Monday, 21 November 2022
Appropriation Bill (No. 1) 2022-2023, Appropriation Bill (No. 2) 2022-2023, Appropriation (Parliamentary Departments) Bill (No. 1) 2022-2023; Second Reading
We're talking about the Appropriation Bill (No. 1) which, of course, is about the budget, so let's start at the budget. If we look at this year's budget from the Labor Party, what does it say? It says $182 billion of deficits over the next four years. The government's argument is basically, 'A lot of this is beyond our control. There are things happening internationally. Basically it's not our fault.' But the problem with that is that the budget specifically spells out the impact of decisions made by this government to increase those deficits. So it's quite inconvenient for the government, because they basically say, 'It's not our fault. There's nothing we could do about it,' except the budget actually says, 'This is specifically what they did.' It is only measures that are very clearly identified as new government initiatives, so it's quite narrow but it's still $28 billion. It's on page 176 of Budget Paper No. 1. The government's own initiatives are adding an additional $28 billion on to budget deficits.
This is a very concerning thing but it's not surprising, because you will recall that during COVID, when absolutely unusual and exceptional measures had to be put in place to save the Australian economy—none more so than JobKeeper—the position of the then opposition on effectively every spending measure was: spend more. That was what the opposition said, and it was about $80 billion worth of additional spending that the opposition wanted the previous government to pursue. You'll recall, Deputy Speaker Georganas, that that included things like, most famously, paying people to get the vaccine. It was billions of dollars in just that one thought bubble. Then of course it also included keeping JobKeeper going and going and going, beyond the point where the situation with COVID required that to occur. So, $80 billion in opposition, and already, in really just a few weeks of preparation of this budget, another $28 billion of additional spending.
That's really symptomatic of what this government is about. It wants to spend and it wants to tax, and there is no question in my mind that when we come back here in May the punchline in the national conversation that the Treasurer is so keen to pursue will be, 'Here are your new taxes.' That's where the national conversation is going. But it's quite instructive to have a look back at 2018-19, which was the last budget before COVID hit. What actually happened with the budget outcome for 2018-19 was that it was in balance. There was effectively no deficit, and the accrual accounting for that year actually shows a surplus of about $9 billion. That was the actual outcome in 2018-19. So, that's where the previous government got the budget to, prior to the extraordinary and unprecedented situation with COVID-19.
So we got the budget to surplus—actually, a bit better than surplus on an accrual basis—so what's happened since then? What's happened is that this government has very substantially increased spending. If you go back to the 2018-19 budget outcome and compare that with what this government is forecasting for 2025-26, they have an increase in income tax of $99 billion across those seven years. The last I heard, $99 billion is quite a big increase. So, on the notion that tax isn't enough and we need more tax and all that sort of stuff—$99 billion in income tax alone—there's a problem, and that problem is that there is one line item in the entire budget, just one, where the increase exceeds $99 billion, and that is social security and welfare. If you compare 2018-19 with 2025-26, the increase in social security and welfare spending is $101 billion—more than the entire increase in income tax of $99 billion across that period.
So, facts matter, and numbers matter. The Treasurer is very big on the vibe and the national conversation, but the numbers matter, and the numbers show that this government is increasing social security and welfare spending by more than $100 billion over that period, which is more than the entire increase in income tax of $99 billion. So we're seeing, in quite a short period of time, from the budget back in April to this budget in October, an increase in spending in that 2025-26 year, three years from now, of $44 billion. So, just in a few months the expenditure plan for that year, which is only three years away now, is $44 billion under this government.
We know where this is headed. There's this sort of interesting thing that happens in politics, Mr Deputy Speaker—and you've been involved in it for a little while now—whereby the Treasurer clearly enjoys this notion of a big conversation, and no doubt there'll be lots of round tables and there'll be lots of stakeholders and there'll be lots of grave summits—and working groups, maybe. I think we'll see a number of those over the next six months, and we'll see some very serious and grave press conferences about the grave international circumstances and how difficult it all is for Australia. But it's all a ruse, because it's just about more tax.
The government fundamentally believes that it is better placed than the people of Australia to decide how to spend their money. That's the guts of this. So you can have as many national conversations as you want, as many appearances on ABC's 7.30 or wherever they might go, but that's what this is about. That's what we know is happening. It has already happened quite a bit. Already $555 million in this budget for self-funded retirees, who were told before the election, 'No tax increase after the election,' and then $555 million. So you can't say we haven't been warned, and self-funded retirees, many of whom live in my electorate, are very much aware that that's already happened. The numbers of the federal government are so huge that $555 million—one can say it quite quickly. It doesn't sound like it's a lot of money, but it actually is to those people who have saved incredibly hard to provide for their retirement.
We know that new taxes are coming, but they're coming in an environment where people are really struggling. That's why the stage 3 tax cuts are so important, because they will mean the vast majority of Australians, more than 90 per cent of taxpayers, only pay 30c in the dollar as their top marginal rate—and that's great! That's a really good thing; it should be celebrated. Why should the average Australian taxpayer be paying more than 30 per cent of their taxes to this building? They shouldn't. That's why the stage 3 tax cuts are so important—and everyone supported them. Again, I recall before the election the then opposition fully supporting those tax cuts, but now it's a little bit wobbly. Quite a lot wobbly, actually.