Gary Humphries (ACT, Liberal Party) Share this | Hansard source

Although this is not the subject of my remarks to the Senate today, I do want to take the opportunity to associate myself with the call made a moment ago by Senator Kirk for there to be an apology to those children who were abused in state institutions in Australia in recent decades. Having been a member of the Senate Standing Committee on Community Affairs inquiry into that issue, I believe that that apology is richly deserved, and I hope that the Australian government will be able to consider that call very seriously.

I want to talk today about the federal budget that was brought down last night and indicate in which ways I feel that this budget has failed the Australian community by, more than anything else, failing to determine a clear direction for where Australia should go in terms of the preservation of the extraordinarily good economic position in which we find ourselves today. This budget is a confused budget in that it fails to give a clear indication of what principles guide it. It wants to look tough on spending, but in fact this budget spends at record levels. It says that it wants to provide relief to working families, but in many ways the by-products of this budget and the decisions leading up to it place further pressures on working families. It wants to reject the record of the previous government but many of the new programs that it rolls out are nothing more than coalition programs that have been slightly reshaped and rebadged.

We have to ask ourselves: what are the principles that this budget tries to use to take the budget process into the future? Let us examine a few of those. We are told that we cannot go on as before, spending irresponsibly. That is from Mr Swan’s speech last night. The problem that we have with this assertion is that it runs counter to so much that we hear day in, day out—and we have heard it day in, day out—from Labor senators in this place. The day that Mr Tanner, the then opposition spokesperson on finance, put out a media release accusing the Howard government of spending too much, of irresponsibly expending public money, I went back to the Hansard and checked through what had been said about spending in both houses of the federal parliament by Labor members and senators. In that one day, calls from Labor members and senators for expenditure commitments amounted to at least $2 billion. Mr Tanner was saying that too much was being spent by the Commonwealth government and Labor members and senators were saying that it needed to spend more.

If we think back over the last few years, the recurring theme of Labor members in opposition was: ‘The government is not spending enough on education; it is not spending enough on health; higher education is suffering; the environment needs more expenditure et cetera.’ We were spending, program by program, too little; but, overall, we were spending too much. If someone can explain to me how that works, I would be very grateful. But that confusion is here in this budget as well. The government talks about stopping irresponsible spending but, in fact, it spends at record levels. This is, as far as we can tell, the highest spending budget ever. No budget has ever spent so much money. It has done so partly by cutting back programs of the former government and partly by significantly increasing taxation levels. This is the first budget in a long time that has actually introduced new taxes—taxes, I might say, that were not clearly signalled to the Australian community in the lead-up to the 24 November election last year.

It is true that the new government have cut some $15.2 billion of Commonwealth programs that were the brainchild of the former federal government; but, in their place, they have put $30 billion worth of new programs on the table. They are not the restrained expenditure custodians that they claim to be. They have maintained a surplus. I would have to say that it would be pretty hard not to maintain a surplus, given the inheritance from Peter Costello. But we have to ask ourselves: what is the future when the government have such a strong adherence, even in their first budget—the budget that is supposedly to fight inflation—to high levels of expenditure? The government say that they want to keep inflation down, but this budget increases taxes on alcohol, cars, health insurance and energy. Those things all have an inflationary effect. It is very hard to see how inflation can be brought down in the long term if the government take that kind of approach. We know that they have a highly inflationary industrial policy that they are presently rolling out.

The government say that they are in favour of low debt. That is very good to hear, and there is no significant debt added by this budget, I am pleased to say. But it is a concern that state governments are dramatically increasing the Australian community’s level of debt. The Victorian budget last week lifted debt in that state from $2.3 billion to $9.5 billion by 2011-12. Western Australia is also dramatically lifting debt in that state to $11.4 billion—tripling it in the space of the next four years. The Northern Territory and the ACT are also raising their debt levels, and the other states have yet to bring down their budgets. This is a worrying sign of what long-term Labor budgeting is all about. We need to watch that very carefully.

I want to close by making some comments about the effect of the budget on the ACT. The Labor Party has long purported to be a friend of the national capital, but decisions of recent months have to throw that claim into some doubt. The budget last night trimmed a significant number of Public Service jobs. This is not particularly transparent in the budget papers, but we estimate some 3,200 civilian Public Service jobs are axed in this budget. There is also the imposition of the two per cent efficiency dividend on government agencies. It is worth remembering that Labor, when in opposition, said that the efficiency dividend of 1¼ per cent was lazy budgeting, it was badly targeted and it did not give people the chance to distinguish good programs from poorly run programs. Labor have now upped it to 3¼ per cent. How does that work out?

There are cuts to the planning of Canberra: $12.8 million over five years to the Griffin Legacy and $15.8 million to the National Capital Authority. We should all be proud of this national capital, but we cannot be proud of it if it is not well planned and does not look like an outstanding national capital. I think the cuts that have been proposed are heading in the direction of reducing the quality of planning in the national capital.

Finally, it is worth recording that this budget fails to deliver on a promise that was made by the government when it was in opposition: to provide relief to Australian families with respect to higher petrol and grocery prices. There is nothing in the budget to provide that relief. In fact, a number of decisions made by the government, effectively through extra taxation to push up other costs for Australian families, are going to push them in the other direction. It will be worth looking very carefully at whether Australian families are any better off, even with the tax cuts that were announced last night, given Labor’s failure to act on those particular promises.