Karen Andrews (McPherson, Liberal Party) Share this | Hansard source

I rise to speak on the Appropriation Bill (No. 1) 2013-2014 and cognate bills. On Tuesday, 14 May the Treasurer introduced the Labor government's sixth budget, and I, along with my coalition colleagues, have serious concerns about that budget.

Let me start with the surplus promise. Over 500 times the government promised that there would be a surplus, but there is no surplus this year, there will be no surplus next year and there will be no surplus the year after that. According to the budget papers, there will not be a surplus until 2016, and it will be a modest balance at that.

The Prime Minister herself said, on 165 separate occasions, that the government would deliver a surplus this year. The original promise was for a surplus of $1.5 billion, but, in the weeks leading up to the budget being introduced, the Treasurer foreshadowed that this would not be achieved. He said that this was because of a drop in revenue of $7.5 billion. I will talk more about that shortly. As it got closer to the budget being handed down, the shortfall became $12 billion and then $17 billion. On 14 May, the deficit that we had was $19.4 billion. This is the fifth-biggest deficit in our history. What we are looking at here is the promise of a $1.5 billion surplus and the delivery of a $19.4 billion deficit. That is a difference of $20.9 billion. This is not a small amount of money. It is not an insignificant amount of money. To put it into a local context for my electorate of McPherson, it is more than 20 times the money that was allocated in 2007 to upgrade the M1, an upgrade that the Labor government has failed to complete in its almost six years of government.

As I said just before, the Treasurer claimed that the deficit was a result of revenue shortfalls of anywhere in the order of $7.5 billion to $17 billion, depending on which day you choose to consider. Arguably, the Labor government used optimistic forecasts of revenue and spent the money accordingly. As an engineer, I always worked with factors of safety, so I ask: where was the factor of safety in the budget forecasts? We all understand that spending money before you have it is a high-risk strategy. Relying on optimistic forecasts to budget is also a high-risk strategy. This government has demonstrated time and time again that it has a forecasting problem. It is not a revenue problem; it is a forecasting problem.

The government also has a spending problem. It is clear when you compare the revenue that the Treasurer now has to balance the budget and the revenue that Peter Costello had to balance the budget six years ago. The Treasurer now has an extra $80 billion of revenue. Peter Costello delivered a $20 billion surplus with $80 billion less revenue than the Treasurer has. It is not because the revenue is down that we have a deficit; it is because spending is up, and it is up by $120 billion. It has been said by many of my coalition colleagues that the Labor government has a spending problem, and it does. It also has a waste problem. Let us have a look at some of the waste and budget blow-outs over the years of this government. Let us start with home insulation. A headline from The Age on 11 March 2010 says '$100m to fix botched insulation program'. An article in the Adelaide Advertiser on 17 May 2013, headlined 'Ad spree to cost $100m', says:

LABOR is splurging more than $100 million on government advertising this financial year and next around the election …

On immigration, a headline from The Daily Telegraph of 23 July 2012 says, 'Greens' asylum seeker demand set to blow the budget surplus'. On the NBN, a headline from The Australian of 10 August 2012 says, 'NBN costs soar as Labor rolls out extravagance'. A headline in The Australian on 13 August 2012 says, 'PM's $150m spin doctor brigade'. A headline in The Courier-Mail on 17 June 2009 says, 'School rip-offs exposed'. On set-top boxes, a headline from The Daily Telegraph of 18 July 2011 says, '$67m worth of set-top box red tape'. On 'gold-plated' coffee machines, The Courier-Mail of 14 August 2012 says, 'We pay to perk up officials' daily grind':

LABOR'S bureaucrats are splashing taxpayer money to deck their offices out with $15,000 coffee machines.

News Limited can reveal the Department of Industry, Innovation, Science Research and Tertiary Education has dropped $75,000 on buying and installing just five high end coffee machines for its Canberra office.

That is a truly staggering amount of money.

Summing up this year's budget can be done in one word, and that word is 'disappointing'. Even that, quite frankly, is being somewhat generous. It was disappointing for Australians and it was disappointing for the future of our country. Why was it disappointing? There are many reasons, but let me start with this: total gross debt, which is set to breach the $300 billion debt ceiling within the forward estimates, is expected to approach $400 billion over the forward estimates.

But the government has not increased the debt limit in these bills. The government has raised the debt ceiling several times in the past, so to do it now would not be a new concept. They increased it from $75 billion to $200 billion, then to $250 billion and then to $300 billion. Each time the government has said that it will not break the limit. Well, gross debt is expected to approach $400 billion over the forward estimates, and if that is the case then the current $300 billion-ceiling will be breached. That is an unprecedented level. It brings with it interest payments of $35 million a day, $245 million a week and close to $13 billion a year.

But when we are talking about a disappointing budget, that is not all there is. This is the fifth consecutive deficit that this government has delivered, with at least two more to follow. This raises a very serious issue of credibility in relation to the government. After maintaining up to a few weeks before the budget was delivered that there would be a surplus this year of $1.5 billion, only to reveal a $19.4 billion-deficit and the promise of a surplus next year of $2.2 billion, which is now a deficit of $18 billion, the obvious question, and the question that many Australians are asking is: will there really be a promised surplus in 2016? Can you believe what the government is actually telling you? I would say that if past behaviour is a predictor of future behaviour then the answer is that the prospect of Labor delivering a surplus is highly unlikely.

What else do we have? We have net debt at a record level of $192 billion, and there is no credible path back to surplus. The government has failed to demonstrate with any credibility the path that will deliver the promised surplus. Many Australians just simply do not believe that it will happen.

In his budget speech, the Treasurer said that the budget was about jobs and growth, but growth decreases and unemployment rises. Unemployment, underemployment and workforce participation are all issues that are being faced around this country, and my electorate of McPherson on the Gold Coast is no exception. Last week there was a hearing held in Melbourne in relation to the inquiry by the Standing Committee on Education and Employment into the Fair Work Amendment Bill 2013, which is a significant piece of legislation with regard to employment, and I asked the following question:

Last week in the Treasurer's budget speech he spoke about supporting jobs and growth. Do you believe that the amendments that are proposed in this bill support jobs and growth, or do they potentially create a negative impact on jobs and growth?

We had a response from Mr Stephen Smith, who is the Director, National Workplace Relations, at the Australian Industry Group. He said:

The problem with the legislation, and particularly this bill, is that it imposes a lot of impediments on businesses when they are making decisions about employing people and making decisions about what they can do about problems within their business. There is nothing in this legislation at all that is going to promote one job, and there are a lot of things in this legislation that will impose more barriers on business …

Mr Daniel Mammone, the Director of Workplace Policy and Director of Legal Affairs, Australian Chamber of Commerce and Industry, responded:

It is a really good question and point, given that confidence is so important for the SME sector. Our small business survey which was released this week unfortunately indicated that confidence was still tracking in negative territory.

He went on to say:

In summary, this does not really provide any further confidence to the business community, unfortunately. It is something that the business community have told us they are disappointed with. Small business in particular feel that they are not being heard—and they are too big to ignore, in our view.

It is important to instil confidence in the business sector and also instil confidence in everyday Australians, many of whom struggle on a daily basis. It is time that the government takes note of the millions of families and businesses across the country who are struggling to ensure that they have a balanced budget, even in the face of a 90 per cent rise in electricity and a 64 per cent rise in gas prices under the Rudd and Gillard governments. If they spent more than they earnt and let their debt spiral out of control, where would they be? Businesses would be forced to close and families would not be able to put food on the table.

Australians deserve a better government. The coalition has a plan to build a strong and prosperous economy for a safe and secure Australia.

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