Matt Thistlethwaite (Kingsford Smith, Australian Labor Party, Shadow Parliamentary Secretary for Foreign Affairs) Share this | Hansard source

When I was speaking the other night, I was making the point that, rather than provide the Australian people with sound economic management, this Liberal government has delivered a deficit blow-out of $26 billion over the forward estimates, debt at nearly $100 billion higher than was forecast in the 2013 PEFO, higher levels of spending, gross debt heading towards $550 billion by the end of the forward estimates and growth that is well and truly down since they came to office.

Two and a half years ago the new government promised new economic leadership. Prime Minister Abbott made this one of the principal priorities of his government. Over the course of his prime ministership, what we saw was the deficit double and an increase in public debt. To target that issue, the former Prime Minister and his government attacked the weak and vulnerable in our community. They sought to increase the Medicare co-payment. They sought to reduce pensions. They sought to increase fees for students and introduce $100,000 degrees.

Then, of course, we saw former Prime Minister Abbott toppled in a leadership spill, and in September last year Prime Minister Turnbull, too, promised new economic leadership. But what have we got from the new Prime Minister in terms of economic policy? Well, zip—nothing! No new economic plan for our nation.

The new Treasurer is clearly floundering in this new job. We saw last week at the National Press Club 46 minutes of nothing. The opportunity on the national stage for the new Treasurer to put to the Australian people a new economic plan for our nation to stimulate growth, to invest in infrastructure, to grow real wages, to reduce unemployment and to invest in jobs and all we got was rhetoric and spin—no plans for our nation's future.

As a result, what have we seen in terms of living standards? Living standards have been falling for six consecutive quarters. The real wages of Australians have been falling. It is becoming harder for Australian families and for pensioners to make ends meet. Capital expenditure has experienced a broad-based decline, and not just in the mining sector; consumer confidence and business confidence are at levels far lower than they were when the Liberals took office in 2013.

They have busied themselves by floating ideas about raising the GST. I have to say that this has become a farce, really, because I have no doubt that Treasurer Morrison initially went to the Press Club last week with the intention of talking about the Liberal's plans to increase the GST. When he became the Treasurer he was instructed by the Prime Minister to go out to work with the states on a new plan to increase the GST to 15 per cent, or to broaden its base. Then, at the last minute, the Prime Minister pulled the rug from underneath him. He pulled the rug and his support for an increase in the GST that, clearly, he and those opposite did want to do in order to raise additional revenue.

That left the Treasurer with nothing to say last week at the Press Club. Nothing at all to say about economic leadership and economic management. There is no doubt that the instability and the division that clearly exists within this government and the inward-looking focus of the Liberal Party is now affecting this government's ability to make decisions—to make tough calls when it comes to policy. And it is hurting Australians. It is hurting the Australian business community, because we have subdued growth and a lack of confidence—people are not willing to invest in businesses.

It is hurting Australian workers, because real wages are continuing to decline. We have unemployment increasing—it has jumped back up to 6 per cent again. And it is hurting those on fixed incomes, like pensioners, who have had their pensions cut and who have seen a decline in their purchasing power.

So we have seen a disastrous couple of budgets from the Abbott government, that they could not get through the parliament. Then they switched leaders to the new Prime Minister Turnbull, promising to deliver tax reform and to talk to the Australian public about tax reform. They put the GST on the agenda, then they removed it and now they have no economic plan. It is clear that the Abbott-Turnbull government is making up financial management as they go along. As the papers have so rightly suggested, they are desperately scrambling for any policy that will save them from further disastrous economic woe into the future.

Contrast that with the work of the opposition under the leadership of opposition leader, Bill Shorten. Labor has been busy over the last couple of years, consulting with the Australian public: working with business leaders, working with economists and academics, working with families and working with workers to ensure that we put together a set of tax reform packages and economic strategies that will deliver growth and an increase in jobs in our economy, to ensure that we transition from the mining boom to an innovation-led recovery in our economy and, ultimately, over time to grow our economy and increase living standards.

Labor has had a clear set of policies on tax reform for the last six months. We consulted about them, we debated them and we made decisions about them. We have subjected them to the scrutiny of the independent Parliamentary Budget Office, and the Parliamentary Budget Office has come back with reports on all of our policies, indicating how much additional revenue they would raise for the budget. I must say that in terms of the electoral cycle, this opposition has had more policy out there than any other opposition in living memory.

These policies include an increase in the tobacco excise over the next three years, which will raise an additional $48 billion. We will clamp down on the excessively generous and unsustainable tax concessions for very high-end superannuants—people with more than $1 million in their superannuation balance, who earn an income above $75,000 off that balance. We are not talking about drawing down on the balance, but if someone earns an income through interest or dividends on that balance over $1 million currently they pay no tax on that—no tax whatsoever. Labor has said that is unsustainable; that tax concession will eventually swallow much of the social security system. So we need to tighten that up. It is an area where we can raise additional revenue, and we have developed a policy such that if you earn more than $75,000 as interest off a balance in a superannuation fund then you will pay 15 per cent tax on the additional amount over $75,000.

We have also announced a policy to crack down on multinational profit shifting, ensuring that the likes of Google, Apple and Microsoft cannot shift profits overseas on the billion dollar revenues they are making in Australia in the form of loans before they pay tax here in this country. Some of those companies have been paying effective tax rates of one and two per cent. How many Australian workers or how many Australian businesses get away with paying effective tax rates of one and two per cent? They do not, and nor should big multinational companies which earn $6 billion and the like in revenue from the Australian people. They should pay their fair share of tax and Labor's policy will ensure that they do. These measures together will raise an additional $14 billion over the next decade.

So there we have it: a set of policies announced by Labor—clearly enunciated and giving time for people to have a look at them. And over the course of the last two weeks we announced another policy, to crack down on the unsustainable negative gearing that is occurring in our economy. It will ensure that we are making home ownership affordable again, taking out some of the heat that exists in the housing market—particularly in communities such as the one that I represent. Not a week goes by where I do not get a complaint from a parent about whether or not their kids are going to be able to afford to live in our community in the future. They are bewildered about how their kids are going to be able to afford the prices that certain properties are going for.

We have listened to those concerns and we have worked with economists and experts to put together a reasonable policy. We have put it out there well before the election so people have the opportunity to have a look at that policy and make their mind up. There is a fact sheet that goes with that policy and explains in detail how the policy will work. To summarise the policy: anyone who is currently in the system and negatively gears a property will be grandfathered. They will not lose the opportunity to continue to negatively gear that property that they own at the moment, and that will continue until the property is sold. Then people wishing to negatively gear beyond 1 July 2017 will be able to do so so far as they must invest in a new property. They must invest in new housing stock. The aim of that policy is to grow housing stock to increase supply, take some of the pressure off those hot housing markets and boost the construction industry and create jobs. The independent McKell Institute indicates that that policy should promote an additional 25,000 jobs in the housing industry. Again, that policy will raise an additional $30 billion in revenue in savings because of the tax concession that exists in negative gearing coupled with the reduction in the discount on the capital gains tax. This will raise an additional $30 billion for the budget over the next decade.

That additional revenue will go to fund Labor's policies. It will go to funding a decent education policy, restoring the $30 billion that has been cut by this government from school education policy over the last two years by abandoning the Gonski reforms. It will restore that funding and ensure that we fund our schools on a fair dinkum basis based on the needs of kids.

There will be a decent healthcare policy. The cuts that have been made to hospital budgets by this government will be reversed by Labor because we will have that additional revenue to fund that through these policies. Because of these policies, Labor will be able to commit to funding fully the National Disability Insurance Scheme and other policies that are fair and will grow our economy.

In summation, the choice is clear. This government, which has no economic plans whatsoever, talks about tax reform. Malcolm Turnbull says one thing but does another, says that he is all about tax reform and new economic leadership but delivers nothing. We do not have an economic plan or a tax reform policy from this government. On this side of the chamber, the Labor Party has a clearly enunciated set of policies, a clear economic vision for our nation's future. It is costed, it is fully available for people to see and it contrasts the difference in leadership between the Labor Party and those opposite.

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