Zed Seselja (ACT, Liberal Party) Share this | Hansard source

I will pick up where Senator Furner left off. He is claiming that the Labor Party left the budget in good circumstances. That is where I am going to start. The fundamental problem with the modern Labor Party, in opposition right now, is that they simply will not acknowledge the damage that they did to our budgetary situation and the mess that they left us to pick up. Martin Parkinson, the Treasury Secretary, eloquently outlined the challenge that we face and that Labor now seeks to deny. It is not credible to deny the budget problems and the budget mess that Labor has left us. Martin Parkinson said:

Without policy change, the budget is projected to be in an underlying cash deficit for the next 10 years.

If this situation came to pass, it would mean that the budget would be in deficit for 16 consecutive years, substantially longer than the 7 years of deficits in the early 1990s.

Martin Parkinson's warning needs to be taken seriously: 16 consecutive years of deficits, which would lead us to $667 billion in debt, is unsustainable. It is a budget emergency, it does need to be dealt with.

That is what this budget is about. It is about saying that we cannot keep doing things in the way the Labor Party was, that we have to make savings, that we have to change the way that we deliver our budgets, the way that we spend, so that we can get our finances on a sustainable footing. As we talk about all those important programs, as we talk about health and Medicare, as we talk about education, as we talk about pensions, all of these things are important, and that is why we need to keep them sustainable. If you look at nations when they lose control of their finances all of these things suffer. All of these things suffer when debt and deficit get out of control because the severe cuts have to happen. We have seen it in Europe and we are not there and we do not want to be there. This is what this budget is about, about stopping us from going down that road. The Labor Party well and truly had us on that road.

Let us look at some of the figures that they left us with, what they inherited and what they left. They inherited a $19.8 billion surplus and they left us with a $47 billion deficit. The average budget position under the Howard government was an $8.1 billion surplus, the average under Labor was a $39.7 billion deficit. Government debt was negative $44.8 billion when we left office and it was $191.5 billion in net debt when Labor left office. What has this left us with? It has left us with an interest bill of $12 billion per year. $1 billion a month is what Australians are being asked just to service the interest on our debt. If we do not get it under control, this could rise to almost $3 billion per month, and that would be disastrous. If we allowed our nation's finances to get to a situation where we were paying almost $3 billion a month to service our debt, $3 billion a month in interest payments, we would see health suffer, we would see pensions suffer, we would see defence spending suffer, we would see our education system suffer. All of these services that need to be funded, all of the infrastructure that our nation needs would become less and less affordable if we allow debt and deficit to get out of control. So I say to senators opposite, I say to the Labor Party, stop living in denial. Martin Parkinson's warning is right: 16 years of deficits would take us down a very dangerous path, a path which would lead to severe cuts because eventually the money has to be paid back. So future generations would be asked to pay increasing amounts of tax and suffer under the burden of increasing amounts of debt, all the while seeing their services cut back. That is what the coalition is against, that is what this budget is about—fixing the mess we inherited from the Labor Party. (Time expired)