Andrew Giles (Scullin, Australian Labor Party) Share this | Hansard source

The problems this budget is attempting to solve are those of this government, not those facing Australians and, in particular, not those which are of most concern to constituents in the Scullin electorate. It presents the wrong answers because the government has been asking the wrong questions for the wrong reasons. It is fundamentally concerned with the political survival of the Prime Minister and his hapless Treasurer, not the challenges facing our nation. This budget, like this government, is all about tactics—tactics in place of vision, a vision of a government, a vision for our nation and particularly an inclusive vision for Australia and for Australians.

Indeed, what this budget demonstrates is pretty much the reverse. It is a recipe to deepen inequality and also to constrain economic growth and, with it, all of our futures. It is a very crude exercise in trickle-down economics. Indeed, it is cruder than that proposed elsewhere. Extraordinarily, the centrepiece of this budget is not housing affordability, as it was supposed to be, but a $65 billion giveaway to large corporations. It is cruder than similar trickle-down exercises elsewhere, including that proposed by President Trump, because here there is no trade-off; it is a straight giveaway, a straight transfer of wealth.

This kind of exercise is not a novel experiment. As we debate this budget, as we pick apart the threadbare agenda of this government, we see the evidence of what this sort of policy agenda means. We can look to the US and the impact of their company tax cuts on American society and, indeed, on the American economy. It is a vision of the future which Australians should and will reject.

We also have before us our present circumstances. On this side of the House we are deeply concerned that inequality in Australia is at a 75-year high. Today we face circumstances where company profits are at record highs but we have very low rates of investment and, of course, stagnant wages growth, the lowest on record. I asked myself, as do all my Labor colleagues: how can large company tax cuts be an answer to any of these problems? While the government's cheerleaders and boosters in the Business Council of Australia say there is no plan B, this is the only way ahead, on this side of the House we join with pretty much everyone who has thought about these questions in the international community—bodies like the IMF and research bodies like the OECD—and we do not merely reject the notion that there is no alternative way forward but we set one out. I was so proud to be in the House for the budget reply speech of the Leader of the Opposition. It was a strong reply to a weak budget, building on strong foundations—a body of policy work that we started back in 2013, founded on a very different vision for our future, a vision of inclusive growth, a real fairness agenda rather than the fakery of members opposite.

The Prime Minister, as he works his way through the process of this budget, is a diminished figure. He has come a long way from the optimism of that courtyard where he launched his leadership bid and promised a sophisticated economic narrative. All of that has disappeared. Cities are an afterthought, really a way of wrapping around some local infrastructure commitments and all about marginal seats. Innovation seems to have been entirely forgotten. He is operating a one-size-fits-all antidote to Australia's problems—although, of course, it is an antidote not to Australia's problems but the problems that bedevil his government. I ask, as I make my contribution to this debate alongside my Labor colleagues the member for McEwen, the member for Braddon and the member for Richmond: isn't the silence on the other side of the chamber extraordinary? The government members do not want to talk about this budget; they do not want to talk about these bills. I think there are some very good reasons why they do not. They understand, as we do, that this budget has already been rejected by the Australian people; that it offers nothing more than a recipe to deepen inequality and no pathway to sustainable and strong economic growth that can be shared by all Australians, our children and our grandchildren.

When we look at the budget we see that perhaps another challenge preventing government members from rising to their feet to debate it is its incoherence. It oddly combines ideological surrender on the surface, with the government walking away from many of the most egregious aspects of the 2014 budget. I think about question time and the way the Prime Minister clings on to those words 'needs based' when it comes to schools—and I will return to that. He does not mean it of course, but he understands he has to mouth the words because the Liberals and their coalition partners have been unable to persuade Australians that their race-to-the-bottom agenda is acceptable. They seek to cloak it, to disguise it, in the language of fairness. We heard 'fairness' a lot on budget night. I actually had a sense of deja vu because of course they tried this repositioning a couple of years ago, as the member for Richmond will well remember. How did that work out? Not terribly well, because they did not have any conviction in mouthing these words.

We see this most obviously in how they really think about those measures from the 2014 horror budget. No less a figure than Senator Cormann, the Minister for Finance, has admitted that this is not a position he is committed to. It is again a tactical withdrawal, no more, in a budget that is all about strategy and tactics but absent any strategic direction for the Australian economy, much less Australian society. I think we should remember that very important elements of the 2014 budget still remain, such as keeping the pension age at 70, which, as we on this side of the House all know, is the highest in the developed world. This is alongside deep cuts to family payments. Notwithstanding some sleight of hand around the edges, there is a very cruel cut to pensioners, through the abolition of the energy supplement.

As a whole these bills remain both incoherent and still deeply unfair. The most well-off in Australia, be they wealthy individuals or shareholders in major corporations, will receive significant tax relief while those on ordinary incomes are being required to pay more today whilst their prospects are being constrained—constrained in terms of the continued cuts in health, despite rhetorical positions to the contrary, and in particular in terms of this budget's vision for schooling, skills and higher education.

I ask myself: what is the point of this budget and, indeed, its authors: the Prime Minister and the Treasurer? The journey to budget day is instructive in this regard, because this budget was going to be all about housing affordability. That was to be the centrepiece, but it ended up little more than an afterthought, and perhaps that is a generous description. This is extraordinary at two levels for those of us on this side of the House and for those of us who talk to young Australians who are interested in purchasing their first home, not investors looking at six, seven, eight, nine or 10.

There is a plan on the table—the plan that the shadow Treasurer and the Leader of the Opposition put forward to make significant changes to capital gains tax and negative gearing—to boost the bottom line, to allow young Australian families into the housing market and to do something about this awful trend to greater wealth inequality. There is a solution there. It is free of charge to the government to take it up, yet they spurn it, despite the evidence and the soundness of the case.

Beyond this it is critical to examine the budget's foundations because they are extraordinarily weak. We know wages growth is at a record low in Australia, but apparently, if one is to have regard to the budget papers, there is a miracle cure somewhere around the corner. This budget contains the most heroic assumptions about wages growth—not out of any sense of what is going to happen in the world of work but rather to support equally heroic revenue forecasts to disguise the fundamental structural weaknesses of this budget.

Today's Australian Financial Review really tells it as it is. In an article entitled 'Slugging households "no budget fix"' it says:

A budget crisis looms because the Turnbull government is asking ordinary households and workers to do the heavy lifting of budget repair by paying higher income taxes as company taxes and wages sag, top budget experts say.

The 2017 budget is built on heroic assumptions about company taxes and wages growth returning to pre-global financial crisis levels, and the burden will instead fall on wage and salary earners who will have to pay higher effective income tax rates … to close the gap.

It is no foundation at all. I will say very briefly on tax that of course we are not opposed to the bank levy, the centrepiece on the real revenue side, but, as the shadow Treasurer and other Labor members demonstrated in question time, this is not a policy that has been developed with any thought. It is policy making on the run. This is not the way a government should go about its business.

There are many aspects of the budget that I would like to discuss in detail, but time means I will be able to only pass over them. I would like to talk very briefly about infrastructure. What we have seen in infrastructure under the member for Warringah and now the member for Wentworth is almost a strike, and that is particularly in terms of my home state of Victoria and my city of Melbourne, which contains Australia's fastest growing suburb in my electorate of Scullin. Victoria has 25 per cent of Australia's population yet has less than 10 per cent of the infrastructure spending, despite extraordinary growth and despite emerging evidence that congestion is one of the greatest drags on the Australian economy. This failure to support urban infrastructure, particularly public transport, is coming at a huge economic cost and also a huge cost to the lives of too many of my constituents.

I would like to talk more about schools, my own portfolio area, but let me just say this: a $22 billion cut to school education will not lead to a nation that is agile or innovative. It will not. The rhetorical position of the government is simply extraordinary. They are wrapping themselves up in words that actually convey the opposite meaning to that which is suggested. When they talk about needs based funding and when they talk about being sector blind, they mean the reverse. At the heart of the government's schools-funding package is a retreat by the government from any national responsibility for school education. It will hit schools in Tasmania, in the Northern Territory and in South Australia the hardest. It will hit regional communities the hardest. It will hit remote communities the hardest. It is a betrayal of a vision of school education as a driver of equity and excellence in Australia. For these reasons, I am so proud to have rejected these measures in the House with all of my Labor colleagues.

Similarly, in higher education, we see a cut of nearly $4 billion alongside increases in fees and—I think most shockingly of all—a decrease in the repayment threshold to a level that will discourage people from disadvantaged backgrounds from participating in higher education. Similarly, in skills, could the contrast between Labor's vision of investing in TAFE and supporting apprenticeships and the failures of this government be any more stark?

The member for McEwen dealt very effectively with health, but let me just say this: what a cruel hoax the supposed end to the rebate freeze is. What a betrayal of all of our communities from this government!

Fifty-one percent of Australians are women, but extraordinary revelations in Senate estimates this week have shown that Treasury did not model any impact of this budget on women. In Labor, through the member for Newcastle and many of my colleagues, we have focused on a women's budget for some time. It is an extraordinary omission, and one that this government stands condemned for—that it is not concerned about the impact of this government on women—particularly in the light of other evidence showing that many women under the measures here will be paying effective tax rates at quite extraordinary and punitive levels.

I should touch on overseas aid. Under this government, in this budget, we see the weakest levels in Australian history: 23c out of every $100 in national income. The cruellest cuts in this budget go to those who are unable to speak to it in this place. On climate change, you have to look very hard at the budget to find a mention—in fact, it is not even there. What a cruel betrayal of future generations. It is one that must be rectified when the Finkel review is before us.

In conclusion, obviously I do not oppose these appropriations. I want the business of government to continue. But I want government members to get real. I want them to account for themselves and to account to their electorates for this budget. I want them to make clear why it is, how it can be, that they can support this recipe for more unfairness, to deepen inequality, to constrain economic growth and to deny young Australians a foothold into housing, education and decent lives.

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