Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Hansard source

Sometimes politicians get accused of not knowing what day it is, and I must confess that this morning I was close to leaving myself open to that accusation. When I got the topic for the MPI, signed by Malcolm Turnbull, and saw the words ‘the government’s failure to prevent wasteful spending’, I had to check the date—I thought it might have been 1 April. This is a genuinely surreal proposition being advanced by the opposition. It is perhaps somewhere in the same league as the Leader of the Opposition telling us how he created the republic or saved HIH. Of all the areas in which the opposition, and particularly this Leader of the Opposition, might seek to claim the high moral ground, wasteful government spending is very much at the bottom of the list. For the opposition to be putting forward this debate is truly in the surreal world of two-way mirrors of politics.

I want to start by drawing some attention to the recent track record of the Leader of the Opposition and his party in government just to illustrate what the Rudd government inherited by way of government spending—that is, the situation when we took office at the end of 2007. We took office at the end of a period when there had been four federal budgets in a row with virtually no significant savings measures. We took office at the end of a period when, over five years, the total headcount in the federal public sector had risen from 212,000 to 247,000, a dramatic increase in the total number of public servants on the federal government payroll. We took office at a time when the federal government, at a time of economic boom with the mining boom turbocharging the Australian economy, was budgeting for five per cent real growth in spending. There are some circumstances where that kind of spending is appropriate, but not when the economy is already going along at a rapid rate and inflationary pressures are building.

We took office within weeks of an Auditor-General’s report into the Regional Partnerships scandal, in which government funding was provided to assist in the establishment of a cheese factory that had closed down before the funding had been provided, to assist in the creation of a heritage steam railway where no trains had ever run and to provide a carriage for the Queen. This, to my mind, was probably the most spectacular example of wasteful government spending. The Howard government budgeted for and provided $350,000 to subsidise a private citizen’s gift of an ornate carriage to the Queen—$350,000 of taxpayers’ money for a private citizen’s birthday gift to the Queen! That was the kind of standard that was being set for wasteful government spending by our predecessors when we took office.

We may want to actually consider the approach that was taken by the Leader of the Opposition when he was a minister. We well remember the infamous $10 billion water plan announcement. It was all dreamed up on the back of an envelope or a serviette. It was announced without consultation with the departments of treasury and finance. My predecessor as minister for finance, Senator Minchin, was asked about this the following weekend on Meet the Press. He was asked, ‘Will this be costed by the department of finance?’ His answer was, ‘Yes, this will be costed in due course.’ In other words, a program of $10 billion was announced by the government without even being costed by the department of finance.

I can move on to other spectacular examples such as the fact that, from about 2002 to 2007, the Howard government’s spending on discretionary grants rose from about $450 million to $4.5 billion per annum, a tenfold increase, as well as the scandalous misuse of taxpayers’ money on government advertising. In the last 16 months of the Howard government, according to advice from my department, $457 million was spent on government advertising. So that is the recent past of the Leader of the Opposition and the Liberal Party.

We cannot forget the Leader of the Opposition’s decision as a minister to grant $10 million, five times the amount recommended by his department, to somebody who was well known to him and lived near him in his electorate who indicated that he would be able to make rain and that he was exploring new technology that might be able to make rain. That is the recent track record of the opposition when in government.

We now consider the coalition’s track record in opposition and their practice when dealing with the question of fiscal responsibility. Numerous announcements have been made by both the Leader of the Opposition and his predecessor about their commitments to the Australian people were they to be elected to government. We have heard proposals for a 5c a litre cut in fuel tax which are yet to be formally repudiated. We have seen proposals to cut the capital gains tax on the retirement of small business owners which have never even been costed and have never been withdrawn. Proposals have been advanced to pay a proportion of the superannuation liabilities of small businesses.

See this speech in context