Wednesday, 26 February 2020
Appropriation Bill (No. 3) 2019-2020, Appropriation Bill (No. 4) 2019-2020; Second Reading
I come back to the point that we as a nation are experiencing record underemployment. This is where people feel that the wages that they're being offered, the hours that they're being offered and the type of work that they are being offered is not meeting their needs. They have bills to pay, families to raise and mortgages that they want to meet, and they don't believe that the way they're working or the hours that they're getting are meeting what they require.
We have a government that, in the budget documents that underpin these bills, constantly makes predictions about where wages are going that don't eventuate, or there is absolutely no wages policy in evidence whatsoever as to where they want to lift wages in this country. Earlier in the year the Reserve Bank argued that the government should be encouraging a lift in wages and doing so by changing what we've experienced at the moment, where they expected that wages will go no higher than a certain amount. The Reserve Bank argued that the reins around that should be eased up. The expectation was that that, in effect, would flow through to the rest of the economy. And what was the government's response? They refused to. This, as I said a few moments ago, in a climate where people are expecting that wages should improve and that they should be getting better than what's on offer. The government refused the urging of the Reserve Bank to do so, which is ludicrous.
What we are seeing, to try to help people out, are tax cuts that were promised, that the government said would lead to a major uplift in consumer confidence and a major uplift in, for example, measures like retail spend. It has hardly had the impact that the government desired or expected whatsoever. We should be seeing, for example, a government that takes on board what the Reserve Bank is saying in terms of public sector wages. We should also be seeing an argument carried out in the public domain around employers. When quizzed by Treasury, 40 per cent of CEOs said they would not pay a pay increase this year, which leads me to make the observation that I genuinely believe that enterprise bargaining in this country is approaching a point where it's going to break. If you're going into negotiations where 40 per cent of CEOs refuse to countenance, to consider, to contemplate an increase in wages, you're going nowhere in enterprise bargaining whatsoever.
It's not like the climate with respect to profitability is tough. It's not like, for example, dividend growth or the payout of dividends is tight or difficult. It's not like we're seeing senior executives reining in their own salary and remuneration expectations. Yet ordinary wage earners are being told that they should just cop a situation where 40 per cent of CEOs are saying they won't increase wages, where the government's refusing to lift public sector wages and are also refusing to back up their claims in budgets that they'll see wages increase, but not have a policy to see that occur. Ordinary people are being made to pay for that incompetence, that inability of the government to see wages policy move in this country.
What else are we seeing as a result? We are seeing an economy that's not working in the way that people expect. Growth is still chugging along. It's not expected that it will increase anytime soon. If anything, the impact of recent events is adding on top of that sluggish growth, where the expectation will be that coronavirus or the bushfires themselves, as has been flagged during the course of this week by the government, are going to cause another hit. An economy that wasn't really firing to begin with, that wasn't sparked up and operating very well, is going to have even further challenges presented as a result of some of these other instances. But the government's big game plan was that, no matter what, it was going to pursue a surplus. It was going to get to that surplus regardless of the economic conditions. Why? Because this was a political ambition, not an economic necessity.