Jim Chalmers (Rankin, Australian Labor Party, Shadow Treasurer) Share this | Hansard source

Thank you for the opportunity to speak on the Treasury Laws Amendment (2021 Measures No. 4) Bill 2021. As the House would be aware, there are a number of schedules in this bill which implement measures from the last two budgets. There's a measure on the fringe benefits tax, there's a measure on the Junior Minerals Exploration Incentive, there's one about granny flats and capital gains tax, there's one about the way ASIC and the product intervention regime work and there's one for members of New Zealand sports teams who have spent longer than expected in Australia because of COVID-19.

But the most prominent part of the bill before us, of course, is the extension of the low and middle income tax offset. Both sides of the House support the low and middle income tax offset. We have done so since the very beginning. We do think, when it comes to tax relief in the budget, that the priority should be those who need it most and who are most likely to spend it in the economy. Since the beginning, since the last term of the parliament, we have said that we are enthusiastic supporters of some cost-of-living relief for the Australians who are doing it toughest. So, of course, our position on these bills before the House reflects that. We'll be supporting these bills through the House and through the Senate. We'll be supporting the individual measures, but, most particularly, supporting the extension of some more tax relief for people on modest incomes in this country who are doing it tough, the people who we want to be spending in our shops and small businesses and local communities right around Australia. So we support the bills for that reason.

There are, though, a couple of points that need to be made for the public record as these bills make their way through the House and through the Senate. The first point is the obvious point that the extension of the LMITO, the extension of this particular offset, happens to—what a coincidence!—push this tax relief to immediately beyond the next election. This tax relief ends on 30 June next year, which may be a few weeks or a few months after the next election. Because those opposite have form with making decisions for purely political reasons, I think there is a lot of concern in the community that the extension of this tax relief—otherwise welcome tax relief—is being pushed just to the other side of an election, where millions of Australians will then get a tax hike when this offset is removed. I think Australians are right to be suspicious and sceptical of a government which always puts the politics before the economics and which is always thinking in terms of the next election and not necessarily what is the optimal outcome for people. I think perhaps the starkest evidence of that, in a budget chock full of other examples of decisions taken to plug political holes, is the extension of this LMITO to immediately after the next election. It really is the most stunning example of that.

The next point I'd like to make is that in the budget a little over a month ago—and then, indeed, this week—the Treasurer put some numbers out into the public sphere about what this tax relief means for the amount of jobs created in the Australian community. Clearly, the 120,000 or so jobs that the Treasurer is claiming will flow from this tax relief—obviously, we want to see jobs created. We want to see a heap of jobs created in the community. We welcome the strong labour force figures that were released in the last 20 minutes. I expressed that privately to the Treasurer, who's here, and I expressed it publicly. We want to see jobs created. We want to see Australia recover strongly from the recession of last year. But, more than that, we want to make sure that those jobs are good, secure, well-paid jobs. Targeting the unemployment rate is important, but it's not the full story.

We've got a challenge here with underemployment. We've got a challenge with insecure work. We've got a challenge with some of the structural barriers that are in our society and prevent people from grabbing the opportunities of a recovering economy. These barriers include child care, training, concentrated disadvantage and the like. And so I think it's important to understand, even as we acknowledge the improvement in the unemployment rate today, that that is not the full story. There is a bigger story here in the labour market, and it's about job insecurity, underemployment and what that means for record-low wages growth in this country, which has been the defining feature, in my view, of the economic management of those opposite over the last eight years or so.

Wages had been growing at a record slow pace under those opposite even before COVID-19. It is not necessarily a problem created by COVID-19. It has been a feature of the economy for some years now. The long-serving finance minister Mathias Cormann said that stagnant wages growth was a deliberate design feature of the coalition's economic policy. So this stagnant wage growth has not been accidental. It has been a deliberate feature of those opposite when it comes to the economy.

Think about that record while I'm speaking about that stagnant wages growth. We had quite a stunning report from the Productivity Commission released overnight as well. The conclusions of the report were that, when it comes to national income, the last decade—overseen in large part by those opposite—has seen the slowest growth in national income and economic growth per person out of the last six decades. Those opposite, of course, have been in charge for eight of those 10 years. What that means, according to the Productivity Commission, is that national income is about $11½ thousand less in the last year of the last 10 years than it would have been had the productivity growth and economic growth continued as it was before those opposite got the keys to the Treasury.

These are important factors that we need to consider as we think about the extension of this low- and middle-income tax offset, the jobs claim by those opposite and the broader claims made about the economy by those opposite. Whether we look at the Productivity Commission report or all of the other data that we have before us, we see that there have been issues with the economy in the last eight years: wages, productivity, business investment, living standards and per-person national income. We need to do better as a country than just going back to that. I fear that the ambition of those opposite is limited to simply going back to how things were before COVID. Things weren't real flash for a lot of people, particularly Australian workers, particularly people on modest incomes, before COVID-19. We can do better than going back to that.

To go back to the 120,000 jobs claimed by the Treasurer, flowing from this tax relief and these tax bills: we also need to remember it's the same Treasurer who said 450,000 jobs would flow from the JobMaker policy. That was the centrepiece of last year's budget, in October last year. He said 450,000 jobs would flow from JobMaker. Instead, we know from estimates that it was more like 2,000 jobs that came from JobMaker, so I think we are right to be a bit sceptical about the grand claims that the Treasurer makes about how many jobs will flow from his policies.

The next point I wanted to make—really the final set of points I wanted to make—was about the claim that the Treasurer likes to make about how those opposite are the party of low taxes.

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