Tony Abbott (Warringah, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

My question is to the Prime Minister. I point out to the Prime Minister that over the past year electricity costs are up 12.4 per cent, water and sewerage costs are up 12.8 per cent, gas is up 9.8 per cent, child care is up 7.2 per cent, medical costs are up 6.9 per cent and education costs are up 5.8 per cent. I ask the Prime Minister: how is her great big new tax on everything going to help families with their costs of living?

Julia Gillard (Lalor, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I thank the Leader of the Opposition for his question. Of course, it points to the debate that we have been having, in this parliament and beyond, over the last few days about economic reform, about pursuing economic reform or about seeking to wreck economic reform. I would refer the Leader of the Opposition to my speech to the Australian Industry Group dinner in Parliament House earlier this week. He, unfortunately, was not able to be in attendance, but a number of members of his political party were in attendance so they would be able to advise him of those words.

What I pointed to in that speech is the fact that electricity prices have been rising as a reflection of underinvestment in electricity generation capacity. When we look at that underinvestment and look at the legacy and the pressure that it is bringing into the electricity system now, our thoughts immediately run to the future. I said during that speech that I do not want the next 10 years to be like the last 10 years when we continued to see underinvestment.

The reality is—and the Leader of the Opposition, if he talked to representatives from the electricity industry, would soon find this out—that investment is being held up now because of lack of certainty about a carbon price. To the extent that investment is being made, it is running to short-term stock-gap capacity rather than to the long-term baseload power that the system needs. If the Leader of the Opposition is as concerned about electricity prices as he claims to be, then the rational course would be for him to get on board with an agenda of working through and discussing the pricing of carbon. And the door, of course, is open to him to participate in those discussions, accepting the need for a carbon price and participating in the multiparty climate change committee.

I understand that cost-of-living pressures are there for Australian families. Because I understand that, we are taking steps about working through questions of pricing carbon. I do not want to see continued underinvestment in electricity generation and supply putting upwards pressure on prices. I also want to continue to deliver those things to working families which will help with cost-of-living pressures. We have implemented tax cuts to make a real difference. We have created the education tax rebate to help with the cost of getting kids get back to school and we will extend that to school uniforms, as promised. We increased the child care tax rebate from 30 per cent to 50 per cent and will move to the payment of that fortnightly. We will deliver our promised changes to family tax benefits to assist with the costs of teenagers, understanding that the costs of kids do not go down when kids turn 16. To the Leader of the Opposition, who continues his slogan driven fear campaign, I say: get to grips with the underlying complex issues. If the Leader of the Opposition really wants to make a difference to working families the door is open to him to do so.