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

The Senate is considering the Nation-building Funds Amendment Bill 2009. The practical effect of this legislation is to rip $2,500 million out of the Education Investment Fund. I repeat: it will rip out $2,500 million. It is important  from time to time to remind ourselves that $2.5 billion, which so easily slips off the tongue, actually represents $2,500 million. This is from the fund that was created with all the ‘wow’ factor of the The Hollowmen only 12 months ago. This Education Investment Fund was going to be the fundamental underpinning of the Labor Party’s education revolution—it was fundamental to it—but, of course, ‘education revolution’ was yesterday’s slogan. It was yesterday’s slogan to be forgotten today. The focus group has told the government that there should be a new slogan, that of ‘nation building’.

So the government, shortly after introducing its budget—the very same evening, about half an hour later—slipped into the House of Representatives this legislation, which will strip $2,500 million out of the Education Investment Fund and place it in the so-called nation-building fund. Why have I been concentrating on this stripping out of funding from the Education Investment Fund? It is because of all the words spoken so very hollowly by the Prime Minister, the Deputy Prime Minister and, indeed, the Treasurer in relation to this Education Investment Fund. Ms Gillard, on 17 September last year, said:

Our reform agenda will be complemented by increased investment in innovation and infrastructure through the new $11 billion Education Investment Fund.

It will be interesting to hear the minister’s response at the end of this debate as to how much money will actually be in the Education Investment Fund after this raid. Prime Minister Rudd, on 25 August, was bemoaning the supposed, alleged run-down by the Howard government in this area, and he said:

We sought to turn that around, and one of the main vehicles for turning—

that—

around in the Budget was the announcement of … an Education Investment fund.

But, of course, as with everything with this government, that was five minutes ago. Now we need a new slogan and we need new money, so we just take the money out of one fund, slip it into another, give it a new name and once again are able to placate the 24-hour news cycle, which is the real driver of this government’s agenda.

That is the matter that concerns us in the coalition the most, Madam Acting Deputy President, because if you have a look at this government’s approach to economic management in this country then you will recall that it was only some 18 months ago or so that Kevin Rudd thundered, about the coalition government, ‘This reckless spending must stop.’ It had to stop. So, in their very first budget, they hoovered $20 billion out of the Australian economy through extra tax revenue measures because we had to slow the economy down! The reckless Howard government had so overheated the economy that it had to be slowed down! Indeed, the Reserve Bank was goaded and cajoled into increasing interest rates with that memorable line that the inflation genie was out of the bottle, one of the more infamous comments by a federal Treasurer—and, of course, no wonder that it comes from the current federal Treasurer, Mr Swan!

That was in May 2008, but, of course, that was for the news cycle for that month. Shortly thereafter, rather than slowing the economy down, they had to inject over $10 billion into the economy for a stimulus package. This is a government that simply has no idea day to day as to how to manage the economy. It has no vision for the future. It has no idea what the fundamentals that need to be addressed are in our economy. One day it is reckless spending: ‘That sounds like a good, focus-group-tested idea, so we’ll throw that into the media for a while. When that’s run its course, we’ll talk about the inflation genie getting out of the bottle and run that for a little while. Then we’ll talk about an overheated economy for a little while.’ Then, without blinking an eyelid, having said all these things only a matter of a few months earlier, the government turns around and says, ‘We’ve got to stimulate the economy.’

It is this same ad hoc, stop-start approach that Labor are now taking to education. The interesting thing is—and I must say that I will keep scanning the newspapers and listening to the airwaves—that I do not seem to hear the Australian Education Union, such a huge funder of the Labor Party at the last election, complaining about this siphoning of money out of the Education Investment Fund into what the minister described in his second reading speech to the House by saying:

This amount will be made available for the new Clean Energy Initiative.

These new clean energy initiatives may well be worthwhile projects, but what we are saying is: why is it that this money is being taken out of the Education Investment Fund, which was promised to the Australian people and, in fact, funded by Howard government surpluses? That is how the money got into this investment fund in the first place—make no mistake. Now Labor, having pledged themselves to the Education Investment Fund and to ramping it up to $11 billion, are siphoning out $2.5 billion—and I remind myself that that is $2,500 million.

What it shows is that this government has no consistent set of priorities. One day it will be education if that is what focus groups are telling it, but the next day it will be nation building, and it will not bother to check to see if its two lots of rhetoric actually match into a common theme for its management of the Australian economy. Indeed, it is interesting to note—and I invite honourable senators to have a look at the legislation that, in fact, set up the Education Investment Fund—that it was specified in the legislation that this money would only be available for certain purposes, which are enumerated from (a) to (l) in the legislation. I have read through those subparagraphs time and time again, and nowhere—and this might surprise honourable senators—does the Education Investment Fund legislation say that the money might be used for new clean energy initiatives. Nowhere in the legislation does it say that. But, of course, the Australian people were told and guaranteed by Ms Gillard, this great champion of education—how she has allowed this $2.5 billion to be ripped out of her portfolio nobody knows—on 13 May 2008, at the time of the second last budget:

The Future Fund Board of Guardians will be responsible for managing the fund.

Let Ms Gillard tell the Australian people and this parliament whether the board of guardians of this Future Fund had any say whatsoever in the diversion of $2.5 billion out of the fund. Let her tell the Australian parliament when it was considered. I have a funny feeling that these guardians on the board of this Future Fund would in fact be experts in the field of education. Chances are they are highly qualified capable individuals, able to make decisions as to where an investment fund in education ought be directed. I just have a feeling that if they were to be asked, ‘Where would money be well spent if you were to pursue new clean energy initiatives?’ they might say, ‘You’re asking the wrong people.’ If that is the case, what it shows and highlights is that Ms Gillard’s promise to the Australian people that the guardians would be responsible for managing the fund was wrong, that there was no intention whatsoever of allowing these guardians to manage this fund, which we were told on so many, many occasions was so vital to the future of Australians, especially young Australians.

Let’s just keep this in mind: Labor has stripped $13.8 billion out of future funds—the health one, the building Australia one and the education one—in about 12 months. $13.8 billion has now been spent and taken out of these funds. You then consider that the cash splashes that were splashed around the community for no benefit whatsoever, other than to keep us out of a technical recession, cost the Australian taxpayer $22 billion. So the simple fact is, but for the cash splash of $22 billion, this sleight of hand, stealing money out of the education fund and putting it into the clean energy initiatives, would not have been necessary. This is the price young Australians are already paying for the spending spree of this government. Not only do they have a $9,000 debt hanging over their heads as result of the spending spree, but they have also been denied the investment of this $11 billion Education Infrastructure Fund, courtesy of the sound management of the Howard government, from being spent on educational institutions around this country. So the young people in particular are going to suffer a double whammy as result of this economic negligence. In fact, I am not even sure if it is negligence. Sometimes I wish it were just mere incompetence, mere negligence. But there is a deliberate pattern emerging—

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

Vandalism!

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

where the government says one thing one day and does the exact opposite the next day, and still places hand on heart, saying, ‘We are committed to our election policies.’ I note in the chamber Senator Mason, a very excellent advocate for education in this country. He has pursued the issue of the education revolution and shown how hollow it actually is, that it was a mere two words, ‘education revolution’, which meant nothing, especially for the young people of Australia. But for the cash splash, the so-called ‘socks and jocks revolution’, the young people of Australia now are going to be denied a real education revolution. We know the ‘laptops for everybody’ was a disaster. We now know, courtesy of Senator Mason’s questioning at Senate estimates, that the school-building program is also a farce. Schools that were slated to be closed down over the next year or two will still have funding provided to them for new facilities. Indeed, I became aware of one school recently that were given $250,000 for a new facility. They were able to get it for $150,000, but when they put in their submission the department bounced it back to them, saying: ‘No, no, no, naughty people! It has to cost $250,000.’ This is how money is being squandered and that is why the Education Investment Fund has to be raided to the tune of $2,500 million.

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

Gross mismanagement!

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

Senator Parry, you are absolutely right—it is gross mismanagement. But methinks it is not so much negligence as part of the 24-hour news cycle spin. Education revolution was five minutes ago; that no longer has any traction. Now it is nation building; now we have to talk nation building. And I am sure by the time of the next budget—but let’s just wait on this. What is the bet there will not be a budget before the next election? Let’s wait and see whether Labor are willing to deliver another budget. That is when the young people of this nation will get hit with a triple whammy. The first whammy is the $9,000 debt. The second whammy is that it is their Education Investment Fund that has now been stripped of funding. Of course, the third whammy will show how the economy is in a complete train wreck scenario because of the mismanagement. For those of us that are over 50, chances are we have lived half our lives. But the young people, whose cause people like Senator Mason and I are trying to champion, still have their lives in front of them. They still have their educational needs in front of them. That is why the stripping out of this money from the Education Investment Fund is so very damaging to the future of our country. Indeed, I recall Ms Gillard—and I happen to note the minister for innovation and industry, amongst other things, in the chamber—told us on 17 September 2008:

Our reform agenda will be complemented by increased investment in innovation … through the new $11 billion Education Investment Fund.

How hollow those words now sound, because we know there was never any intention. If the government were genuinely concerned about education and its funding for the future, they would have said, ‘Education is a better long-term investment in human capital in this country than giving a cash splash of $22 billion.’ Remember the first $10 billion? That was supposed to create 75,000 new jobs, yet not a single job can be identified for that gross waste of money. But then not to be outdone they came into this place with another $40 billion-plus stimulus package, and you would have thought that by spending four times the amount of money there may have been the creation of a further four times 75,000 jobs. No, they came into this place and said that $40 billion on this occasion would not create—only support—90,000 jobs.

What a waste of money these stimulus packages have been. We as a coalition would have had a lot more modest a figure. We would not have had the cash splashes and as a result the Education Investment Fund, which was the guarantee to future generations, the legacy that was able to be left by the sound financial management of the Howard-Costello governments, money that was set aside for future generations, is now being squandered by Rudd Labor.  We take the view in general terms that governments are elected to govern. They are entitled to make decisions, and on this occasion we will not stand in the way of this legislation, but I, on behalf of the coalition, hope I have been able to express our concerns as to why this raid on the Education Investment Fund has been necessary, the damage it will do to the future of our country and especially to the future of our young people and that but for the reckless spending spree, the reckless cash splashes, there would have been no need for this raid and education would have been able to continue to shine and grow as it did under the Howard years.

Let me remind those opposite, in case they comment on the so-called lack of investment under the Howard government, the greatest investment that the Howard-Costello government made in the future of young people was to pay off Labor’s $96 billion debt that it left from last time. We paid that off only in April 2006. That is how long it took. It was only after that debt was paid off that we were able to start investing in schools and set aside these future funds, and Labor has squandered the future funds and got us back into debt to the great future detriment of the young people of Australia. We will seek to champion their cause yet again, as we undoubtedly will be required to, when we fix up the economy after the next election.

Ian Macdonald (Queensland, Liberal Party, Shadow Parliamentary Secretary for Northern Australia) Share this | Link to this | Hansard source

The second reading speech to the Nation-building Funds Amendment Bill 2009 says that the legislation is to provide funding for infrastructure spending priorities and that to do that the bill will repeal the crediting of $2.5 billion from the 2007-08 budget surplus—I want to come back to the word ‘surplus’; it is something we do not understand much about these days—to the Education Investment Fund that was to occur by 30 June this year. This amount is now to be made available for the new Clean Energy Initiative. The second reading speech also says that the Clean Energy Initiative will encourage further research and innovation in clean energy generation and low-emissions technology. On that point I refer to a comment by Dr Glenn Withers of Universities Australia, the peak body representing universities, which criticises the decision to divert funds from the education fund to the Clean Energy Initiative. He is reported as saying that ‘little of the money for the Clean Energy Initiative would go towards universities, vocational education and training or research institutes’. So at last academia in Australia is getting to understand the duplicity in the approach of this government to any issue and, in the instance I have quoted, to this particular bill before the parliament.

I refer again to the second reading speech, in which the government talks of surpluses in the 2007 budget. Madam Acting Deputy President, you and all senators would realise that that budget surplus was really money left to the current government by the Howard-Costello government—money and surpluses that had been built up in the previous couple of years after the Howard-Costello government had paid off $96 billion of Labor’s debt. As those senators who were here in 1996 when the government last changed would remember, in 1996 when the new government came in there was no indication that the current account for that particular year was $10 billion in the red. But when the new government came in and had a look at the books we found that there was almost a secret $10 billion deficit that had been run up in that particular year, and that $10 billion deficit went together with other deficits to create the $96 billion that was owing by the last Labor government. Madam Acting Deputy President, you do not have to look far to understand that this is not an isolated instance. That was the last Labor government. It was $10 billion in debt for that particular year and $96 billion in debt for the 13 years that it was in power. Have a look around at all of the state governments now, Madam Acting Deputy President, and you will see that all are in substantial debt.

It just shows that you simply cannot trust Labor with money. Labor is incapable of managing the taxpayers’ finances. My own state of Queensland, regrettably, has lost its AAA rating. We are facing a budget that is cutting services. In Queensland we are even talking about selling Queensland railways. We are talking about selling all of the electricity generation companies. We are talking about selling the ports infrastructure. These were all things which prior to this time I thought were tenets of the Labor Party philosophy—you know: the government should own all of those things. I see the unions, in their typical way, were demonstrating outside the Labor Party conference the other day. They were not going to let this happen. Of course, the Premier went inside the doors, said a few fine words, all the union bosses scurried around to fall in line and so went through the decision to privatise a lot of the Queensland government infrastructure.

Why is the Queensland government doing that? Because they have run out of money. They are now at a state where they cannot even borrow money without the support of the federal government. If any of you were around in Queensland before the state election just a few months ago, you would have heard stories from the Labor Party of how well the state was being managed and what good shape the finances of the state were in, only to find out two or three short months later that we as a state are in the financial pits. If we were a business we would be going into liquidation. That is what you get from the Labor Party when you leave them in charge of money. This bill before us today is another indication of the Labor Party simply being incapable of making financial decisions that stick.

We thought $96 billion in 13 years was pretty horrendous. Now Australians are beginning to realise that in 18 short months this Labor government has provided not for $96 billion of debt but for over $300 billion worth of debt. How are the Australian taxpayers going to pay that off? The Labor Party are not interested in it. This has been well commented upon. They have come to the conclusion that they will not even try to pay off the debt. They know that the electoral cycle will turn. As every day goes by I think it is going to turn much sooner than the Labor Party intended. They always knew that at some time the electoral cycle would turn and the good old Liberals would come back, take the hard, tough decisions, get the economy back on track and pay off the debt.

It is because of this financial profligacy that we hear reports of interest rates going up. Why are interest rates going up? It is not the fault of the Commonwealth Bank. It is not the fault of the National bank or the other banks. It is because of the huge amount of debt that this government has racked up in 18 short months. It is simply incredible that any group of people masquerading under the pretence of government with financial responsibility can have done that in such a short period. You will remember Mr Rudd telling the Australian public, with hand on heart, that he was a financial conservative. How can he possibly lie straight in bed these nights? He knew at the time that he was not telling the truth, and he has proved that in his actions since that time.

I know time is short and we have a busy legislative program. The coalition will be helping the Labor Party get through the urgent bills that are on the program this sitting fortnight, so I do not want to take too much more of the Senate’s time. Suffice it to say that the Labor Party’s ‘Clean Energy Initiative’ is also as fanciful as their suggestions of financial conservatism or of good economic management. In the two Senate committees inquiring into climate change policy and emissions trading that I have sat on, it has become quite clear that this is another piece of legislation that the Labor Party simply have no idea how to manage.

They have appointed a minister who in the first couple of weeks of government slipped over to Bali, got nationwide publicity—not worldwide publicity, as the Labor Party tried to pretend, but at least they did get nationwide publicity—for signing the Kyoto agreement, an action which meant absolutely nothing and did not provide one iota of benefit for reducing the emissions of the world. We had this minister who was going to solve everything. It quickly became clear that the job was far too big for this minister and so when it got into real problems Mr Rudd, at least realising that he was in some real trouble with the unions, with others, with industry and with financiers on the emissions trading scheme, brought in Mr Combet as Parliamentary Secretary for Climate Change to go out and do the negotiations to try to bring the Labor Party’s emissions trading scheme back on track. Mr Combet has at least spoken to people; many people who spoke to us could not get in to see the minister, but at least they were able to get in to see Mr Combet. As a result of Mr Combet’s work, there were substantial changes made to the emissions trading scheme.

I would not mind betting you that before this bill sees its time out in this parliament there will be other substantial changes, because even the Labor Party now understands that the bill to come before us is a dog of a bill and one that will not make one iota of difference in reducing world emissions or the changing climate of the world—but it will destroy many Australian industries and will ensure that many working families who were working families in the Howard government years no longer have that title. They will be families of unemployed, families whose parents do not have jobs because of the mismanagement of the Labor Party and particularly this emissions trading scheme. In the two committee hearings that I sat through, witness after witness told us of the job losses that would occur.

In Queensland last week, the bankrupt state government increased electricity prices by 16 per cent. The minister who was given the short straw to go out and announce this 16 per cent increase said that if your electricity bill was something like $360 a bill—and I do not have the exact figures with me—it would go up by $55. This was done just because the Queensland government has run out of money. If you think of electricity and what the people of Queensland are paying now, our committee heard evidence that electricity costs for ordinary households would increase by anywhere between 50 and 200 per cent following the emissions trading scheme and the mandatory renewable energy target—the most modest estimate was a 50 per cent increase. While electricity prices in Queensland went up 16 per cent last week, when the Labor Party’s emissions trading scheme and mandatory renewable energy target come in electricity prices will go up another by 50 per cent at least—and perhaps by up 200 per cent.

The Clean Energy Initiative, which is mentioned in this bill, is a joke. Coal companies who appeared before the committee talked about clean energy and what they were doing to help reduce emissions. They have been cut off the Labor Party’s help list simply because they are coal companies and the Labor Party apparently do not like the coal companies. I can tell the Labor Party that many of their union members love the coal companies because they provide them with jobs, and up in my part of Queensland they provide them with very well paid jobs that in the future will not be available thanks to the Labor Party. I can just imagine the outrage and sense of betrayal that unionists in the Bowen Basin coalfields will exhibit when they realise that the government that they worked so hard to get elected just 18 or 19 months ago has turned on them and taken away their most valuable asset—that is, the right to work. Yet coal companies are doing things to try to reduce greenhouse gas emissions. They are trying to do their part but they have been shunned by this government and will not be assisted.

These are matters which we will be debating in the future, but what comes to mind when looking at the bill before us is that the Labor Party are using budget surpluses that were put aside in previous years and taking from education and putting it somewhere else. It again shows that where money is concerned you simply cannot trust the Labor Party.

Christine Milne (Tasmania, Australian Greens) Share this | Link to this | Hansard source

I rise today to say how very disappointed the Greens are with the government’s decision not to keep the money that was promised to the education infrastructure fund in the fund. I would like to remind the Senate of the genesis of this and the conversation and the argument that occurred in the Senate. In the first quarter of last year when the government brought in its Infrastructure Australia legislation, there was a long debate in the Senate. At that time, I pointed out that the government’s total focus on infrastructure in Australia was based on the assumption that Australia would remain a resource based economy; it was all about building coal ports, railways and roads and the rest of it. I pointed out at the time that if you are going to move to a post-industrial, post-resource based economy and move to a low-carbon economy your major investment has to be in things like education. It is critical infrastructure for the nation to invest in education, skills training and retention, and move Australia from being an economy based on digging up things, cutting down and shipping away. We have to become a more sophisticated economy. We have to invest in manufacturing, innovation and new technology, and to do that we need the innovation coming out of our universities.

Subsequent to the establishment of Infrastructure Australia in the budget last year, the government—taking on board what had been said about the need to move beyond a resourced based economy—announced an Education Investment Fund. At the time the government said that that fund would come from the transfer of what had previously been known as the Higher Education Endowment Fund, and that it would be added to in this year’s budget. Interestingly, the amount at that particular time was $6.5 billion, which would be transferred from the old Higher Education Endowment Fund. Now, as a result of the government’s decision to redirect money and not fulfil its promise to the nation last year in terms of education infrastructure, we find that there will still be $6.5 billion in the Education Investment Fund. In other words, all we have in the Education Investment Fund now is what was transferred from the old Higher Education Endowment Fund.

All of the publicity and all the hype last year about the money and the interest being made available to universities, to the higher education sector, to invest in new infrastructure was no more than hot air. I am really surprised that universities across Australia have not been much more outspoken in their criticism of the government’s failure. In part, that is because the government made several promises to the higher education sector in this year’s budget. But I wonder how closely the universities have actually looked at them, because the government’s promises for this year are going to be funded out of the Education Investment Fund. The Prime Minister announced that $4.1 billion has been committed in the 2009-10 budget, so we have already seen a substantial amount of the previous fund, the Higher Education Endowment Fund, spent in this year’s budget, with very little capacity in the future to build infrastructure in education, as indeed the Chief Executive Officer of Universities Australia, Glenn Withers, pointed out on 20 May this year. He said that the sector would require extra funding to cover the infrastructure needed to support the government’s plans to expand the number of students attending universities—reforms announced in the budget—and that this spending was not currently covered by the Education Investment Fund. He said:

To reach those [new participation goals] we need more volume infrastructure, not just excellence infrastructure.

Where is the ‘more volume infrastructure’ going to come from for our universities to physically house and teach the expanded number of students who are going to come—and I hope they do come—from the initiatives to increase participation at the tertiary level? This really has been an extraordinary sleight of hand: $6.2 billion of an existing fund, the Higher Education Endowment Fund, transferred last year into the Education Investment Fund and the promised increases not put into that fund but diverted. The universities have not realised that they are actually losing big time because their Higher Education Endowment Fund—or the Education Investment Fund, as they are now calling it—is going to fund the initiatives from this year’s budget, leaving them precious little in that fund to cope with the capital needs they will have for building infrastructure into the future. That is a bad idea.

What is the money going to be used for? The government has announced that $2.5 billion will not go into education infrastructure; instead, it will go to the $4.5 billion Clean Energy Initiative. One billion dollars of that already existed, so it will have $3.5 billion and—what a coincidence—$2 billion has been promised for industrial-scale carbon capture and storage projects under the carbon capture and storage flagship program. So we are seeing $2.5 billion for infrastructure taken out of the universities sector and given straight to the coal industry. This is the community subsidising coal to the detriment of students and increased participation rates in our universities.

The Greens’ view is well known to the Senate—that is, if the coal industry is confident that carbon capture and storage will work then it will fund it itself. After all, the coal industry has made extraordinary profits over the last 150 years by treating the atmosphere as a waste dump for the coal industry, privatising the profits and socialising the costs. The cost is the greenhouse effect. The cost is global warming. And it is being met by increasing numbers of people dying around the world because of the impacts of global warming that are striking us right now. Why wouldn’t you expect the coal industry to spend $2 billion on its own future? It has no legitimacy without carbon capture and storage. Several of Australia’s leading scientists, David Karoly amongst them, wrote to the coal industry recently saying: you cannot continue with coal-fired power stations unless you have carbon capture and storage, and that technology is not going to be available in the foreseeable future—certainly not in the time frame in which the Intergovernmental Panel on Climate Change has said we need to address dangerous climate change. We only have until 2015, and carbon capture and storage is going to be nowhere in that time frame.

Only last week I was at the CSIRO centre in Newcastle talking to them about the work they are doing on carbon capture and storage. Here is another example of the complete failure to have a whole-of-government approach on these issues. That particular research institution is looking at the capacity to capture carbon from coal-fired power stations—postcombustion capture—but who is actually doing the map on the capacity for storage? It is no use proving you can capture CO2 unless you can also prove you have the volume capacity in suitable geological structures to absorb the liquid carbon dioxide you are going to end up with at the end of the process. It is no use proving it if you cannot afford to pipe the liquid carbon dioxide from the Hunter Valley down to the Otway Basin in Victoria. Whatever that is going to cost—and of course it will be the community who end up paying for that infrastructure too; you can guarantee it—it will never be cost-effective compared with wind and solar thermal, which you can bring on-stream right now.

The issue here is that instead of the government honouring the commitment to the higher education sector that they made in last year’s budget—and there were accolades from one end of the country to the other because at last Australia was going to invest in education—we find that they are not investing in education at all. They are using the previously acquired funds of the Higher Education Endowment Fund to fund this year’s budget promises. There will be no capacity to build the infrastructure that will be necessary if we are to move to a postindustrial society. If we are to get beyond digging holes and cutting down and shipping away, we need not just excellence in our universities but the people and the physical space and infrastructure to absorb them.

I think it is very interesting that the government has not actually specified where the $2 billion is going in terms of the Clean Energy Initiative. It is trying to suggest that the $2 billion will just get mixed up in the $3½ billion of new money that is going to be spent partly on the $2 billion Carbon Capture and Storage Flagships program. There is $500 million going into Renewables Australia, which is the $500 million previously promised. Then there is $1.6 billion in solar technologies including $1.4 billion in the Solar Flagships program. So mixing clean coal and solar into this Clean Energy Initiative could imply that some of this money is going into solar. If that is the case, the government should be finding the money for solar energy elsewhere in its budget; it should not be taking it out of money that was promised to students in Australia to allow them to participate fully in reasonable conditions—physical spaces—in our universities.

This is a retrograde step from the government. I do not believe that one cent of public money should be used to cross-subsidise the coal industry’s research on carbon capture and storage. That industry is rich enough to pay for its own research. Its future depends on paying for its own research and proving it in a time frame that is consistent with the scientific imperatives. I strongly want to put on the public record the fact that the Greens are disgusted with the government’s sleight of hand on the education infrastructure funding initiative announced last year. As I indicated, I am very surprised that the university sector are not more outspoken on this. We can expect them to be more outspoken in the future as they come to realise how little will be left in the education infrastructure fund when the real test is absorbing this larger number of students, whom I hope we get enrolled. When they do enrol in universities across the country, the universities will be back here saying, ‘What happened to our education infrastructure fund?’ What will have happened to it is that it will have gone across to the coal industry to pump good money after bad down holes in the ground—into technology that is not economically viable and will not be economically viable in the time frame required. Every dollar spent on that carbon capture and storage is a dollar that is costing students, and that ought not to be the case.

Kim Carr (Victoria, Australian Labor Party, Minister for Innovation, Industry, Science and Research) Share this | Link to this | Hansard source

I thank senators for their contributions to this debate. I think there are some matters that require some response. First of all let me draw the chamber’s attention to the fact that this budget includes $22 billion worth of investment in nation building and infrastructure. This investment will provide an economic stimulus in the short term to build jobs during a global recession. It will also build critical infrastructure, which we will need for future productivity as the economy recovers and we move forward to ensure the prosperity of this nation into the future. The Nation-building Funds Amendment Bill 2009 is required to give effect to the government’s infrastructure program as well as to investments in a new broadband network and transport infrastructure such as ports, roads, rail, hospital and higher education. The government will also be investing some $4.5 billion in the new Clean Energy Initiative.

The Clean Energy Initiative will encourage further research and innovation in clean energy technologies that will play an important role in Australia’s transition to a low-pollution economy. The Clean Energy Initiative will help accelerate the development and deployment of carbon capture and storage, solar energy and other forms of renewable energy. Of course, the government stand in sharp contrast to the Greens. We are not going to turn our backs on the coal industry. We are not going to turn our backs on the coal communities of this country. We are not going to turn our backs on an industry of this significance in terms of its contribution to both the economy and our society. We are ensuring that we are able to meet some of the greatest challenges this country has ever faced, in terms of climate change, in a responsible manner that ensures we have jobs for people into the future and we are able to provide the economic security that our people rightly deserve.

This bill provides funding for these priorities. It repeals the crediting of some $2.5 billion from the 2007-08 budget surplus to the Education Investment Fund, which was to occur on 30 June 2009. These are propositions that we made clear at Senate estimates; there is no secret about this approach. We made it very clear right from day one that we were able to support an expansion in infrastructure spending for the higher education and research sectors in quite considerable terms. We also said that the future commitments to the EIF program would be conditional on the macroeconomic circumstances of the time, and I do not believe that anyone in this chamber can seriously argue that the economic circumstances of this country have not changed, as they have throughout the world, since the collapse of Lehman Brothers in the United States last year.

What we said, and remain committed to, was that we were going to have a massive expansion in capital programs in all sectors of education in this country. So, on top of the largest single modernisation program in schools that this country has ever seen, we have also seen the government allocate some $5 billion in the last 18 months to higher education and research infrastructure in this country. How does that stand in comparison to the previous 11 years of coalition government? In that period the coalition invested $1.1 billion. So, in 18 months, we allocated $5 billion; in 11 years the conservatives of this country allocated $1.1 billion. And we see the crocodile tears from those opposite, as they say they now want to ensure there is adequate funding for a range of other programs on top of what is, in this current budget, the largest single investment in research and innovation that this country has seen for 30 years. Have we heard anything in support of that? Not one word.

We note that the government—in terms of draw-downs over the next four or five years, on top of what we have already spent—were only indicating commitments to some $4 billion in EIF funding. We have seen that in posts right across the teaching and research sectors of this country. On top of that, very substantial sums of money are also going for medical research, so that is in addition to what I am arguing in regard to the particular use of this fund. It is not credible for the opposition to claim their concerns about these matters in the context where not only do we have these additional commitments to those we already made but total funding commitments in the context of what is a $5 billion spend. The balance of the EIF will be some $2.4 billion, plus investment earnings estimated to be around $630 million over the forward estimates, and there will be further additional investments in VET, in universities and in research.

What has been put to us by Senator Milne is clearly fanciful. Four hundred million dollars is going to clean energy research in this budget alone. She gives no acknowledgement of that whatsoever but makes spurious claims about what is still available for future investments in higher education, in research and, of course, in ensuring that we have the capacity to provide the answers to some of the challenges that this country currently faces in terms of our climate action program. There is more than $6.5 billion in the Education Investment Fund for education and research, of which $4.1 billion has been committed in the 2009-10 budget and in terms of the nation-building package announced by the Prime Minister on 12 December 2008. There is a substantial proportion of funding available for future commitments on top of that.

The Rudd government’s performance in regard to higher education, research and innovation is second to none in this country. In 18 months we have demonstrated that. You had 11 years, and in 18 months we have surpassed your record by a figure of $5 billion to $1 billion, so I find it extraordinary that these spurious claims could be made by coalition senators, aided and abetted by the Greens, on this matter. I commend the bill to the chamber.

Question agreed to.

Bill read a second time.