Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

On 21 April 2006, Australians celebrated debt-free day. That was the first time in many, many years that Australians were able to wake up to the news that Australia was no longer in debt. The government, after 10 years of sustained, sound economic management, had delivered the nation from the burden of debt. But 3 February 2009 will go down in history as the date on which Labor reimposed a burden of debt upon our great country.

It is very instructive to look at the history and development of the circumstances in which we find ourselves. This chameleon Prime Minister went to the election saying, ‘I am an economic conservative—always have been, always will be.’ At his campaign launch he told the Australian people that the reckless spending of the Howard government must stop. That was only 18 months ago. Indeed, in the May budget, only 10 months ago, Labor said there was an economic imperative to cool down the economy because the Liberals had so deliberately and mischievously overheated the economy. They said that the inflation genie was out of the bottle and that Australia faced the devastation of an overheated economy. To deal with that problem, Labor told us that they had to introduce—and they did introduce—$20 billion worth of new taxes. They took $20 billion out of the economy to cool it down, because it was overheating. How wrong Labor and Mr Rudd have been, time and time again. Today, when we are going into debt to the tune of $200 billion to stimulate the economy, one wonders why $20 billion was taken out of the economy through increased taxation only 10 months ago.

Madam Acting Deputy President, do you remember what our slogan was at the last election?

Glenn Sterle (WA, Australian Labor Party) Share this | Link to this | Hansard source

Whatever it takes to get elected!

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Senator Sterle, you are wrong. It was: ‘Go for growth’, and it was ridiculed by Labor. It was ridiculed by the economic commentariat. It was ridiculed by journalists. What are the government trying to do today? They are trying to go for—you have guessed it—growth, but by taking this country to huge and unprecedented debt levels. What this shows is knee-jerk, stop-start economic reactions. They have no idea. One day the economy is overheating and we have to pull out $20 billion by way of tax. Ten months later they are in this parliament saying, ‘We need an extra $200 billion by way of debt to keep the economy going.’

Who was it who predicted the economic tsunami before the last election and said tough times were ahead, that we did have to go for growth and that, whilst the economy might be slightly overheating, that would be a good buffer for us before the circumstances in which we now find ourselves would hit? That is what we said, and we were ridiculed. Senator Faulkner, in the wrong seat, is sitting there laughing. That is what he did. Like all the Labor people, during the election campaign he ridiculed the coalition government of the time. But within 18 short months we have been proven correct in our diagnosis and our remedies. All the commentators are now strangely silent. They have forgotten about the coalition warning of economic devastation, of an economic tsunami coming our way. They have forgotten about our warnings. They have gone strangely silent.

Despite Labor getting it so badly wrong, we took them on trust in relation to the first stimulus package. We were told the first stimulus package, of $10.4 billion, was needed to create 75,000 jobs—I repeat: to create 75,000 jobs. Madam Acting Deputy President Moore, as you would well know, when we asked in this chamber yesterday or the day before if Senator Conroy or the government could point to just one job that was created by this $10.4 billion stimulus package, Labor could not. We took them on trust and we allowed their $10.4 billion package to go through on the basis that it was not a rushed job or a botched job, that it was carefully thought out and that 75,000 jobs would be created. Labor no longer make that claim, and the reason they do not is that there is not a skerrick of evidence to suggest that that outrageous claim was right or that it has come to fruition. The sad fact is not that Labor cannot point to 75,000 jobs; they cannot even point to one job.

Clothed with this great success of the $10.4 billion package, Labor are saying to us and the Australian people: ‘We know the first package was a complete failure but, trust us, we will now spend four times as much—we will spend $42 billion.’ So I got out the pocket calculator and thought: ‘Right, if you spend four times as much, and it was 75,000 jobs for $10 billion, that means the creation of 300,000 jobs. You beauty!’ I then looked in the fine detail. What is Labor’s promise now? That $42 billion will not create one extra job but it will support up to 90,000 jobs. So whilst they put the ‘90,000 jobs’ out into the marketplace, the old weasel words have come in: it is no longer ‘creating’, it is now ‘up to 90,000 jobs’. I would like to know what the lowest parameter is. I have got a funny feeling it is a lot, lot lower than 90,000 jobs.

This package clearly is not an economic package, it is a political package. Yes, it is concerned about job protection—the protection of one man’s job, the Prime Minister’s. But the arrogance of that man—which I think would even make former Prime Ministers Whitlam and Keating blush—is such that whilst this very important package, which demanded an address to the nation, was being debated by the parliament he said: ‘I couldn’t be concerned about it. I’ll go home to the Lodge and have a good night’s sleep.’ That is how concerned he is about the economy. Whilst he was asleep he did not hear the contributions that were being made. He was not interested in the role of the parliament. Indeed, he wanted a $42 billion package to go through both houses of parliament within 48 hours. What is the urgency? Why can’t the parliament spend at least a week considering $42 billion? The Senate has now voted for that, against the wishes of the Australian Labor Party. But what was Mr Rudd’s position before the last election? I thought part of his mantra was Senate scrutiny, that it was so vital and that the Howard government had been treating the Senate with contempt. Can I tell you: never, never in the 11½-year history of the Howard government was there a proposal to raise $200 billion worth of debt on the back of the Australian people and then have it discussed and put through within 48 hours.

Mr Rudd does not only sleep while the parliament is debating. Clearly, he was asleep whilst the warning signs were appearing on the horizon. We warned about them before the last election, and he slept all through it as though he was not aware of it, as though nothing was happening. He seems to have slept through all the warnings that we gave. He misdiagnosed the state of the economy so badly before the election and as late as May last year at the time of the budget that can I say, as an aside, that if he were a doctor he would be sued for medical negligence and the case would be open and shut. But having so misdiagnosed the economy he is now telling the Australian people: ‘I’ve got the prescription that you need. Have a little taste.’ And, yes, the prescription does taste sweet, but that is the sugar coating on a very, very bitter economic pill. We acknowledge that, whilst people are still sucking on the sweet sugar coating of this economic pill, they will say, ‘This is nice,’ and enjoy it. But we are concerned as to the economic consequences when the bitter part of the pill is tasted by the Australian economy—and the bitter part of this pill will be when the Australian people are faced with the burden of paying back this debt. Make no mistake, it took the Australian people a full decade to pay back $96 billion. How long will it take them to pay back $200 billion? Indeed, yesterday at question time the Minister representing the Treasurer could not even tell us what the interest bill would be.

When the average home buyer goes to a bank to borrow money, they ask, ‘Can I have a loan for so much? What will the interest repayments be and how long will it take to pay off the debt?’ It is clear that Labor have not asked any of those fundamental questions. They cannot tell us about the interest rates, they cannot tell us when the debt is going to be paid off; it is going to be into the never-never. But one thing we do know is that it took the coalition 10 years to pay off $96 billion worth of debt. It stands to reason that it will take a full generation of Australians to pay off this $200 billion worth of debt. That is why, in pursuit of the interests of the next generation and looking to the future, we are saying that at this time this is an irresponsible measure. At this time there is no evidence put before us as to why it should be $62 billion, $42 billion or $22 billion, or why $200 billion is needed as the bankcard limit. None of that has been put before us. We are entitled to have a look at that, we are entitled to examine it and we are entitled to ask questions.

As I said, it is always a difficult task, when people are having a good time, to remind them that there might be a hangover the next morning—so I am told. At the moment, people are looking at the package, I would imagine, and they are saying, ‘Sounds good to me.’ The farmers, for example, will get $950, but the cost to government—indeed, to every man, woman and child in this country—as debt will be $9,500. It is a pity that Labor, in their advertising and direct mail, will not tell the Australian people that. Do you actually want $950 in exchange for a $9,500 debt that your children will be paying off? That is the irresponsibility in this package and that is where we believe that further questioning needs to take place. We will be pursuing those questions at the Standing Committee on Finance and Public Administration because we want to know why pink batts or boom gates, worthy causes though both are, are going to provide the productive stimulus to the economy to prepare us for the future. I think we might be able to spend our money in a better, more targeted and more substantial way for the future. That is why the alternative Prime Minister, Mr Turnbull, has set out a blueprint for an alternative approach. I will not repeat that today because time is running short, but it is a blueprint that would in fact provide the economic stimulus that is actually needed and will have a long-term ongoing benefit.

Indeed, we as an opposition have said, ‘If this is a crisis as described by the Prime Minister, it would have been good for the Prime Minister to have consulted with the opposition and discussed it with them.’ Indeed, in one of the most high-handed chapters of Australian history thus far, he has said: ‘It is my way or the highway. I want this passed within 48 hours—no discussion, no committee stage; just ram it through the parliament.’ When we say, ‘Slow down a bit, and let’s discuss this, let’s see if we can get some common ground,’ he says, ‘No, it is my way or the highway.’ Yet his very own speech says there is no silver bullet—unless it is Mr Rudd’s of course. What we have is arrogance and incompetence, which makes for a very dangerous cocktail as we move into these uncharted economic times. But the Liberal Party and the coalition has a very strong record of sound economic management. We are concerned to ensure the future of the next generation. We are concerned that we do not spill out all the money straightaway and then scratch our heads later.

Indeed, I confess I am somewhat confused. We have been told that this situation has arisen because of the credit crisis, the credit squeeze, and that it is too difficult for the private sector to access credit. So what does the Australian government do? Hit the market for $200 billion. That is going to ease the credit squeeze, isn’t it! That is really going to make it easier for small businesses to borrow or for other people to get a home loan. It is really going to help by cutting $200 billion out of the economy. On page 6 of the Updated Economic and Fiscal Outlook statement—and I look forward to meeting officers of Treasury and Finance this evening just to ask a few questions of them—we are told interestingly about the first stimulus package that it was designed for spending and to stimulate. It says:

To the extent that households save part of their payments and tax bonuses, this will help repair household balance sheets, provide a boost to confidence and support a return to more normal levels of consumption over time.

I have an idea: how about the government saving some of its money and getting all of those benefits it has referred to? Why does it have to go into debt and give it to people for them to save for that outcome?

Many coalition senators will speak on the flaws in this package and about our alternatives, but one thing we are sure of is that we will protect future generations from this huge $200 billion debt burden. That is why we as a coalition, every man and woman of us concerned about the future, knowing we will take a hit in the polls and knowing it is unpopular in the short term, will stand up for our nation and oppose these measures. (Time expired)

Barnaby Joyce (Queensland, National Party) Share this | Link to this | Hansard source

I rise to speak on the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and related bills. When we first took this prudent and, to be honest, courageous decision, as the fourth estate would agree—and that is a euphemism for their believing that we might be doing wrong to oppose this package—it was very interesting to hear the reports everywhere about how foolish that is and to hear people saying, ‘Don’t you understand the views of the public?’ It is interesting to see in a Herald Sun survey that, as we speak, 10,384 votes have been registered. That is a substantial sample and, surprise, surprise: 54 per cent of those people believe that this package is irresponsible. I have complete faith in the Australian people. They are not foolish. They can see through this. Pink batts, boom gates, school halls—goodness gracious me! Is this what we have descended to in this place? This is a government that in the 1930s would not have built the Sydney Harbour Bridge; instead, it would have loaded us up with millions of cans of spam. It would not have built the Snowy Mountains scheme; instead, we would have had thousands of acres of vinyl curtains.

This is a crazy, tokenistic and ridiculous appropriation of the nation’s funds for causes that are completely unrelated to the purpose they are to achieve, which is the delivery of job security. Now we have to go through these bills with the gun-to-our-heads approach of Mr Rudd. Mr Rudd said that this is like a form of economic open-heart surgery, but he has the clock on us. If we don’t do it in time he is just going to say, ‘Sew them up; that’ll do,’ regardless. There is a sense of complete arrogance in this approach. But you cannot gyp people, because they know exactly what is going on. You are spending their money.

All we can judge this package by is the last one, and the last one was a complete and utter flop. There was $10.4 billion and the promise of 75,000 jobs. Where are your 75,000 jobs? Then the government got people from the Australian Retailers Association to stand up and say, ‘It was great.’ Well, of course! That organisation is representative of the biggest owners of gaming machines and hotels in Australia, so of course they would be happy with it. They are looking forward to the government delivering some more largesse in their direction.

But is this package going to help working families? At the moment we are being overloaded with emails from people who are scratching their heads and wondering what on earth is going on. This email from Mr Tony Watts is typical—and I have rung him to confirm that I can read it out. He says, ‘Once again the ALP has seen fit to support working families earning up to $100,000 per annum whilst ignoring the plight of carers and pensioners in this latest economic bailout.’ On the justice issue, people are being left behind. People are looking through the package and they are all coming up with the same conclusion: those who are in a position of comfort get a tokenistic payment and those who need it have been left out. This is supposed to stimulate the manufacturing economy in Australia. It is not going to stimulate the manufacturing economy in Australia; it is going to stimulate the manufacturing economy in China, South Korea or somewhere else. All it is going to stimulate is the bottom line of certain retailers.

I am an accountant, and my experience in owning an accountancy practice for 10 years and before that in banking is of two expressions. One is the expression of the person who has got the loan—their sense of joy. They have got this loan; they have got their hands on this money. That is in no way matched by the sense of concern and the grimace when they are trying to pay it back, when they are faced with the reality of having to pay the money back. As this government goes forward to launch Australia into a possible $200 billion debt, I say to them: you have not fooled the Australian people. They know what this will do and the pressure it will put on interest rates. For every person who has a million-dollar facility, because of the absolute and overwhelming participation of the Australian Labor government, every one per cent increase will cost them $10,000. So a $500,000 house facility will cost people $5,000 a year for every one per cent that interest rates are pushed up because of this overwhelming engagement in the marketplace. For the sake of $950, people will be paying $5,000 per year for their $500,000 facility for as long as this debt remains. And if you force it up by two per cent that amount will be $10,000.

People are not foolish. They know this will come home to bite them; they can see that. We have to be more prudent. There is obviously scope for a stimulus package, but it must be one that can be seen to return something to the Australian people. It must be one in which we can see in its construction an income stream—an income stream from owning it and the capacity in the future to recoup some of the debt and to refloat the economy if we need to sell the asset. But the government is just launching us, full scale, into this quantum of debt without any form of idea of how we are to get out of it. This is a bad situation. People are aware of it. They look around the world and can see the problems that the United States currently has. The United States is trying to raise money by bonds, with a US$1½ trillion stimulus package. The world is asking the logical question—unfortunately, for all of us—who are we lending the money to? Do they have the capacity to repay us? I have to say to President Obama that it is not his fault. The problems started before he came to office. But we are on that path now, and the only thing that the conservative side of this chamber must do is say: ‘Stop! We do not want to get ourselves into that position.’ That position is down the track, but when we arrive there we will not be able to reverse the situation, so we must be prudent now.

I do not know whether the government will have the numbers in this chamber or not, but the Australian people are awake to them. It is not that they are against a stimulus package, but they are against this stimulus package because it is so tokenistic, parochial and ridiculous. This whole idea that we have got to get it through defies belief. Why do we have to get it through? Are there parked behind a shed somewhere mountains of boom gates to be delivered to a railway crossing near you, immediately? Are there hiding in the bushes, down there behind the oval, armies of green people armed with pink batts, ready to ascend into the ceilings and insulate the nation? Would it actually matter if we were to take our time and do things prudently? No, it would not.

Why do you have this gun-to-our-heads approach? It is Australian taxpayers’ money and you are insisting that they not only spend that money but go further into debt. This brings to mind the dodgy aluminium siding salesman who goes from house to house saying: ‘You’ve gotta sign up. It’s gotta happen now.’ I can tell you, from the point of view of an accountant, when the pressure salesman turns up, the product is dodgy and the only thing you should say to them is, ‘Go away.’ If what you are offering is so self-evidently beneficial to the Australian people, leave the details of your program with us and it will scream from the paper that it should be endorsed. I do not doubt for one moment that, if the product were fiscally responsible, it would be endorsed. But this is not simply about a stimulus package; it is the issue of your stimulus package and what it represents.

Let us look at the position that we will eventually be in if we implement this package. If we end up hocking our nation’s credit card with $200 billion of worth of debt, for every per cent of interest that is $2 billion. Let’s say that over the cycle of this debt we will be looking at around six or seven per cent interest per year. That is around $14 billion in interest a year. Those numbers just roll off the tongue, but what are those numbers? Those numbers could represent cancer treatment that could be provided on the Pharmaceutical Benefits Scheme. Those numbers could extend hospitals. Those numbers could fix the rail system in Victoria. Those numbers could provide dams so we can secure our water supply. They could seal roads. They could build an inland rail system that would deliver a corridor of economic activity in Australia. This money would just disappear, year after year.

As an accountant, one of the things that frustrated me was that hardworking families were only just able to meet their mortgage interest payments year after year and could never get ahead because they were hocked up to their eyeballs with debt. They basically sell their families and those who come after them into a form of financial servitude. That is the reason that we must stand against this package. I am not going to sell the Australian people who come after me into a form of financial servitude because of the improvidence of trying to buy our way out of the global recession with ceiling insulation and boom gates. This is something that resonates. I am receiving email after email saying: ‘What is this thing about pink batts? What are pink batts going to do to our global economy? Who devised this? What font of knowledge came up with this work of financial wisdom?’ The reason people are sceptical is that they found out about the first package. It had no modelling; it was just plucked out of the air—‘Bang. Here, spend $10.4 billion’—and half the surplus was gone. The government came up with promises and was able to deliver on none of them. That is the form and track work of the Labor Party economic horse, and it is dodgy.

This is going to be an incredibly important debate for the Australian people because it is about not just this moment; it is from this time forward. The debate will go on for a period of time, but the debt, if it descends on us, will remain on us for goodness knows how long.

When are the Labor Party going to present information showing the efficacy of this proposal? When are they going to tell us exactly what they hope to achieve? When will we see specific details of the purpose and desired outcome of this proposal? Where does the arrogance of proposing one of the biggest packages that has ever been brought forward, without any time allowed for its consideration, come from? We had this ridiculous vigil last night in the House of Representatives till five o’clock in the morning because you insisted on being so barbarically arrogant that your leader did not even turn up to his own vote. This is really starting to show the people of Australia exactly who is running this country. If we had efficacy along with the arrogance, at least we would have something excusable, but we have arrogance and these ridiculous ideas all tied up together.

We now have people, quite rightly, going through the details of this package and realising that they have been left out. They are beginning to understand. People thought that every farmer would get $950. They will not. In fact, in the whole $41,534,000,000 package $20 million has been put aside for farmers—that’s it. Of course, not every farmer will receive a payment. You have to already be deemed as being in exceptional circumstances and basically in financial trouble to receive it. And I will tell you what people in financial trouble also have: they have debt. What your package does is put the price of their debt up. What are you delivering them? Ten thousand dollars per million per percentage point. They are not foolish; they will understand when the interest bill turns up where it came from. It came from the Australian Labor Party.

Then we have the state governments, which have been building up debts that Steve Hooker, the pole vaulter, could not traverse. These state Labor governments are salivating because they are going to get bailed out by the federal government. They are losing the capacity to go any further. The debts that the states now have behind them are almost insurmountable, so now we are going to have major state debts compounded with a debt laden federal government, which in the past could always sit behind them and say: ‘No matter how much you get this wrong, state Labor governments, at least we have a parachute. Although we don’t want to use it, we have the capacity to bail you out if it all goes to clay.’

But now we are going to lose the capacity, the ability, to bail them out. We will have a compounding effect of debt upon debt with no income stream, putting immense pressures on the productive capacity of this nation to finance it. By going to the people who will have the providence to go to the markets to borrow the money to produce a form that adds to our economy, we are also going to those people who in the future will have to bail the nation out of the problem and saying, ‘We’re going to make it impossible for you, because we’re going to be in the marketplace bidding against you for the money.’ This is the reality. It is going to be a very hard debate. We have to take the Australian people on this journey to clearly spell out piece by piece why this is not any sort of statement of belligerence, obstinacy or arrogance but is a deeply felt concern about where this will all end up if we get it so entirely wrong—and the track work of the Labor Party so far is that they are getting it terribly wrong.

I am deeply heartened by how, no matter what poll I looked at this morning, the Australian people are waking up to the situation. They understand. The lady I spoke to last night and the calls I took all had the same message: ‘What on earth are they up to down there?’ Where has this manifestation of manic borrowing come from? At the end of the day, in the global economy we are in the same economic plane as the United States of America and China, but we are not in the cockpit; we are down the back of the plane. Where the front of the plane goes, we will go regardless. In this nation we have to be fully aware of where we are economically and have a good understanding of where we are going. Our idea is to protect our people. Australia does not have the capacity to reboot the global economy. I wish we did, but we do not. Our primary responsibility is to our people and to the realisation that we are only about 1½ per cent of world GDP.

In the past we were protected because we were provident and prudent and had money put aside, but the Labor government have started down a path and this is how the path will go: the first thing they do is spend the money you have. They have done that—it has gone. Then they spend the money you do not have—that is, they borrow it. They are flat out into that, they are $200 billion into that, and they have not been here two years. Then they try to drive whatever mechanism possible—interest rates, for example—as low as it can go but are confounded by the fact that at the same time their debts are forcing interest rates up. Then they do the big one: they print money. Around the world at this point in time are certain economies at various positions. Believe you me, you do not want to get to position 4, because then it is game, set and match. That is Zimbabwe. How do we stop ourselves getting to that position? It is by having the honesty and losing the arrogance to make sure that we do not get ourselves on that path. It is by being prudent at the start to save ourselves the pain of the end. This is why people are asking the National Party and the Liberal Party—I do not know about the crossbenchers—the question. It is not what is popular now; it is what is prudent in the long term.

Any person going to the pub and seeing some person who is half-cut and buying everybody beers would of course grab a beer off them, but you do not respect them. You think they are foolish. You think their whole process is obviously flawed. The Labor Party’s position is that, because people are accepting these beers off them at the bar on a Friday night, we all think they are wonderful. No, we think they are half-insane. We the conservative side, the fiscally responsible side, have the capacity to try to bring some sense and balance back into this situation. Those people who have a long-term vision of where this nation is going, those people who are honest and prudent, will understand this statement. It is not about us now; it is about where our nation goes and the debt we leave behind for others to pay. The most selfish thing you can do is leave your debt behind, and that is what the government is doing. (Time expired)

Bob Brown (Tasmania, Australian Greens) Share this | Link to this | Hansard source

The nation faces the consequences of an extraordinary meltdown of the global economic wellbeing that has emanated from a mismanagement of the trust of people by the corporate sector based in New York and the inevitable catch-up from the spending of assets that simply could not be backed. This is not unforecast. JK Galbraith, for one—I read his book in 1995—forecast an inevitable bust because of the boom that could not be sustained, could not be justified, that even then had appeared in Western economies and was being led by the biggest finance houses on Wall Street. However, this neoliberal and rampant capitalism, based from the Reagan years on the diminution of government—government, get out of the way—now has to be fixed by government.

We are in democracies where it is the role of government ultimately to be the defender of the public good. The Prime Minister is late to this. In his recent essay—I have not read it yet—I think he has done a 180-degree turn from being a conservative economist to now saying that he understands that the role of government is to defend the public good and to work on behalf of all components of the electorate, not just the big business houses. That will take a transformation in thinking by both of the big parties in this parliament, a transformation which is contrary to their practice certainly for the last decade and more that I have been here and for years extending back beyond that. We Greens have a different approach to economic management, one which is much more responsible and which says we certainly should live within the means that there are to support ongoing economic prosperity not just at the given time but into the future.

Australia is the richest country in the world per capita in resources but has had its share of mismanagement. I watched in this place over the last years, particularly during the Howard years, as a massive amount of public money that should have gone into the public sector was poured into the private sector. As a result, we have a run-down education system in a country where everybody—from the poorest person to Rupert Murdoch, who at the turn of the century called for more spending—knows that education is the absolute staple of not just our economic wellbeing but also the general wellbeing of everybody. It provides fulfilment. It gives every individual person in society the opportunity to find their own creative genius. Through the application of that fulfilment they make a contribution to the rest of society.

However, if you look at the average spending on education of OECD nations, Australia has a spending shortfall of $6 billion per annum. We are at the back of the pack. I found it quite extraordinary that neglect of education became a hallmark of the Howard government at a time when we had massive assets and a massive ability to contribute to education. Not least here was the running down of public education stock. We have been left with schools which are way behind international norms in both infrastructure and the good teachers to deliver the education that we want for every child in Australia in 2009.

Now we are faced with this dilemma of unprecedented proportions—that is, unprecedented for those people who cannot remember back to the Great Depression of the 1930s. The Greens have a very clear difference from the big parties in our approach to the rescue of the economy from this situation—that is, short-term stimuluses are not enough. We take the long-term view. In meeting this emergency, we want to see the governments in this country and around the world looking long term and redirecting the economies so that we do not get ourselves into this mess again. In our communications with the government on this package and on the structuring of future economies, we want to see a very clear direction as to where they expect the economy to be not just in three years time but in 30 or 50 years time.

As far as the Greens are concerned, that means following the advice of Sir Nicholas Stern when he was here in Canberra nearly two years ago. He pointed out to the closed ears of the then Howard government—and, I suspect, the current government—that those economies which take their lead from ecological excellence will be the leading economies in the coming century. Why is that? It is because there is a greater catastrophe than this economic one which is stalking not just Australians but the whole of humanity. We are in an age of cataclysmic climate change. Sir Nicholas Stern pointed out that we should redirect one per cent of gross product into tackling climate change now, and there is no evidence of that in any of the program we have before us. In fact, the Rudd government has said that it is putting off its major legislation to deal with carbon trading until midyear, as it is a secondary matter. Sir Nicholas Stern pointed out that, if we do not urgently redirect one per cent of the global economy into fixing climate change, it will have a six to 20 per cent hit on the economies of our grandchildren. All the evidence points to us having a huge responsibility to think about not just how we fix the economy now but the direction of the economy into the future. The chamber will hear a lot more about this from my colleagues and me in the coming week.

Nevertheless, we are charged with dealing with a $42 billion stimulus package from this government to meet this exigency. The opposition has decided it will not support that package and says that half the stimulus package would be a more prudent way to go. The questions to both the big parties are these. How do you decide the parameter of a stimulus package at this stage of the economic downturn? How do you justify $42 billion or $21 billion or $84 billion or $11 billion? There is a bit of a hunch involved in the government of the day delivering even such a massive package. You listen to the economists. They simply do not know what size package is required or what sort of government intervention is required to get us out of the mess the big finance brains of the world got us into—because there was not enough government scrutiny of their activities over the last several decades.

Our view is that Australians are hurting and are fearful. There are predictions that, instead of four per cent unemployment, there will be seven per cent unemployment within a year or two. These are not just statistics. These are hundreds of thousands of Australians who were doing well last year but have been suddenly confronted with dire economic circumstances which may lose them their houses, their cars, their ability to go on holidays, their ability to feel good about themselves or even their ability to inject the money into their children’s wellbeing to ensure they get the good education I was just speaking about. Part of the question is this. How do we inject optimism into a nation which in economic terms is feeling pessimistic about the future? I say we do that by both dealing with the economic problem and pointing to a more optimistic and secure future for everybody.

To do that you need to be able to speak to those kids who recognise more clearly than many adults in this country the dire threats coming down the line from overpopulation, resource depletion and cataclysmic climate change—and Australia is not going to be insulated from any of those things. These are huge worries stalking our society. It is up to us, as the wealthiest resource based nation on the planet, to be leading a new direction for the whole of this planet. People are looking to Obama in the United States. We must look to our democratic system in this country to set an even better lead because we are better equipped to do that. Unfortunately, government is not there yet.

The Greens offer an alternative to the old big party thinking in this country, which is really, ‘The big end of town does have the nous and does know what is good for this country.’ There are good-hearted people in the big end of town but their ideology is not a wider one which says that we have to be aiming for quality of life, improvement of happiness and particularly optimism among our citizens, who are seeing ourselves as part of a global community which is facing gargantuan problems into the future. The Greens are prepared to look at those problems, to reset and reconfigure Australia’s role and its domestic policy, to ensure that we take a lead in giving future generations the security, the peace on earth and the stable environment which they all should be inheriting but are not going to inherit in the boom and bust capitalist age which we have just seen deliver us this extraordinary financial problem.

What do we do with the $42 billion stimulus package? The opposition has decided to oppose it. We Greens would have said it very differently. We will go into this in the coming days of debate. The first thing we have done is to join with the opposition and other members of the crossbench to ensure the Senate gives this package at least a basic scrutiny through the committees which have been set up. The Greens have extended that with the acceptance—we are in a cooperative mood—with the other non-government members of the Senate, of a second committee to ensure that we sit, if necessary, through until next Thursday at midnight to give this package due scrutiny. We will have a lot more to say in the meantime.

I flag this with you, Mr Acting Deputy President. We will run critical scrutiny over this massive amount of money, but we are not here just to criticise; we are here to bring forward positive and helpful suggestions that the government may take into account. I ask the government to accept that it is the role of the whole of parliament, not just the government, to work out what is best for the Australian community. If good ideas come out of other components of the elected parliament then the government should be flexible enough to adopt those good ideas into this package before we get to the final vote next Thursday. In the United States, the Obama administration has proposed a bigger package than this one—we know the United States is a much bigger economy. It is a US$50 billion green stimulus package to ‘create jobs with clean, efficient American energy’. President Obama has said:

To put people back to work today and reduce our dependence on foreign oil tomorrow, we will make investments aimed at doubling renewable energy production and renovate public buildings to make them more energy efficient. America’s energy shortcomings present a huge opportunity to put people to work in ways that will transform our economy.

Senator Milne has our portfolios for both education and climate change and her staff are working very assiduously looking at the $14 billion part of this package which is for new school buildings right across the country. We would want to see not just that we are renovating buildings but that new buildings being built with this massive amount of public money are highly rated for energy efficiency and for environmental outcomes. That creates jobs and stimulates new skilling in such fields as building, plumbing, carpentry, insulation placement and the electrical trades—right across the board, that stimulates new jobs, giving people new skills which they then carry on into the future building industry in the private and the public sectors.

In Obama’s package, there is $11 billion for research and development, including pilot products and federal matching funds for a smart grid investment program to modernise the electricity grid, making it more efficient, secure and reliable and building new powerlines to transmit clean renewable energy from sources throughout the nation. There is an $8 billion program for loans for renewable energy power generation and transmission projects. There is $6.7 billion for renovation and repairs to federal buildings, including at least $6 billion focused on increasing energy efficiency and conservation. There is $6.9 billion to help state and local governments make investments that make them more energy efficient and reduce carbon emissions. Might I add that the component of the Rudd government’s package which goes to local government is well directed. Who better than the administrators at the local level to know where best to target expenditure of money to stimulate the economy. There is $2.5 billion in the Obama program for energy efficient housing retrofits and a further $2 billion for energy efficiency and renewable energy research.

There is $2 billion going into renewable energy research in America, when we in Australia, this sunny country, have starved our solar researchers of money. When you starve researchers of money, you then starve the pilot programs, the implementation of the technology, the manufacture and the science. So, after 12 Howard government years, we are in the extraordinary position where, for example, in putting a solar hot water system on our house last year, I found that the technology was Australian but it was imported from China. Well, good on the Chinese! But ought not we be manufacturing the Australian technology, which is world’s best, here in Australia? The answer to that is: of course we should. The Obama government is putting $2 billion into energy efficiency and renewable energy research. Where is that in this package?

There are also a range of other measures, and here I point to the fact that Australia is way behind the greening of the economic direction that we see in Germany, the UK, the United States and Spain. Where in this package is there refurbishment, renewal, or at least a national overview, of our public transport system? The Spaniards, with their very fast trains travelling at 350 kilometres an hour—it is now 3½ hours from Madrid to Barcelona, and the other major cities are connected—are taking thousands of people out of the air to slow down the release of greenhouse gases. The Spanish government has just allocated €50 billion to extend this fast, efficient train system, which is 99 per cent on time. What do the people of Sydney or Melbourne think of that? Where is that in this program? Where is even a thought about that in this program? That is the sort of program which, in an age of cataclysmic climate change, sets the course for an efficient transport system into the decades and the century ahead, creating jobs, stimulus for local business and world’s best expertise.

I have a lot more to say about this legislation, but my colleagues will be following me in this debate. We are excited by the opportunities that arise here. We will be talking with the government wherever we can to make this package more job rich, more environmentally cohesive and more long term, leading to the skilling of this generation so they will be assured of jobs for decades to come in this lucky country of ours.

Joe Ludwig (Queensland, Australian Labor Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

I wish to make a personal explanation. In my speech on the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and related bills this morning I used an example, which was that the package could provide support and assistance for air conditioning. I have been subsequently informed that that is incorrect, and I apologise for any misunderstanding.

George Brandis (Queensland, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

On 6 May 2007, the then Treasurer, the member for Higgins, Mr Peter Costello, stood up in the House of Representatives to deliver the 2007-08 budget—what would turn out to be the last budget of the Howard government. Mr Costello delivered a budget which, for the 10th consecutive year, was in surplus. In the previous 12 years, Mr Costello, as Treasurer, had paid down the $96 billion of debt with which the previous government had been saddled by its Labor predecessor. If you look at the fiscal projections which formed part of the last Costello budget, they paint a magnificent picture of the state of the Australian economy then.

In budget statement No. 1, Fiscal strategy and budget priorities, we learn that the budget surplus for 2007-08 was projected to be $10.6 billion in the black. But, if you look at the projections in the out years, you will see that the state of the Australian economy at the time of the last Costello budget projecting into the future was that in the following year, 2008-09, the year we are now in, the budget would have been in surplus to the tune of $12.7 billion. A year beyond that, in 2009-10, the budget would have been in surplus to the tune of $13.8 billion. That was the healthy, robust, solid, solvent state of the Australian economy at the time of the Liberal Party’s last budget.

As it turned out, those budget projections were wrong, but they were wrong because they underestimated the robust health of the Australian economy in that last golden year of the Howard government, when the economic circumstances of this country were such as filled individuals, households and businesses with confidence. When it came to the time of the election on 24 November 2007—only six months after Mr Costello’s last budget—the state of the economy was so healthy that the budget surplus which the incoming Rudd government inherited had been revised upwards to $21 billion. That does not include the amount of money that had been set aside prudently in capital funds such as the Future Fund and the Higher Education Endowment Fund to make provision to relieve the debt burden from the backs of future generations—from the backs of your children and my children, Mr Acting Deputy President. Australia was $21 billion in the black—not even taking into account the Future Fund and the Higher Education Endowment Fund—and that is what the Labor Party inherited from us. Twelve and a half years earlier, we had inherited $96 billion in the red from them.

Mr Acting Deputy President, you might think that a government newly in power—even a Labor government—led by a Prime Minister who announced boldly during the election campaign in a slick television commercial that he wore the badge of an economic conservative with pride, which inherited a $21 billion surplus in a growing economy would at least have a few years before it would destroy the country’s fiscal position. We know that sooner or later Labor governments always destroy the country’s fiscal position.

John Williams (NSW, National Party) Share this | Link to this | Hansard source

It is the lesson of history.

George Brandis (Queensland, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

Thank you, Senator Williams. That is the lesson of history and I will go back to it in a moment in these remarks—

Brett Mason (Queensland, Liberal Party, Shadow Parliamentary Secretary for Education) Share this | Link to this | Hansard source

Senator Mason interjecting—

George Brandis (Queensland, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

As Senator Mason rightly points out, we on the Liberal side of politics, we neoliberals, wear our badge with pride—don’t we, Senator Mason?

Brett Mason (Queensland, Liberal Party, Shadow Parliamentary Secretary for Education) Share this | Link to this | Hansard source

Absolutely!

George Brandis (Queensland, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

Absolutely. We are always the ones who have to clean up the mess after Labor governments have destroyed the country’s fiscal position. But, nevertheless, what a difference a year makes! Mr Acting Deputy President, did you know that last Saturday it was 62 weeks since the change of government? It was 62 weeks since Mr Howard and his ministers—since I and Senator Mason—surrendered the seals of office and 62 weeks since the responsibility for the management of the Australian economy was placed in the hands, as it should have been as a result of a wonderful democratic process, of the Australian Labor Party.

In 62 weeks what has been the result? I can tell you, because the day before yesterday in the House of Representatives the Treasurer, Mr Swan, and the Minister for Finance and Deregulation, Mr Tanner, tabled the Updated Economic and Fiscal Outlook. The Updated Economic and Fiscal Outlook projects that by 2008-09 the budget will have moved into deficit to the tune of $22.5 billion, a reversal of the nation’s fiscal position of more than $40 billion in a year. In 62 weeks there has been a reversal of the country’s fiscal position of some $43 billion—that is, not quite a billion dollars a week. It took the Hawke and Keating governments 13 years to accumulate $96 billion of debt. It has taken the Rudd government little more than a year to accumulate half that already and to reverse the nation’s fiscal position by half that much already. And the Labor Party asks, ‘Why is it that you Liberals are going to vote against this so-called economic stimulus strategy?’ The reason we are going to vote against it is to protect the national interest from a Labor government gone crazy, a Labor government gone mad with its addiction to spending and borrowing as the only tool of economic management.

We do not say that there should not be stimulation of the economy to deal with the current downturn. Mr Turnbull in his statement to the nation last night and in his interviews on The 7.30 Report and other programs indicated measures which the Liberal Party—the party that can be trusted with the prudent management of the economy were we today in power—would have implemented. It would have implemented, in particular, tax cuts so that people could project forward what their savings would be and might thereby be encouraged to change their household budgets and elevate their expenditure rather than merely pay off debt and not contribute that money into the circular flow of the currency. So we do not say there should not be a stimulus. What we say is that the magnitude of this package is reckless and the targeting of the package is wrong.

There are two fallacies—two lies—that have been put about by Labor Party politicians to try and justify this reckless expenditure, this policy decision which will cripple our children and perhaps our grandchildren with debt. The first of those fallacies, which was articulated among others by the Prime Minister when he stood up in the House of Representatives on Tuesday, pale-faced, panic stricken and petulant, to announce these measures, is that the reversal of the budget position is the result of the decline in the government’s revenue because of the economic slowdown.

The Prime Minister’s claim is belied by his own government’s document, the Updated Economic and Fiscal Outlook, because those with a taste for drilling into the detail of these documents will find, on page 40 in table 4.2, ‘Reconciliation of Australian Government General Government Sector Underlying Cash Balance Estimates’, a disaggregation of the extent to which the deterioration of the budget position is due to policy decisions of this government and is due to a decline in the revenue. What table 4.2 tells us is that taxation receipts estimates have been revised down by $9.5 billion in 2008-09, while the effect of policy decisions in the so-called stimulus package is recorded as $18.037 billion. That is in addition to the $10 billion economic stimulus package announced in December, which many consider was largely ineffective.

So the value of the policy measures—the decisions made by the Australian government in the last 2½ months—has been the expenditure of $28 billion. The effect of the decline of the revenue has been $9 billion. Let us not let the Labor Party get away with the lie that the budget has been driven into deficit by a decline in the revenue. Overwhelmingly, by a factor of more than three to one, the budget has been driven into deficit by advertent policy decisions made by Mr Rudd, Mr Swan and Mr Tanner. The second fallacy that is propagated by the Labor Party and in particular by Mr Rudd is that the reason these extreme measures are necessary is the global financial crisis—in which, so they say, Australia stands in the same position as every other Western nation. That is not so. The global financial crisis was generated by imprudent lending practices and deficient regulatory requirements within the United States of America. It was a problem that emerged from the United States of America, in particular from the so-called subprime housing market, and was propagated to other Western economies, including Australia’s.

Brett Mason (Queensland, Liberal Party, Shadow Parliamentary Secretary for Education) Share this | Link to this | Hansard source

It was imported.

George Brandis (Queensland, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

As Senator Mason says, it was imported. Where Australia stands in relation to this crisis is not the consequence of decisions of the previous government. On the contrary, the previous Treasurer, Mr Costello, in 1997—long before the subprime housing crisis was dreamt of—anticipated and, so as to avoid the emergence of such problems in Australia, set up the Australian Prudential Regulatory Authority. The Australian financial system has been largely quarantined from the effects of the global financial crisis. We have had no Bear Stearns, we have had no Northern Rock and we have had no collapse of a Lehman Brothers or Bank of Scotland.

In fact, over the last weekend the Deputy Prime Minister, Ms Gillard, was able to boast at the World Economic Forum in Davos that, of the 11 strongest banks in the world, four are the four big Australian banks. Mr Acting Deputy President Trood, you and I both know that in the international financial system Australia is a relatively small player. The value of our capital markets is a fraction of the aggregate value of the world’s capital markets. A decade ago, not one of the 11 strongest banks in the world would have been Australian banks, simply because of their relatively small size in international financial affairs, but today—because of the decline in the credit base of American, British, European and some Asian banks—four of the 11 strongest banks in the world are Australian. That did not happen by accident; that happened because of the foresight, prudence and judgement of Mr Peter Costello.

But do not take it from me. Let me read you some words from an address last December to the Centre for Independent Studies in Sydney, published in yesterday’s Australian newspaper. The commentator, an economist, said this:

Lax business regulation has contributed to the global financial crisis that has plunged most of the Western world into recession. But before we pronounce free markets dead and 2009 the year of reregulation, let’s analyse what went wrong.

This particular economist goes on to say:

For Australia the short answer is nothing. Australia’s financial regulation is the envy of the rest of the world. Both the International Monetary Fund and the World Economic Forum rank our financial system among the top four in the world.

Who was this sage, who was this Cassandra, who was this Daniel Come to Judgement who announced as recently as last December that for Australia the answer is that nothing went wrong—that, in a financial maelstrom, for Australia everything went right because our financial system is the envy of the world? Why, it was none other than Dr Craig Emerson, the Minister Assisting the Finance Minister on Deregulation—the only professional economist who sits as a minister in the Rudd government. Dr Emerson was right.

The Australian government, the Labor government, will be judged by its response to the global financial crisis. The response so far has been panic stricken and hysterical, and no more so than in a flimsy polemic, the product of a second-rate mind, published by Mr Rudd in the Monthly journal this week. Mr Rudd, contrary to the assertions of his much better educated Minister Assisting the Finance Minister on Deregulation, claimed that it was regulatory failure in Australia, in common with the other Western economies, which was to blame. It is nothing of the sort, as Dr Emerson had the understanding to point out as recently as the month before last. The Rudd government’s response to this crisis has been a panic-stricken, hysterical and wrong-headed response. We Liberals, we who proudly bear the name ‘liberal’, neo or otherwise, will not stand by to see this nation sunk in generations of debt.

John Williams (NSW, National Party) Share this | Link to this | Hansard source

I rise to speak on the so-called stimulation package that the government has proposed—or could we call it the debt package? I go back to 15 September last year, when I presented my maiden speech in the Senate. I intend to quote from it. I drew an analogy between running the family farm and running the nation. I said:

The family farm cannot carry too much debt; otherwise, when the tough times strike, the farm will be in financial trouble. So too with our nation. If governments build debt, they are mortgaging our children’s future away. It pleases me that the previous government paid off our huge debt. This is something that as a nation we can be proud of. It is surely the envy of many.

Here we are today with a Labor government once again in charge of the chequebook. Let us have a good look at what they are doing. They propose to spend $42 billion—$42,000 million in borrowings—on propping up the nation’s economy. Let us have a look at another analogy. We have what greed and reckless, foolish lending by financial institutions has caused around the world, especially in America. Now we face a situation where our economy is like a tyre with a puncture, and it is losing air and going flat. On 8 December the government released $10 billion-odd to blow into that tyre to inflate it. What happened to that $10 billion? We in the coalition supported it because it was money for our pensioners, money that we had called for for weeks or even months. We thought it was a disgrace that single pensioners were trying to survive on $273 a week and said they should receive some assistance. That is why we supported the package. But even with the $10.4 billion splashed around last December the tyre went flat. Now we have a situation where Mr Rudd and Mr Swan are going to inflate the tyre with $42 billion, and we know that in the months to come the tyre will go flat. What are they going to do then? Are they going to just keep borrowing and borrowing? It amazes me that the stimulation bills before the Senate allow the government to borrow up to $200 million.

Let us have a look at Labor’s history and at this stimulation package. We have $14.7 billion for our schools. Of course I support money going into our schools. It was a coalition government that brought in the Investing in Our Schools program to put in money because of state Labor governments neglecting our schools. I think $14.7 billion is too much. Let us look at the next item: $8.2 billion of handouts, $950 for all of those who have a gross income of less than $80,000. Going back to the package in December, I was amazed when one of the returned services clubs told me that in the week after 8 December they took an extra $46,000 through their poker machines. I was also amazed that one liquor outlet had customers ordering pallets of beer—not a carton, not a couple of slabs but pallets of beer. This is stimulating the economy the Rudd way. It is foolish, stupid spending that will only backfire. So we have a system being introduced by those opposite where if you are on $78,000 a year you are going to be handed another $950.

Thankfully, since 3 September we have had a four per cent reduction in interest rates, which has helped many of those people in business and farming and those with home loans. Because of the world meltdown, we have had a reduction in fuel prices. That has also helped. But I was amazed when my chief of staff, Greg Kachel, informed me that while speaking to his 21-year-old daughter last night she had said, ‘The money would be good but who’s going to pay it back and at what interest?’ This is how a typical young person, one whom I might add is apolitical, reacts to this package.

Let us go on a bit further. Let us say you are on $95,000 a year, a huge amount of money. You will get $300. Well, that will stimulate the economy, won’t it! This is just crazy. Let us have a look at rural Australia. Let us have a look at our farmers, who have suffered drought since January 2002. They are going to get a paltry $20.4 million out of a $42 billion package. Those in exceptional circumstances are going to get $950. Now $950 will buy you a tonne of fertiliser. Those over the other side would not understand the cost of fertiliser and the cost of running a farm. One tonne of fertiliser usually goes over 15 to 20 acres, so when you are sowing 3,000 or 4,000 acres of wheat it is a drop in the ocean. However, it will help to pay the phone bill, the utilities bill and the grocery bill, and I welcome that; something is better than nothing for those who actually feed our nation.

Let us go on to the 2.7 million homes that will have batts put in their ceilings, at up to $1,600 a house. I am going to tell you a little story. A very good friend—a very close friend; there is probably no-one closer, as we plan to marry in April—has a wooden home in the little town of Bingara. A couple of years ago Nancy put batts in the ceiling of her house. It has made the house substantially worse, and I will explain why. When you have a stone or brick home, your walls are insulated pretty well, but with a timber—cypress pine—home the heat comes in during the day through the walls and, because of the batts in the ceiling, cannot escape at night through the ceiling. The house is substantially hotter at night during summer because of the batts in the ceiling. That is a fact. I know and Nancy knows. If she had it her way and we had time we would probably pull the batts out. In a wooden house it is a waste of time and a waste of money, unless you do the sides of the house is well. But, if you are going to pull the HardiePlank off cypress pine, you are going to split every panel and it is going to cost you a fortune. So do not think that the batts in the ceiling are going to be the magic wand that will save the economy, give everyone a job and save a swag of greenhouse gas and electricity, because it will not. I know it through personal experience.

Let us move on to this $42 billion package, and I will explain why I will not support it. Our hospitals in New South Wales are in disarray. It was one Kevin Rudd who promised the Australian people prior to the election that the buck would stop with him and that he would fix our hospitals. Go out to Dubbo and explain to the people of Dubbo in western New South Wales that their hospital is fixed. There is actually a rally planned for Friday the 13th—what a suitable date—for the people of Dubbo to protest the conditions of their hospital. Let me tell you about their hospital. It is in the board of Greater Western Area Health Service of NSW Health—one of those magic, great boards that Bob Carr introduced—and it is another failure. Gilgandra and Coonabarabran hospitals, remember, had the meat cut off—they could not pay the butchers’ bills. Now we find that the security companies have not been paid and have threatened to walk out. This is where the doctors borrow the bandages from the local vet so they can actually bandage their patients. This is fixing the hospitals, Rudd style! We have a doctor practising in Bingara who was in the Dubbo area previously. He is owed $50,000 for his services by the Greater Western Area Health Service and cannot get paid. He has had to move out of the area, borrowing against his home loan to keep himself afloat. This is the hospital system that Mr Rudd is going to fix. It is an absolute disgrace. What is in this $42 billion package for our hospitals? The answer is simple: there is nothing in it at all.

What about our aged-care facilities? Haven’t we got an obligation to look after our elderly? Imagine an elderly lady in an aged-care facility in a country town—her husband went to war; they battled through the hard times. These aged-care facilities are doing it so tough they have threatened closure. Surely this parliament, this nation, has a huge obligation to look after aged care. What is in it for them? There is not one cent in it for them. But for someone on $78,000 a year it is: ‘We will give you $950. Go and have a night at a restaurant, buy a heap of booze, do what you like—that will help us.’ But do not look after our elderly.

What about our pensioners? How long have we fought here in our parliament to help our pensioners? As I said, we supported the package last December because it actually helped our pensioners and our carers. What is in this package for our pensioners? Nothing. A single pensioner has got to survive on $273 a week. How can you survive on that? These elderly pensioners, who have done so much for our nation, now live on or below the poverty line. What is in this package for them? Not one red cent. But I tell you what is coming: it is the big bill on the MasterCard. It is coming because Labor is in charge of the bank.

Let us have a look at Labor’s history. Let us go back to the late 1980s and 1990s. Let us look at our states. Victoria went broke, with $60 billion of debt under Labor; South Australia went broke; Western Australia went broke; Tasmania went broke; and, had it not been for the Greiner-Murray governments in New South Wales, it would have gone broke as well. They were conservative governments that actually kept the show on the road. Queensland did not go broke because they had 30 years of National Party government and were debt free. That is what got them through the tough times. That is a fact. I know the truth might hurt some around here, but that is a fact. They were debt free. Being free of debt is something that the Labor governments in Queensland inherited. The government in this place inherited it, too. But we are no longer debt free.

Let us look at the time of the Hawke-Keating government. I remember the big blue when Mr Keating wanted to become Prime Minister. The little squabble started and grew into the big squabble. They introduced a Treasurer by the name of John Kerin. We had him in primary industries; you would be familiar with the bloke. He budgeted for a $3 billion deficit. At the end of the year it was $10 billion, three times the amount. That is not even a good guess. We have people here now saying that they are economically responsible conservatives. The Australian people know differently, because they know the past of the Labor Party managing money, and that is what it is all about. I have no doubt that we are in for a tough year—

Glenn Sterle (WA, Australian Labor Party) Share this | Link to this | Hansard source

That is an understatement. It would be a lot tougher if you lot were in charge.

John Williams (NSW, National Party) Share this | Link to this | Hansard source

Senator Sterle agrees with me. If you simply go and borrow and borrow, who is going to pay for it? It is easy to borrow money—I have borrowed plenty in my life—and it is darn hard to pay back. We know that markets all around the world trade on sentiment, and we know that sentiment is very negative. I will give you an example. Just take the local cattle market. If exports are strong and there has been plenty of rain, plenty of pasture and plenty of grass and you go to buy some cattle, they are dearer. The sentiment is positive. Likewise, when the drought sets in, the cockies are out of feed, there is no pasture, there are big numbers of stock in the market—that is, there is oversupply—the market falls. The sentiment is negative. Sure, we have a lot of negative sentiment right around the world—brought about by foolish, greedy, stupid lending by those in the subprime institutions in America.

There is one problem we face in this world: with banks there is never a level of profit they are happy with. In Australia, if they make $4 billion this year, they want to make $4.4 billion next year and $4.8 billion the year after. They go on taking risks. All of a sudden the wheels fall off the cart, and what have they got? A swag of bad debts—$3.1 billion for the last six months. Sure, these are tough times, but to think to patch that tyre or keep it spinning around by pumping billions of dollars worth of air into that tyre is not going to fix the problem. What will fix the problem is interest rates falling lower and growth through the private sector—the sector that actually drives our nation’s wealth. Then we can grow from the real part of the economy, not from governments borrowing and spending.

Remember the years of Keating as Treasurer and Prime Minister, when he said, ‘We are running at 3½ or four per cent growth’? Half of it was from money borrowed by the government. Then, when the coalition got into power, they inherited a huge debt. It took 10 years for the Howard government to pay off that $96 billion debt. As I said in my maiden speech, we surely were the envy of the world when we did. Now it has taken a bit more than 10 months for this government to plunge us back towards the same level of debt. If this $42 billion package does not save the nation—and I frankly say it will not; the tyre will still go flat—how much more are we going to borrow? Will it be another $60 billion or another $100 billion? ‘Just throw it on the MasterCard. She’s right; the next generation will pay for it.’ If we are looking at the $200 billion debt that this government is proposing through that bill, at five per cent interest, that is $10 billion a year in interest only. If it is a 20-year loan, it will be another $10 billion. The taxpayers of Australia are going to have to pay $20 billion in interest and principle. And it has to be paid. If we do not pay it, we will go down the road of America—that is, huge government debt and one huge financial mess.

Hence, I believe this package is reckless spending. It pays no attention to our elderly, our pensioners, our aged care facilities or our hospitals the Prime Minister is going to fix. Well, good luck! I believe it is a package to bail out the Labor state governments that have neglected our schools, hospitals—there are no hospitals in this case, but the states are the ones who neglected them—and public housing et cetera. It is a cop-out for the financially disgraceful management of our state Labor governments. I refer to New South Wales. I think Mr Rees is still Premier. They change pretty often these days. I do not know how the factions and the warlords are getting on. But, on the way that state is managed, this package is a bailout of people like Mr Rees and shores them up for the 2011 election. He will need a lot of shoring, that is for sure. Wouldn’t you agree, Senator Sterle? The package is too great. It will not keep the tyre inflated. The tyre will go flat and I worry what sort of borrowing will continue after that.

Finally, I will sum this up with a question. Why the rush? ‘We told the people the money would be there in early April.’ Labor expect the Senate to have a $42 billion package put forward and to rubber stamp it. ‘Trust me,’ says Mr Rudd. ‘Trust me,’ says Mr Swan. ‘We will fix it. Just rubber stamp it. It’ll be right.’ That is a disgraceful attitude. And now people are slinging off at us today because we want to scrutinise the package, to have a look at what is in it. We are copping flak for that, but to rush this through would be a disgrace. It would be an absolute betrayal of the Australian people. You would wonder why we even have a Senate. The government expect us to rubber stamp this and pass it today. Thank goodness others around the chamber have the brains and the intelligence to take it easy, to have a look at it, to see what the government are actually doing. I appreciate their support on that. Let us be fearful of where this debt is going. I would imagine that, if this passes, it will be only a matter of months before we are back here discussing the next package—$60 billion, $70 billion, whatever it will be.

Michael Ronaldson (Victoria, Liberal Party, Shadow Special Minister of State) Share this | Link to this | Hansard source

Before I get into my comments on this package, there is one observation that I would like to make—which I am sure has not been lost on others in this chamber. This is potentially the most significant package that has ever been put through either chamber. I looked at the speaking list and what did I see? I saw the names of coalition senators wanting to speak on this bill. Is there one member of the Australian Labor Party who has their name down on the speakers list to speak on the largest package that has ever been through this parliament?

Opposition Senators:

Opposition senators interjecting—

Michael Ronaldson (Victoria, Liberal Party, Shadow Special Minister of State) Share this | Link to this | Hansard source

Not one of them is prepared to stand up here and defend this package. Not one single member of the Australian Labor Party has their name down on the speakers list to debate this package.

Glenn Sterle (WA, Australian Labor Party) Share this | Link to this | Hansard source

We all agree it’s great!

Michael Ronaldson (Victoria, Liberal Party, Shadow Special Minister of State) Share this | Link to this | Hansard source

Not one single person.

Mathias Cormann (WA, Liberal Party, Shadow Parliamentary Secretary for Health Administration) Share this | Link to this | Hansard source

The government is gagging you!

Glenn Sterle (WA, Australian Labor Party) Share this | Link to this | Hansard source

I can’t wait to tell all the people in Stirling, Cowan and Swan and tell all the schools that you’re making sure they don’t—

Michael Ronaldson (Victoria, Liberal Party, Shadow Special Minister of State) Share this | Link to this | Hansard source

When the Australian people are judging the integrity of the Australian Labor Party in relation to this package, they will need to look no further than who is prepared to speak on this and who is not.

Glenn Sterle (WA, Australian Labor Party) Share this | Link to this | Hansard source

Senator Sterle interjecting—

Stephen Parry (Tasmania, Liberal Party) Share this | Link to this | Hansard source

Order! Senator Sterle, it is disorderly to shout across the chamber. Remarks must be addressed to the chair. If you have a point of order, please raise one.

Michael Ronaldson (Victoria, Liberal Party, Shadow Special Minister of State) Share this | Link to this | Hansard source

We have had interjections from Senator Sterle. I have had a look at the speakers list and I cannot see Senator Sterle’s name on there. So he is happy to sit in here and throw a bit across the chamber, but he does not have the intestinal fortitude to put his name down to debate it. After all the crocodile tears we have seen shed by the Australian Labor Party over the last decade about the role of the Senate and the ability of the Senate to scrutinise the actions of government, what did we see today? They tried to ram it through without any scrutiny from the body that for 10 years they said was being stymied by the former government. It is probably the most hypocritical action I have ever seen in my life. They try to gag the debate; they will not stand up and put themselves on the line to debate it. What an extraordinary outcome and how incredibly duplicitous those people are.

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

You have nothing to say about the bill, though.

Michael Ronaldson (Victoria, Liberal Party, Shadow Special Minister of State) Share this | Link to this | Hansard source

Another voice from the wilderness! Senator Marshall will love this bill because there is absolutely nothing in here which forces the government to look at the long-term ramifications. Senator Marshall is quite happy to bankcard everything. He is well known for supporting the nefarious activities of the Cain-Kirner government, which sent the state of Victoria broke. He is a member of the Australian Labor Party that was quite happy to defend that. He is not standing up here today because debt does not worry him. It has never worried him and he is not worried about it now. He is not going to talk about it, but he sits across there with a silly grin on his face throwing some stuff across the chamber. Why doesn’t he have the intestinal fortitude to stand up and debate this?

While we are on people who are not prepared to stand up, I just wonder where Mr Darren Cheeseman, the member for Corangamite, is in relation to this bill. Mr Cheeseman, of course, has been running around saying, ‘There is money coming for the Princes Highway West duplication.’ We are talking about $42 billion, and where is Cheeseman in relation to this? Where is the member for Corangamite?

Stephen Parry (Tasmania, Liberal Party) Share this | Link to this | Hansard source

Senator Ronaldson, you need to address members of the other house by their correct title.

Michael Ronaldson (Victoria, Liberal Party, Shadow Special Minister of State) Share this | Link to this | Hansard source

I picked two out of three. Where is the money for the Princes Highway West duplication between Waurn Ponds and Winchelsea? We are talking about $42 billion and you cannot even keep a commitment like that. I will be interested to hear what he says, although I suspect that Mr Cheeseman will not be speaking on this matter either.

The one key issue in this package is jobs, and it is the one thing that is missing from this package. It should be about jobs, yet there is nothing in this $42 billion package about jobs. You cry crocodile tears for Australian workers. There is nothing in this package for jobs. Before I go any further, we on this side of the chamber would like to know what happened to the 75,000 jobs that were lauded as the outcome of the last $10 billion cash splash. Where are they? We have not heard a word about it. We heard Senator Evans today saying, ‘People are arguing over 35,000 or 45,000 jobs.’ The reality is that he has not come into this chamber and said whether the 75,000 jobs were created. Now he is trying to play it down to 35,000. Is it 35,000? Is it 10,000? Is it 15,000? Once again, that $10 billion did not create jobs, and this $42 billion package will not either.

Where is the assistance to small business to keep employment high? There is no mention of small businesses. Very few of them will benefit from this. We need a fiscal stimulus which invests in the Australian economy in a way that makes the whole economy more productive, efficient and competitive. Of course, that is why tax cuts are so effective—because every business and household in Australia benefits from them. We believe that an element of the stimulus package should be that it lowers the cost of employing Australians so that we can both retain jobs and promote jobs growth.

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

You’re a bit confused, Ronno.

Michael Ronaldson (Victoria, Liberal Party, Shadow Special Minister of State) Share this | Link to this | Hansard source

Senator Marshall is at it again. He is not prepared to talk on this matter but he is prepared to yap, yap, yap across the chamber. If you are so anxious about this, get up and make a speech. I will be looking forward to it. The reality is that the Australian Labor Party is hopelessly out of its depth. This is just the latest in a string of mistakes. Of course, we have the nonexistent inflation genie. Remember that the genie was out of the bottle. The Prime Minister and Mr Swan were out there goading the Reserve Bank to lift interest rates. They almost threatened the Reserve Bank to lift interest rates. You were told what the impact of that would be. You were told that this economy was in real strife. But, no, you had been running the inflation genie political argument for three months, and you were still doing it in the May budget. Everyone knew at that stage. Blind Freddie knew by May that if you were to put higher interest rates into this economy you would kill it dead. No, you were prepared to run the political argument because you had been on a political course for six months and nothing was going to stand in the way of cheap politics, certainly not killing the Australian economy dead. You were running this line about the inflation genie, and you killed this economy stone-cold dead. In May, you were still doing it.

Then we had the unlimited bank deposit guarantee. This is a government that is totally out of its depth. We had the cash splash before Christmas. I hope those opposite are proud of this outcome, by the way. I hope you will be similarly proud of the potential outcome of this cash splash. I would just like to read something from the Colac Herald to put all this into some sort of perspective:

Gamblers also broke the highest-ever spend on Colac poker machines for a one-month period in December with $756,000, or $24,387 a day, spent.

The December record smashed the previous record of $691,000…

If that is the outcome of a cash splash which you think would benefit the Australian economy, then you need to have a good, long, hard think on what the outcomes are going to be. If you think that an increase in problem gambling is an appropriate outcome of this cash splash, then you will stand utterly condemned for your behaviour. You have been lauding a very marginal increase in retail figures in December, which of course includes alcohol and gambling, which you are not prepared to talk about. I will finish these remarks after question time, but I just want you to think long and hard about this: are you members of a government that is prepared to put at risk the lives of people with gambling addiction by making it easier for that addiction to grow? If that is an outcome that you think is appropriate, then say so. If you think problem gambling is not an issue, you say so. But you have to accept that one of the outcomes of this cash splash will be an increase in spending on alcohol and an increase in spending on gambling. You know that, I know that—we all know that. That is the only outcome that will come from this.

Government Senators:

Government senators interjecting—

Michael Ronaldson (Victoria, Liberal Party, Shadow Special Minister of State) Share this | Link to this | Hansard source

I see that this provides some mirth for those opposite. They think that problem gambling is something funny. They are all laughing and giggling over there. If they think that is an issue for mirth, then that is entirely up to them.

Debate interrupted.