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

I noticed in the newspapers this morning a report that the Treasurer will resign from parliament should the member for Griffith be elected Leader of the Labor Party—and I suspect that after that question time the member doubled his numbers in the caucus. The Treasurer made a very feeble attempt to recover some level of economic integrity after yet again being exposed in his failure to address the details of all of his announcements—quite ably, I might say, by my colleague the member for Mackellar, who had picked up quite appropriately that the announcement in the government's second reading speech that there was no age limit on the Superannuation Guarantee contribution in fact totally contradicted what was in the law they were introducing, which put up a 75-year age limit.

This is a classic example of this government's performance and the fact that they are incompetent and pay no attention to detail. Even this morning they were still updating on the internet the explanatory memoranda for the 11 mining tax bills they introduced yesterday—and they expect this parliament to have a properly informed debate about the matter!

You would have thought that this week Australian households and small businesses would have been relieved at a decision by the Reserve Bank of Australia to cut the cash rate by 25 basis points. Three of the four major banks passed on that rate cut in full to the standard variable home loan. Of course, the National Australia Bank did not. I say it should have been good news because it will be some measure of relief for Australian households from some of the challenges they face with higher utility prices, higher food prices and so on. But the reduction in interest rates came about because the Reserve Bank is concerned about international movements—and rightly so—but also concerned about the moderation in economic growth. Economic growth is not travelling at the speed that the Reserve Bank expected. That means the economy is not performing as well as the Reserve Bank originally expected.

Consumers are also more cautious than the Reserve Bank expected. Why are consumers cautious? Every time this government sees a problem or challenge in the community it taxes it—'If there's a problem with teenage binge drinking, introduce an alcopops tax,' 'If there's a problem with people smoking too many cigarettes, introduce a cigarette tax,' 'If there's a problem with carbon dioxide in the atmosphere, introduce a carbon tax,' and, 'If there's a challenge for the Australian car industry facing cheaper imports, introduce laws that increase the taxation rate on foreign made cars and more expensive motor vehicles.'

Of course, if you do well in Australia this government always wants to target you, no matter who you are. It was not that long ago, perhaps 14 years, that the mining industry in Australia was, relatively speaking, on its knees. But this government now says: 'Well, if you're doing well in Australia, we'll tax you. If you're not doing well in Australia, we'll still tax you. And if anyone is left, we'll regulate them.' That is what the Labor Party does.

I nearly fell off the green leather chair here today when the Treasurer said they had a great fiscal strategy and it is delivering a surplus. Unfortunately, it is not delivering a surplus; that is why it is a bad fiscal strategy. The budget deficit this year will be $22.6 billion, and it will be the fourth consecutive year of deficit. I said before, and I have said consistently, I do not expect Labor to ever deliver a surplus budget. Originally I said it about the member for Griffith, and I was absolutely right—he never did deliver a surplus budget. I say it emphatically about the Labor Party: they will not deliver a surplus budget. Bear this in mind, Mr Speaker: you will need to deliver surplus after surplus after surplus to start paying down the $110 billion of net debt. Bear in mind that, over the last four years, Labor have accrued a deficit of $154 billion. The only reason net debt is less than that is that we left money in the bank. We actually left the country with no net debt; in fact, there was a net surplus of assets. So they have spent the surplus of assets that we left them with four years ago and then they accrued $110 billion extra in net debt. The government are borrowing $62 million a day, at the moment, simply to meet day-to-day expenditure. It is no wonder that the Australian people reacted when the Prime Minister announced in the papers today that she wants to lend money to the IMF to lend money to the Eurozone to lend money to the Greeks. Under this proposal, Australia would be borrowing money to lend it to people who would lend it to people who would lend it to people who have a debt problem.

Of course, the Treasurer himself was tricking in question time. He knew exactly what we were getting at. First of all, he started the bluff and bluster about the coalition no longer supporting the IMF. We do support the IMF; we have always supported the IMF. We have done so on a number of occasions and we will continue to do so. But the IMF should not accept some of the suggestions from the Eurozone that it should form a partnership with the Eurozone for the European bailout fund. It is not part of the current mandate of the IMF. That is a very important point.

I quoted the Chancellor of the Exchequer in Great Britain, and I repeat it. He knows that the people of Britain will not cop British taxpayers' money being used to bail out the Greeks and the European currency. It is one thing to bail out an individual country. The IMF does that on regular occasions and it is appropriate that it does so. The strict rules that the IMF applies—and they are often criticised, as they were during the Asian financial crisis—are appropriate as a way of repaying those loans. The concern of the Chancellor of the Exchequer, and our concern, is that this is about shoring up a currency. This is about shoring up the European Union.

The Prime Minister has gone into this issue like a wild bull in a china shop. Firstly, the Prime Minister arrives overseas and says, 'We stand ready to give more money to the IMF for this purpose,' yet the IMF has no deal with the Eurozone. Secondly, the concerns for everyday Australians are: what is the amount of money that is going to be put into this program and why is Australia leading the charge when the nearest neighbours to the Europeans—that is, the British—are not prepared to do the same? The third key factor is that the Europeans are trying to get the Greeks to agree to the current package on the table. They are trying desperately to get the Greeks across the line on the current package, saying, 'It is this package. You should accept it.' But along comes Julia Gillard and says, 'Hang on, there could be another pot of money.' So all the dissenters in Greece can turn to the words of the Prime Minister of Australia and say, 'Here's an alternative to accepting the existing European package.'

When the Prime Minister said she does not understand foreign affairs, she was damn right. The British know this, and other countries know this, but unfortunately we have a Prime Minister who is more interested in big-noting herself and going to the G20, when she is one of the weakest voices and trying to pretend to Australians that she is the strongest voice.

The challenge for Australia out of this is that, firstly, we should fix our own house. Our strength in our words comes from our actions. When Australia speaks, people listen, provided that we have the cash in our pocket, that we are not penalising our people, that we do not have to have austerity measures and that we as a nation are enhanced and empowered by having no debt, by having cash in our pocket. In a world where there is financial turmoil there is one truth: the person who has cash, the person who has no debt, and the person who can influence politics and influence outcomes is the one who has the most money in their pocket. That is the rule.

There is the emergence of China and the fact that the Europeans are now seeking out China for funding. The Chinese are not openly offering funding to the Eurozone like our Prime Minister. No, no, no. The Chinese are standing back and saying, 'You must prove that you are prepared to fix your house, and you come to me.' That is because they are the powerful ones, they have the money. But our Prime Minister feels the need to be generous at taxpayers' expense, after she has just delivered a $50 billion deficit, with a more than $22 billion deficit this year and with her incompetent Treasurer umming and ahhing about whether he actually can deliver a surplus.

You know what, the bottom line is this: the Prime Minister is promising what she cannot deliver. She is 'writing cheques her body cannot cash'—to quote from a great movie. The bottom line out of that is: Australians end up paying the price. Why do they end up paying the price? Because this is a government addicted to tax. On the same day that the Prime Minister offers money to help the Eurozone—the richest and largest economy in the world—when they did not even ask for it, Australians are having new taxes imposed on them by the government. A flood tax, a mining tax, a carbon tax, an alcopops tax, a cigarettes tax and new taxes on cars are all happening at the same time that our Prime Minister is beating her chest over in Europe, saying, 'We're going to lend you money.' My goodness! That is like a member of the gallery up there going along to the National Australia Bank and saying, 'Look, I can lend you 100 bucks'—

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