David Coleman (Banks, Liberal Party) Share this | Hansard source

That is a problem as well, member for Deakin, because that involves a net deterioration in the budget over that period of over $16 billion, and $600 million is about four per cent of $17 billion. So it is slightly better than the two per cent but still very bad. It is the right direction but still out by 96 per cent. As a consequence, the government needs to make sensible adjustments because we are not just going to sleep walk into the future, pretending the budget situation is okay, pretending that two-thirds of a trillion dollars of debt in 10 years—which is the trajectory we are on—is okay. We are not going to pretend that is okay because it is not. We need to make some sensible adjustments and deferral of the superannuation guarantee increase is one of them.

You do wonder about the previous government. The member for McMahon was in here earlier, very excited and speaking passionately. He was here when the member for Lilley introduced the mining tax. Why did he not take him aside and say, 'We need to go through the numbers in a sensible way before we commit to tens of billions in spending'? Why did he not make sure that there was some reality? He did not do that. It is unfortunate because the member for Lilley was not the Treasurer for the under-7 sausage sizzle; he was the Treasurer for the entire nation and that is just not an acceptable standard.

The key point on the superannuation guarantee deferral is that, as many people have noted, when superannuation guarantee goes up, that comes out of wages. Obviously, businesses cannot just invent money, much as the opposition probably think they can. Business cannot say, 'Okay, we'll just find an extra three per cent.' That is not the sort of thing that happens in the real world. Consequently, there is a negative impact on short-term wages. So there is no question that, if the guarantee goes up more quickly, wages come down. So deferring it by three years—a sensible budget saving—makes no difference to the total compensation paid to an employer but it means they get more of it up front than they otherwise would have. So this is a very sensible response to some appalling public policy by those opposite. Let us just be thankful that the government has changed since these initiatives were put in place. (Time expired)

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