House debates

Wednesday, 27 May 2009

Prime Minister and Treasurer

Suspension of Standing and Sessional Orders

2:48 pm

Photo of Malcolm TurnbullMalcolm Turnbull (Wentworth, Liberal Party, Leader of the Opposition) Share this | | Hansard source

I move:

That so much of the standing and sessional orders be suspended as would prevent the Leader of the Opposition moving immediately—That this House censures the Prime Minister and Treasurer for:

misleading the House and for refusing to come clean with the Australian people about how they are going to repay the Government’s massive debt; and
claiming that the 2009-10 Budget papers contain all data on economic growth, inflation rates, budget surpluses and financial assumptions through to 2022 that would support the Prime Minister’s dubious claim that his Government’s national debt will be paid off by that date.

We have an issue not just of financial integrity but of character. We have a Prime Minister and a Treasurer that have told this House that all the financial assumptions to justify their claim that $315 billion of debt will be paid off by 2022 are in the budget papers. They know they are not—they simply are not there. There are all those forecasts and estimates and projections through to 2012-13. The budget papers do not contain the financial and economic projections through to 2022. That is why, in good faith, we ask the Prime Minister to provide those assumptions: because he is saying to the Australian people that he is going to fling onto the shoulders of our children and their children debt unprecedented in our history—debt that has been incurred in large measure to enable the government to send out cheques to millions of Australians. This is debt that has been incurred while revenues were falling to enable the government to engage in cash splashes. Australians right around the country are saying to themselves, ‘What is the government doing, putting us further and further into debt and with so little to show for it?’

This matter of debt is a matter of vital public interest. For years, the coalition in government laboured hard to pay off the debt that the Australian Labor Party left us with—$96 billion. It took us a decade to pay that off, so naturally we are entitled to ask: how long will it take to pay off $315 billion of gross debt—$203 billion, they assert, in net debt?

Any claim that a government makes to be able to deliver a financial result has to be backed up by some evidence and assumptions. What are their assumptions about revenues, about economic growth, about inflation and about employment? All of these factors are perfectly relevant and perfectly necessary to enable the Australian people to form a view as to whether this debt—this so-called temporary debt—will be the work of 13 years to pay off or the work of 33 years or more to pay off. How can we trust the government? If the government is not prepared to provide the assumptions, how can anyone believe its claims that it will pay this debt off by 2022?

We would assume that the government has all those assumptions at their fingertips. We would assume that the Prime Minister and the Treasurer would not make this claim and would not give this reassurance to the Australian people without having all of that financial information at their fingertips. So it is perfectly reasonable for the opposition to ask the government—not once but three times—to provide that information here in question time. And what were we told? ‘Oh, it’s all in the budget papers.’ Those were the Treasurer’s own words. He said, ‘All of those are in the budget papers.’ But they are not in the budget papers. We asked him to nominate the page and he just gave us a few minutes of abusing the opposition. This is not good enough.

This Prime Minister and this Treasurer have deliberately misled the House. They have stated that vital and relevant financial information necessary for any Australian to form a view about whether this debt can or will be repaid by 2022 is set out in the budget papers, but most plainly it is not. Either they made a reckless claim that had no basis in fact, in which case they should acknowledge that and apologise to this House, or they have made that claim based on financial assumptions and economic projections, in which case they should make those projections public. They are the ones who have claimed that $315 billion of debt will be paid off by 2022. They are the ones who have given an assurance that it will be paid off in 13 years. They are the ones who have sought to reassure Australians who are anxious about the heavy burden of debt that they can see being thrown onto the shoulders of their children. It is they who have made that claim, it is we who have asked them to provide the evidence for us and it is the government that has misled the House by saying that the evidence is to be found in the budget papers, where it is not.

This is not the first time we have seen the financial recklessness of this government. We need only go back to the extraordinarily reckless claims made by this government about the so-called National Broadband Network. It had a cost of $43 billion—so they claimed—and there was no business plan and no financial analysis. The Prime Minister said on The 7.30 Report that it was an outstanding commercial investment. Like a snake oil salesman he called out for mums and dads to invest in it. Where is the financial analysis for that? None is to be found. This is the problem with this government. They are given to recklessness in spending and recklessness in making claims about economic and financial matters vital to the future of our children.

We have seen confirmed today in the Senate estimates that the $43 billion proposed to be spend on the National Broadband Network will, apart from $2.4 billion of it, all have to be borrowed, and not a cent of it—not one cent—is included in that $315 billion debt figure. So the $315 billion does not include anything for broadband and it does not include anything for Ruddbank and yet the government claims that it will be paid off in 2022.

This is a fundamental question about the government’s integrity. If the Prime Minister and the Treasurer want the Australian people to believe them when they say that this debt can and will be repaid, all they have to do—and they can do it right now—is provide the figures on which they base their claim. Or is this like the reckless claim about broadband? The day after the Prime Minister said that it was commercially viable and mums and dads should invest in it, his Treasurer was asked, ‘How many people will subscribe?’ He said, ‘Oh, I don’t know that.’ He was then asked, ‘What will they be asked to pay?’ He did not know that either. In other words they knew nothing about it. They had plucked a figure out of the air and thrown it out there as a distraction. I fear that this is precisely what they have done with their claim about the repayment of debt.

The government can claim that it is borrowing money to invest in infrastructure, it can claim that it is investing money in schools, it can argue the case for its cash splashes and it can say that that is a fiscal stimulus. There will be arguments for and against the merit of those investments and payments. But the one thing we know for sure is that every dollar of debt is a fiscal drag. Every single dollar of debt we fling onto the shoulders of our children will make it harder for them to enjoy a lifestyle and a standard of living equal to or better than that which we have enjoyed, because every dollar of debt will have to be paid for. It will have to have interest paid and principal repaid and all of that will mean higher taxes and higher interest rates in the future.

That is why Australians are so anxious about this debt. That is why they are concerned that each and every Australian man, woman and child is being loaded up with $10,000 of debt—$10,000 of debt raised by a government that 18 months ago had no debt at all and had cash in the bank. That is the level of the recklessness. Yet when we ask the government for the basic financial facts on which they base their claim that the debt will be repaid they will not provide it, and then they mislead this House and the nation by claiming those figures are in the budget papers when they know full well they are not.

This Prime Minister and this Treasurer have not simply thrown an unsustainable level of debt on the shoulders of our children but insulted us. They have insulted our children and the children who will come after them, because they have said, ‘We are going to raise this debt and we have no idea how it will be repaid.’ More importantly, they do not care. They neither know nor care about the damage they are wreaking on this nation. (Time expired)

2:59 pm

Photo of Joe HockeyJoe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | | Hansard source

I second the motion. The Prime Minister expects us to believe that he is a fiscal conservative. Yet the Prime Minister took us into the deepest deficit since World War 2. The Prime Minister expects us to believe, and the Australian people to believe, that he can control debt. Yet he has delivered the biggest debt for the Australian government since World War 2. The Prime Minister expects us to believe that he is fiscally prudent, yet so much of what he is spending is going on the nation’s credit card. The Prime Minister expects us to believe, and the Australian people to believe, that he has a plan to get Australia out of the Rudd government debt, the debt that was accrued in just one budget.

He expects us to believe a figure that never appeared before on a date that never appeared before. With a sense of panic the Prime Minister plucked out of the air 2022, 13 years hence, for the repayment of the Rudd government debt. It is not in the budget papers, but with a sense of panic he pulled it out of the air. Then, when we started to ask questions about the economic assumptions, about the justification for that so-called 13-year plan—longer than anything the Soviet Union can be proud of—he expected us to take him at his word. Today the Prime Minister and the Treasurer, with a rhinoceros hide, came into this place and said, ‘It’s all in the budget papers.’ We asked them specifically: ‘Exactly where in the budget papers? Point out the data. Point out the assumptions about economic growth. Point out the assumptions about inflation. Point out all of the detail that gives any credibility at all to the claim by the Prime Minister that he is going to pay off the debt in 13 years.’ And there is silence. If there is not silence, they try and have what we call in this business ‘weapons of mass distraction’.

The Prime Minister has stood here for a number of days and held up photos. It is like Kevin’s world tour. Normally we get the Eiffel Tower, normally we get the Vatican, normally we get each and everything. On this occasion we have Handy Manny going like Bob the Builder—mixing all the children’s metaphors—around the nation pretending to build. He is not telling the Australian people it is all borrowed money. He is forgetting that fact, a fact that is fundamental to the economic destiny of our nation. At a time when countries—not just companies, but countries—are struggling to raise money to pay their day-to-day bills this Prime Minister is running around the country protesting about the fact that the opposition did not support him on the biggest spending package in memory. It is $43 billion, and yet he decries us for asking how this is going to be paid for. Isn’t there a contradiction there? The Prime Minister says, day after day, question after question, that we opposed all these initiatives, and yet he has the hide to claim that there would be no difference in the debt between the coalition and the Labor Party. What a hide. To come into this place, the House of Representatives, the people’s House, and to simply lie to the Australian people about the justification for his claim that the debt of the nation will be repaid by 2022 means that the spin of the Prime Minister and the incompetence of the Treasurer are as great as the debt, the legacy that they are leaving the Australian people. We are asking basic questions about the numbers. If we are wrong about those numbers, tell us where we are wrong. Tell us how we are wrong. Give us the numbers. Tell us exactly what the assumptions are that lead you to claim that you are going to pay off the debt.

There is one message out of this: the Rudd government stands for the biggest debt the Australian people have had since World War 2. The Rudd government stands for a failure in fiscal policy. The Rudd government stands for incompetence. The Rudd government stands for spin. The Rudd government is not going to deliver the Australian people any hope that they can get us out of the financial mess that they have made far worse.

Photo of Stephen SmithStephen Smith (Perth, Australian Labor Party, Minister for Foreign Affairs) Share this | | Hansard source

Mr Speaker, I rise on a point of order. You might want to draw to the attention of the member of North Sydney that it is not a censure motion; it is a suspension motion. And he might want to be careful about the assertions he makes about the telling of truths.

3:05 pm

Photo of Wayne SwanWayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | | Hansard source

This is a classic case of overreach from a dying leader. He never gets fired up about jobs for Australians. He only gets fired up about one thing: his own job. Of course we have all the huffing and puffing from the shadow Treasurer up there trying to tell all of his colleagues how he is better qualified than the Leader of the Opposition. We had a defining moment in Australian politics a couple of weeks ago. The Leader of the Opposition went to the Press Club the week before the budget and he said, ‘Labor’s stimulus packages have not created one job.’ That is what he said. All the evidence has been presented in this chamber over the past few days of jobs that are being supported by this government. The core of our budget is to support jobs. If it was not for our budget, many more people would over time become unemployed.

What they resent in the budget forecasts, and what they resent in the budget projections, is that we are doing everything within our power to support employment in the Australian community. So when we talk about the school modernisation program, when we talk about nation building for recovery, when we talk about roads, rails and ports, we are talking about jobs. We are talking about Australian jobs for Australian families. There is one thing about the Labor Party: when times are tough, we look after families and we look after our community. Those opposite are so out of touch, so unable to comprehend the nature of the economic challenge facing this nation, that they do not understand the need for stimulus. The Leader of the Opposition does not walk in the same shopping aisles as average Australians, and neither do many on that front bench. That is why they do not support economic stimulus.

We support employment in the Australian community. We were prepared to do something about the age pension. We stand up for our principles. We must protect our people, and we are protecting our people in the teeth of this savage global recession by responsibly putting in place economic stimulus. And who opposes that? The Liberal and National parties, who famously came into this House and said their approach is to sit and to wait and to see—to see many more people, hundreds of thousands of people, relegated to the unemployment queues. That is what this debate is about, because they will not admit that the responsible thing to do right now is to invest in the future and to support jobs in our community, and that is what we are doing. And we are borrowing responsibly and we are going to pay down the debt over time responsibly. We are doing all of those things.

We have had a discussion about what is or is not in the budget papers. These budget papers have been the most comprehensive that have been produced in this parliament—much more comprehensive than anything that has been produced by those opposite and certainly much more comprehensive than anything that was produced by the member for Higgins. We have got estimates for two years—2009-10 and 2010-11. We have got projections for 2011-12. We have got medium-term projections for the budget and for net debt right through to 2019-20. When has that ever happened before? Never. And they have got the hide to come into this House and pretend that we have not been open and transparent. You could not be more open and you could not be more transparent than we have been in these budget papers. It is not our fault that the shadow Treasurer cannot read them. It is just not our fault. He might want to blame us for his inability to actually read the budget papers—and he could not do it in the House here yesterday when he made the preposterous claim that we needed surpluses of two per cent of GDP for eight years. It was disproved by the very graph that he was holding up in the House. He got away with it today but it will not be forgotten, because what it demonstrates is the absolute incompetence of the shadow Treasurer.

Photo of Joe HockeyJoe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | | Hansard source

Tell us what the inflation figure is, Wayne.

Photo of Harry JenkinsHarry Jenkins (Speaker) Share this | | Hansard source

Order! The member for North Sydney was heard in silence.

Photo of Wayne SwanWayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | | Hansard source

He needs to go through the various budget statements which do contain the assumptions all the way through them.

Photo of Joe HockeyJoe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | | Hansard source


Photo of Harry JenkinsHarry Jenkins (Speaker) Share this | | Hansard source

Order! Member for North Sydney, this is not a time for asking questions, and you were heard in silence.

Photo of Wayne SwanWayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | | Hansard source

If he cannot read them he should go and hire somebody who can help him. What this government has been about is investing in the future. What we have been talking about through this budget is nation building for recovery to support employment, nation building to make sure that our people are protected from the ravages of this global recession. That is what the budget is all about. That is why, in this budget, we have the very strong support of the business community. We have the strong support of the business community for economic stimulus because they understand that when the world imposes such a sharp contraction in global demand on an economy such as this, the only force in society that can move in to protect people, to protect families and to protect businesses is the national government.

Those opposite have got the hide to come in here and complain about a net debt figure of 3.7 per cent in 2019-20. That is a remarkably low figure. They have the hide to ignore the fact that when they left government they had $58 billion worth of securities on issue anyway. We have not heard anything about that form of debt, and that was necessary debt and we supported that debt. And there is a role for debt in the circumstances we are in at the moment, because we nation build. What we do is invest in the future. We expand our capacity. There have been all of these questions about inflation. What our nation building for recovery is all about is expanding the productive capacity of this economy to maximise the opportunities that surely do come when global growth returns. That is what investment in road and rail and port is all about and, of course, what our investment in education is all about, from primary school to secondary school and higher education. It is all about investing in the future. It is absolutely sensible to borrow to do some of those things and, as growth returns, bring the budget back to surplus and pay down the debt. That is the responsible course of action that we have embarked upon.

In any other parliament in the world there would be oppositions supporting these logical, sane propositions from the government. But it is a measure of how feral those opposite have become, how they are unable to handle the role of opposition and how embittered they have become by their election defeat that they cannot come into this House and support Australian families and Australian businesses in their hour of need. They really should be condemned for this behaviour. It is so opportunistic.

Of course, the Leader of the Opposition does know better, but he is now so consumed with the threat from the shadow Treasurer on the one hand and the member for Higgins on the other, who are conducting this foot race behind him every day, that he is getting involved in some of the most desperate, irresponsible political tactics I have ever seen in this House. How you could come in here and claim it is irresponsible to pay down net debt to 3.7 per cent is entirely beyond me. Other nations around the world—advanced economies—are having net debt levels of 80 per cent. It is a small price to pay to protect our people, to invest in the future, to look after families and to make sure that we chart a course through a global recession, protecting our people to the maximum possible extent, which brings me back to where I began.

The Leader of the Opposition stood at the National Press Club and said, ‘Stimulus has not created one single job,’ despite all of the evidence—retail sales, housing, consumer confidence. All of these things are higher in Australia than they are anywhere else in the world, because the Australian government had the courage to face up to its responsibilities, to borrow to put in place phase 1 of economic stimulus, phase 2 of economic stimulus and phase 3 of economic stimulus. Phase 3 of economic stimulus was the budget—nation building for recovery. It was the investment in road, rail and port that those opposite would not make when it was raining gold bars during the mining boom. They could not make those decisions then.

We have taken the responsible decision to invest in the future to protect our people, which is why we reject entirely this motion from those opposite, because there is not a shred of economic credibility in their behaviour and absolutely nothing to their baseless assertions about our projections and our forecasts. We stand by them because they have been prepared by some of the most professional people, respected here and around the world, in our Treasury. We stand by them because what we have the courage to do is to stand up for Australia in the middle of the global recession. It is incredible that the only people in the community who are opposing what we are doing are the Liberal and National parties in this parliament, who do not have the sense to understand the nature of the challenge or the courage to develop an alternative policy framework. This government has done it. We are absolutely proud of it. We have a course set to pay down debt and get back to surplus and we will pursue that. (Time expired)

Question put:

That the motion (Mr Turnbull’s) be agreed to.

Photo of Kevin RuddKevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | | Hansard source

Mr Speaker, I ask that further questions be placed on the Notice Paper.