House debates

Wednesday, 4 February 2009

Appropriation (Nation Building and Jobs) Bill (No. 2) 2008-2009

Second Reading

9:22 am

Photo of Wayne SwanWayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Hansard source

I move:

That this bill be now read a second time.

The unfolding global economic story reminds us daily that we find ourselves in the midst of the most significant global economic crisis since the Great Depression and, as our international circumstances get harder and harder, the government gets more and more determined.

Its severity has grown since the release of the government’s $10.4 billion Economic Security Strategy in October last year, and has become even more serious since the Mid-Year Economic and Fiscal Outlook that I released in November.

Projections of world growth, including by the International Monetary Fund, continue to deteriorate to a much greater extent than many envisaged at that time.

The largest advanced economies in the world are already in recession, bringing the loss of millions of jobs.

This global recession, the slowdown in the mining sector and among our trading partners, particularly China, has serious consequences for Australian jobs and for Australian growth.

While we find reassurance in knowing that Australia is better placed than almost any other developed economy to withstand this fallout, we also know that we are far from immune.

Although Australia has weathered the early stages of the global recession better than many other countries, the weight of the global recession is now bearing down on the Australian economy.

The global mining boom that drove large increases in the terms of trade and in our national income has come to an end.

Australian growth, as a result, is expected to be significantly weaker than previously anticipated.

Growth for 2008-09 has been revised down from two per cent in MYEFO in November to one per cent in the Updated Economic and Fiscal Outlook, and unemployment will be higher.

And that is precisely why the government has introduced the Nation Building and Jobs Plan, which incorporates:

1. $28.8 billion to build the schools and roads and homes and communities and energy efficiency we need for future prosperity; and

2. $12.7 billion to boost consumption so we can support jobs right now.

Jobs now, and the building blocks of growth and prosperity for the future—that is the absolute essence of the nation-building and infrastructure plan the Prime Minister and I announced yesterday.

It is a plan with which we expect to boost growth by around by one-half of one per cent in 2008-09, and three-quarters to one per cent in 2009-10, and to support up to 90,000 jobs over that period.

There is no guarantee our economy will not deteriorate further—even slower growth remains a genuine threat.

The only certainty here is that our country will be worse off, and more Australians will be out of work, if we do not act in the way that I will outline here today.

Nation Building and Jobs Plan

The Nation Building and Jobs Plan is based on the reality that now is not the time for half measures.

It is a time to be bold and to get on with it.

It is weighted towards productive investment.

It meets the crucial conditions for effective fiscal stimulus; it is temporary, timely and targeted.

It will allow the swift construction of the schools and roads and communities we need for future prosperity.

And like the Economic Security Strategy—which boosted demand in December and January 2008—this plan will keep Australia ahead of the curve.

The measures we are introducing today are critical and they are urgent.

Our plan seeks to support jobs and growth immediately, through a further round of targeted tax and transfer payments.

It also lays foundations for higher productivity and future prosperity through a program of infrastructure investment.

The plan will contribute to our long-term productivity reform agenda—an agenda that embraces the education revolution, investing in advanced infrastructure, COAG reform, and making the transition to the low-carbon economy of the future.

The infrastructure investment in this bill accounts for $28 billion of the overall $42 billion cost of the plan—more than two-thirds of it.

This investment will provide lasting benefits to local communities and to our national economy, as well as supporting Australian jobs during these tough times.

Building the Education Revolution

The bill that I introduce to the House today will fund the largest and most ambitious school modernisation program in Australian history.

This is the centrepiece of our Nation Building and Jobs Plan.

The Building the Education Revolution program will fund a $14.7 billion investment in educational infrastructure over three years.

It will benefit each and every one of Australia’s 9,540 schools: every single community, every single school, every single P&C—all with a role in the nation’s economic future.

This is a critical investment in the education revolution.

Nothing is more central to our longer term economic and social development than the education of our children.

We cannot provide our kids with a 21st century education if they are stuck in cramped, decaying classrooms, designed for a generation of Australian children that left school many years ago.

Schools that were built in the 19th and 20th centuries reflect the design standards, equipment and needs of a different era.

Under the Building the Education Revolution program, we will invest $12.4 billion in the construction of assembly halls, knowledge centres, indoor sports centres, performing arts centres and similar major improvements for all Australian primary schools, special schools and K to 12 schools.

Funds will be allocated to reflect school size, with $250,000 provided to small primary schools of up to 50 students and up to $3 million for large primary schools with more than 400 students.

A further $1 billion in 2009-10 will be available for the construction of science laboratories and language learning centres in approximately 500 secondary schools, based on assessed need.

Primary and secondary schools will also be able to apply for one-off funding of up to $200,000 for maintenance and infrastructure at an estimated cost of $1.3 billion over two years.

This package of investment will provide tangible benefits to all local communities and will provide a major boost to key educational infrastructure for Australia’s children.

Social Housing

This bill also contains vital measures to tackle the crisis in affordable housing inherited by this government after years of underinvestment.

Improving the supply of affordable housing is a key part of achieving the government’s goal of halving the level of homelessness by 2020.

Across Australia, individuals and families in the bottom 40 per cent of earners are struggling to find affordable housing.

For these people the social housing system is a key element of Australia’s social safety net.

A cumulative real cut of $3 billion to public housing over the last 10 years has reduced the social housing stock and contributed to the state of poor repair.

As a result, many people who needed public housing have been forced into the private rental market.

This has contributed to a situation where 150,000 of the poorest households in Australia pay more than half their income in rent in the private rental market.

The Commonwealth Social Housing Initiative will provide up to $6 billion to the states and territories to fund construction of approximately 20,000 new dwellings.

This is a significant investment that will accelerate progress to our 2020 goal and reduce the number of low income households paying more than half their income in rent.

The Commonwealth Social Housing Initiative will also provide an important immediate stimulus to the housing construction sector through $400 million for repairs to get existing social housing up to scratch.

We have received strong support on this initiative from industry, for example from the Property Council of Australia, who said:

Every dollar that goes into construction sector has a multiplier effect–it is spent three times over in the economy. This makes for an ideal measure of a well thought-out stimulus package.

Community Infrastructure

A third nation-building priority in this bill is community infrastructure.

There is a desperate need for renewing and upgrading the infrastructure of local communities around our nation.

Our nation has a large backlog of essential infrastructure projects in local communities.

Much of our community infrastructure was built in the 1950s and 1960s and is in urgent need of renewal.

That is clear from the response to the $300 million Regional and Local Community Infrastructure Program (RLCIP) that the Prime Minister announced at the inaugural meeting of the Australian Council of Local Government in November last year.

The competitive component of that program, $50 million for strategic projects, is already heavily oversubscribed.

That is why the bill I introduce to the House today includes a $500 million investment over two years to help councils to invest in critical local projects through the Community Infrastructure Fund.

This will include community halls, tourism infrastructure and sport and recreation facilities.

It is in addition to the $300 million investment announced last year and it will provide an important boost to local economies of regional centres, towns and suburbs right across the nation.

The bill also provides an additional $390 million over two years for black spots, boom gates and regional infrastructure.

This will bring forward and boost capital expenditure in regional areas.

It will also improve safety for motorists and passengers. I note the remarks yesterday from the National Roads and Motorists’ Association:

The NRMA warmly welcomes this additional funding, particularly the fact that a substantial proportion of the money will be immediately available to be spent this financial year. Black Spot funding has been a major factor in improving road safety on many roads around Australia–additional funding for these projects is fantastic.

This and the other community initiatives the government announced yesterday will provide an immediate boost to jobs and businesses in regions right across Australia as well as providing a lasting benefit to local communities.

Conclusion

There will be no quick fix to this global recession and many of its effects are still to be felt.

But the government is doing what it can to help see Australia through.

This is the first in a package of six legislative bills to give effect to its Nation Building and Jobs Plan, announced on 3 February 2009.

It shows the government will do whatever it takes to support Australian jobs during these difficult times while still laying the foundations for the next generation of prosperity.

With the Rudd government’s dedicated nation-building program, with initiatives like those I have outlined today, with national unity and with purpose there is no reason we cannot emerge from this global recession stronger and more prosperous than before the global financial crisis began.

I commend this bill to the House.

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