Jane Hume (Victoria, Liberal Party) Share this | Hansard source

I rise today to speak on the Productivity Commission Amendment (Addressing Inequality) Bill 2017, a private senator's bill introduced to the Senate by our colleague from New South Wales Senator McAllister. I'm very pleased that Senator McAllister shares the coalition's passion for decreasing inequality in Australia so that all Australians can have a fair go—after all, Australia has long been heralded around the world as the land of the fair go. But what is less pleasing is that Labor would once again commission yet another study into the problem of inequality rather than tackle it head-on.

You see, the Labor Party so often seeks to appear to be taking real steps to solve today's pressing issues, but in reality the Labor Party is unashamedly just sitting on its hands. By contrast, the coalition government is addressing inequality with policies to boost economic growth, general employment and income for hard-working Australians, while targeting assistance to those who need it most. We don't just want to be seen to be doing good; the coalition is actually doing good.

Before I address the substance of this bill, allow me to first highlight what some might view as a glaring flaw in the bill itself. I wish to draw the Senate's attention to the fact that Senator McAllister's bill links the timing of the reports to the intergenerational reports that are produced by the Parliamentary Budget Office every five years. An inequality report must be tabled, according to this bill, within 15 sitting days of the tabling of an intergeneration report. However, the intergenerational report is produced by Treasury, not by the Parliamentary Budget Office, which is a significant flaw in the bill that we are discussing today. So this bill can't have any effect, because the PBO won't be producing the intergenerational report. Although, undoubtedly, the intent of the bill is sound, it would appear that it was potentially hurriedly prepared—and, let's be frank, it's a politically motivated piece of legislation that would in fact have very little effect.

Australia's tax and transfer system overwhelmingly directs assistance towards those who need it the most. According to the ABS household expenditure survey, the poorest 20 per cent of households, on average, receive welfare payments and social services worth more than eight times that which they pay in taxes. This is evidence of how our social welfare net is working effectively to assist those Australians who need it the most, ensuring that conditions are available for them so that they too can prosper and grow as contributors to our nation's great economy.

Recent data has supported the notion that income inequality outcomes in Australia have in fact continued to improve since the dark days of the global financial crisis, and that's thanks to a strong and resilient economy. For example, the Household, Income and Labour Dynamics in Australia Survey—the HILDA Survey as we know it colloquially—released in June 2016 found that the percentage of Australians in both relative and absolute poverty has in fact fallen since the global financial crisis around 10 years ago. Absolute poverty has in fact decreased substantially, from 12.9 per cent to 3.9 per cent, and relative poverty has similarly decreased from 13 per cent to 10.4 per cent. Furthermore, the HILDA Survey shows that, thanks to a robust economy that facilitates social mobility rather than fosters inequality, most 'poor' households are not persistently poor, and this is particularly important. Half of those who experience poverty over a 10-year period remain in poverty for only one to two years.

In keeping with these findings, the government took steps in the 2017-18 budget to encourage greater workforce participation, and it also protected the welfare system for those who need it the most. Meanwhile, in stark contrast to our own track record, those opposite are talking. They're prevaricating, they're equivocating and, rather than developing a policy, they are commissioning yet another study. I can't believe that the opposition has not learnt from years gone by, and I remind those in the chamber of the years of Prime Minister Kevin Rudd. In the lead-up to his campaign he promised study after study after study and, as his term as Prime Minister showed, the people of Australia dismissed this as window-dressing. The people of Australia do not want that kind of do-nothing government, big on announcements but devoid of outcomes. Rather, what Australians expect of their government is a government that gets things done, working in a methodical, logical and timely manner to improve the lives of everyday Australians. Alternatively, the coalition government, on the other hand, is doing exactly what coalition governments are expected to do and what they have done since time immemorial—what they have always done. The coalition government is getting on with the job. Our priorities and our policy agenda are to secure the essentials that Australians rely on and to work to reduce the cost-of-living pressures in this country.

I am thankful for the opportunity this private senator's bill provides me to speak a little about the Turnbull coalition government's program to reduce income inequality in this country. One of the coalition's flagship policies is of course the enterprise tax plan. It was justified by a recently released journal study, courtesy of The American Economic Review. According to that study, titled 'Do higher corporate taxes reduce wages? Micro evidence from Germany', higher company taxes in Germany actually led to reduced wages and thus to greater inequality. The study I cite is particularly useful in the Australian context, given the similarity of our labour market to that of Germany. The study finds that workers bear about half of the total tax burden, a figure that is congruous with the 50 per cent corporate burden often quoted by Treasury. Examining administrative linked data from the 18,000 tax changes across 10,000 municipalities in Germany between 1993 and 2012, this study found that higher company taxes in fact reduce wages most for those who need our help most: low-skilled workers, women and younger workers. The study also noted that higher-skilled employees are not affected at all.

All of this points to a simple fact: cutting company tax rates improves inequality.

In spite of this, the Labor Party continue to meet our enterprise tax plan with downright hostility, stubbornly dismissing it as trickle-down or neo-Liberal Reaganomics. As the aforementioned study demonstrates, those who the Labor Party purport to look out for the most—women, young workers and low-skilled workers—are those who stand to benefit the most from our enterprise tax plan. That's right: contrary to the member for Maribyrnong, the Opposition Leader, Bill Shorten's assertion that our tax plan is a cut for the top end of town, it is in fact women, young workers and low-skilled workers who are the main beneficiaries of our corporate tax cut. As per usual, the Labor Party are all talk. They pretend to look after the little guy, but, when push comes to shove, all they want to do is bash job-creating companies and look after union cronies. So artificial, in fact, is the Labor Party's concern for hard-working Australians that they refuse to support legislation to ease the tax burden for those who need it most. When will the Labor Party learn that higher taxes of any kind are not the answer? We cannot tax our way to prosperity.

Furthermore, the coalition government's budget repair measures are designed to reduce debt and deficit—a symptom of the addiction to spending that is solely attributable to the Australian Labor Party; an addiction for which all Australians are now paying dearly. Our measures reduce the debt and the deficit; they increase the ability of the government to respond to economic shocks in a way that supports economic growth and employment—two factors that are key in reducing income inequality. As the most recent round of job figures showed, the coalition's policies to increase employment and grow the economy are working consistently and are working effectively, with a record of more than 400,000 jobs created in 2017, of which, I remind the chamber, 300,000 were full-time. And, furthermore, in addition to our strong jobs growth, we have seen rising profitability and a gradual tightening in the labour market as companies are finding it harder to find skilled workers. As such, all the primary drivers of wages growth are now in place, and we expect, as do many prominent economists such as Chris Richardson and Saul Eslake, that the so-called income recession will now come to a rapid end. Attendant on the expected wages growth is swifter budget repair and an end to the crops of debt and deficit sewn and grown by Labor over those six fateful years.

In addition to creating jobs, the government has introduced a range of measures to rein in spending and improve the sustainability of Australia's social safety net—a social safety net of which we are immensely proud—all whilst ensuring that the welfare system remains one of the most precisely targeted in the world. With the support of the Senate, more than $37 billion worth of budget repair measures have already been legislated, including measures from the 2014-15 budget that comprise part of the omnibus savings bill that passed with the support of the opposition, and for that we thank them.

Our 2017-18 budget, building on the success of the omnibus savings bill, seeks to grow the economy to secure more and better-paying jobs—the kinds of jobs that are required, that are necessary, that are fundamental to a 21st century economy. The budget, as expertly put together by the Treasurer, the Hon. Scott Morrison, also guarantees essential government services that Australians rely on, such as Medicare, hospitals and schools, all in spite of the scare campaigns that emanated from those sitting opposite.

Our budget tackles cost-of-living pressures, many of which are the result of the disastrous former Labor government, and, contrary to our predecessors, ensures that the government lives within its means. All of these measures, working in concert with one another, are about continuing to redress inequality and ensuring that there isn't a single Australian who cannot access the assistance that he or she needs, while fostering the prosperity and growth of all Australians.

One of the core features of this coalition government's agenda has been guaranteeing the essentials, protecting and boosting essential services that Australians rely on. As we have endured the so-called income recession, Australians have come to place even greater faith in the government's range of essential services. And so it should be, for the first duty of a government is to protect and keep Australians safe and ensure that critical services they rely on are guaranteed. These services include health care, housing, disability support, education and, in particular, employment. This coalition government is, most importantly, guaranteeing Medicare, making funding fairer for students and sharing the responsibility of our higher education system.

Our essential services give Australians the security and confidence they need to seize opportunities as they arise. First and foremost, this government is tackling the cost-of-living pressures on Australian households. The 2017-18 budget eases the cost-of-living pressures on Australians and their families particularly in the areas of energy, housing and childcare costs. On the energy front, the National Energy Guarantee, unveiled by the Minister for the Environment and Energy in October last year, will further ease cost-of-living pressures on Australian households, with expected savings of up to $400 per year on their energy bills. The government's energy security plan will help provide reliable and affordable energy for Australians, with practical reforms designed to meet immediate challenges and lay the foundations for our future energy needs.

Hardworking families have faced increasing childcare fees, with costs growing by 51.7 per cent between 2008 and 2016. This has placed a significant strain on household budgets and presents a hurdle for Australians considering returning to the workforce. To assist around one million hardworking Australian families, the government is investing $37.3 billion over five years through its Jobs for Families Child Care Package, which will help ease the cost-of-living pressures and provide more affordable access to quality child care.

Australians will also get a better deal from our financial and banking system, with the government giving consumers access to free, fast and binding dispute resolution services—making banks and their executives more accountable and giving consumers greater access to and control over their banking data, empowering them to seek out better and cheaper services. All of these measures are real, genuine and productive steps in making sure that Australia continues to improve on measures of inequality.

Finally, as part of our commitment to ensuring that all of our older Australians are able to enjoy a comfortable and dignified retirement, the government will reinstate the Pensioner Concession Card for those impacted by the asset test changes introduced in January this year. This will allow an extra 92,000 people to access the discount offered to holders of the Pensioner Concession Card, including subsidised hearing services, offered by the Commonwealth. Furthermore, these people will continue to be able to access discounts offered by the states and territories.

So it becomes clear that this coalition government is working to redress inequality by guaranteeing essential services, and the most important essential service is Medicare. Contrary to the despicable 'Mediscare' ad campaign run at the last election by the Australian Labor Party, this coalition government can assure all Australians that not only is Medicare here to stay but also it will be significantly strengthened in the future. The government is guaranteeing vital healthcare services, with Commonwealth health funding expected to increase from $75.6 billion in 2017-18 to $82.6 billion in 2020-21.

The Medicare Guarantee Fund was established on 1 July last year to secure ongoing funding for the Medicare Benefits Schedule and the Pharmaceutical Benefits Scheme, guaranteeing Australians access to these services and affordable medicines into the future. The fund provides transparency around the cost of running the MBS and the PBS and guarantees the government's commitment to funding affordable health care that all Australians rely on. Not only is Medicare guaranteed but it will be made stronger under this coalition. The government will provide a billion dollars to lift the freeze on the indexation of the MBS, to encourage GPs to bulk-bill children under the age of 16 and concession card holders. Bulk-billing incentives will also be indexed from 1 July 2017.

When the Gillard government introduced the National Disability Insurance Scheme to parliament in November 2012, there was only one small problem—it was not fully funded. As they are wont to do, the Labor Party came up with a piece of legislation and passed that legislation but conveniently forgot that it must be paid for at some point if it was ever to become functional. Fortunately now, though, for those Australians who rely on the services provided through the NDIS, the Turnbull government has acted to fully fund the NDIS scheme. If my memory serves me correctly, I also think it was Mr Shorten, who is part of the party which now rejects the true Gonski funding that excludes unfair and special deals for particular education sectors. The Gonski program is also now fully funded.

The only failures, I believe, are those of the Labor Party, who have wrecked and resisted at every step of the way the government's economic plan to repair the budget, grow the economy and create jobs. Our achievements in implementing the national economic plan stand in stark contrast to those opposite, who show no sign of waking up to the economic challenges facing hardworking Australian families and Australian businesses. I thank the chamber for its time.