Aaron Violi (Casey, Liberal Party) Share this | Link to this | Hansard source

I move:

That this House:

(1) notes that:

(a) the Government's spending will reach its highest level outside of recession since 1986;

(b) since the Government came to office, it has added $100 billion to the national debt, set to breach $1 trillion this financial year and $1.2 trillion by the time of the next election;

(c) the Government's new decisions since coming to office total a shocking $22 billion, and had the Government shown any fiscal discipline to find savings to fund the new commitments, the Government would be delivering a healthy surplus today;

(d) we are spending $50,000 on interest every minute, which is money that cannot be spent on essential services;

(e) the persistence in inflation has pushed out the prospect of further interest rate relief with markets now expecting it may be 'one and done', that is, for interest rates to remain at around 3.25 per cent indefinitely, little more than one rate cut lower than the current level; and

(f) millions of Australian mortgage holders will have repayments on the average mortgage set to remain at $1,700 higher per month indefinitely under this Government than under the previous Government; and

(2) calls on the Government to reintroduce the quantifiable fiscal rules that every recent government of either political persuasion has adopted, and to heed the calls of leading economists like former Treasury Secretary Ken Henry, and former Reserve Bank of Australia Governor Phillip Lowe, as well as leading international organisations like the International Monetary Fund to introduce such rules.

Government spending has an impact on all Australians, but we need to remember as lawmakers, and the government need to remember every time they look to spend money, that it's not their money; it's taxpayer money. It's the community's money. Every dollar raised was earnt by someone—a factory worker in Casey, a farmer or a small-business owner who has taken an risk.

It is important and so crucial for the health of the country and the health of the community that that taxpayer money is spent well. Unfortunately, in Australia today we have a treasurer who has clearly lost the confidence of the Prime Minister. The Prime Minister clearly has no confidence in the Treasurer, and that is a dangerous situation for our country. We know that because the Treasurer had to stand two weeks ago and backtrack on his biggest commitment when it came to raising revenue in the budget, the superannuation changes. The Prime Minister was clever. He asked, or ordered, the Treasurer to deliver that backtrack and that backflip on the first day of the Prime Minister's leave for a holiday. The Prime Minister then went to the US, and he is now at ASEAN, not in the country to face questions in question time about that huge backflip.

What does that say about this Treasurer? He's been rolled again by this Prime Minister, just as he was rolled at the productivity roundtable, which the Treasurer wanted to turn into an economic reform roundtable. He got pulled back into line, and it became a productivity roundtable, with one outcome: suspension of changes to the National Construction Code, which was coalition policy at the last election. So there was a three-day talkfest for the government to rebadge a coalition policy.

We argued at the time that, when it came to the super changes, indexation is a must and you should not tax unrealised capital gains. It is a fundamental accounting principle that can't be breached. The Treasurer—and those opposite—defended to the hilt the importance of the changes, but then he had to change when his boss pulled him into line.

This change by this government is going to leave a significant black hole in the budget, a budget that, by the Treasurer's own admission, is having 10 years of deficits. There are deficits as far as the eye can see! So how is this treasurer and this prime minister going to pay for this black hole? Is it higher taxes? Is it cutting services? Or is it bigger deficits? They are the three options for this treasurer and this prime minister, and they've refused to answer those questions.

If it's higher deficits, we need to understand that debt is not free. The debt we take on today will be repaid by our children and our grandchildren. Today, as it stands, as I speak, there is $50,000 a minute in interest repayments under this government. What it shows us is that Australians are paying the price.

Sam Rae (Hawke, Australian Labor Party, Minister for Aged Care and Seniors) Share this | Link to this | Hansard source

A trillion dollars.

Aaron Violi (Casey, Liberal Party) Share this | Link to this | Hansard source

The Minister for Aged Care and Seniors wants to talk about a trillion dollars of debt. He faithfully regurgitates the Treasurer's talking points. I came prepared because I had a feeling those opposite might talk about misleading the parliament with the trillion dollars of debt they inherited. I give the minister notice that, at the end, I will table the document from ABC Fact Check that shows that is pure spin from the Treasurer and those opposite. They did not inherit a trillion dollars in debt. They did not. Those are the lies we have from this government. This treasurer does not have any solutions to the economic challenges that we face. All he can do is give talking points on spin to those opposite to try and talk his way out of trouble.

The reality is that spin and talking points and mistruths to the Australian people do not solve the economic challenges that our communities face. And our communities know they have been abandoned by this government. They know that this government has short-term fixes that are not working. They have no medium-term fixes and they have no long-term fixes to the economic challenges the Australian people face. It's my community in Casey and communities all across the country that pay the price. (Time expired)

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

Is there a seconder for the member's motion?

Cameron Caldwell (Fadden, Liberal National Party) Share this | Link to this | Hansard source

I second the motion and I reserve my right to speak.

Aaron Violi (Casey, Liberal Party) Share this | Link to this | Hansard source

I seek leave to table the document I referenced.

Leave not granted.

Gabriel Ng (Menzies, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak against this motion. Those opposite desperately try to cling to the fantasy that they are the better economic managers because they have nothing else to offer the Australian people than an outdated fiction. The reality is this: if you are looking for the party of good economic management, look no further than the Labor Party. The Hawke and Keating governments built the modern, open Australian economy. The Rudd government steered Australia through the global financial crisis, and the Albanese Labor government has navigated Australia through an international inflation crisis, keeping unemployment low, increasing wages and delivering cost-of-living relief, all while better managing the budget.

It is rich that the member for Casey would bring this motion forward when his party in government completely failed to reduce debt while cutting essential services that effected many Australians. The irony is that the rules set out by our predecessors were not worth the paper they were written on, because not once did the Liberals follow their own rules. The member for Casey refers to fiscal rules which the previous coalition governments broke time and time again. They said they would deliver a surplus. They went none from nine—doughnuts! In contrast, we have delivered back-to-back surpluses in our first term, the first government to do so in two decades. We improved the fiscal outlook by $209 billion compared to what we inherited in our first term, the biggest budget turn around in a parliamentary term in history. They said they would offset spending. Four out of five times they didn't.

They said they'd bank revenue upgrades. They kept only 40 per cent. We have banked almost 70 per cent of revenue upgrades since coming to office, reducing debt and interest payments. They said they'd cut the payments-to-GDP ratio. It went up even before the pandemic hit. They said they'd rein in debt; instead, they almost doubled it. We reduced debt by $188 billion last year. It is now projected to peak at around 37 per cent of GDP compared to the 45 per cent peak projected under the coalition government.

Since coming to government, we have found $100 billion in savings. In their final budget, those opposite delivered none. The Albanese Labor government is managing the budget responsibly, and we will not take lectures from those whose record speaks for itself.

Of course, good economic management isn't just about how we manage the budget; it's about what we do with it. At the last election, those opposite ran an out-of-touch platform of taxpayer funded lunches for bosses, restricting working from home, scrapping the Public Service and a taxpayer funded nuclear fantasy that would drive power prices up. Australians, and the people of Menzies, endorsed our investments in Medicare, in mental health, in fully and fairly funded public schools and in cost-of-living relief. Not only are we better at managing the budget, but we've ensured that we have an economy that works for everyday Australians. The fact is, when we came to office inflation was rising, and interest rates were rising too; real wages and living standards were falling; and debt and deficit stretched as far as the eye could see.

Under Labor, we have made real progress in the economy and in the budget. We've brought inflation down from a number with a six in front of it to a number with a two in front of it. It is now around four-year lows. Annual real wages have been growing for seven consecutive quarters. Interest rates have been cut three times in six months. More than 1.1 million jobs have been created since we came to government—a record for any government in its first term. The average unemployment rate is the lowest of any government in 50 years.

We've navigated the Australian economy through tough times, and we've done it while growing wages and keeping unemployment low. Because of the Albanese Labor government, more Australians are in work, earning better wages and paying less on their mortgages.

We know the job isn't finished. Australians are still feeling the pressure, and we're going to keep working to make sure the relief is reaching them. We are delivering real, practical and ongoing help with the cost of living, energy bill relief, reducing student debt by 20 per cent and tax cuts for every Australian—one last year, one this year and one next year. (Time expired)

Cameron Caldwell (Fadden, Liberal National Party) Share this | Link to this | Hansard source

It gives me great pleasure today to rise and speak in support of this motion moved by the member for Casey, because the state of Australia's financial management deserves to be highlighted.

We, as a nation, are on the brink of the highest national debt in our history—$1.2 trillion. The Treasurer likes to remind us all of how much of an overachiever he is. As I've said in this place before, I know that one day he'd like to be on the mugs and the tea towels out there in the parliamentary shop, but this is one record that nobody has asked the Treasurer to break, and that is that he will preside over the highest level of debt that our nation has ever seen. While he preens, it's Australians who pay—$50,000 every minute on interest. That's $72 million in just one day. It's $26 billion every year. And what could that wasted interest have funded instead? It's not abstract; it's real, tangible money. It could be paying for vital road and rail projects, Medicare, schools, pensioners or perhaps putting money back in the pockets of hardworking Australians through some tax relief. That's the opportunity cost of a Labor government.

Under Labor, Australia has suffered an historic collapse in living standards. And despite what my friend opposite said earlier, mortgages are up around $1,800 per month since Labor took office. Markets expect that interest rates are going to remain around 3.25 per cent for the long haul. Those higher interest rates, those higher mortgage repayments, are now baked in. The pain is being felt. Electricity prices are up 39 per cent. Housing—rents are up 21 per cent. Food, health and education costs are all up. Local families in my electorate of Fadden feel like they're working harder but that they're not getting ahead. For many this isn't a cost-of-living crisis anymore; it's a cost-of-survival crisis.

I want to highlight one particular sector where we are seeing the poor economic management of this Labor government hitting Australian families in the hip pocket, and that's child care. A young couple with two children in child care who live on Hope Island in my electorate talked to me about the cost rises that they've suffered under this Labor government. At the start of 2024, the daily rate they were paying for child care was $153. Now, it's up to $190.20. That is up by $37.20. That $190 a day represents a 24.3 per cent increase in their childcare fees. Yet, when we went to the last election, the headlines that Labor put on corflutes said 'Cheaper child care'. It's just not right. They say one thing, but their delivery is doing something else.

We heard my friend the member for Casey talking about our beloved Treasurer, who only a matter of weeks ago got absolutely rolled, embarrassingly, by the Prime Minister. You see, the situation that our national accounts face is such that they are so desperate to bring in more income that they were prepared to tax unrealised gains on superannuation. That's not tax reform; that is a tax raid on hardworking Australians' retirement savings. This is not about the backflip—although that, itself, was pretty entertaining to watch. What this is about is the fundamental approach that Labor will take in trying to chase after more of your money, because when they can't manage their budget they will come after yours.

What we've seen with this higher interest rate environment is that Australians are struggling to borrow money. They are struggling to pay these high mortgages. They are struggling to buy homes. How do we solve this? There needs to be some accountability, some fiscal guardrails, and the Treasurer needs to stop spending money on the Australian credit card and expecting Australians to pay.

Zhi Soon (Banks, Australian Labor Party) Share this | Link to this | Hansard source

The Chief Opposition Whip has us debating government spending and fiscal rules today, and I am so glad that he has. It means I get to talk about some of the most important economic reforms in this great country's history and the repair that has been required because of the actions and inactions of those opposite. While this government has an enviable record, I want to start by spending time talking about the history of economic and budget management in this country.

Prime Minister Bob Hawke inherited an economy that was closed, overregulated and falling behind. He had the courage to modernise it, floating the dollar, opening the banking system and cutting tariffs. He worked with the unions through the accords to control inflation, whilst strengthening Medicare, education and the social wage. Hawke's reforms laid the foundation for a stronger, fairer economy. He was followed by Prime Minister Keating, who built on that foundation. He introduced compulsory superannuation so that every worker could retire with dignity. He reformed the tax system to make it fairer and modernised key industries through competition. Keating turned Hawke's groundwork into a productive, resilient economy that could meet global challenges head-on.

When the global financial crisis hit, it was again a Labor government, with Prime Minister Kevin Rudd and Treasurer Wayne Swan, that kept Australia safe. While other advanced economies sank into deep recession, Australia was resilient. We kept people in jobs and we kept businesses afloat. The stimulus approach, rather than austerity, has been praised internationally and studied as a model for effective economic management. You will see a clear trend here: these were all led by Labor governments. Those opposite claim they are the party of economic management, but history tells a very different story. It was Labor that reformed the economy, it was Labor that built decades of growth and it was Labor that protected Australians in times of crisis. We make the hard decisions, we get the big calls right and we do it while keeping fairness and opportunity at the core of our mission.

The motion brought before the House today suggests the government should show fiscal discipline to find savings to fund new commitments. Perhaps this advice should have been provided to the former members for Kooyong and Cook instead, because we have kept average real spending growth to 1.7 per cent—less than half the former government's, which sat at 4.1 per cent. More importantly, we have also found more than $100 billion of savings since we came to government, when the former government did not deliver one dollar of savings in their final budget. The Liberals have no interest in finding savings for government or the people of Australia. They took bigger deficits, bigger debt and higher taxes to the last election—a real trifecta—in order to pay for a $600 billion nuclear scheme which they still continue to talk about. This government is addressing the big structural processes and the pressures that people are facing, turning deficits into surpluses and driving down our debt.

The motion before the House also talks about fiscal rules. This government has a fiscal strategy and is delivering on it. Our rules include reducing gross debt as a share of the economy, and we've got debt down by $188 billion. When we came to government, as the wonderful member for Menzies outlined, inflation was high and rising—and was taking interest rates with it—while real wages and living standards were falling. The government is making incredible progress. Inflation is at four-year lows, real wages have been growing for seven straight quarters, more than 1.1 million jobs have been created, and we have the lowest average unemployment rate of any government in 50 years. The budget position improved by $209 billion, and debt, as I mentioned, is $188 billion lower, saving $60 billion in interest rate costs. In fact, last year the IMF's data saw Australia rise to second in the world for budget management, just behind the Canadians. (Time expired)

Mary Aldred (Monash, Liberal Party) Share this | Link to this | Hansard source

I completely associate myself with the remarks of my good friend and colleague the member for Casey, who highlighted the impact of the declining health of our economy on families, small businesses and the broader community. Australians are suffering right now. Many people in my electorate of Monash are doing it incredibly tough. Just last week I was volunteering at Frankies Community Kitchen, who do a terrific job of looking after people in need. I cracked a few hundred eggs during my shift, and the volunteers there enjoy good tunes and good company as they do incredibly important work. Frankies Community Kitchen are preparing 1,230 meals a day for people in need, and that need is continuing to rise. Frankies Community Kitchen supports a number of other food banks in the area, like Longwarry Foodbank. But the demand on those services is at unprecedented levels and is showing no sign of slowing.

The reason I raise this is food banks are the canary in the cage for how the rest of the economy is travelling. Right now, it's a very bleak picture. Labor have presided over the biggest collapse in living standards in the developed world, and they're continuing to spend. You won't see any fiscal discipline or budget control from this Treasurer. Labor are well and truly on their way to leaving a $1.2 billion debt bomb for the next generation—for young people who already see owning their own home as a dream that gets further and further away, into the distant future. Every minute Australians are paying $50,000 on the interest payments of this federal Labor government. This is not just at a federal level—don't even get me started on the Victorian state Labor government—because spending other people's money is the Labor way. Victoria's debt is out of control. It's more than the states of Queensland, New South Wales and Tasmania combined. The Victorian Labor government is paying $21 million a day in interest payments, and that is projected to climb to $29 million a day over the next three to four years.

Labor have demonstrated an absolute collapse of fiscal discipline, and everyday Australians are wearing the consequences. These figures are mind-boggling. You could build a new West Gippsland hospital within one week on the amount of money we're talking about. Every dollar that is spent on repaying Labor's debt is a dollar that we are not investing in schools, hospitals and regional roads in electorates like mine. You couldn't run a small business like this. You couldn't run a big business like this. You certainly could not run a household budget like this, but everyday Australians are paying the consequences.

The former governor of the Reserve Bank, Philip Lowe, said that inflation remains high because of Labor's spending. When he was governor, he diplomatically said that inflation remained sticky and that it was a homegrown problem—in other words, government spending was too high. There seems to be an invisible ring around Australia such that anyone outside of metropolitan areas falls into Labor's 'no care zone'. Our plight and our challenges are invisible to this Labor government.

Shortly after I was elected, I wrote a letter to the Treasurer, Jim Chalmers. I wrote on behalf of drought impacted farmers in my electorate. They are doing it really tough. For many, this drought has depleted not just financial but mental reserves. I asked the Treasurer to please prevail upon the ATO to show leniency to drought stressed farmers who had been forced to sell their stock early and would have a resulting ATO debt bill that reflected this. Those farmers are doing it really tough. I'll tell you what response I got. It wasn't a response from the Treasurer; it was just a standard proforma fact sheet from the ATO. It didn't even address the concerns that I had raised. That is the level of interest and care shown to farmers right across Australia by this government.

My farmers in Monash are struggling, and I say to them: I will keep fighting for you, and the coalition will keep fighting for you. This Labor government has let you down, and you deserve so much better.

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

The debate is adjourned, and the resumption of the debate will be made an order of the day for a later hour.