Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Hansard source

Yes, well done, great spin. Best spin I have heard for a while. Off you go!

Government members interjecting—

They are all having a chuckle on the other side about the fact that this government has put the economy in the eye of a perfect storm. Well, laugh on! This is not a game. No wonder we have a view in the community that this government is such a dysfunctional mob and unable to manage money. That is the view, and you know it. You must be getting it. We are getting it in spadefuls everywhere we go. Professor McKibbin said:

The federal government has bet that a crisis in Europe will not happen during the 2012-13 financial year.

Furthermore, David Uren, the respected economics editor of the Australian, observed today:

There is no effort to place Australia's prospects into the context of a global malaise that shows no sign of lifting.

That is what concerns me about the member for Lindsay; he shows no awareness that there is a global malaise that shows no sign of lifting. Mr Uren went on:

Its continuing hold has been seen across the past 10 days, with signs of rapid slowdown in China, renewed crisis in Europe and speculation that the US Federal Reserve will again start printing money to buy its own government's bonds.

These observations are confirmed by the views and the confidence levels of Australian business people. If everything that the member for Lindsay said were true—if this economy is going gang busters, if we are better placed than the rest of the world, if households should not be worried about where the next dollar for their mortgage is going to come from or whether there is any threat to their jobs—then you would expect that the confidence levels of the 2.4 million small business people and the hundreds of thousands of bigger businesses across this country would be at some reasonable level.

Let us have a look. In March 2010 the NAB business confidence level was measured at 17. In March 2011, last year, it was at 11. In March 2012, just a month or so ago, it was at minus one. There has been a significant—

Ms Rowland interjecting—

Members opposite are saying we are talking down the economy. This is facing the facts. This was the subject of the debate. Are you going to get your head out of the sand and look at the dangers that are coming down the line, or which could come down the line? Are you going to restore the resilience that you inherited when you won government? Are you going to restore us to no debt? Are you going to restore the $70 billion of assets? Are you going to restore the confidence of the business sector and households back to what it was? No! Minus one is the reality. You cannot wish it away; it is the reality. It has gone down from 17, to 11 and then to minus one. Business people, who make the investments and who take the risks, are the ones who have no confidence. They are not spending any of the money sitting on balance sheets—and there is a lot of money around. They are not investing it.

There is a crisis of confidence across the business sector and, outside the resources sector, they are not investing at all. Within the resources sector, we are now seeing again over the last week Access Economics warning that $260 billion of projects being actively considered and at an advanced planning stage may be deferred. That is a quarter of a trillion dollars worth of projects on which the Treasurer stood up here today and proudly declared, 'Job done.' They are not even finalised in terms of investment decisions, and Access Economics assess that these projects may well be deferred.

In fact, I went to Perth a couple of weeks ago to talk to a number of senior people within the mining industry. I spent several years working in the mining industry. I got to Perth, and half the people that I went to have a chat with to see what was happening were not there. They were in Africa. All I could hear in Perth was that there are now some 300 Australian mining companies who are actively seeking opportunities in Africa. It is not just Australian mining companies; it is investment dollars. Investment funds by the billions that were coming here out of the United States and other countries are now heading to Africa. Why is that so? What do they say to me when they give me a reason for starting to write down the prospects of mining here in Australia? They say 'sovereign risk'. That is what they say. They say 'the carbon tax' and 'the mining tax'.

Again, there is the very smart decision in the budget to double the withholding tax, which the government had very properly reduced to 7½ per cent, one of the very few measures in the last four or five years that you could commend the government for and that gave any sense to the business community that you knew their circumstances. You have turned around and doubled it, and not only that: you have made it retrospective. So the billions of dollars that were attracted because of that 7½ per cent withholding tax are now going to be thwarted. You will see this dry up. You have sacrificed billions of dollars of potential investment for the sake of $260 million over the next three or four years to try to convey that you have balanced your books, when in fact you have lost billions of dollars of investment on behalf of the Australian community. They talk about the re-regulation of the workforce and many more things. All of these things add up to sovereign risk. It is why the business sector are so down in the mouth about their prospects under this government. It is why they endlessly say, 'Can't you bring on an election? For goodness sake bring on an election.' This country is stopping in its tracks because of the uncertainty of this government.

It is not only all of these policy decisions; it is the way in which you conduct business between yourselves. It is the way in which you protect, cover and spend weeks of time and distraction over a member who really has disgraced himself and the parliament. Yet you are spending time and effort protecting this person, at the expense of the proper operation of this parliament. People see this and cringe. They are cringing in coffee shops, in shops, in factories and in households all over this country, wondering how much more dysfunctional you lot can become. This is why we need an election, and it is for these reasons that you have not in any sense anticipated some of the danger signs coming. Warwick McKibbin is not a man known for his dramatic expression or his overstatement of issues. He said that this government has put the economy 'in the eye of the perfect storm'. You have massive spending commitments. You have increased spending by 40 per cent—$100 billion more than four years ago. You cannot explain this; you simply cannot explain it. Let us forget about the stimulus; that was for two years.

Mr Perrett interjecting—

No, let us except the stimulus. I am talking about this year's budget, which has no stimulus money in it, I am told by you. This year's budget is $100 billion more than four years ago. That is a 40 per cent increase. What about a household? What about any of these people in the gallery? If they increased their spending 40 per cent every four years, their households would go broke in no time. This is unrealistic, yet you are spending $100 billion more, and the member for Lindsay stands up here and makes out that you are being fiscally responsible and tough. You are just full of spin. Explain $100 billion at a time when inflation was 13.2 per cent.

This government has created structural deficits such that, if the mining income comes back by just a modest amount—20 or 30 per cent—we will dive straight into deficits in excess of $50 billion and debt will ratchet up. It is giving no sense that it understands any of this. People have lost confidence. There is a crisis of confidence. We need an election. We need somebody in these chairs that knows how to manage money.

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