is one of the main reasons. Unfortunately, we did not inherit that situation. We inherited a situation very similar to that which the Howard-Costello government inherited in 1996, and we again face the challenge of having to address that problem—to clean up after the party that the Labor Party threw.

Senator Di Natale also mentioned that he thought that the Commission of Audit was a piece of theatre. Well, the committee that he referred to was set up, stacked with opposition and Green members. Because it had the numbers, it decided who the witnesses were. It decided when the hearing dates were. It set the findings in the reports. It was even quorate without any government senators being there, so it could hold meetings when and where it wanted to and if coalition senators could not make it then it did not matter—they could just proceed anyway. I suggest that the only reason that that committee was set up was as a piece of theatre.

The National Commission of Audit was a serious attempt to actually examine all lines of spending of the government, with a view to seeing where savings could be made. It made recommendations to the government—and I guess we will find out tonight which of those recommendations, if any, have been accepted. But, in terms of a piece of theatre, I have never seen anything more theatrical than the select committee that was set up to look at that. It spent months examining the Commission of Audit that had been set up, when no findings had been released. It was purely there to run a scare campaign: highlighting all sorts of things that it might find needed to be cut and then scaring the people who might be affected. Talk about theatre! That was it.

Senator Di Natale also mentioned how we compare with other comparable nations. This is very interesting to me. They look at our percentage of debt to GDP, and they say, 'Look—we are so much better off than other nations.' Ignoring the fact that when Labor came into government in 2007 we had no debt, the fact is that, yes, we might compare well with other nations—if we have 13 per cent of debt to GDP and they have 30 per cent, then we compare better to them—but if they were at 60 per cent, would it be okay to have a debt-to-GDP ratio of 30 per cent? If they were at 90 per cent, would it be okay for us to have a debt-to-GDP ratio of 60 per cent?

It is not about the relativities; it is about the absolutes. And the absolutes show that if we have the debt that we currently have, we are going to be paying $12 billion worth of interest every year. That is $1 billion of interest a month, and that comes at a huge opportunity cost. That is hundreds of billions of dollars we are going, largely, overseas to borrow, and $12 billion that we are sending overseas to pay the interest on that debt. That is $12 billion that we are not spending on the types of things that Senator Di Natale outlined: the very worthwhile projects that all Australians think that government should deliver. But we are still taking that $12 billion. We are taxing people to pay interest on debt.

Twelve billion dollars is a massive amount of money. It is equivalent to around half of Australia's defence budget. It is around the same amount that the government spends on aged care. So the same amount that we are spending on aged care annually we are, because of decisions that the Labor Party and the Greens made when they were in government, currently paying in interest and sending overseas, largely to people who we had borrowed money from—the same amount of money that we spend on aged care annually. It is also more than the government spends on universities. I heard Senator Tillem talking about what may or may not be in the budget tonight affecting education. Well, I will tell you what: we could fund education a lot better if we were not sending $12 billion a year in interest to people who we had borrowed money from during the Labor-Green years, every year.

Also, the concerning thing about our relative position is the trajectory of the rate of growth of debt. The International Monetary Fund recently found that Australia's spending is projected to grow faster than any of the 17 advanced economies profiled. So if you are looking at comparing Australia to any of those other 17 advanced economies, and you say, 'Our debt-to-GDP ratio is nowhere near as bad as theirs,' we are growing faster than they are and we are catching them. A lot of those countries have actually decreased their debt in recent years at the same time as we are rapidly increasing it. In the absence of any decisions such as those that we are likely to make tonight, that debt will continue to grow rapidly at a rate that puts us in a position where, within 10 years or so, we will owe three-quarters of a trillion dollars in debt, and that $12 billion of interest that we are paying is likely to be three or four times that amount—up to $50-odd billion that we will be paying in interest. So that is money that we take off Australian taxpayers and we send off somewhere else before we can spend one dollar on delivering services to Australians. To me, that is not the best use of taxpayers' money. I would rather be spending taxpayers' money delivering the services that Australians want and need.

And if we do not make the tough decisions early, we are going to have to make far tougher, far more draconian, far deeper cuts in order to be able to deliver those services. As I said before, we need to take the medicine now to deal with the problems that we are likely to have. Even if that medicine tastes a bit bitter tonight, it is going to taste a lot better than the consequences of the disease that will result if we allow our debt position to continue to get larger and larger, along the trajectory that we are currently facing. Just bear in mind that in the 1980s Greece had roughly the debt-to-GDP ratio that we have now.

Sam Dastyari (NSW, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak on this matter of public importance. In just under two hours, we are going to finally see unveiled the Abbott government's budget of broken promises. Throughout the election campaign, voters were given promise after promise by the then opposition leader, Tony Abbott, who went so far as to say, hours out from the last federal election:

No cuts to education, no cuts to health, no change to pensions … no cuts to the ABC or SBS.

Voters put their trust in Mr Abbott and in his words when they elected him as the Prime Minister of Australia. But the Prime Minister today will reveal that he has abused the trust of the Australian people.

Voters who took Mr Abbott at his words have been duped. They have been misled. Mr Abbott made promises during the election campaign that will not be kept this evening. The public will be the victims of this deceit, and if the leaks about the budget are accurate, if what has been strategically dropped by the government in media stories over the past week is true, then, frankly, the Prime Minister has not kept his word and the Prime Minister in those cases has lied to the Australian public.

The rules of debate in this chamber do not permit me to use offensive words against either house or member, but I suspect there will be many people who took Mr Abbott at his word, who gave him their trust, who gave him their vote, who have every right to be offended by him today. I suspect some of the offensive words will be used by those voters tonight as the Abbott government breaks promise after promise in its budget. Tonight we are going to hear Mr Abbott break his promise to our elderly pensioners, to young families sending their kids to our schools and hospitals and to the people who rely on our public broadcasters.

Voters may have been jaded by the choices facing them at the ballot last September, but they have every right to be outraged by the duplicity of Tony Abbott—

John Williams (NSW, National Party) Share this | Link to this | Hansard source

Mr Abbott!

Sam Dastyari (NSW, Australian Labor Party) Share this | Link to this | Hansard source

Mr Abbott—and his deception, his dishonesty and his fraudulence if the claims that have been strategically dropped to the media are true. With all due respect to our Prime Minister, even the News Corp press have stood up this week to call him out for what is a litany of broken promises. Even his friends and the Prime Minister's supporters are shocked by the lies that have been used to coax voters to cast their ballots—the promises that, it now appears, are not going to be kept. We have heard repeatedly in the media of members of both the coalition's backbench and cabinet who are disgusted by the duplicity, the deception and the dishonesty of what has been said. We have heard that members are calling coalition MPs to remind them that this is not what they signed up for.

This is not governing the country with integrity. The very idea of fairness that is a foundation of Australian culture and society is something that Mr Abbott used again and again during his campaign. He told us he was going to be the most fair dinkum Prime Minister we have had. But the Prime Minister has not been fair to his party colleagues. He has not been fair to his organisation. And, more importantly, he has not been fair to Australian voters. He has violated the trust that he was instilled with, and he does not deserve their confidence.

Australians are about to receive a budget that no-one thought they would be getting and that they were told would not be the case. Not even in the most cynical corners of the Liberal Party were they expecting what is going to be unveiled tonight. Tonight we will receive the Abbott government's first budget of broken promises, a budget that is built on duplicity, on deception, on dishonesty and on lies. When our kids stop going to the doctor for check-ups, Australian voters will remember that that was not something they voted for. When our grandparents, our parents and people of my generation are working until 70, they will remember that that was not something that Tony Abbott promised. (Time expired)

John Williams (NSW, National Party) Share this | Link to this | Hansard source

What a pleasure it is to follow Senator Dastyari, a young fellow born on 28 July 1983. This July he will turn a massive 31 years old. You can imagine a little Sam Dastyari—he was six years old the last time the Labor government delivered a surplus in the budget in this nation. A little boy like that would not even remember it. He would not even have contemplated what was going on.

Senator Lines interjecting—

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Order, Senator Lines! Interjections are disorderly.

John Williams (NSW, National Party) Share this | Link to this | Hansard source

The lion roars! We will continue. Senator Dastyari would have been a little boy of six years old, and his mum and dad would have said, 'At last we've got a budget surplus.' He would have said, 'What's a budget surplus?' And now every Labor supporter ever since 1989 has asked the same question when Labor was in government: what's a budget surplus? They do not know what the word means. And here you are saying 'a budget of lies' tonight.

Sam Dastyari (NSW, Australian Labor Party) Share this | Link to this | Hansard source

When were we told about Medicare?

Senator Lines interjecting—

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Direct your comments through me, through the chair, Senator Williams, please. Ignore the interjections.

John Williams (NSW, National Party) Share this | Link to this | Hansard source

I certainly will do that, Mr Acting Deputy President. It is very rude, and you would think they would know better by now, wouldn't you?

Senator Lines interjecting—

Senator Dastyari interjecting—

Crikey, give us a break! The flatmates are teaming up together! They do! They share a unit together. I asked Senator Dastyari, 'Does she speak in her sleep?' He didn't answer my question!

Honourable senators interjecting—

Yes, you would wonder how they get in. Imagine if she spoke in her sleep, Senator Smith. It would be never-ending. We could put some microphones there and just broadcast to everyone in Canberra. What an exciting night it would be! They would dream about budget surpluses. The Labor Party in their wildest dreams: 'We will deliver a surplus.' Remember the former Treasurer, Mr Wayne Swan: 'We will deliver a budget surplus.' You do not know what the word means. Look up 'surplus'. It does not mean red ink; it means black ink. You do not understand what it means.

We went to the election saying we would stop the boats. We have not had a boat in 20 weeks. In fact, the billions of dollars that the previous government cost our taxpayers, along with the more than 1,100 people who lost their lives from a crazy policy, were an absolute disgrace. We said we would do away with the mining tax and the carbon tax. Senator Tillem said, 'This is a cost on families.' You lot over there are costing every family in Australia $550 a year because you will not support the abolition of the carbon tax and respect the mandate that the coalition were elected on last September. We said we would get the books in order.

I make no apology that it is going to be a tough budget tonight. I am quite prepared to pay some more, as I should. There is the contribution to Medicare. Perhaps Senator Lines disagrees with me. Three weeks ago I had my glaucoma pressure tested. I am one of the roughly 300,000 in Australia who has glaucoma. I walked in to the optometrist and had a quick test of the pressure—the new drug is working very well; 15 drops in each eye; very good—and I walked out. I did not pay a red cent. Isn't it amazing! I am on a salary of $200,000 a year and do not pay a red cent. Shouldn't I pay $15? Shouldn't I pay $20? Shouldn't I make some contribution to the government's budget of Medicare and the cost of health in this country? I walked out scot-free, and that is wrong. If we continue down this road of your financial destruction, there will be no Medicare, there will be no hospitals and you will send us broke.

I had to laugh when Senator Di Natale said, 'Compared to other OECD countries, we're in pretty good shape.' It is like living in a street: I owe $300,000 on my house, but things are pretty good because the person next door owes $400,000 and the other person next door owes $500,000. What they owe does not help me pay my debt of $300,000. The sum of $12,000 million a year goes to interest alone. You inherited a government debt free. Remember former Prime Minister Kevin Rudd and Treasurer Wayne Swan's first budget. There was a $22 billion surplus. It ended up being a massive deficit. You built $191 billion of government debt in the time you were there. All my life I have seen it, whether it is state governments or the federal government: put Labor in power and they empty the cheque account and we wallow in debt. Who is going to make the hard decisions? We did not make the mess. You made the mess and we will clean it up for the benefit of future Australians instead of mortgaging our children and grandchildren's futures away, because you are financial messes. You have done it all my life when I have followed how you manage money. You could not manage a circus. Your fiscal management is an absolute disgrace. Tonight will be the turning point where Australia will start heading in the right direction because of a courageous budget. (Time expired)

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Order! The time for the discussion has expired.