Sussan Ley (Farrer, Liberal Party, Shadow Minister for Justice and Customs) Share this | Link to this | Hansard source

I appreciate the opportunity to speak on Appropriation Bill (No. 3) 2008-2009 and the related bill. Appropriation bills, as the parliament knows, are about appropriating dollars for government to go about the very important business of funding activities and services within Australia. I want to focus today on a particular concern in my electorate of Farrer, and that is the future of a company called Drivetrain Systems International, or DSI. DSI presently finds itself in a very difficult trading position—not, I have to say, of its own making and certainly hugely influenced by the global financial crisis.

I asked a question in the parliament today on behalf of the constituents of my electorate, in particular those in Albury. I asked Mr Rudd for support for Drivetrain Systems International under the Green Car Innovation Fund and, most importantly, for support for the 400 workers and their families who are facing redundancies and job losses. You can imagine that 400 workers lost in a town like Sydney or Melbourne would be quite a shock. Let me tell you that in a town the size of Albury it is savage, is unexpected and will have long-lasting ramifications if in fact those jobs are permanently lost. So my purpose today is to raise this issue in the Parliament of Australia to make sure that we draw a line in the sand if we possibly can for the future of this company and manufacturing in Australia, especially innovative manufacturing, and for job losses that I do not think need to go ahead.

Let me clarify that. The company DSI is currently facing liquidation and that, I think, is fairly inevitable. But, following this, the receivers and managers are looking to sell it as a viable proposition, possibly to a global car company. Local reports have identified Mahindra, from India, and Geely, from China, as possible purchasers for the company.

We are focusing on two things. The first is the welfare of the workers who, as I said, are facing redundancy. Because the money is not there to pay entitlements—in some cases, accumulated over 20 or 30 years—they are enormously worried and angry about the situation they find themselves in, and that is understandable. So I am focusing on the welfare of those workers, to make sure that we provide whatever government services are available should they—as it seems inevitable they will—face redundancy and be unemployed for a period of time As we know, that time in a person’s life is the most stressful.

The second thing we are focusing on is this. On the other side of the equation, I want to be positive and to focus on the future, because while Drivetrain Systems International, I am certain, will be no more—it has had receivers and managers appointed, and is in voluntary administration—I very much want to see a company, if possible a local consortium, take on this company, under a different name obviously, and continue trading and manufacturing transmissions in Australia. That is the most important thing.

Let me make it very clear: this is a viable, profitable business. The company DSI has had several incarnations. It is often called by the locals ‘BorgWarner’, because that was what it was for many years, and then it was BTR and then ION, and then it became DSI. So it has travelled a difficult road at times. But it is important to note that it is basically viable. There is no doubt that BTR and BorgWarner took sizeable profits from the company and it provided a lot of returns for the people of Albury and their families. It is actually doing now exactly what we want an Australian export focused company to do. In fact, I think we need another 15 DSIs. Remember that our future lies in integrating ourselves with global trade, and nobody here is talking about protecting Australia from overseas trade influences. The important thing is that Drivetrain Systems International is manufacturing the most elaborately transformed manufactures—and that is a technical term—in Australia today. It is world class. It is competitive on the world stage. It is all-Australian. And 35-plus years of technology have gone into this company.

I want to stress the key role that this company plays in manufacturing technology and consequent spin-off employment in Australia. Over all of the last 40 years, DSI and its predecessors have developed a great deal of technology. And that technology has been highly sought-after by overseas companies. Interacting with DSI has helped other companies hone their skills which, in turn, have been transferred to other high-tech manufacturers throughout Australia. So it has played a critical role across Australian manufacturing industry, and allowing it to disappear would actually undo a great deal of this work, much of it done in the 1920s and 1930s—part of industrialising Australia and making it a world-class economy. So, as I said, this company is doing exactly what we want it to do. With all our AusIndustry and export focused programs, we have the perfect example here.

The receivers, I presume, are looking for overseas purchasers and domestic purchasers, too. I would like to make a plea to our industry minister and to our government to turn their attention to this problem and to engage with what is happening in Albury. I would like to see a local capital-raising, a new management team, perhaps a stock market float. But to have a successful local company, I think we need a local customer—if we are serious about manufacturing in Australia and an automotive industry. That local customer has for many years been Ford. Ford has played a critical role in the development of DSI. I thank them for what they as a company, Ford Australia, have given to my local regional economy and industries over so many years. The company at the moment is finalising the manufacture of a four-speed gearbox for Ford, and also has in its production capability a six-speed, rear-wheel drive gearbox, also for a later Ford model.

DSI has invested—I read in the press today—about $40 million on developing a gearbox for its major current customer, which is SsangYong from Korea. This is a front-wheel drive, six-speed electric gearbox. As many know, SsangYong is currently in receivership and discussions are being had between it and its Chinese parent about whether it will in fact cease manufacturing in Korea altogether. This is the point: the main customer of Drivetrain Systems International has folded, as a result of the global financial crisis, and that has put this company, and Australian transmission manufacturing, in a very difficult position.

It is also the case that DSI has manufactured, or has gone a large way towards manufacturing, a hybrid petrol-electric gearbox. That might have been for SsangYong, its main customer; I am not sure. There is no doubt that I am not an expert on types of gearboxes or whether there are gearboxes looking for cars or cars looking for gearboxes in different parts of our manufacturing industry, but what I do know is that it would be a tragedy to lose this manufacturing industry from Australia.

There is no doubt that the worldwide auto industry is in a very difficult position. I understand that Volvo in Sweden is close to closing, and there are huge bailouts happening across Europe and America. General Motors Opel in Germany is receiving, or has asked for, a $7 billion bailout. The amount of dollars that we are talking about here—the support that we are asking for from government—is not large, but it would not be in the form of a bailout either. We are talking about basically a viable production process going through a difficult period. Some have said that to continue manufacturing for the next few months for Ford would be like a bridge to the future, when hybrid transmissions are going to be far more in demand. That is something that the government and its green car package should be supporting.

As local members, we know that, when we are looking for assistance for industries in our electorates, we need to find a government program, and, once we have found one, we sometimes have won half the battle. There is a government program in this instance, and it is called the Green Car Innovation Fund. The Prime Minister and the Minister for Innovation, Industry, Science and Research, Senator Carr, in December last year promised that $6 billion would flow under this fund to support the Australian automotive industry and to keep manufacturing here in Australia. Applications for the fund open in July this year, so it is not possible for them to be made at this stage, but I really hope that our government will sit down at the table with the people who have the future interests of this company or this type of manufacturing at heart, and with Ford Australia, and demonstrate what they, as the government, could provide in support under the green car fund.

As I told these workers that I represent—400 families in the district—at a meeting last Friday, I do not want to fight for their Centrelink benefits; I want to fight for their jobs. I know that the company they work for is folding, but it is so very important that another company takes its place. For us to lose the intellectual property, the research and development—as I said, a hybrid gearbox, a new generation six-speed electric front-wheel drive gearbox, which is the way of the future—and for that all to be packed up and sent overseas, perhaps to China and India, would be a tragedy for Australian manufacturing.

I asked Mr Rudd about this in question time. I hope that he will turn his attention to the question that I asked. The Prime Minister did not appear to be in tune with what was actually happening with DSI. That does not surprise me, because he has got a lot on his plate at the moment, but, having asked the question, I hope that he and his office now turn their attention to what is going on here and take sensible steps to rescue an Australian manufacturing industry that is a world leader in innovation, research and development.

Bernie Ripoll (Oxley, Australian Labor Party) Share this | Link to this | Hansard source

It is always a pleasure to speak on appropriation bills, because I think it gives members of parliament some licence.

Michael Danby (Melbourne Ports, Australian Labor Party) Share this | Link to this | Hansard source

Wide-ranging.

Bernie Ripoll (Oxley, Australian Labor Party) Share this | Link to this | Hansard source

I was not even going to make any comment on the previous speaker, but I got the look! But it does provide members of parliament with the opportunity to have some wide-ranging debate and to express views on many issues that are related to the appropriation of funds. In particular, I think the area of finance and deregulation is an appropriate area to speak about. Appropriation Bill (No. 3) 2008-2009 together with Appropriation Bill (No. 4) 2008-2009 amounts to $3.1 billion, or about 4.1 per cent of total annual appropriations. It touches on all the key areas of the economy and matters that are so critical at a time of global financial crisis.

These are things that everyone in this parliament should be supporting, encouraging and communicating back to their electorates, as I know members of the government are. But, sadly, we see members of the opposition pretending in here that they do not support our measures. They certainly voted against our stimulus package but I am sure that at the same time that they voted against the package they secretly wanted it to get up because they want the money for their schools and for jobs in their electorates, and they want to make sure that the economy—at least I hope they do—does not collapse in the end. Perhaps it is just a bit of bravado, a bit of licence, a bit of political opportunism and political opposition for opposition’s sake that that opposition votes against such a critical and important measure to stave off the worst impacts of the global financial crisis. I hope that that is all it is. I hope that they do not actually believe that voting against the stimulus package was the right thing to do, because it was absolutely not the right thing to do.

Rowan Ramsey (Grey, Liberal Party) Share this | Link to this | Hansard source

It is a bad package.

Bernie Ripoll (Oxley, Australian Labor Party) Share this | Link to this | Hansard source

I just heard a comment from a member of the opposition that it is a bad package. What do they mean by that? Is it a bad package because they do not like the size of it or is it a bad package because there are parts of it that they do not particularly support? I will touch on both of those areas. But even if it were a bad package—and I do not believe it is—the opposition voted against it. They voted against schools, they voted against jobs, they voted against families and they voted against pensioners at the very same time that they were out there saying: ‘More, more, more; we need more money for schools, more money for roads and more money for jobs. Why isn’t the government doing something?’ Well, the government is doing something, and what it is doing it has done in two tranches—two very significant phases. In fact everything we have done has an underpinning theme. That underpinning theme has been jobs, jobs, jobs: job security, job maintenance and job creation.

We have heard all sorts of rhetoric in the House about job loss numbers, job creation numbers, how many jobs were created before and after and all the rest of it. The reality is that we need to invest if we are going to create jobs and sustain and maintain jobs or at least wash away the worst impacts of the global financial crisis.

Let me start by first dealing with the global financial crisis and what took us to the place that we are at today, which is of critical importance and should be of critical importance to everybody in this House and to all Australians. Some time ago a number of organisations—I will just mention Lehman Brothers and perhaps some companies in Australia, including Storm Financial and a whole range of others—particularly in America saw a collapse. That led to other countries falling into similar circumstances, which created, for want of a full explanation, a global financial crisis. Australia is not immune. Australia has not been left out of things of a global nature that have happened.

While our economy is resisting—I think we will all agree—the worst impacts and effects, it is still being dragged down like other economies. We are not as badly off as the United States of America and the position they find themselves in, either in terms of debt, or in terms of trying to manage the global financial crisis in their own country or trying to manage job losses. So we are not as bad as the United States. We are not as bad as Great Britain. In London we are seeing massive job losses—we are seeing a collapse of financial services sector jobs. We are nowhere near as bad as that.

We are nowhere near as bad as Europe. In Europe we are seeing some of the worst effects of the global financial crisis. And we are nowhere near as bad as Japan, where, very unfortunately they have slipped from a recession to a depression. I would say very clearly and confidently that the reason that Australia is managing to stave off the absolute worst impacts and effects of the global financial crisis is the strong, decisive, quick and considered action that the Rudd government is taking in terms of ameliorating those impacts.

We not do that to make ourselves feel good. We do not do that because we are going to get a pat on the back. We are doing that in the national interest because it is our responsibility. It is our job; it is something we must do. It is something we need to do to protect families, to protect jobs, to make sure that we still have an economy in six months time, in nine months time or in 12 months time. So we come into this place and we hear the hollow, shallow rhetoric that we get from members who are not quite sure how they should deal with this. They are caught, they are trapped. They are trapped deep down, knowing they ought to be supporting what we are doing. Even if they do not agree with all of it, that does not really matter. They know the package is needed. As I said earlier, if it is a disagreement about the size of the package, then tell us the size of your package. Is it $42 billion or $40 billion or $25 billion? What should it be? We are not getting that, but we can do the sums pretty quick—

Robert Oakeshott (Lyne, Independent) Share this | Link to this | Hansard source

Show us your package!

Bernie Ripoll (Oxley, Australian Labor Party) Share this | Link to this | Hansard source

I’m not going to get into that one! I can count pretty quickly, and let me tell you this: if we started adding up all of the individual commitments that members of the opposition have been making, it ain’t a $42 billion package; it is about an $80 billion package. That is the reality of what is coming from the opposition. And why is that the case? Why are we getting that from individual opposition members? Because they do not have a clear strategy. They do not have a plan. They are just looking at this global financial crisis and the situation in Australia as a political opportunity. For them it is an opportunity to attack the government, blame the government, blame the states—blame anybody, but take no responsibility. I will not make too big a point of it because, in the end, it is only coming from an LNP member—the Liberal National Party—particularly a Queensland LNP member who has no authority, no mandate, no credibility at all.

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

Are they a real party?

Bernie Ripoll (Oxley, Australian Labor Party) Share this | Link to this | Hansard source

I will take the interjection: are they a real party? Ask them. They are not sure. That is the bottom line. The opposition come in here and talk about this situation as if it were just a political game, as if there were no losers in this game. The sad reality is the losers in this game are ordinary Australians. They are ordinary people relying on their government, their elected officials, to assist in a time when every other economy and every other country in the world is doing something right now. If we do not do something right now, we will follow the same circumstances that are happening in those other economies—in America, in Great Britain, in Europe and in parts of Asia, in Japan and so on.

What is our strategy? What are we doing? As a government, what have we decided is the right course of action? The question would have to be: have we just decided this on a whim on our own, or have we consulted? These are serious questions. What are the circumstances? I will deal with those. We do have a plan, we do have a strategy, and it is quite clear. We are in the second phase of that strategy. The first one was the pre-Christmas $10 billion stimulus package. It came hot on the heels of probably the most direct need at that very critical time, that Christmas retail period, to protect jobs. How do you protect jobs? You make sure you put a stimulus right into people’s back pockets and that you do it through families and you do it through pensioners, and that is exactly what we did.

Funnily enough, the opposition opposed this, but at the same time were calling for a massive increase in pensions. So which one was it? This is the hard thing for them to sell. On the one hand they oppose it, and on the other hand they support it. It is pretty hard to get a sense of what direction the opposition are heading in. It does make it really clear that there isn’t one, that the Leader of the Opposition is looking for an opportunity. In the end, that is all it is: it is self-interest, and opportunism. It is, ‘Where is my next opportunity?’ It is not, ‘What is the national interest?’ It is not, ‘Is this package in the best interests of Australians, even if it’s not a perfect package?’ No government ever creates a perfect set of packages when trying to deliver something, but at least this one met to a T and met absolutely what the IMF was saying was critically necessary in Australia. The IMF said that.

Who else supported us in this? We have heard some people say that it must be those leftist communists in ACCI or in the Business Council of Australia, those old Labor Party hacks that are working there. They ticked it off and they thought it was absolutely spot-on. Perhaps it was just the unions, all of them, that said, ‘We need to do this to protect jobs.’ Of course, what would unions know about jobs and workers and protecting jobs! Or perhaps it was just Treasury that supported this package and said, ‘This needs to be done now; you can’t wait and see,’ because, if there was a strategy that you could articulate about the opposition, it would be the wait-and-see strategy. They are the exact words of the former shadow Treasurer. I understand the Treasury portfolio is a technical and very complex portfolio—

Dennis Jensen (Tangney, Liberal Party) Share this | Link to this | Hansard source

What about small business?

Bernie Ripoll (Oxley, Australian Labor Party) Share this | Link to this | Hansard source

I will take the interjection; I will come to small business in just a moment. The former shadow Treasurer obviously could not deliver in that portfolio because her only strategy—it is pretty simple; you could probably write it on a very small piece of paper—was, ‘We’re just going to wait and see.’ My question was: wait to see what? Wait to see people lose their homes, wait to see unemployment rise, wait to see small businesses collapse, go under, fail—wait to see what? The rest of the world is already going down that path at an alarming rate. It is one of the greatest crises the world has ever faced. But the reaction from the opposition and from the former shadow Treasurer was: ‘Let’s just sit on our hands. Let’s just wait and see.’

Michael Danby (Melbourne Ports, Australian Labor Party) Share this | Link to this | Hansard source

What does the current one say?

Bernie Ripoll (Oxley, Australian Labor Party) Share this | Link to this | Hansard source

Good question. I will deal first with the opposition member who interjected, ‘What about small business?’ That is good question. We have actually got a huge stimulus package aimed at small business. It is about reducing red tape, bureaucracy. It is about accessing the tax system, about the way that they pay tax, about arrangements in terms of depreciation. It is about putting money into people’s pockets so they put it back into the retail sector, which supports small business, which keeps jobs in small business. You cannot separate them. This is what the opposition fail to understand. They try to separate the injection of cash into the economy as a stimulus, and jobs. We have all the evidence of it now. It is irrefutable. Retail sales in Australia went up. In contrast to every other economy in the world, ours were the only ones that went up—and they went up directly on the back of our stimulus package in that period. Now, that is not something that happens in isolation. What that did was keep people in jobs. It kept people in retail employment—

Dennis Jensen (Tangney, Liberal Party) Share this | Link to this | Hansard source

Seven per cent—

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

I would ask the member for Tangney to refrain from interjecting. There is ample opportunity in this place to have your say.

Bernie Ripoll (Oxley, Australian Labor Party) Share this | Link to this | Hansard source

Thank you for your protection, Mr Deputy Speaker. As I said when I started, this package is about three things. It is about jobs, jobs and jobs. It is about, for the first time in probably three decades, making a massive investment in our schools and school communities. You need to think about what that really means. If the reactions that I have got from my electorate, from my school principals, from my P&F presidents and from the school communities are anything like the reactions that opposition members are getting from theirs, then I fear for them. My school principals and school communities are overjoyed by the package that we have presented to them—the investment in schools. We think it is a good package. We think it is actually worth spending money on schools to better educate our children. We do not think it is a cost; we think it is an investment: an investment in people’s future.

This mob voted against it. They voted against schools. They voted against their own kids’ futures and education. This is the first time in over 30 years that we have had some serious money spent on schools, schools that have been trying to inject some pride and some standards and to build facilities—replace the demountable classrooms and provide real 21st-century facilities—to give our kids a better shot. And what did those guys opposite do? They voted against it. They voted against money for their own schools. Did they do that because they thought that was the best strategy? No. They did it out of pride, self-interest, opportunism. There is no way that anyone could go out to a school and stand before a school community and say, ‘I don’t want you to get $3 million for a brand new library, because your kids don’t deserve a library.’ Opposition members are standing up and saying, ‘Your kids don’t deserve a school hall; they can sit out in the elements in winter and summer.’

How can I prove that the opposition members are doing that? Because they voted against funding for schools. That I could not comprehend. Even if you did not like the whole package, on that alone you would have to say: what were the opposition members thinking? I have got an answer as to what they were thinking. They were thinking about themselves—not about the economy, not about the national interest, not about anybody else: opposition for opposition’s sake.

We have invested in infrastructure—and it makes me really proud, as a government member—in a way I did not even contemplate was possible. I wanted to deliver a lot to my community and to the broader community out of us winning government. I wanted to build roads because roads had not been built for over a decade—in some cases, for nearly 15 years, spanning two governments. But there was no will and no commitment from the former government after 12 years in office in the best economic times globally, in the best economic times this country has seen for a long time—the resources boom, rivers of gold that used to flow into Canberra, when money used to rain from the sky, when unexpected windfall gains of $50 billion to the bottom line in the economy meant you could do anything you wanted in government. Everything you spent—tax cuts and everything else—was completely offset by windfalls of $50 billion at a time. Something like $400 billion of unexpected windfall was delivered to government through tax revenues, the rivers of gold which flowed in because of a booming economy.

What did they do with the unbelievable opportunity? For the most part they squandered it. They just threw it away. They had a great party. I can remember them smiling from ear to ear. They were never going to lose government. Nobody was clever enough to figure out that there was no money going back into communities, that schools had not seen a red dollar for more than a decade. ‘Let’s just blame the states for everything and let’s forget that the states rely on federal funding to deliver programs and education in schools. So let’s disregard all of that and concentrate on blaming other people. We’ll have a great big party.’ When the party was over, they woke up with that huge headache and a big mess to clean up, looked around and said, ‘Who made the mess?’

I ask opposition members: who made the mess? I am not saying that the opposition and then Howard government created the financial crisis. That would be ridiculous, even though that is what they are trying to imply in terms of this government’s performance since coming to office. Nobody is being fooled by that. Nobody believes that for a minute. Even they do not believe it. They are completely disingenuous.

In the last few days, we have really seen what the opposition is all about. We have seen the former shadow Treasurer being discounted away and ejected out of the position. It is too complex, too difficult. It is a very difficult job. You would think that the member for North Sydney, Joe Hockey, would have been the second choice, but he was not; he was third choice, so two scalps have been claimed. The second choice was Peter Costello, but he is too proud, too self-interested to do a job for the country. Maybe the country does deserve to have him there. If he is as good as he says he is, why is he not there serving his country, serving the people? If he is the best person on the opposition benches, why is he not there? I have already answered that: self-interest. He is not going to lower himself to the role of shadow Treasurer when he believes he ought to be the leader. I do not have to give him any advice because his own party has already done that.

The reality is that Australia and the world faces one of the greatest crises we have probably ever faced, certainly in many generations. We have a couple of choices to make as members of parliament about how we deal with the situation. Either you can completely oppose for the sake of opposing all the measures—the stimulus packages, the funding we are providing to stimulate job creation and keep people spending, the banking guarantee to ensure that our banking system does not collapse and that there is not a run on banks, all of those integral parts in making sure our economy survives—or you can just oppose about leadership, about who gets which spoils of defeat, about rank opportunism. That to me is not right and is not what an opposition should be about. (Time expired)

Robert Oakeshott (Lyne, Independent) Share this | Link to this | Hansard source

While I acknowledge that appropriation bills are normally opportunities for laps around the electorate with particular significance because of the release of money, and while I recognise the significance of the many good aspects of Appropriation Bill (No. 3) 2008-2009 and cognate bill, I certainly raise some concerns about aspects of this legislation, so much so that, on balance, I will be asking for the bills to be returned to the House for a division when all the speakers are done.

I will do that for the following reasons. One is an issue of process in a key area, and it concerns the $14 million being allocated through this legislation for climate change advertising and promotion for the Carbon Pollution Reduction Scheme. For me, it is a case of that cliche in politics, the cart before the horse. You only need to read any of the media in the past week to see that there is plenty of politics to be played out with regard to both the introduction of the Carbon Pollution Reduction Scheme following the white paper process and the process of steering it through the parliament. I think the government have to do a fair bit of work to get it through in the form that I am sure they want. Therefore, for me, it is odd and also inappropriate for the question to be put for $14 million to be released by Finance for a national advertising campaign to raise public awareness of climate change. That in itself is questionable because there is certainly a heightened awareness within the community about climate change, but in particular I question the use of taxpayers’ dollars to ask the community to participate in a scheme that we as members of parliament have not even seen and are yet to debate. We are certainly looking forward to that, but at this stage the ‘for sale’ sign simply cannot go up. Maybe we could consider it in four months time if the CPRS gets through in the clean form in which the government wants it to get through. But I think it is a classic example of the cart before the horse to ask us to agree to a significant advertising and promotion campaign. Fourteen million dollars might not sound much around these hallways, but in the community’s mind I think that is substantial dollars and deserves a revisit once the CPRS goes through, if it does, in the form we are expecting.

On a similar topic, there is an issue about the inconsistencies in the narrative on climate change contained within this bill. Whilst in general there are some fantastic aspects in this bill, I want to highlight some that are of concern. The first one is the AusAID commitment. I have family who work for AusAID and I am certainly not one to bash international aid dollars, because I think we have global responsibilities. But there is an allocation here of $150 million to the World Bank, with $50 million for the trust fund established to respond to the global food price crisis. That is one of the first acknowledgements I have seen in my short time here that government does recognise it has a role to play in addressing an increasingly difficult and challenging area for government policy and global consideration—that is, the global food price crisis we are facing. Yet at the same time, in the same bill, we see an allocation of $37 million for the ethanol production grants program, with the development of the concept of food for fuel within Australia. As that concept has developed over recent years, I have to say that from my point of view it looks to be largely driven by vested interests within the various agricultural sectors. This allocation is entirely inconsistent with the $50 million allocation being made to the World Bank. For West Wing fans, you only need to see the episode called ‘The Pledge’ to know exactly where my cynicism is coming from about grain ethanol production and the $37 million allocation. Sitting alongside that in the legislation is the allocation to the World Bank to recognise Australia’s responsibilities and role with regard to the global food price crisis. As I said, that is an inconsistency within this legislation. I hope the coalition and the non-executive members of caucus will give further consideration to that inconsistency in the narrative we are currently working through on climate change.

The second inconsistency in narrative, to me, is this allocation of $100 million to the Clean Technology Fund—again through the World Bank—which ‘will offer development finance at highly concessional rates for transformative investments in low-carbon technologies by developing countries in the transportation and power sectors and in energy efficient buildings, industry and agriculture’. Again, the rights and wrongs of international aid can be debated by others, but this does show that government recognises the need for transformative policy and investment in transformative policies overseas. Yet, within Australia, the allocation in this bill is $99 million—no small bickies—for the carbon capture and storage institute. I certainly hope that is a success. I fully recognise that my vote against this legislation is not going to stop this legislation going through, so I certainly hope that institute succeeds in proving the concept of carbon capture and storage. However, it is an unproven science. I would hope that most of us recognise that.

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

All the more reason to have a centre.

Robert Oakeshott (Lyne, Independent) Share this | Link to this | Hansard source

The interjection is that, because it is unproven science, that is all the more reason to have the centre. I am throwing the opportunity now to the coalition to read the front page of the Sydney Morning Herald today where biochar was put up as an option by the coalition and the comment in response from the minister for agriculture was that it is an unproven science that has potential and deserves further consideration. If this is unproven and recognised as unproven, a $99 million allocation of taxpayers’ dollars as a response, sitting alongside a fund overseas that is getting $100 million for transformative investment in low-carbon technologies, again has inherent inconsistencies in its narrative for Australia. That is my view in regard to the Clean Technology Fund. I think that is a direction that the world needs to be heading in, not just developing countries, and I would love to see more clean technology being funded within Australia.

I do note at the same time with regard to the carbon capture and storage institute some lovely semantic name changes also happening. We saw it with the concept of ‘global warming’, where that took a name change because it was seen as too harsh. It was, I guess, softened to take on the new name of ‘climate change’. We are now seeing the ‘National Clean Coal Fund’ softened to the ‘National Low Emissions Coal Initiative’. Again, that is hopefully a recognition by government that some of what I consider to be vested interest claims on the climate change debate are not successful in capturing community expectations and community wants in regard to solving real problems at a community level. The concept of clean coal, in my view, is also one that should be questioned and that we should all be sceptics about. Hopefully, the debate is moving from one on sceptics about climate change to one on who is and is not sceptical about certain responses to climate change.

In my view we deserve, as a community and as a country, to have high levels of scepticism about what is driving particular responses by government to issues such as clean coal, and carbon capture and storage. We should be sceptical because, unless there is a part of this story that is not being told, the response looks to be driven by vested interests rather than governments genuinely dealing with real problems on the ground within communities like the mid-North Coast of New South Wales. There are huge opportunities, whether they are in clean technologies, solar technology or solar thermal technology. There is a whole raft of engaging opportunities at a community level, yet the big bickies look to be going elsewhere.

The third reason to go against this, with regard to the overall appropriation bill, is not climate change but related issues. I hope, again, that everyone in this place might think of reviewing the $28 million allocation to the Australian pavilion at the Shanghai Expo in 2010, bearing in mind what is clearly a tsunami going through world economies. If we try and look forward to 2010, I am not sure whether that $28 million spend is necessarily the best message or the right message for Australia to be sending. I think of David Jones putting on tea and scones this year at their fashion expo rather than the champagne and all the bells and whistles. Maybe a statement from Australia that we are conscious of the importance and value of money in the current climate would be a strong domestic message and might even be a better international message for consideration.

As well, an issue for concern—it is not a reason to oppose the legislation—is the further $21 million allocation for Australia’s financial regulators to ‘maintain the strength’ of Australia’s financial system during the global financial crisis. I recognise that we have a strong economy; however, I think there is some work to be done with regard to some accountability trails and some strengthening of the regulators that we have in this country today—not necessarily the regulators of the private sector but those that regulate the public sector.

This has been well positioned as a private sector crisis; however I think the untold story of the last 18 months is the public sector crisis. There is an amount of taxpayers’ money at the three tiers of government, and in all the various roles that those three tiers play, that has been lost or at the very least exposed. I think it would be—and this is being conservative—in the hundreds of millions of dollars of taxpayers’ money. I have a council in my region that has $25 million exposed due to their taking on questionable CDOs. Importantly, the council argues that they were within the state Treasury Corporation guidelines. And there have been reports from councils in other locations. I understand there is a council in WA that has an exposure in the $80 million class.

This is the untold story where we need to start to see some good work done in going down the accountability trail to find out who is exposed and to what extent, who is accountable and to what extent, and who is in breach of investment guidelines and to what extent. And probably of more concern is that, if no-one is in breach, how on earth did we end up with so much exposure? Were people with taxpayers’ money in the public sector taking due care in protecting capital or were people chasing risky investments with taxpayers’ money in order to try and make a buck for services, such as those run by local councils, which are already stretched?

You can include in all of this semistatutory and non-statutory bodies. You can think of the non-government education sector. There is exposure all down the trail of the public sector, yet the story has yet to be told or explored. I think it is the role of the federal parliament to take a lead on that, to start to call to account those who were in breach of regulatory investment strategies in particular and, if there were no breaches, to start to clean up those guidelines throughout the country to make sure that taxpayers’ dollars are treated with the premium that they deserve to be treated with.

Having said all that, in the remaining time I am very conscious to welcome many aspects of this legislation. The Organ and Tissue Donation and Transplantation Authority, I think, is excellent. I went along to the ‘gift of life’ ceremony this morning with the Prime Minister, and I congratulate the government on the work they are doing in regard to organ and tissue donation and transplantation. In my particular area, it will be something that is promoted to try and get as many organ donors as possible involved in the national campaign. That is good work being done by government. The Prevocational GP Placements Program is one that is really important to the mid-North Coast of New South Wales. The breast cancer drug initiative is good. The Job Capacity Assessment program is good. These are all incredibly relevant to various aspects of life within my region and, I suspect, around the 149 other electorates in Australia. The Sustainable Rural Water Use and Infrastructure program is good. I think the local government study program and the centre of excellence at a university are also timely—in fact, in many cases well overdue considering what I was just talking about, the exposures at a local level in regard to financial planning.

I also put on the record, in that regard, a separate council that I represent, Greater Taree City Council, which has just had Percy Allan, who would be known to many people in this room, go through the backlog of maintenance just on local roads and bridges within its area. The figure that it now has to deal with is $140 million of backlog. For those who are going to be critical of me being antsy about various moneys going here, there and everywhere, I hope you understand that I have a maintenance backlog of $140 million for local roads and bridges; that is the standout problem for the southern part of the electorate of Lyne. It is not, at the moment, part of the responsibility of the federal government, but the reality is that it is the problem that my communities face and therefore it is the problem that I and, I hope, government at all levels are willing and, hopefully, able to assist in addressing over time.

I know there are a lot of speakers who have emerged on the list. When the time comes—probably in a few weeks—I will certainly be calling for this to be returned to the House of Representatives and will be voting against this legislation unless those changes are considered by all and relevant changes are made.

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

I rise to support Appropriation Bill (No. 3) 2008-2009 and the cognate bill. I think their passage is essential to the stability of the Australian economy and to the good works that the government is doing for the wellbeing of the Australian people. I want to concentrate on, perhaps in less detail than the former speaker, the member for Lyne, and talk a little bit about the car industry and vehicle manufacturing—in particular, the early signs of success of the government’s $6.2 billion car plan. This car plan was designed to drive investment to make the Australian car industry both economically and environmentally efficient. I think that is a very important goal, and it is coming at precisely the right time.

While I did notice other speakers talking about manufacturing plants being in trouble in Albury, there are some positive signs. In the electorate of Corio, I know that Ford has reversed its decision to close an engine plant. I think that is the first time in living memory that a corporate player, a company, has changed its mind about the closure of a plant. It is an extraordinary decision and a real vote of confidence in not only Geelong but also the government’s support for this industry. It is really welcome.

The second indication of the car plan’s success—and I think this is a very big indication of the early signs of success—is the announcement by General Motors Holden last December of its intention to build a new front-wheel drive, four-cylinder car at its factory in Elizabeth. This was a big day for Elizabeth in late December. The Prime Minister visited the factory. It was closed down at the time for its maintenance period, and most of the workers were on holidays, but we still had around 1,500 workers show up to the plant in their uniforms for this announcement. There was a tremendously positive feel. Lots of workers were holding signs up about the new car and about the vote of confidence in the Elizabeth plant that this is. A lot of families and a lot of kids were really enjoying not just the Prime Minister’s presence but also the commitment of the company and the government to this vital manufacturing plant in my electorate.

The new car is going to be part of the global Delta small-car platform. It is a vehicle which will be integrated into the global operations of GM. That is incredibly important. In the Bracks review, one of the issues—particularly around components but also around vehicle manufacturing—was that automotive products need to be integrated into the global platforms of these companies. That is increasingly where the car industry will go in the future. I think this immediate crisis will drive that process and accelerate it in some instances. It is really an important feature of this car. It will support up to 1,200 jobs in the factory in my electorate and it is critically important for not just those manufacturing jobs but also all the component suppliers that exist in the northern and southern suburbs of Adelaide. In the city of Playford, one in four workers is employed in manufacturing, so it is of vital importance to the local area.

These jobs are going to be green-collar just as much as blue-collar jobs. They are secured by cooperation between the company, the workers, the union and both levels of government. The Rann government in South Australia is to be congratulated for its commitment. Premier Rann was there on the day, which was a welcome sign of state and federal cooperation. But it is also worth noting that Holden’s workers, led by their local delegate, Mr Paul Brown, and the vehicle division of the AMWU, were very disciplined and moderate in their claims during the enterprise bargaining agreement negotiations which happened just prior to this announcement. That was really critical, because it showed real commitment to the new project. The two were linked. That future investment was, I think, linked to the successful conclusion of the EBA negotiations.

Importantly, the new vehicle is going to be about 20 per cent more fuel efficient than current vehicles. It is going to emit about 20 per cent less carbon. It is a green car. Its production lays the foundation for the introduction of hybrid engines, the use of ethanol, the use of LPG and the use of CNG. All of those things are very important in the evolution of not just this small car but also other Australian made cars to more fuel efficient and more environmentally friendly vehicle design.

The federal government is contributing $149 million over three years to this project—money that will be very well spent to support a new car, local jobs and investment in the future. Despite the critics—and there are many critics inside this parliament and outside of it—the government is absolutely committed to backing this industry and to making sure that we have future investment in this industry so that General Motors Holden will still be around and there will still be workers employed in that factory long after I have retired from parliament. There are many naysayers in the press who want to constantly run a negative story about these things. It is disappointing that there are critics in the opposition. Only last year the member for North Sydney, the new shadow Treasurer, told the Sunday program: ‘I don’t know that it is necessarily the right thing to do to hand money immediately to the motor vehicle industry.’ That is what was said, at that time, by the new shadow Treasurer. Basically it is the wait-and-see approach, the ‘we’re not going to help’ approach. I think that the new car announcement has proved critics like the member for North Sydney wrong.

The government rejects that sort of armchair-general approach to economic management, where you sort of sit back and wait and see. We want to take action. We want to be ahead of the curve. We know that it is important not just for triggering new investment in this industry but for the economy as a whole. It is incredibly good news for the car industry in my electorate; but we know that there are problems facing global automotive manufacturing, and there is no hiding from that. There is also no hiding from the fact that there are ramifications for our car industry in South Australia. In the local paper, the News Review Messenger, on 4 February this year, there was an article with the headline ‘On an enforced holiday’. It talked about the program of planned shutdowns of the Elizabeth plant. There are some 25 days of scheduled shutdowns. Workers in that plant are either taking holidays or they are on 50 per cent of their pay, thanks to their enterprise bargaining agreement negotiated by their union. But even then we find workers are looking in other areas for work. Paul Brown, a senior shop steward, was quoted in this article as saying that workers are ‘looking in landscaping and gardening, helping friends out in small businesses, stuff like that’. I think that shows that those workers need the government on their side. They need the government to do what it is currently doing in terms of the Nation Building and Jobs Plan. They could not afford delay in that program. They could not afford the wait-and-see approach of the Liberal Party. By the time we wait and see, it will be too late. And if you wait and see, there is an opportunity cost. If we had taken that approach to the car industry, we would have missed out on this new investment.

Communities like Elizabeth, Salisbury and Gawler understand from practical experience what the Liberal Party do not understand, and that is: action is required immediately. We cannot afford indecision and we cannot afford division at this time, either in this parliament or within the Liberal Party. It is so disappointing, at a time when workers in my electorate have got 25 days of planned shutdowns and are looking at other areas to work in, like doing work in small business, that we have got two senior members of respective factions of the Liberal Party in my state—a senator and the new Manager of Opposition Business in the House—arguing about what was said at a golf game 14 years ago. It is absolutely extraordinary. It is a bit like the Great Gatsby v Little Lord Fauntleroy—just incredibly childish. I think that the Liberal Party have got to get their act together. They have got to start supporting the car industry rather than knocking it and they have got to come to grips with the nature of the new economic challenge.

There is this attitude in the Liberal Party in which they think that we exist in a bubble in 2007, when mining royalties and the commodities boom were driving government revenue, and that nothing has changed, but the reality is that we have had the most serious collapse in the world economy since the 1930s. We have seen a retraction of credit. We have seen the collapse of international banks, the collapse of international consumer confidence and the loss of jobs from indebted companies. There was recently an article in Time magazine that had an example of some of the banks in America. Citibank, for instance, received $45 billion in assistance from the TARP, the Troubled Assets Relief Program from the US government, and the value of the bank at the time of this article was $22.9 billion. It gives you an idea that, even though government is acting in the United States, we face an extraordinary situation with international banks, and that is having massive effects on economies around the world.

Likewise, there was an article in Foreign Policy which was headlined ‘The List: the Next Iceland’. It goes through five economies—I will not go through all of them—and calls Great Britain ‘Reykjavik-on-Thames’. It says:

The question in Britain is no longer when the economy will enter a recession, but when it will enter a depression, with many bracing for a slump that could rival the 1930s in severity.

There is no doubt that, internationally, we face extraordinary challenges, and that will have an effect on the Australian economy. We know that the Governor of the Bank of England, Mervyn King, has warned that the UK is in deep recession in 2009. There was a bit of talk about sales in the United Kingdom in the House today. It seems to me that things in the United Kingdom are very serious indeed. We know that the government has to act ahead of the curve. That was best highlighted by Rupert Murdoch, head of News Corporation, who was quoted in The Age on Saturday, 7 February:

“The downturn in Australia is very late,” he told an investor briefing.

“It is beginning to hit now, but we are not yet feeling it the way we have felt it in Britain.”

We can see the signs, overseas, of a very serious economic situation and that is why it has been important for the government to act and to take strong, decisive and extraordinary action in order to support our economy. That is why it is important that we guaranteed deposits, something that has helped our banks raise the funds they need from overseas. It is why it was important for us to have the Economic Security Strategy, which supported pensioners, pumped money into the economy before Christmas and helped to support the retail sector. There is plenty of positive evidence, both in retail sales and anecdotally from retailers. I was talking today to a furniture manufacturer in my electorate who employs 20 or so people making furniture, which is a really great thing to do, and he says he has not seen the effect of the economic downturn in main street sales. But if you go a couple of steps behind and talk to engineering firms, they are certainly seeing it. There is no doubt in my mind that the government’s strategy in December is working, and there is no doubt in my mind that the Nation Building and Jobs Plan will also work.

Workers in my electorate will certainly welcome the $900 bonus for low- and middle-income families and singles and to students, to drought affected farmers and to single-income families. They will also welcome the support for tradespeople in the building industry; the largest ever single investment in housing to build 20,000 new defence homes, many of which are in my electorate—there is a $26 million commitment in Wakefield; 500 new science labs or language centres in secondary schools; funding for maintenance and school building upgrades; and tax breaks for small business. These are all really important measures and, as I said before, we know that a great many of our measures are already working. On 12 February a headline in the Sydney Morning Herald read ‘Housing shines amid more economic gloom’. Basically it talks about new home buyers charging into the market and taking advantage of the government’s grant program to get an asset that they will hold, hopefully, for the rest of their lives.

So we think these projects are incredibly important. We know that the communities we represent have welcomed the action we have taken to support the banks, the action we took in December to support pensioners and the action we have taken to support new home buyers and that they will also support the Nation Building and Jobs Plan and the measures we are taking to build public schools and to improve the nation’s homes through insulation. They know that this government is ahead of the curve and is taking action to ensure that we have a good and strong economy in a time of international peril. I commend the bills to the House.

Mrs Bronwyn Bishop (Mackellar, Liberal Party) Share this | Link to this | Hansard source

In speaking on Appropriation Bill (No. 3) 2008-2009 and Appropriation Bill (No. 4) 2008-2009 I want to range fairly wide and talk about commentary we currently have from the Prime Minister and his now famous, or infamous, essay entitled ‘The global financial crisis’, in which he said:

…barely 30 years since the triumph of neo-liberalism—that particular brand of free-market fundamentalism, extreme capitalism and excessive greed which became the economic orthodoxy of our time.

That could not be a statement which is further from the truth. There has been a great deal of theorising and fantasy making by our Prime Minister in trying to explain why his left-wing ideology is about to become the orthodoxy. He likes to say that the market failed, that capitalism failed and that there was too little regulation and therefore it collapsed. Nothing could be further from the truth. The case is in fact the direct opposite. There was too much regulation and there was bad centralised government policy, and the combination of all those things meant that the market did not fail; it was excluded.

I would like to talk now about an act that had its origins in the United States in 1977 under Jimmy Carter called the Community Reinvestment Act 1977. This was an act that was passed which was designed to force banks to lend into areas which were known as red-lined areas, where the banks had decided that there were certain pieces of geography in their territory where repayments would be difficult to get and therefore they would not lend into those areas. This act was designed to make the banks lend into those areas. It was reasonably benign in the early years. You could put an ad in the paper to say that loans were available and you could satisfy the CRA requirements and go about your banking business. In those days, of course, the American banking system was different from ours. There was no real interstate banking; they were very much chartered banks and they were limited to geographic areas. But this geographic concept has become quite significant in the problem which has resulted in the United States and which has now spread throughout the world.

In 1994 there was the beginning of the liberalisation of banking in the United States whereby they could have interstate banking and whereby they could open further branches and so on. But in 1995 Clinton introduced new regulations under the Community Reinvestment Act which required not some benign advertisement or involvement with the community but in fact an enforcement and a requirement for a counting of the number of loans given to low-income families and minority groups. What this meant was that the reserve bank was charged with the function of auditing banks, and if they did not get a high CRA rating then mergers were not permitted and interstate banking, which had just been able to come about from the 1994 reforms, was not permitted. In addition to this, the Clinton policy was to fund left-wing political activist groups to be the enforcers, making banks lend in accordance with this policy and these regulations. The net result was that it was estimated that by about the year 2005 $9.5 billion had been paid to these left-wing activist groups to force banks to comply with the CRA requirements. But they did more than that. They would make a pre-emptive strike. They would say to a bank: ‘If you want to get an approval or if you want to get a good CRA rating, then perhaps you’d better give the money to us. Give us the right to underwrite these loans and then you’ll get a CRA approval rating and you will be able to open new branches and have interstate banking or indeed be able to merge.’

A lot of this material was put into the public arena in the year 2000 by a man called Howard Husock from the Manhattan Institute. His background is that he is vice-president, policy research, and director of the Manhattan Institute’s Social Entrepreneurship Initiative. He was formerly the director of case studies in public policy and management at Harvard University’s Kennedy School of Government. He is a prolific writer on housing and urban policy issues. He has become well known for the articles that he has written and for drawing attention to the impact that bad policy has had in bringing about this crisis. He wrote in 2008 that the CRA bad mortgages on their own could not have created it. He said that through them together with other bad policies of government ‘we found ourselves in this mess’.

Not only did you have these left-wing groups like ACORN saying to a bank, ‘Well, you’d better give us the money or we won’t recommend your CRA rating; some of these organisations were also particularly skilled at disrupting meetings. Indeed one of these organisations required that anyone who got a loan through them had to perform five functions for that organisation a year. One of those included being prepared to make telephone calls or to disrupt meetings and, in particular, to register for a political party. Usually that would be the Democratic Party. An example of this type of extortion, if you want to call it that, is that by the year 2000 ACORN had a $760 million agreement with the Bank of New York, the Boston based Neighbourhood Assistance Corporation of America had a $3 billion agreement with the Bank of America and a coalition of groups headed by New Jersey Citizens Action had a five-year agreement for $13 billion with the First Union Corporation. Similar deals operated in almost every major US city and, as Tom Callahan, the executive director of the Massachusetts Affordable Housing Alliance, which had $220 million in bank mortgage money to parcel out, observed, ‘CRA is the backbone of everything we do.’

The really alarming thing is that these organisations had the power, once they had the money, to have total underwriting authority and to place those loans with people who they chose to place them with—and this had nothing to do with their ability to repay. Then it got worse. I again quote Mr Husock:

… in 1992, the Department of Housing and Urban Development pushed Fannie and Freddie to buy loans based on criteria other than creditworthiness. These “affordable housing goals and subgoals”—authorized, ironically, by the Federal Housing Enterprises Financial Safety and Soundness Act—became more demanding over time and, by 2005, required that Fannie and Freddie strive to buy 45 percent of all loans from those of low and moderate income, including 32 percent from people in central cities and other underserved areas and 22 percent from “very low income families or families living in low-income neighborhoods.” As one former Fannie Mae official puts it: “Both HUD and many advocates in the early 2000s were anxious for the GSEs to extend credit to borrowers with blemished credit in ways that were responsible.”

These loans were then parcelled up in what was known as securitisation. Alan Greenspan, in his evidence to the US Senate Committee of Banking, Housing and Urban Affairs in February 2004, said:

Although the risk that a home mortgage borrower may default is small for any individual mortgage, risks can be substantial for a financial institution holding a large volume of mortgages for homes concentrated in one area or a few areas of the country.

This of course was exactly what the CRA legislation was designed to do. Mr Greenspan went on to say:

The possible consequences of such concentration of risk were vividly illustrated by the events of the 1980s, when oil prices fell and the subsequent economic distress led to numerous mortgage defaults in Texas and surrounding states. The secondary markets pioneered by Fannie and Freddie permit mortgage lenders to diversify these risks geographically and thus to extend more safely a greater amount of residential mortgage credit than might otherwise be prudent.

What that meant was that, simply, debt was taken from all over the country, bundled up into mortgage backed securities and then sold. They were sold to Freddie Mac and Fannie Mae. But there was no account taken of the creditworthiness of these bundles, merely that they came from all sorts of geographic areas which, because of the nature of banking in the United States originally, was based on banks being chartered to an area or serving a very specific geographic area. Greenspan then, of course, in 2008, said that he was bewildered; he did not understand why it all went wrong. Then he admitted that it did go wrong.

Kevin Rudd, in his now infamous essay, said that those people who believe that the market acts and acts well talk about something called ‘moral hazard’, which he pooh-poohs and says should not be discussed. But, in reality, Freddie Mac and Fannie Mae were evidence of that sort of moral hazard because, although it was specifically said that there was no government guarantee for these institutions, the public believed that because they were government instrumentalities they would never be allowed to fail and therefore they would take a higher risk for a lower return. It was because they thought there was that implicit understanding. Of course, we now know that there is not and that both of those institutions have failed. When other pressures were put on them because of liquidity difficulties with those two institutions, what happened was that the banks then started to sell those mortgage backed securities which had been bundled up with that toxic component to each other. And ultimately they ended up in some of our local councils here in Australia, through Lehman Brothers.

So the long and the short of it is: in all this discussion that we are having, we have to get real. Kevin Rudd is wrong. The market did not fail. Capitalism did not fail. The market was excluded; it was not allowed to act. In fact, Greenspan, in part of his testimony, virtually admitted that. He said that these policies really did not allow the market to act in the way it normally would. So what we have to be careful about in this situation that we find ourselves in is that we do not go down the path of the state knowing best, that we do not go down the path this government has chosen—racking up additional debt and throwing money at the problem without even really understanding what the problem is.

There is no doubt about it. We are caught up in the whole global financial crisis, as it is now known. We certainly are. But let us understand what failed. It was bad government policy and too much regulation to enforce that bad government policy. And that is what we are getting now: bad government policy. Forty-two billion dollars is going to be expended—on what? On building school halls and libraries, which is the job of state governments and which they should have been doing already.

Where is the grand vision of some form of infrastructure which the people understand—like bringing water from Northern Queensland, where the floods are, down to the parched south where our food bowl needs to be. And there are people who have worked it out. There are people who can in fact deliver a project like that for somewhere between $6 billion and $11 billion, as opposed to the Penny Wong fantasy of buying back water from farmers, who are asking, when their land and their living is destroyed, that they get payments that will amount to between $6 billion and $12 billion. Where is the vision of the government? If the answer to the problem is pink batts, it must have been a hell of a question!

If we are not to simply ignore wisdom and are to learn from what has happened in the past, we must understand that if we are to invest public money there has got to be some infrastructure and some policies put in place which will allow productivity in the future, so that we see gains in the growth of our economy. And we need to hear a few other words—we need to have words like ‘work’, ‘save’, and ‘invest’ come back into proper usage, as popular concepts of the way we need to go.

We have heard people on our side of politics say very wisely that what this government is doing is going to plunge us right back into debt. When we came into office in 1996 they had left a debt of $96 billion. And we had to repay that. Doing so saved us an enormous amount of money in interest repayments. It also freed up capital which the government was otherwise absorbing so that the private sector could have access to it. This government has been asked in question time and at other times: where does this government intend to borrow the money from that it is going to need to borrow in order to finance the money it has given away?

We have just passed legislation that will enable this government to borrow up to $200 billion. When they start borrowing that money, where are they going to borrow it from? Are they going to borrow it domestically? In that case, they will be in competition for those funds with the private sector—including banks, who then on-lend to small business and to homebuyers. Are they going to try and go overseas to borrow it? Who are they going to borrow it from? The Chinese. The five biggest banks in the world today are all Chinese. Yet, before this crisis, the biggest bank in the world was Citibank. The capitalisation value of Citibank today is the same as that of St George Bank prior to the Westpac takeover. From where are we going to borrow the money internationally? From the Chinese. Does that put us in a vulnerable position with regard to any Chinese offer to buy our corporations, which are part of our national assets? How is that conflict of interest going to be dealt with by the incumbent government?

Have we been given any indication of where the money is going to be borrowed from? No. Will the government answer the question of where they are going to borrow the money from? No. The answer has been no every time a package has come forward, whether it was the $10.4 billion before Christmas, the $42 billion being promised now, the $22 billion for the infrastructure fund or, indeed, the money that is to be handed out to the state governments—rewarding them for doing I am not quite sure what. What are the criteria for that? Is that to bail out the state governments? Is the federal government going to borrow to bail out state governments who have failed miserably? We are entitled to know the answers to these questions. I simply repeat: the market has not failed; the market was excluded. The answer is not more bad public policy and regulation. The answer is enabling the principles of free enterprise to really work so that jobs can be created for people who, in turn, can save. This will then allow them to invest. That is the way forward, not the centralised socialist method of collectivism.

James Bidgood (Dawson, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak on the Appropriation Bill (No. 3) 2008-2009 and cognate bill. This legislation seeks a total appropriation of $2.4 billion and includes a number of election commitments and changes in the estimates of existing program expenditures. We are a government that delivers on our election commitments. I am proud to be part of a government that is delivering for Dawson such things as the $150 million upgrade that was promised for the Bruce Highway between Mackay and Townsville. There is also $95 million for the port access road in southern Townsville—something which has not happened for 30 years. This government does have vision, it does have commitment and it does deliver on its promises. There is also a $110 million commitment for the junction in my electorate which is just south of Townsville, between the Van Tassel Highway and the Flinders Highway.

All together, we have $300 million worth of projects. That is substantial in itself. And there is not only that: these projects also create work and jobs. When people are employed, they can contribute back to the community in a number of ways—by the goods and the services they buy, the accommodation that they require while on these sites building this key infrastructure which will last for 50 or more years. These are major pieces of infrastructure which we need to help productivity in our region.

When people work on these projects, they contribute to the local community through the goods and services that they buy and also through the taxes that they pay to the government—and so the money goes around. When workers are busy working at their jobs and spending money on local goods and services, the money also goes around there, as well as being reinvested in the tourist economy between Townsville and Mackay, because people can save money to take their families on holidays. In my seat of Dawson, that is a key economy.

So we welcome the government’s commitment to invest in and deliver on these major infrastructure projects. We have major commitments for roads. We also have an $8 million commitment to the junior rugby league and a rugby league stadium in Mackay. At the two elections prior to the last one, the previous member for Dawson promised that she would deliver $8 million, but she failed. As a matter of fact, just prior to the last election she could not even promise $8 million. The best she could get was a promise for $6 million. We are delivering in full. Nothing has been cut out of the program. We are delivering what the sports people need to run that stadium properly.

Sport also means sporting tourism—again, a major asset to the region of Mackay, the Whitsundays, Bowen, Ayr and, obviously, Townsville. Having good sporting infrastructure is key for tournaments—tournaments where hundreds of people can come for long weekends. When they pay for the accommodation, goods and services they need, the money flows into the economy. This is what stimulating the economy is really about. This is vision. This is imagination. It is not just a flash in the pan thing; it is something that will last many decades.

Then there is the investment in industry. I am pleased to say that the Rudd Labor government made an election promise to establish the Mackay Mining Technology Innovation Centre. There will be a number of these centres around Australia, but a key one will be in Mackay. It is a $14 million commitment. I am pleased to say that the offices have just been refurbished and established, and I am looking forward to opening them in the coming months—again, a promise made, a promise delivered.

One thing you can say about the Rudd Labor government: if we say we are going to do it, we will do it. That is what we are doing. We are delivering the key infrastructure which the previous government failed to deliver in 11 years. Whether you like it or not, that is the truth. The infrastructure just is not there. They had the benefit of the mining boom, of billions and billions of dollars coming in from overseas buyers. Where did the money go? What did it build? There certainly were not millions of dollars spent on the Bruce Highway. There were not millions of dollars spent on the Port Access Road or the Vantassel Street to Flinders Highway stretch of highway. The money certainly was not spent on the stadium and it was not spent on a Mining Technology Innovation Centre which will help network and connect key innovations to help productivity in our mining industry—and Mackay is a key strategic service city for the mining fields of the Bowen Basin, Moranbah and Collinsville.

This bill also appropriates $242.1 million to the Department of Education, Employment and Workplace Relations to tackle Australia’s skills deficit, including $100 million to establish the National Secondary School Computer Fund. I have been to many schools in my electorate. Just recently I went to the Milton Street Mackay State High School, a school with over 800 pupils. The principal of that school is over the moon that he is going to get a trade training centre, because until now he did not have the facility to build a training centre for the everyday working-class kids there. We are going to give those kids a trade. We have a great scheme that is going to operate there and also at Whitsunday Anglican school, which is coming together with Carlisle Christian College and Mackay Christian College to build a trade training centre for their pupils. Again, this could not have happened before. We are going to skill up the next generation. This is good news for industry. This is good news for business. Our students are going to be highly educated, highly trained and given the correct facilities to do the job. They will be well educated in trades and skills. What parent would not want that for their child? What parent would not want a good education, a good trade, for their child? That is the only thing you can give a child: the opportunity to develop their mind to its full potential.

The other side of politics did not get behind this; they voted against it. What they were saying was, ‘We are denying your children the right to develop their full potential.’ What does that mean? It means that they do not want everyday working-class kids to have a good education, to have good skills and to have good training—because without this money they will not get it. They will be poorer for it, this country will be poorer for it and businesses will be poorer for it, all because you voted against it. And we will not let you forget that—not once. We will take you all the way to the next election and we will remind you—and the people of Dawson and the people of Australia—every step of the way that you voted against developing the full potential of the education of the kids of this nation.

Mal Washer (Moore, Liberal Party) Share this | Link to this | Hansard source

The member will address his remarks through the chair.

James Bidgood (Dawson, Australian Labor Party) Share this | Link to this | Hansard source

Through the chair, I say to the other side of politics: our children will be poorer for not having this investment. This is like a seed that you plant, and 10, 15 or 20 years later the whole nation will reap the benefit from the investment in the education of every child to develop them to their full potential.

I can tell you that every principal and every teacher I have spoken to has said that this is the best thing that has ever happened. And history will record that, so far, this is the biggest investment there has ever been in education. We in the Rudd Labor government are proud of that because we believe in our kids and we believe in giving the kids of this nation, regardless of who they are or where they come from or what their backgrounds are, an equal opportunity to maximise their abilities. That is the least we can do for the future generations, and every teacher and every principal is right behind that.

Also, there is $33.3 million for the government’s Skilling Australia for the Future programs. This funding will deliver 20,000 vocational education and training places that are aimed at people currently outside the workforce. Retraining is a key component. I am a baby boomer and I started life in the print trade. I did 20 years in the print trade as a darkroom technician, final film planner and platemaker. Those skills are completely obsolete now, and I am 50 this year.

Greg Combet (Charlton, Australian Labor Party, Parliamentary Secretary for Defence Procurement) Share this | Link to this | Hansard source

You don’t look it.

James Bidgood (Dawson, Australian Labor Party) Share this | Link to this | Hansard source

I know I don’t look it. Thank you, I appreciate it. But I can honestly say to you that there are many in my generation who have come up through the trades who are having to reskill. This legislation helps that happen. We have a resource of over-40s who want to get into new trades or perhaps new businesses and they need skilling up. But they need a helping hand. We on this side of politics believe the role of government is to give people that helping hand up—not to push them down. That is what we intend to do, and that is what is behind this investment in reskilling people. And it is for giving people, particularly businesses, the opportunity to save apprenticeships where the bottom line is perhaps tight in these extreme global economic conditions in which we live. They are conditions that ultimately are global and because they are global they are beyond our control.

But we stand in a good position. We stand with the knowledge of the storm that is coming. We can be wise and we can prepare, and that is what we are doing through this legislation—we are preparing for the future. There will be some hard months ahead; there is no question about that, and everybody is real enough to acknowledge that. But I can tell you that this is the right way forward. This is the way to stimulate the economy and the way to create and save jobs. And if jobs do perhaps become redundant we will reskill and retrain. We do not believe that we should allow unemployment to rise beyond control because when unemployment rises beyond control families hurt and suffer and children hurt and suffer.

We have to look after families in this nation and we have to look after individuals in this nation. If there is one thing that gives a human being purpose, it is to contribute to society through work. Some people, when they cannot find paid work, are only too glad to move into volunteer work, because it is in human nature to work and to contribute to community and society in order to make the world—and their own lives in the process—a much better place.

The Department of Infrastructure, Transport, Regional Development and Local Government has been provided with $2.5 million to establish Infrastructure Australia to ensure that there is genuine rigour and accountability in infrastructure spending. This is so that this government will be transparent and not be accused of regional rorts or anything like that. We are open to accountability, and this money helps provide that accountability, because accountability is important and infrastructure is for the long term—not the short term. That infrastructure will be here long after most of us have moved on from this place.

The Department of Innovation, Industry, Science and Research will be provided with $15.2 million to introduce the Enterprise Connect program, which will replace the previous government’s Australian Industry Productivity Centres. I referred earlier to the Mackay Mining Innovation Skills Centre, which will be a key touchstone for industry to bring together various businesses in the mining sector to look at ways of increasing productivity through innovation.

The government are totally focused on stimulating the economy. For example, we are building 20,000 units of homes in the next two years. We made a commitment to build 40,000 homes by 2020. Stimulation for the building industry is fantastic, and I can honestly report that my phone at my electoral office has not stopped ringing from builders in the construction industry saying, ‘How do we get on board with this? We want a part of this. How can we do that?’ Even yesterday, on my mobile phone, I received a call from a developer saying, ‘We want to be part of this. This is fantastic.’

It is fair to say that there is broad consensus among the business community and amongst tradespeople that this is the right way to go; this is going to save businesses in the construction industry. The insulation of 2.2 million homes is going to create jobs, and a vast majority of that insulation will be Australian made. Seventy per cent of the solar hot water systems will be made here in Australia. This will create work; it will create greener homes which will have less carbon footprint. It has been worked out that between now and 2020 the amount of carbon saved from going into the atmosphere will be in the region of 49 million tonnes. That is equivalent to taking one million cars off the road. That is good, and through that we fulfil our Kyoto agreement. This is smart, because this is going to happen in two years. This is very smart indeed.

Here we are, insulating homes, making them energy efficient, creating work through that, reducing the carbon footprint, fulfilling the Kyoto agreement, building 20,000 homes in two years—those will be for low-income people and the homeless. That is a core Labor commitment, a fundamental belief. Give children an education. Give children good health. Give children a good basic home. That is what the Labor Party has always been about. That is a core fundamental belief, and we, the Rudd Labor government, are delivering on our true beliefs.

The previous speaker, the member for Mackellar, gave a sort of critique and said that capitalism has not failed and the market did not fail; rather, it was the responsibility of the American administrations of Jimmy Carter and Bill Clinton. She seems to have forgotten that for the last eight years President Bush was running the country. He, obviously, from her assessment, had no influence whatsoever. She talks as if someone waved a magic wand and things just suddenly went wrong—because of state intervention, supposedly. This is absolute Disneyland politics, because the reality is she did not address the CEOs who were paying themselves massive bonuses. I refer to the Lehman Brothers CEO. After eight years of running the bank, he busted the bank and walked away with over US$450 million. I think there needs to be some accountability for that. I personally find it ethically unacceptable to receive $450 million for sending a bank broke. That is not good stewardship of anybody’s money. There needs to be some serious accountability right now across the world of all the CEOs of all the banks.

In conclusion, I truly do believe this is the right way forward, the right stimulus and the right package to save our nation from huge unemployment queues. The opposition voted against this package, but without it that would have been the result. I commend these bills to the House.

Greg Combet (Charlton, Australian Labor Party, Parliamentary Secretary for Defence Procurement) Share this | Link to this | Hansard source

I also wish to speak on Appropriation Bill (No. 3) 2008-2009 and Appropriation Bill (No. 4) 2008-2009. It is appropriate—and I think earlier speakers have done so—to address these bills in the context of the current economic circumstances. In fact, certain provisions in these bills go towards the government’s response to what is the greatest economic crisis since the Great Depression without any doubt. In particular, a significant amount of money has been allocated within the bills to councils for much needed infrastructure investment.

Last year during the debate on the 2007-08 appropriation bills, one of the things that I spoke about when I spoke on the legislation was one of the central challenges for government, which is to manage the economy in order to achieve social progress. Of course, that is a fundamental tenet for Labor. When speaking, I also highlighted the need for strong, sustainable and responsible economic growth in the face of a very uncertain international economic environment. At that time we did not know as much about what we were going to confront as we do now. The third theme of the speech that I made at the time was the determination of the government to address the chronic investment deficits on the capacity side of the economy, particularly in skills and infrastructure. These were gaping holes in public policy and in investment left by the previous government, and that had been evident for some time. Of course, many of the measures that the Rudd government has taken and continues to take are to address those investment deficits on the capacity side of the economy.

These are all themes that are also a feature of the government’s most resent response—the $42 billion Nation Building and Jobs Plan. To return briefly to the wider economic circumstances, I made the comment earlier, and I think it is clearly the case for any amateur economic historians—and I proffer to include myself in that category—that this is without any doubt the greatest financial crisis since the Great Depression. It is a financial crisis that over the last six to nine months has migrated from the financial system through to the wider economy, and the real economy is starting to demonstrate the impact of it.

I was watching the ABC news just before I came to speak on these bills, and today’s results in the US stock market are now the worst in 12 years. The market has depressed to a level not seen since the mid-nineties. The Australian All Ordinaries Index is down to a five-year low. I think some of the market results are not receiving as much media attention now as they did several months back, but we are in a very difficult position in the equities markets internationally, including in our own market.

The impact has been that as the financial crisis worsened it, in the words of the International Monetary Fund, weakened consumer and business confidence, raised uncertainty and destroyed wealth. That is demonstrably the case. Values on balance sheets and in portfolios have been written down very significantly. All of this has contributed to much lower demand at the consumption level in the economy and much lower investment. Some of the anecdotal stories that I am hearing about plans for investment that are being shelved in the private sector are extremely disturbing. One of the other results, which I just noticed on the news, flowing from the market in the US is reflected in the destruction of value on the balance sheet of one of the largest financial institutions in the world, Citigroup. This has now led its share price to collapse from US$54 to just over US$2. I think that is evidence of just how serious this crisis really is.

Beyond its impact on confidence, the financial crisis makes it very hard for companies and consumers to borrow. There is a serious credit crisis. This obviously reduces economic activity in terms of both consumption and, very importantly, capital investment. While the impact on access to debt was the worst aspect of the financial crisis early on, the negative impact of collapsing confidence is the main driver of the current problems. The result of this is demonstrated best by recent IMF forecasts that the global economy will not even be stagnant; it will be in recession this year. The advanced economies will experience the sharpest contraction in the post-war period. These are the predictions of the IMF. Six of our top 10 trading partners are in recession now. The United States is predicted to contract by a significant amount, but the most recent news from Japan is that the economy there appears to have contracted by as much as 12 per cent over the last 12 months. That is extremely serious, and Japan remains our key trading partner.

The current economic conditions are not good, and they call for serious and considered responses in order to try to insulate to the best of our capacity the Australian economy from the effects of a global recession. We are seeing, however, rapidly falling commodity prices and a decline, as a result, in the terms of trade. We are seeing a fall in confidence; a fall in investment, as I have spoken about; and a fall in expected exports. I was with a number of exporters in the port of Newcastle late last week. Obviously the coal industry and coal exports are extremely important there. Fortunately for the Hunter region, most coal exports are in thermal coal for power generation. Demand is holding up reasonably well for that, but coke and coal exports are falling quite dramatically, which is affecting the Queensland economy in particular.

With all of this, of course, the most recent predictions for the Australian economy are to see unemployment rise to the order of seven per cent by next year, which is a worry for every member in this place. The impact on government revenues has also been dramatic. The projected revenue estimates over the forward estimates has fallen by $115 billion. There was a $40 billion revenue reduction projected in the 2008 Mid-Year Economic and Fiscal Outlook. This was followed by a revised projection of a reduction of $50 billion in company tax, $13 billion in income tax, $10 billion in GST receipts and $2 billion in other taxes. This is a serious crisis by any measure. The government has been determined to respond to this crisis and will continue to do so in order to support, to the extent that the government can, both economic growth and jobs. Jobs are critical for people in this environment. The Prime Minister has stated, and he is determined to see it through, that the government will move heaven and earth to support growth and employment in these circumstances.

No Australian government, I think it is fair to say, has ever devoted so many resources to trying to stimulate the economy and insulate it from the effects of global recession. In the last year alone, particularly in the latter part of the year, the government announced packages worth almost $70 billion. To that we can add the recent announcement of the $42 billion Nation Building and Jobs Plan. These are big numbers, big amounts of money, but they are justified in the context of the economic environment that I have briefly sketched.

The most recent announcement is an extremely important one because it concentrates on nation-building projects that will translate into job creation in the near and medium term. It is worth noting that for every dollar spent providing immediate stimulus to the economy the government has invested more than $2 in long-term investments—so $1 on immediate stimulus; $2 on long-term investments that will generate future economic growth. Many of these initiatives are well known. However, I will briefly advert to the key initiatives. The range of nation-building initiatives include: the building or upgrading of large-scale school infrastructure; the building of 500 new science laboratories and language-learning centres in schools that can demonstrate need; and the devotion of up to $200,000 to every Australian school for maintenance and renewal of school buildings. This is nearly a $15 billion program to massively upgrade school infrastructure, with multiplier effects through local economies.

The government has also announced the installing of ceiling insulation in 2.7 million Australian homes, which will cut ultimately around $200 per year off the energy bills of those households and, of course, reduce greenhouse gas emissions. There has been a commitment to finance the construction of 20,000 new social housing dwellings. Given my portfolio in Defence, I am pleased that that package includes the construction of 800 new houses for members of the Australian Defence Force. About 30 of those will go in the region which I am in part representing in the Hunter, in New South Wales. There will be funding for urgent maintenance to upgrade around 2,500 vacant social houses, a 30 per cent investment tax break for small and general businesses investing in eligible assets before 30 June this year—a very significant incentive for small businesses to invest in capital equipment with a value of greater than $1,000. There is the resourcing of 350 additional projects in the Black Spot Program. The package also includes a $650 million funding boost for local community infrastructure and maintenance on Australia’s national highways. Complementing all of these important nation-building programs is a range of initiatives to provide immediate stimulus to support jobs and economic growth. These measures include a range of one-off cash payments: a $900 tax bonus for working Australians, a $900 single-income family bonus, a $950 farmers hardship payment, a $950 per child back-to-school bonus and a $950 training and learning bonus paid to students and people outside the workforce returning to study. All of these are extremely important from a social standpoint and an economic standpoint. They complement the programs announced last year, which were also targeted at supporting growth and jobs. All of those programs were worth $27.6 billion in total and I have adverted to a number of those initiatives.

The central organising principle of the government’s approach is to do whatever is necessary to avoid the impact of recession in this country, to stimulate growth and to support people’s employment and therefore their living standards and capacity to support their families. Australia is in, I think it is fair to say, a somewhat better position than a number of other countries to weather this storm but it does require the determination of government to take significant steps such as these. In my own electorate of Charlton, the impact of these stimulus packages has had and will continue to have a significant positive effect. The Economic Security Strategy package resulted in 25,000 pensioners receiving one-off payments of $1,400 for singles and $2,100 for couples. Payment of $1,000 was also made for each child who attracts family tax benefit part A. In my electorate, almost 12,000 families were eligible for that payment. These payments were designed, as I described a while ago, to stimulate the economy and also to recognise the financial strain that many working families face.

The $42 billion Nation Building and Jobs Plan is also a great package for the Newcastle and Lake Macquarie communities and is aimed at helping the region deal with the impacts of the global financial crisis. It will provide a much needed fiscal boost to the regional economy. According to Centrelink figures, nearly 10,000 families in my electorate of Charlton will be eligible for the $900 single income family bonus, for example. That is a significant cash injection into the local economy and will arrive during April. At least 130,000 people in Newcastle and Lake Macquarie will also be eligible, as estimated by my office, for the $900 tax bonus.

Both the Newcastle and Lake Macquarie city councils are expected to receive funding for important infrastructure and road projects. Every school in the region, of course, will be receiving significant investment, including much needed maintenance for schools. One of the primary schools in my electorate did not have functioning toilets about 18 months or so ago. I am hopeful that we will never have to see that sort of degradation in the infrastructure of local schools anywhere in the country again as a consequence of government decisions. There will also be, as I mentioned a moment ago, investment in new Defence housing in the Hunter, which will also be extremely important. There are larger infrastructure projects in the region and I will be, as I have been for quite some months, actively agitating to source the funding from state and federal governments to make sure that those investments are made, for example, in the Lake Macquarie transport interchange, about which I have spoken previously in the House.

I hope that I have painted, at least in brief terms, not only the significance of the economic challenge that the country faces but also the importance of the government’s policy responses to deal with this from a social and economic point of view. Therefore, it is important also to note for the record that the opposition voted against these measures—most recently, the $42 billion Nation Building and Jobs Plan. This was a curious decision, in my judgment, given the circumstances that we face; nonetheless, it was a decision that was taken. I, like my colleagues in the government, will certainly be bringing that to the attention of people in my local community. On all of the indications that I have had in my time in the electorate since the announcements were made, the packages that have been developed by the government have been very warmly welcomed.

All of these things are extremely important policy responses to the global economic crisis. The government has taken a number of steps to stabilise and repair the financial system. We have taken these steps to introduce strong fiscal stimulus to the economy. Also, I think it is fair to say that monetary policy and fiscal policy are working well together to deal with this issue. The cash rate is now 3.25 per cent, and the most recent decision by the Reserve Bank to reduce it by 100 basis points was welcome. Overall, people with a mortgage are paying lower interest rates and have received and will be receiving some of the assistance that has been provided by the government through the last two packages for economic stimulus. Other changes have also been made, in particular the investment in nation building and infrastructure. These are very positive things not only for my electorate but for all electorates around the country. Strong and decisive action is needed in these circumstances. The government is committed to continue to take such action. I welcome the bills and commend them to the House.

Sid Sidebottom (Braddon, Australian Labor Party) Share this | Link to this | Hansard source

It is a pleasure to follow the Parliamentary Secretary for Defence Procurement. I thank him for outlining very succinctly and fairly the economic situation that exists both globally and in this country. I monitor what my colleagues are speaking about in this place—not necessarily sitting in this chamber or in the main chamber of the House but certainly in my office—and I found it a little disturbing to listen to the member for Mackellar’s diatribe against, particularly, the Prime Minister. Mind you, that has been a long-term thing, rather than a short-term thing. She claimed that our attempts to stimulate the economy, both in the short term, the more immediate term, and the longer term are wrong, wrong, wrong, without offering any clear alternative to that.

I note that the member for Mackellar and others on the other side have belittled some of the more specific projects that the government is encouraging, particularly the economic stimulus package in relation to education, particularly for high schools and primary schools. Indeed, I would just like to remind you, Mr Deputy Speaker and, through you, my colleagues of what the then shadow minister for finance and now the shadow Treasurer said on Seven’s Sunrise program on 13 February in relation to the package on education:

Well let me tell you—

of course, he would have been 10 times louder—

we wouldn’t be spending $14 billion on school halls. I mean that is a phenomenal amount of money. $14 billion … That is just ridiculous.

I can tell the member for North Sydney and anyone else who questions that part of the stimulus package that there are many primary schools and secondary schools in my electorate which are highly excited by the prospects of that section of the stimulus package. They are indeed pleased to be able to have a maintenance budget that will help them out in many ways. Many speakers before me, and no doubt after me, will be able to tell you how they want to spend that money.

But in terms of this ‘wasted money,’ according to the member for North Sydney, on school halls, libraries, language labs and science labs, not only are they a welcome addition to those schools, particularly in providing better learning and teaching opportunities for those in those communities, but they are massive local economic stimulators. I am sure many on this side of the House, and no doubt those on the other side, are receiving very positive responses to that initiative. The opposition must find it very difficult to explain to those schools and those communities why they voted against that very important education and economic stimulus package that was announced.

The Appropriation Bill (No. 3) 2008-2009 and cognate bill before us are about spending to provide the government’s programs. Only on Friday did I have the privilege of attending one of our Better Regions launches, or turning of the sod, as it is called, at the Ulverstone Showgrounds Redevelopment. This saw a commitment of $2 million from the federal government, in conjunction with the state government’s $2 million and the over $2 million commitment of the local council for this very exciting redevelopment, which happens to be at the home of my basketball club, the Mighty Hoppers, of which I am still president. Hopefully, they are winning at this very moment at home! That was an example of Better Regions working in partnership with my local community.

It is pleasing to see eight other Better Regions projects currently underway in my electorate, to the value of over $8½ million. Those are the types of appropriations that we are talking about and those are the types of programs in partnership between the federal government and local government, and the state government in a number of instances, all stimulating our local economies, all stimulating economic activity in the short term and which will provide important future infrastructure, both physical and social, for our communities.

I would also like to raise a number of projects outside of those I have mentioned in the Better Regions program. I note that my good friend the member for Hasluck has arrived in the chamber, and she reminds me of my Better Regions projects, but I would like to talk about some other initiatives brought about by community demand, input and partnership. The first is in the area of the Department of Broadband, Communications and the Digital Economy. I note that work to bring digital television to beautiful King Island will soon be underway thanks to $300,000 from the Rudd government. This project is like just about all the projects that are being discussed on this side of the House, which are the result of election commitments and/or honour commitments made by the former government through their area consultative committees.

Last month, Minister Stephen Conroy signed off on the funding of this project, which I know the people of King Island have been waiting patiently for. This should be great news. The extension of digital television, which many take for granted—although I know my colleagues in rural and regional Australia do not—is an important part of keeping people on King Island in touch with the rest of Tasmania and the nation. They, like anyone else, deserve access to good television services. The funding commitment was made during the 2007 election, and working with the King Island Council, the department is soon to make it a reality.

Because of the innovative approach of the council and its partners, it has taken some time to see this project reach the funding stage, but the aim was to see that the King Island people receive the best service possible. So I do apologise for the time taken. I think all of us in this House are aware of some of the frustrations that go with due process, but we are accountable for taxpayers’ funds and we have to do the right thing by them.

Those who can receive the signal can look forward to an excellent picture once the service is up and running. Unfortunately, due to the nature of digital transmissions and the challenging topography of this beautiful island, not everyone will be able to receive the new signal. The new service is not expected to impact on the analog service currently provided to the island—so that is a benefit—until the switch-over has to take place. The project will also see an improvement in the ABC radio reception on the island, for all those lovers of the ABC. I am sure this room is full of those supporters. The King Island Council will take responsibility for the Currie TV towers project and will operate the facility on a self-help basis and be responsible for any ongoing operation and maintenance costs.

I would now like to move on to another very significant area of expenditure—computers in education. It is somewhat derided by those on the other side but I bet none of them has been into the schools to tell them that they cannot have their computers. I am not a betting person but if I were I would be fairly confident of my loot. I am very pleased that north-west schools will share in the $1,212,000 worth of computers as part of the second round of the Rudd government’s National Secondary Schools computer fund.

The successful secondary schools include School of Special Education North-West, North-West Christian School, Geneva Christian College, King Island District High School, Seabrook Christian School, Circular Head Christian School, Yolla District High School, Smithton High School, Parklands High School, Latrobe High School, Wynyard High School, Penguin High School, Devonport High School, Burnie High School, Reece High School, St Brendan Shaw College, Marist Regional College and, I am very pleased to note, both Hellyer College and The Don College. The Don College in particular is receiving 273 computers. I am very pleased because it is my old teaching stomping ground. Whilst I may, I congratulate The Don College and Hellyer College because they are now, with the introduction of the polytechnic campus and the academy campus, part of the post-compulsory education reforms in Tasmania. I wish them well with that, and I hope the computers that are readily available to them now will enhance their great teaching and learning programs. These computers come on the back of the 194 computers announced for north-west schools last year as part of round 1 of the National Secondary Schools Computer Fund. A further, supplementary round, 2.1, opened on 10 December, as we are aware, allowing eligible schools who have not applied under rounds 1 or 2 to apply if they do not have the ratio of one to two. I encourage any of my north-west schools who have not already applied to do it quickly in order to ensure their school reaches the national ratio level.

I now move into the area of health, where nobody can argue that spending is not very worthy or warranted. The people of Braddon and across Tasmania are set to benefit from a $10 million injection to support patient transport in the state. The whole area of patient transport was constantly put to me before and during the election as a vital area of concern. This was not just about accessing appropriate forms of transport, assisting with the costs and having equipment to assist disabled and challenged patients using aircraft; it was also about having access to accommodation when required to travel to receive medical assistance and treatment. Many of the operators of various travel assistance community groups and regular emergency agencies also spoke of the urgent need to coordinate patient travel arrangements across the region and the state to achieve better and more efficient use of vehicles and drivers. Like many of my colleagues here, I was keen to lobby for these concerns, and I was very pleased that Prime Minister Kevin Rudd and the current Minister for Health and Ageing, Nicola Roxon, listened to our case and were prepared to provide funding for these issues while working closely with the state government and other service providers. While people on the north-west coast would prefer to access all their medical and health services without leaving our immediate region, the reality is that sometimes we have to travel, and I hope that this package will assist them and their families in this.

The mix of funding and services, in cooperation with major reforms from the Tasmanian government, should improve the support for patients and their families. Under the initiative, our government will provide up to $3 million to acquire additional patient transport vehicles in the north-west, the north and the south of the state; up to $3.1 million to establish low-cost patient accommodation at Burnie in my electorate; up to $90,000 for upgrades to the Spurr Wing accommodation complex in Launceston, where a number of our people have to go for specialist services; up to $2.72 million to purchase new IT infrastructure and software to improve communication, coordination of patient transport and accommodation across the state; and up to $300,000 to upgrade Queenstown airport, which will come into my electorate as we are having a redistribution.

Sharryn Jackson (Hasluck, Australian Labor Party) Share this | Link to this | Hansard source

How unfortunate!

Sid Sidebottom (Braddon, Australian Labor Party) Share this | Link to this | Hansard source

They are very happy now! We are already working on this new relationship. That upgrade is to ensure safe patient transfers. Up to $20,000 will be used to purchase appropriate patient transport and lifting equipment at Wynyard airport and up to $770,000 to implement new telehealth initiatives to reduce the necessity for patients to travel to receive health care. That is a terrific package; $10 million was promised in the election period, went through consultation, was committed and is now underway.

Another related area is that of aged care. Something that we must all be aware of is the growing need for this in our community. It should be at the forefront of our thinking and planning. In this respect, only a couple of weeks ago I was happy to announce the start of a project set to become a national aged-care leader, which has been recognised by the Minister for Ageing, Justine Elliot. The minister has offered funding for an innovative project being developed by north-west coast aged-care providers, in particular, for not-for-profit community aged care.

A few weeks ago, a group of aged-care providers from the region met to further discuss a study into ways to strengthen aged-care services and cooperation between providers in the region. The group had grown since the meeting with the minister last year and the series of gatherings that followed. I have been keen to support the group and assist them wherever I can and was only too happy to seek funding for a study of potential models. The challenges we have in the Cradle Coast region are no doubt shared by others throughout Australia, particularly regional Australia. The Rudd government is committed to ensuring high-quality, sustainable aged-care services.

I would like to acknowledge the work of Malcolm Johnstone from Eliza Purton in Ulverstone and Wendy Tadman from Yaraandoo at Somerset. As representatives of the group, they have been crucial to getting funding for the project. I was very pleased to announce that the minister was giving them funding to scope this project. Hopefully, I can share the results later on with members in this place and hopefully it will be applicable to other regional areas throughout Australia—particularly in the area of not-for-profit, community aged care. We cannot deny that this is a very difficult challenge and it is something that all members here are going to have to deal with.

Some significant funds associated with these appropriations will also flow to local government in my region as part of the federal government’s injection of millions of dollars into regional and local infrastructure across Australia. Indeed, the earlier $300 million Regional and Local Community Infrastructure Program jointly announced by the Prime Minister, Kevin Rudd, and the Minister for Infrastructure, Transport, Regional Development and Local Government, Anthony Albanese, has already seen a flow-on into my electorate. The Burnie City Council has received funding of $235,000 to go towards the Les Clark bowls complex. The Circular Head Council has had $277,000 committed to shared walkways in that part of the electorate. The Devonport City Council has received $183,000, which is allocated to a skate park. The Waratah-Wynyard Council has had $339,000 committed to walkways. I note that King Island has been given $100,000, Latrobe has been given $196,000 and the Central Coast Council has been given $391,000 for projects under this scheme.

The money comes on top of the recent announcement of $3.65 million going to the north-west councils in my electorate as part of the second instalment of the federal government’s $1.9 billion financial assistance grants, which we share with other members in this House. Time does not allow but there are many other projects that I could comment on in relation to the government’s investment in infrastructure in my electorate. These are great stimulants and we look forward to sharing their benefits.

Sharryn Jackson (Hasluck, Australian Labor Party) Share this | Link to this | Hansard source

I, like the member for Braddon, am pleased to rise in the Main Committee tonight to support the passage of the Appropriation Bill (No. 3) 2008-2009 and the Appropriation Bill (No. 4) 2008-2009. These bills seek appropriation authority from the parliament for additional expenditure of money from the consolidated revenue fund in order to meet requirements that have arisen since the last budget. The total appropriation sought through these bills this year is $3.1 billion or about 4.1 per cent of total annual appropriations. Like other speakers before me, I may take some licence to broadly address spending initiatives by the government because, to borrow an old saying, we are living in interesting times.

The global financial crisis, which has significantly worsened since September-October last year, has meant that it is necessary for the government to take decisive and early action. So, in addition to the expenditure covered in these appropriations bills, we have also recently seen the passing of bills to establish the Nation Building and Jobs Plan—a substantial and significant stimulus to the economy. I am pleased to be part of a government that has taken decisive and early action to address and combat the worsening of the global financial crisis. Importantly, we have seen the government take decisive and early action to stabilise our financial system in Australia, especially our banks. We have seen substantial investment in funds to stimulate our economy, supporting growth and jobs as well as investing in infrastructure for the future. So it is not only money that is being made immediately available to support consumption; it is also funding payments for the future benefit of Australians through investment in our infrastructure.

Today there were significant announcements about assistance the government will make available to those who lose their jobs through no fault of their own in these difficult economic times. I am confident when I talk about the investment that will occur in my electorate; and how that is well received. I have been visiting many schools in my electorate in recent weeks—when I have been able to get back to my electorate—and they are very pleased about the government’s further investment of some $14.7 billion in Building the Education Revolution. I note that that is the single largest schools building program in Australia’s history. I am very pleased that all of Australia’s 9,540 schools will benefit from the immediate funding for major and minor infrastructure projects.

I particularly urge my own state government, the Western Australian government, to look at an effective way to ensure that those funds are available to state government schools at the earliest possible opportunity. There were substantial difficulties in the previous government’s Investing in Our Schools Program, because of how procurement policies operated in Western Australia. I am hoping there will not be unnecessary restrictions or red tape imposed upon our state government schools in the electorate of Hasluck and that we will be able to see those funds flowing at the earliest possible opportunity. We all agree—irrespective of which side of the House we are on—that it is our responsibility, indeed our obligation, to ensure that Australian children have the best possible education. It is the way to give them the best start in life.

We will also see the benefits of this funding boost to our construction and building industries. I am most pleased about that. Equally, I congratulate the government for its investment in housing and the commitment to build some 20,000 new public homes—not only because this will support local tradespeople and the building industry but because it will have a direct effect on beginning to address the problem of homeless people in our community. Already we have heard in the House today from the Hon. Tanya Plibersek, the Minister for Housing, about the benefit that is already being seen in our local construction industry, particularly in the new homes area, from the government’s stimulus package.

More specifically, I will address some of the issues in the appropriations bill. In particular, I want to comment on the additional funding directed to AusAID. As I have previously advised the House, each year some 34,000 mothers and over 400,000 children under the age of five years will die in our immediate region. These figures will increase to 200,000 mothers and 3.2 million children if we include all of South-East Asia. The mothers generally die from causes related to pregnancy and childbirth, the children from largely preventable causes. Australia’s aid in the region has made a significant contribution to the health outcomes in many countries, and this will increase with the improved AusAID health policies and initiatives of the Rudd government. The government has pledged to increase overseas development assistance from 0.3 to 0.5 per cent of the gross national income by 2015. This funding will in part support our neighbours through the Pacific Partnerships to meet the Millennium Development Goals. The 2008-09 budget allocated an increase of eight per cent expenditure on health issues affecting the Millennium Development Goals outcomes. As a member of ASEAN in 2008-09 Australia is committed to nearly $1 billion in bilateral and regional development for the East Asia region. That is a substantial investment by Australia, one I hope to see increased, and I am proud to be part of a government that has made that commitment and that investment in our region.

I note that the appropriations bill also addresses additional appropriation for the Department of Climate Change. Some $13.95 million is provided for a national advertising campaign to raise public awareness of climate change and of the government’s proposed Carbon Pollution Reduction Scheme. It seems to me, particularly with the recent extraordinary climatic events, as well as the terrible fires we have just witnessed in Victoria and the floods in Queensland, that very few people now would argue that there is no such thing as global warming or climate change. In the lead-up to the November 2007 election, the Labor Party made a substantial commitment to tackle climate change after nearly 11-odd years of inaction by the previous government on that issue. I am glad to say that we are also taking steps to prepare Australia for the challenges of the future by tackling climate change. Australians know that acting now on climate change is the responsible thing to do. We cannot afford to waste any more time on this issue.

I note that the Leader of the Opposition and the opposition parties appear to remain hopelessly divided when it comes to taking action on climate change. Indeed, I think there are still some of his colleagues who cannot agree with the Leader of the Opposition that climate change even exists. But we are moving on from that and taking strong action to tackle climate change by introducing a Carbon Pollution Reduction Scheme. We are also making sure that we are putting in place targets that are appropriate and responsible, given the need to protect our economy and our jobs during this global recession. I think it is money wisely spent by the government in lifting the nation’s awareness of how the Carbon Pollution Reduction Scheme, intended to start in 2010, will indeed operate.

Among the significant benefits of the scheme, we will see for the first time in Australia a cost and a charge on carbon pollution, which will encourage major polluting businesses to lower their emissions. We will see the funds raised help industries that pollute lower their emissions. We will also use the funds raised to assist households to adjust to the scheme, making sure Australian families do not carry the cost burden of climate change and, importantly, build on our investment in renewable energy to create the low pollution jobs of the future in solar energy, on wind farms and in jobs using new technologies like clean coal and geothermal energy. Taking action on climate change will see the renewable energy sector in Australia grow to 30 times its current size by 2050, creating thousands of new jobs.

I also note the additional expenditure for the Department of the Environment, Water, Heritage and the Arts—some $100 million to meet the increased demand for household rebates under the Solar Homes and Communities Plan. I well recall the criticism from the opposition that changes to that subsidy would ruin the operation of the Solar Homes and Communities Plan, but what we have seen is a significant increase in demand by  households for the rebates that are available under the Solar Homes and Communities Plan. These bills will provide rebates of up to $8,000 for eligible households to install solar PV systems, transitioning to the new Solar Credits in mid-2009.

This complements a part of the Nation Building and Jobs Plan that the Rudd government has recently introduced, the Energy Efficient Homes package, which is about supporting clean, green jobs and rolling out energy efficiency to Australia’s suburbs on an unprecedented scale. Free ceiling insulation, worth up to $1,600, will be available to around 2.2 million homeowners. This is a particularly popular scheme in my electorate of Hasluck, and especially in the suburbs of Gosnells and Maddington, where, when many homes were completed, people were unable to afford insulation in their ceilings, and they wait with great anticipation for that insulation program to be available. Equally, I have many suburbs in my electorate that have a high level of rental accommodation. I am pleased to see that landlords will be eligible for a rebate of up to $1,000 to insulate, it is estimated, some 500,000 rental properties around Australia. It is estimated that this initiative will reduce heating and cooling bills by up to 40 per cent—saving the average household some $200 a year on their energy bills.

Rebates for eligible homeowners and renters to install solar or heat-pump hot water systems have been increased to $1,600 and the means test has been removed. Households in Australia can save over $300 on energy bills by replacing electric hot water systems with solar hot water systems. The $300 million Green Loans program will start rolling out energy assessments backed with low-interest loans for solar, water and energy efficient products from mid-2009. In addition, there is the National Rainwater and Greywater Initiative to help people use water wisely in their everyday lives. There are rebates of up to $500 for households to install rainwater tanks or greywater systems.

There is occurring in Australia a substantial and comprehensive response to the issues associated with climate change and converting or transforming our economy from a high-carbon producing economy to a low-carbon producing economy. The Western Australian government previously committed to match funding and cooperate with the federal government in the $13.9 million investment in Perth’s Solar Cities project, which will involve five local councils in the north-eastern suburbs of Perth, including the City of Swan and the Shire of Kalamunda in my electorate of Hasluck, in the rollout of a substantial program to implement for the first time in the east metropolitan region an initiative directed towards Perth’s Solar Cities. There has been some delay in that, and I would urge the Western Australian state government and, in particular, the Department of Housing and Works, to come on board with this crucially important project.

There was $4 million allocated in the budget for the upgrade of drainage systems in Perth’s Canning and Southern River areas. I heard the member for Swan last night in the grievance debate raising his concerns about investment in this important area of Perth’s river system. I indicate to him that I share his concerns. The state government previously agreed to match funding for upgrades of drainage systems around the Canning and Swan River area but have recently indicated that they would like to change the nature of their funding from cash funding to ‘in kind’ funding. We have yet to get to the bottom of what that actually means. These are important projects as part of conserving and protecting not only these important environmental areas but also our water in Western Australia, and I urge the state government to come on board.

There is money in the appropriations bill for the Department of Health and Ageing—and I have heard other members congratulate the government on this—for a national community education and awareness campaign for organ donations and transplants across Australia. I also compliment the government—in particular, the Hon. Nicola Roxon—for the comprehensive set of initiatives concerned. I also note additional funding to increase the number of places available under the Prevocational General Practice Placement Program and I congratulate the government for that initiative. I am very fortunate to have in my electorate an election commitment to a new GP superclinic in the suburb of Midland. Initially this project was agreed between the state government and the federal government prior to the 2007 election. As we speak, the Barnett state government are currently reviewing their decision to match funds and have indicated their opposition to the clinic being collocated on the site of the proposed new Midland health campus. Such a change of location will add further costs. It also has great cost implications for the commitment for superclinics. I know that all of the stakeholders involved at a local level—the Swan Kalamunda Health Service, the Midland Redevelopment Authority and the City of Swan—and the federal government and the current tender proponents recognise the importance and value of having the GP superclinic colocated with the hospital. I urge the Western Australian government to reconsider this decision.

I will address one last area. This concerns Appropriation Bill (No. 4) 2008-2009. It has additional funds for the Department of Infrastructure, Transport, Regional Development and Local Government. There is $300 million for the Regional and Local Community Infrastructure Program. This program sees some $250 million being distributed to local councils. I was incredibly pleased to discover that my local councils will share a considerable amount of that money: some $544,000 for the Shire of Kalamunda, some $677,000 for the City of Swan and some $668,000 for the City of Gosnells. They are all vibrant local councils with increasing populations and pressures on their budgets and expenditure. I am delighted that that funding has been confirmed.

In the case of the Shire of Kalamunda, it will go towards the refurbishment of the Kalamunda Aquatic Centre, which will see a major upgrade with the installation of a pool filtration system, resurfacing of the toddlers’ pools and change rooms and the installation of additional shade shelters, amongst other things. In the case of the City of Swan, there is a raft of projects throughout its very large area in not only my electorate but also the electorates of Pearce, Cowan and Perth, which will all see substantial upgrades to local community infrastructure. I am delighted that we will see that funding both support jobs and boost local economies. I look forward to seeing the City of Gosnells plans. Of course these funds for local government have now been substantially increased by some $500 million. I know my local councils look forward to working with the federal government on building and establishing new, important infrastructure for our communities to use. I commend the bills before us to the House.