Jim Chalmers (Rankin, Australian Labor Party, Shadow Parliamentary Secretary to the Leader of the Opposition) Share this | Hansard source

Thank you very much, Deputy Speaker, for this opportunity to speak on the Appropriation Bill (No. 1) 2017-18 and other appropriations bills for the budget that was recently handed down. There is a large and, unfortunately, growing group of Australians for whom the economy is a very different place to that which has been described by the Treasurer and the Prime Minister from that dispatch box. For this group of Australians, life is precarious, particularly at work. They face record low wages growth. They face record high underemployment. They cannot find the hours that they need to work to provide for their loved ones, because hours worked per person are also at record lows. Unfortunately for them and for the country, amidst all of the spin and rhetoric of this budget—all of the things that the government would like us to believe this budget is about—the economy today and the budget that the government has handed down make life for that group of precariously placed Australians much, much harder. That is the real story of the people facing part of the economy today, not the one told by the Treasurer.

Again unfortunately for this country, this is a budget which sides with the millionaires and the multinationals over middle Australia, and that is because we have a government that still clings to an idea which has been long discredited, this Thatcherite fantasy that says that if you shower largesse on the top end of town then somehow, miraculously, people on low and middle incomes in this country will benefit from that effort. That has been the approach of those opposite for as long as I have been around. It was certainly the approach that defined the first three budgets of the Abbott-Turnbull governments, the Abbott-Turnbull period. The only thing that is really different about this fourth budget is that they want Australians to believe that they have changed—that they have somehow had some big conversion and all of a sudden they believe something else. They are so ashamed that they want to continue with that $65 billion income tax cut for the top of town that they want Australians to believe that the budget is about something different. But Australians are smarter than that. They know that the leopard cannot change its spots. They know that this government will always favour the top end of town over those who work and those who struggle.

What makes this budget particularly peculiar is the gap between the rhetoric that we hear from those opposite and the reality of the budget itself. They want Australians to believe that somehow it is a budget that Labor could have handed down. That is a very flattering reflection in lots of ways. Labor has led the debate on this side of the House on important policy considerations, but no Labor budget would have $22 billion of cuts to schools, dramatic increases to university fees or $600 million cut from TAFE and apprenticeships. No Labor government would fail to take action on negative gearing and capital gains—those tax breaks for wealthy investors that put first home buyers at such a disadvantage.

Those opposite want us to believe that this is a fair budget. But no fair budget would have those cuts to family payments, to veterans health or to pensions—something like $366 a year in terms of the energy supplement, which is still in the budget as a cut for pensioners. The government took out what has become known in the insider talk of this place as the so-called 'zombie measures'. They took out some of those zombie measures from the budget, but we know from the finance minister and others that they were taken out not because the government stopped believing in harsh cuts to the most vulnerable, but because they could not get them through the Senate. The finance minister even said it was regrettable that that they could not pursue those harsh cuts to benefits for the most vulnerable people in our community.

No fair budget would hike taxes for those earning less than $87,000 at the same time as they give a tax cut for everyone earning more than $180,000. That means a millionaire gets a $16,400 a year tax cut on the same day that up to 700,000 Australians lose their penalty rates, on the same day that somebody earning $65,000 a year gets a $325 a year tax increase. No fair budget would give multinationals and banks a $65 billion tax cut at the expense of middle Australia.

The government also wants us to believe that it is an infrastructure budget, but no infrastructure budget would have this smoke and mirrors and old announcements and potential projects and the same old excuses not to get cracking on important projects such as Cross River Rail and projects right around the country. It was this approach by the government, this smoke and mirrors approach to infrastructure funding, that led Infrastructure Partnerships Australia to point to the lowest investment in infrastructure in 10 years.

More fundamentally, those opposite want us to believe that this budget is somehow about budget repair. Some of the numbers that I am about to tell the House—you do not hear a lot about these numbers, but they are there, buried in the budget papers. These are not opinions from the Labor side of the parliament; these are the facts which are in the government's own budget papers. The first one is that the deficit for the year that we are in right now, 2016-17, has tripled from the government's first budget under Joe Hockey, from $10.6 billion to $37.6 billion. The deficit for the year we are in right now has more than tripled. It is worse for the coming year. The deficit for the coming year, 2017-18, has increased more than 10-fold from Joe Hockey's first budget to the budget that the Treasurer handed down very recently. It has increased from $2.8 billion deficit in their first budget to a $29.4 billion deficit in the most recent budget—a 10-fold blowout.

Net debt has blown out by over $100 billion since they those opposite came to government. Net debt will be at record highs for another three years. Gross debt will pass half a trillion dollars for the first time in Australia's history next month. That is roughly $25,000 for each Australian man, woman and child. That is why the Treasurer snuck out the announcement that he would have to increase the gross debt cap, because it will hit $600 billion and will keep rising to well over half a trillion dollars in gross debt. Gross debt will hit $725 billion in 10 years, and it will keep on growing. It does not actually peak in the 10-year budget period. Gross debt continues to rise.

Remember, it was Malcolm Turnbull, when gross debt was expected to hit about $300 billion, who in 2009 described that as an almost inconceivable level of debt. He called it a gigantic mountain of debt. He said it was a frightening amount of debt when it was approaching $300 billion. Now we know that under this government gross debt will hit $725 billion and keep rising after that. No wonder that, when the ratings agencies reaffirmed the AAA credit rating, they kept us on negative watch. They kept Australia on negative watch because they were not convinced that the government had the capacity to arrest these blowouts in debt and deficit.

All of this is in spite of $21 billion of new taxes. They do not like to talk about that on that side of the House. $21 billion of new taxes—the price that Australians will pay for four years of chaos, division, dysfunction and debt and deficit blowouts. Those opposite also want us to believe that, in the words of the Treasurer, it is a budget for 'better days ahead'. I think the Prime Minister described it as a budget to 'make people's dreams come true'. In the short time since the budget was handed down, we have already had two measures of consumer confidence and both have plummeted. The Treasurer stands up and says that this is a budget for better days ahead. But the Australian people have examined it, held it up to the light and said, 'No, we don't think so.' Consumer confidence has plummeted on both of the key measures that were released last week.

But I think perhaps the biggest failure, the biggest gap between the rhetoric of this budget and the reality of this budget, relates to the government's performance on jobs. One of the main reasons they have changed that old slogan 'jobs and growth' to 'fairness', which Crosby Textor has told them to do, is that the record on growth and, especially, jobs, is really poor. Even in this budget—again, it is something the government does not like to talk about—the key measures of jobs and growth have been downgraded. So when they want Australians to believe they are doing an amazing job on jobs and growth, they put downgrades into the budget for all the key measures.

I think the starkest failure in this budget, compared to the budget before it, is that the Turnbull government is now expecting 100,000 fewer jobs in our economy than they were expecting just a year ago. The nerve of them to say this is a government about jobs, while they quietly downgrade their expectations for jobs in this country! Almost 100,000 fewer jobs are expected than just a year ago—no wonder we do not hear so much of that slogan anymore.

The budget is a subset of a broader problem that the government has. It is a subset of a broader reason why the government is not just failing on the politics of this budget but on economic policy more broadly; it is a policy failure as much as it is a political failure. And the policy failure stems from a misguided belief—as I mentioned before, this Thatcherite fantasy—where they think growth comes from a $65 billion tax cut for the biggest companies in this country and an income tax cut for those who need it least, those who earn more than $180,000 in the personal income taxes them. What they fail to understand—and this is the really damaging problem; it is a really unfortunate, disappointing failure on that side of the House—is that we will not get economic growth in this country while people are not earning. We will not get the demand we need in the economy—the household spending, the investment—unless we have economic growth which is inclusive, which gives people a stake in our economic success. We will not get that growth unless people are properly rewarded for the work they put in.

I was greatly heartened by the contribution by the member for Wakefield and the member for Lalor a moment ago. They talked about penalty rates and the 700,000 Australians who stand to lose up to $77 a week because the government will not protect their penalty rates. We need to make sure that work is rewarded in this country if we want to have economic growth. We will not have proper, inclusive economic growth unless we have a decent social safety net. On all three of those fronts—inclusive growth, work that is rewarded, and a decent safety net—this government is taking us in the wrong direction.

I am proud of Labor's response to the budget. I am proud that we will not ask low- and middle-income earners to pay more so that the top end of the town can pay less tax. In the finance portfolio I am pleased that, in the Leader of the Opposition's budget reply, we identified more than $1 billion in spending in this budget that we will not proceed with—including advertising campaigns and other measures in the budget—and we announced new important savings such as capping the deductions that people can claim when they manage their tax affairs. We are making sure that the one per cent of Australians who spend more than $3,000 a year on lawyers and accountants to minimise their tax cannot claim that back on their tax themselves. It is a policy that we are very proud of, which improves the budget. We are proud of our steps on tax haven transparency and further steps towards ensuring multinationals pay their fair share of tax.

We are proud to have announced over $120 billion in savings over the medium term, which demonstrate that we can have budget repair in this country, we can improve and we can address the mess that those opposite made of the budget, but we can do so in a fair way. We can do it in a way that does not ask the most vulnerable Australians to carry the can for the debt and deficit blowouts under those opposite. I am also proud that in the Leader of the Opposition's budget reply two Thursdays ago we prioritised what I think is probably the most important thing we can do if you want growth in this country, and that is to invest in the human capital of our people to make sure that we have investment in apprenticeships—that we put TAFE back at the centre of our vocational training and educational system. These are the things we should be doing if we genuinely care about growth and jobs in this country.

People would be aware, because of the history of the appropriation bills, that there has been a convention for some time that the opposition do not oppose the appropriations bills. We will be supporting the bills in the usual way—the way that people have been accustomed to since the mid-1970s. In that light—the fact that we are voting for these bills—let me finish with something else that we agree on. Those opposite have said in the last couple of weeks that budgets are about choices, and they are. Unfortunately, this budget chooses the millionaires and the multinationals over middle Australia. Only this side of the House believes in the people powered growth that we need in this country, and that begins—but does not end—with budgets that are genuinely fair not just in spin but in substance.

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