Friday, 22 June 2012
Financial Framework Legislation Amendment Bill (No. 2) 2012; Second Reading
As I rise to speak, I should note that we have just seen the 12th package of bills guillotined in this place as a result of the government's guillotine motion passed earlier in the week. Senator Edwards, I know, was extremely keen to speak on the Broadcasting Services Amendment (Digital Television) Bill 2012, but that right for him as a senator to speak has been denied, yet again. I just thought it important to note that as we commence this particular debate.
The bill before us, the Financial Framework Legislation Amendment Bill (No. 2) 2012, is probably one of the drier pieces of legislation which comes before this place. I see one of the clerks raise an eyebrow. I do appreciate that all pieces of legislation are equally scintillating for the clerks. They can find beauty and elegance in each piece of legislation!
This bill seeks to make technical amendments to 21 acts across six portfolios. It forms part of an ongoing program of improving the financial framework as issues arise. The coalition supports in principle the program. This is the 10th financial framework amendment bill since 2004. It seeks to correct anomalies, add clarity and ensure consistency across government acts. It also aims to ensure that legislation is up to date and properly reflects actual and efficient financial practices. The program also seeks to ensure that financial arrangements are consistent with constitutional requirements. Some have suggested to me that this is tedious work. It may well have its arduous elements but it is nevertheless important work.
This bill is, as I indicated, broad in its reach, covering some 21 acts, but the amendments, although technical, are important and vigilance is required. We always have to be mindful of unintended consequences or inequitable outcomes, which is why it is important that all pieces of legislation, regardless of how innocuous they may seem, receive the scrutiny of this place. We obviously do not want to see changes that will inadvertently make people worse off.
The coalition has examined closely the amendments—Senator Cormann in particular has paid close attention to these. A number of amendments affect the agriculture portfolio. In addition, other amendments which have been closely examined relate to the validation of certain benefits under the Defence Force Retirement and Death Benefits Act 1973. They were made as a result of Commonwealth administrative breaches. There are also amendments proposed across various superannuation related acts—and I know that is an area of policy that you, Mr Deputy President, take a close interest in. These would put in place provisions for the Commonwealth to recover inadvertent overpayments in line with provisions under the Financial Management and Accountability Act 1997. Other amendments in the superannuation area would allow payments made between a recipient's death and the time when the Commonwealth is notified to be recoverable from the deceased person's estate.
There are also provisions under the Taxation Administration Act 1953 which would allow the Commissioner of Taxation or their delegate to make discretionary recoverable advance payments. This relates to benefits that may be in dispute but for which entitlement is likely to be established or re-established. This would only be applied if the Commonwealth were satisfied that the eventual costs associated with halting payments would be greater than if the advances were made. This is designed to require considerations of efficient, effective and economical factors in making payments consistent with the FMA Act.
In the agriculture portfolio, there are amendments which clarify the arrangements around Commonwealth support payments to industry bodies. These payments are subject to a limit of 0.5 per cent of an industry's annual gross value of production, known as GVP. They are based on data prepared by the Australian Bureau of Agricultural and Resource Economics and Sciences, ABARES. In practice, the most up-to-date ABARES data may not be available until after the payments are required. As a result, payments made could inadvertently exceed the 0.5 per cent limit. The amendments would allow for determinations to be made by 31 October. If the amount paid ultimately exceeds 0.5 per cent, the recipient body will pay to the Commonwealth an amount equal to the excess. If an amount has not been determined by 31 October, the payment will be based on the industry's GVP from the previous year. The shadow minister for agriculture, Mr Cobb, has been consulting with relevant groups and organisations and no concerns have emerged.
In the agriculture portfolio again there are also amendments which put in place more efficient ways of recovering administrative costs associated with making payments to agencies. Under the National Residue Survey Administration Act 1992, there are amendments which align payment approval requirements with actual practice. The NRS is entrusted with monitoring for harmful residues in Australian agricultural products and is funded through industry levies.
In relation to amendments in the DFRDB and other areas of superannuation, it is important that the government commits to fully communicating any changes to scheme members—for example, the changes associated with provisions to recover overpayments for a deceased person's estate. The amendments under schedule 2 of the bill in relation to the DFRDB scheme, importantly, have provisions in place to offset debts owed by members as a consequence of previous administrative breaches.
The changes in this bill are obviously reasonable. There has been a genuine effort to improve the efficiency of the financial framework, and that is welcome. This bill is in nature technical. The work behind it, I am sure, has been forensic. I do say, however, that it is a pity that the good and hard work of the Commonwealth officers behind this bill and their diligence are not reflected by the executive government in its broader management of Australia's finances. You do, for instance, have a government that refuses to subject the $50 billion NBN project to a cost-benefit analysis and is prepared to risk $10 billion of borrowed taxpayers' money on speculative clean energy projects. I see Senator Whish-Wilson here in the chamber; that $10 billion program will be one of Senator Brown's legacies. It was part of the price that the Greens extracted from the government to support them and to become part of the formal governing alliance of Labor and the Australian Greens.
If I can provide Senator Whish-Wilson with any initial advice as he comes to this place it is that he learns from the mistakes of his immediate predecessor, Senator Brown. Senator Brown was someone who really had no regard for the value of a dollar, particularly a dollar compulsorily acquired from the Australian taxpayer. Every single dollar that is put to a purpose by the Commonwealth is an opportunity cost. If you spend a dollar on something it means that there is a more worthy cause that that particular dollar cannot be spent on. I hope Senator Whish-Wilson, with his background in finance, brings an economic rigour to bear in the Australian Greens, which has so far to date been absent.
The current government has demonstrated itself over its five years in office—it does feel a lot longer than that, I must say, not just for us on this side but for the Australian public as well—to be remarkably consistent in one respect, and that is in relation to profligacy. I well recall the former Prime Minister, Mr Rudd—who is, as we know, on the comeback trail; we will probably see him resuming that position in the not-too-distant future—when he was the opposition leader. He was the official opposition leader rather than the Prime Minister's shadow, which he is at the moment. I remember at that time that Mr Rudd was at an ALP National Conference—Senator Evans will correct me if I am wrong—where, referring to the Howard government, he said, 'This reckless spending must stop.' Now that was said against the backdrop of a government that had delivered 10 budget surpluses, a government that had eliminated $96 billion of Labor government debt, a government that had established the Future Fund and a government that had lived within its means. But let us just put all that aside for one second. Mr Rudd said, 'This reckless spending must stop.'
Also at that time Mr Rudd—and I remember the television ads with him standing in a bright room—said to camera: 'Some people call me an economic conservative. It is a badge I wear with pride.' And we were all meant to believe that Mr Rudd was just a younger, fresher version of Mr Howard. The Australian public were meant to believe that. Back then, we had Mr Rudd accusing the Howard government of reckless spending. We had Mr Rudd saying that he was an economic conservative—a badge that he wore with pride. He was misleading and deceptive to the Australian public. If the ACCC had jurisdiction over the comments of politicians—and I am not suggesting for a second it should—he would have been done for misleading and deceptive conduct, without a doubt.
We recall Mr Swan's first budget, where he stood up and proudly proclaimed that he was going to be delivering a budget surplus in, I think, excess of $15 billion. He also proudly proclaimed that the budget surplus as a percentage of GDP would exceed the target of 1.5 per cent that he himself had set for the government. As we know, the final budget outcome for the first financial year of this government was a deficit, and it has been followed by deficits every year since. This government has delivered four solid budget deficits and it is well on its way to delivering a fifth budget deficit. Mr Swan has forecast a budget surplus. It is a wafer-thin one. At best you would say it is a technical surplus, but there is absolutely no confidence in the community or on this side of the chamber that that budget will ultimately, when we see the final budget outcome in September next year, after the next election, deliver a surplus. There is no confidence at all that it will be anything other than another budget deficit. It is something that annoys me greatly, for a number of reasons. The first is that as someone who worked—
Thank you, and I am being relevant to the bill, because this bill is in relation to financial framework legislation. I am talking about the broad context of the financial management of this government. What frustrates me greatly in relation to this government's financial management—the broad financial framework, the grand architecture of this government's fiscal policy—is that the previous government worked extremely hard to pay off $96 billion of debt that was inherited. I know, because I worked on a Treasurer's staff. I saw how hard that was. I know, because I served as a senator during some of the time of the Howard government. I know how difficult it was to pay off that $96 billion and how it took the previous government the best part of a decade to pay off that money. It was done without any help from the Australian Labor Party. Every savings measure that was put forward was rejected. You would think that if you were responsible for racking up that debt in the first place you might feel some responsibility for actually repaying that debt. That did not happen, and already we are approaching a net debt of $145 billion. This government has already exceeded, in a little over four years, the debt that was accumulated under the Hawke-Keating government. So that annoys me, because I know how hard it is to repay debt, and I tend use the rule of thumb that for each year of bad government it takes three years of good government to undo the damage.
Another reason the profligacy of this government annoys me is in relation to my own portfolio—disabilities. The parliament is united, I am pleased to say, on supporting the establishment of a National Disability Insurance Scheme. The Productivity Commission has estimated, on advice updated by the Australian Government Actuary, that there would need to be an additional $7.5 billion per year to eliminate waiting lists for supported accommodation, aids and equipment, and other things that people with disability need. In the Commonwealth budget $1 billion was allocated towards the National Disability Insurance Scheme, on which the Productivity Commission, over the forward estimates—the period that the $1 billion covers—recommended that $3.9 billion be spent. So there is a shortfall there.
The current government is forecast to spend, in the next financial year, above $7 billion on its annual debt interest costs. That means that if different decisions had been taken over the course of this government—if the government had not gone into deficit, if it had not gone into debt—there would be the funds to fully cover the resources required for a National Disability Insurance Scheme. I come back to a point I made earlier, and that is that for every dollar spent there is an opportunity cost. We see that most clearly with the $7 billion plus per annum being spent on the government's debt interest bill. Every dollar of that $7 billion plus is a dollar that is going towards absolutely nothing—not to a bridge, not to a road, not to a school, not to a supported accommodation place but to absolutely nothing. That is what that $7 billion plus a year buys you: absolutely nothing.
I know it is in vogue now to say that going into debt does not really matter, and of course there are occasions when Commonwealth budgets go into deficit. But as far as possible a government should live within its means. As far as possible a government should be a careful steward of each dollar of taxpayers' money, because there is a cost to not being a good steward. The government can find $10 billion for Senator Bob Brown's legacy scheme, a scheme that will pick losers. It is bad enough when governments try to pick winners, but this scheme consciously, deliberately, goes about picking losers. Government should make sure that it focuses on its core business. For me, the core business of government is to assist people who find themselves facing additional challenges for reasons beyond their control. That core business is compromised when governments are profligate, when governments waste the taxpayers' money.
I hope that the government can bring the same rigour, the same evidence based approach, that is shown in the Financial Framework Legislation Amendment Bill (No. 2) 2012 to its conduct and management of the Commonwealth's finances so that maybe they can achieve what Kevin Rudd wanted, and that is to be economic conservatives. I live in hope, but I will not be holding my breath.
As I continue on from the remarks of Senator Fifield on the Financial Framework Legislation Amendment Bill (No. 2) 2012, it is interesting to note that, as we speak, our debt has just gone up by another $2.4 billion. 'That's not a problem! That's not a bad day in the office, that one, is it! We don't care anymore! It doesn't matter.' It's all out of control, isn't it? They just do not care. Let us just work that out. About $300,000 would be a fair price for a house in a regional town. I imagine Senator Whish-Wilson would probably think that was around the money. That is 8,000 houses. We have just borrowed the money for 8,000 houses. The census tells us that there are about 2.3 people per house these days, so that is houses for about 18,400 people—a town or suburb. The government have just borrowed that. You people in the public gallery are going to pay it back. It is just out of control.
This is all about the financial framework. Any other business would start to tell you that that is a real problem. When you have got debts in excess of $233 billion, they would start to say that that is a bit of a problem. All we get from this government is that we are not as bad as Greece or Spain or Portugal. That is like walking around the graveyard and saying, 'That one is more dead than that one.' It does not matter anymore; it is just a figure. We keep on going down this path because the government have just got no competency whatsoever in financial management—none.
This is to do with superannuation. The Commonwealth superannuation liability, as we speak, is $139 billion. If the government use all the money in the Future Fund—they have got about $77 billion in the Future Fund—there will still be this massive discrepancy of unfunded superannuation liability. That is not added to the debt. That is not part of the $233 billion. That is on top of it. If any individual or any corporation did that, you would go to court. The government do not bother funding their superannuation liability. The only way you can fund your superannuation liability is to get a surplus, but they have not been getting surpluses; they have been getting deficits. The public superannuants around this town, Canberra, and other towns have a figure on a piece of paper saying what they are owed in super, but the government does not have the money in the bank to pay it.
While there is all the anarchy and madness that we see in the front of this government—the Mr Slippers, the Mr Thomsons, the getting rid of an elected Prime Minister and replacing him with another one, the being about to get rid of that one and replace her with another one—what is happening in the background is that the place is completely out of control as well and the finances are completely out of control. So, in talking about the financial framework that pertains to superannuation, we have to acknowledge the financial problems that this nation is getting itself into every week—and all we get are these oblique remarks. One of the ways that they are going to get money in the future is through the carbon tax. This is what they do when they run out of money. First of all what they do is create moral outrage and say, 'Outrage! You must feel guilt. You must assuage your guilt.' And how do you assuage your guilt? 'Well, you accept my premise for how we are going to cool the planet.' How they going to cool the planet? With a tax. It is so bleedingly obvious. That is how you cool the planet: with a tax! Didn't we all notice when they brought in the GST that the place got colder? But, of course, the tax had no effect whatsoever.
Why this is interesting and pertinent today is that, in this rolling fiasco of this circus of madness, today they have appointed to the Climate Change Authority, as one of the people who will instruct the minister to jack up the tax, a very interesting gentleman, a bloke by the name of Clive Hamilton. Clive Hamilton is going to be one of the instructors to the minister, to tell them to put up their tax. This Clive Hamilton has come up with some interesting things lately. One of the things that he has said is that he believes at times that we have to dispense with democracy, because it gets in the way; that you have got a greater moral duty at times just to dispense with democracy. It is an interesting person for a democracy to appoint: a person who believes that you can dispense with democracy. He also believes that at times it is morally right to break the law for the sake of fighting the climate. And he is the one who will be making the recommendation to the minister to 'take your tax up' from what it would initially be—$23 a tonne. It is completely and utterly insane and way beyond where any other nation is at. It is an insane tax. You should not have it at all. He is the one that will make the recommendation that 'to fight the climate, to fight the frost and to fight the fog we must increase it'. Of course, even in their own modelling they talk about taking it up to $131 a tonne. So a man who does not believe in democracy and a man who postulates that it is all right to break the law is probably going to be the same one who is going to start talking about jacking the tax up—to the point where whatever is left in the way of an economy will be quickly put out.
So here we are, as I speak, seeing that as Friday comes around $2.4 billion extra is borrowed. We could build the Toowoomba range crossing with less than that. We could build more inland rail with less than that—and that is just a week. There are so many things that we could do with that money. There are a lot of people out there. Think of the things that we could do for pensioners with that money, think of the things that we could do with the Defence Force with that money, think of the roads that we could fix with that money. People would crawl over broken glass to be able to get their hands on a budget like that given the things that they could do with it. But that money is just going out the back door at this point in time because they cannot make their expenditures match their revenues and so they borrow the difference week after week after week. So week after week, as we make our way merrily through the third debt ceiling and start heading our way to the fourth debt ceiling, we end up with a bigger debt than our nation has ever had in its history!
Take Queensland under the stewardship of the Labor Party. We now know after the latest audit, by the former Treasurer of Australia, Mr Costello, that he found that the Labor Party had basically misrepresented where our debt had got to and that in Queensland it was going to head to over $100 billion. Per capita the debt in Greece is about $40,000 per person. Now in Queensland it is in excess of $30,000 per person. And they say it is not a problem, there is nothing to worry about and there is nothing to see here! But it has all got to be paid back. We see New South Wales heading up to in excess of $70 billion in gross debt. South Australia have lost their credit rating. Queensland, by reason of the Labor Party, are going to get downgraded again. But it is not a problem and there is nothing to worry about!
That massive unfunded superannuation liability, in excess of about $62 billion as we speak, is nothing to worry about. It is all fine—all under control!
We do not know what is happening. We know, basically, that the Prime Minister no longer has the confidence of her caucus, that she does not have the numbers and that they are going to go back to Rudd. And they are arguing now about who the Treasurer is going to be—whether it is Shorten or Bowen. They cannot make up their minds.
Sorry—the Hon. Bill Shorten or the Hon. Mr Bowen. But they cannot make up their minds who the new Treasurer is going to be. Mind you, I must admit I have always believed that, if you are going to change the sheets, you change both of them. So, if the Prime Minister is going then the Treasurer has to go as well.
Yes, there might be a couple of blankets that have to go out the door with them! This is the absurdity of where we are.
It is going to be so hard to try and get the finances of this nation back on an even keel. It is not going to be even. As an accountant, I have seen this client before. The first thing this client always has is denial: 'There's not a problem. It's all under control.' You find they keep on going back to the bank. It is such a problem, they just keep going back to the bank. You always ask them: what do you think is going to keep happening if you keep going back to the bank? Do you think this goes on forever? You explain it to them. It is simple. What happens is that one day the bank says, 'Yes'; then it says, 'Okay'; and then it says, 'I'm concerned.' Then, one day, it gets to a point where it says: 'No, that'll do. That's it'.
Nobody has ever got to a really bad problem that they cannot fix without going through a problem that they could have fixed but chose not to. In the end the number becomes an irrelevance; it becomes a mathematical wonder because it is something you cannot possibly fix. One of the key signs that a person is going out the back door is when they start capitalising their interest—they cannot meet their interest payments so they borrow the money for the interest. Once they start doing that, it becomes kind of economic palliative care. Then you start making sure, as an accountant, that they pay you before they see you. Otherwise, you become another one of the debts that they cannot fix up.
The Australian Labor Party has lost control of the nation's books. Whatever they have to do until, basically, they lose an election, they have to do. It is a time where our major exports have been at the highest prices that they have ever been, a time that we should not be going out the back door—we should be absolutely up to the gunwales with cash. We should have huge reserves put aside. But we do not. They break every rule in the book. In their budgetary papers they have the expectation of a peak price, and the reality is that that is not going to happen, and therefore they are financing future debts with an income stream which is completely improbable.
How do we fix it up? If they are getting themselves into this much debt whilst we have a boom in mining resources, how on earth are we going to pay it back when it naturally peels back off to where it was? How will we fix it up then? Where is the money going to come from? Do you think that the world will just kindly look at us and say, 'Oh, we'll just keep lending you the money; we don't care'? Look at what is happening in Europe. In Europe, as I stated at the start of the year, they are going to split the economic sheets. The southern European economy is going to go in one direction and the northern European economy is going to go in the other. The reality for us is that the whole thing is going to peel off. The biggest market for China is Europe, not America. If that market goes into the doldrums, Chinese sales go down and therefore their demand for our commodities peels off. Prices then peel off—and we are getting the peel-off in prices now. Therefore, the capacity to pay our debt falls over. Obviously, our taxation revenues peel off and we are stuck with this massive debt. So, where do we go?
You have to cut the cloth to fit the wearer. People who rely on government services, or who are the beneficiaries of government services, who live on the providence of the taxpayers' dollar, are the ones who will get hurt. Whether it is pensioners, whether it is those using the Pharmaceutical Benefits Scheme, whether it is public servants—they are the ones who get hurt because of the complete inadequacies and absolute hopelessness, total and utter incompetence, of a person to understand the basic business principles of being cautious, prudent, of banking the best and planning for the worst, of having provisions, of having money aside. But we have not done that. It all went, no matter what they say.
We have to look at what happened in the past. It is not going to be easy to pay back debt. The last debt the Labor Party left us was $105 billion in gross debt and $96 billion in net debt. I say those two figures to show you how close one was to the other. Sometimes we are led down this path. I can show you right now on the Australian Office of Financial Management web site—and for those listening to us, just type AOFM into Google and you will see your overdraft come up. It is in a box. You will note it is 233.4 as we speak. That is the gross. When they talk to you about net they can never actually explain how they get that number. They just tell you and they accept it. It is an acute number for them because they do not have to update it every week when they borrow more money. With that number, if you own $139 billion in superannuation, they say, 'We will take the money out of the Future Fund and basically pay off our debt with it'. That means your unfunded liability for superannuation just blows through the roof. It is absurd.
Yes, it is magic money. This is just so infuriating. I have been talking for years about where our debt has been going. Since then, it has not got better; it has got worse every time. I do not understand why this government does not get why we have got ourselves in such a bind. We now have, by reason of this debt, the lowest expenditure on defence as a percentage of GDP since 1938. You might say that we do not need that insurance policy. I suppose you do not need to have an insurance policy against your house burning down either, except when it burns down and then you do need it. We have put ourselves in this dire predicament. With this client called the government, we can see it is all starting to come unstuck. Everything is starting to rattle and the wheels are starting to fall off it.
Our Prime Minister is over in Rio somewhere. I do not know when she is coming back—maybe she is not. I do not know what is happening there. In the midst of all this chaos we have the former Attorney-General—good luck to him; I think he is an honourable person—asking serious questions that have to be answered about issues pertaining to the past. We did not put this on the agenda. The former Attorney-General of the Commonwealth of Australia has said that there are issues pertaining to the Australian Workers Union and funds that were—we do not know—misappropriated. Questions have to be answered and unfortunately they tie up to the current Prime Minister of Australia and her role at that point of time in the establishment of accounts that were used for the divestment of those funds. It is in the paper today: the front page of the Australian Financial Review. Where did it come from? Not from our side. It came from the Labor Party's side.
This is the chaos that has beset our nation. To improve the financial framework of where we are, to try to get the show back on the road, we have to make some changes now and then get to an election as quickly as possible. For the sake of our nation, not for the sake of the Labor Party or the Liberal Party or the Greens or the Nationals, we must take back control of these finances. You will only know that is happening when, instead of seeing the debt go up, you start to see the debt go down.
The Financial Framework Legislation Amendment Bill (No. 2) 2012 is not a bill that we are intending to oppose; in fact, we support it in principle. This is the 10th bill designed to improve aspects of the financial framework under which the acts of Australia operate. In fact, the program of going about repairing the financial framework when issues arise has been ongoing since 2004 and therefore is something that was begun under Treasurer Peter Costello. This particular bill would amend 21 acts across six portfolios to regularise Commonwealth payments. In the main it is about overpayments and underpayments of funds to people who receive payments from the Commonwealth. Certainly in regard to nine acts there is provision for authority for the inadvertent overpayments of some benefits and for their recovery in line with the duty to pursue recovery of a debt under the Financial Management and Accountability Act.
Whilst we certainly do not object to this bill, whilst we support it in principle, we do of course suggest that there must be great vigilance exercised here, primarily because of this government's inability to implement or legislate its way out of a paper bag. The fact that we are actually here having this debate today demonstrates part of the government's inability to manage its schedules, to manage its programs and to manage its legislation. The fact that all week the number of speakers on each bill has been seriously curtailed by the government-Greens decision to apply a guillotine to legislation once again demonstrates that there is no reason for anyone to have any confidence in this government's ability to implement and legislate in a way that is actually for the benefit of the Australian people or not likely to cause them harm. It simply demonstrates their complete incompetence.
When you think about the cost of having this building operating today, the cost of having so many politicians here today, the cost of having so many staff here today, you realise that the government do not have financial management ability. That is what it comes down to. When Senator Joyce spoke earlier, he gave us a long list about the fact that, if they were a small business coming into the local accountant's office, he would put them in the basket-case category. That is where they belong. That is where they will end up. Unfortunately, it cannot happen soon enough.
I am constantly bemused by their attitude of: 'Why aren't people in Australia happier? You've never had it so good.' Apart from anything else, that is a complete and utter falsehood, perpetrated by Treasurer Swan, who dishonestly persists in claiming that the economy is wonderful and not making the point that, if you are in manufacturing, if you are in tourism, if you are in retail or if you are in the construction industry in any way, you are probably doing it tough.
I watched Treasurer Swan smirking his way through his announcement about the improved GDP figures a week ago. At the same time, within a couple of hours of that, I had had news of two young men who had lost their jobs that day. One worked as a flooring contractor in a company that relies completely on the housing industry being buoyant. It is not. Has anyone noticed that the housing industry is a disaster at the moment? The other one worked for a small business that relies on the retail industry to survive, and he was a deputy manager. The owner of the business could no longer afford to employ him. The owner of the business had been waiting and waiting for the wonderful world that Treasurer Swan is promising but could no longer afford to keep this guy on. In fact, as the owner of the business is currently not making a profit and has not done so for some months, it is quite possible that the business itself will have to close. Yes, it is all very well to talk about the pain of restructuring, but for this government to sit and smirk and carry on and try to pretend that everything is all right for everybody is dishonest. But why would we be worried about the government being dishonest when they have been dishonest since the day in 2010 that they came into existence? They have been dishonest and awful.
The reason that most Australians are not leaping with pleasure over the state of the economy, despite all those wonderful markers that suggest they should be, is that life is not just about the economy. Life is also about having a government that you can trust and a government that performs. I spend a lot of time with people who ask me, some of them quite aggressively, 'When are you going to get rid of that government?' People hate the Gillard government. They do not trust it and they have now got to the stage where they expect it to behave dishonestly. They are completely cynical about politicians, about government and about the ability of Australian MPs to perform in a way that they see as being in the public interest. So it is no wonder that despite the best efforts of Treasurer Swan—despite even the Reserve Bank governor Glenn Stevens talking about the glass being half full—Australians see the glass as being half empty. Because it is not just about where you live; it is about how you feel, how proud you feel of your country and the way it functions, and right now Australians are ashamed of their government, completely and utterly ashamed of their government.
And yes, as Senator Edwards points out, they are tuned out because they would rather not know about it. They simply do not want to know about it.
In that context, whilst we certainly support this legislation, we are very concerned that we continue to be vigilant about how this legislation transpires, given that some of the amendments here relate to the area of superannuation, under ComSuper, and that the legislation overall seeks to correct anomalies, add clarity and ensure consistency across government acts. It aims to ensure that legislation both is up to date and properly reflects actual and efficient financial practices, and it also seeks to ensure that financial arrangements are consistent with constitutional requirements. As the member for Goldstein said in the second reading debate:
It is tedious work, but it is important work.
And that is absolutely right. It is work that is painstaking; it needs to be done with great accuracy and care. So of course we are concerned about this government's ability to legislate it properly, implement it properly and then undertake it properly. We have to be very mindful of unintended consequences and equitable outcomes. You would think that that would be something you would simply keep an eye on if you trusted the government that was doing it, but people do not trust this government so it is something that we have to watch like hawks.
There are some examples given of how the changes will affect people, and I would like to mention some of these in the time that remains to me. I will be curtailing my remarks because I know that, even with me speaking briefly, there are at least three other speakers who will not have the opportunity to speak. So I will be cutting my remarks short, but I would just like to tell you about some of the examples that have been given in the explanatory memorandum of the types of situations that might arise. One of the examples is of a discharge of a Commonwealth liability. It says:
Kath is the recipient of a $100 recoverable advance in the 2012-13 year as a result of an identified error in an interest on overpayment calculation. She lodges her income tax return in July 2013—
and is entitled to a refund of $500. The tax office then says, 'Ah, but Kath owes us $100,' and she receives a refund of $400—certainly a very efficient administrative way of going about things if it works and if Kath, the woman in the example here, is aware that that is what is going to happen. If she is not aware that that is going to happen then she may be left in a difficult situation when she spends what she expects to be her tax refund and receives less.
One of the examples that concern me relates to Defence Force veterans, widows and the like. Under this legislation, it has been made simpler for the government to seek to reclaim payments that are made to recipients in the time between when the recipient dies and when the government body is notified of that recipient's death. So we have a time when payments are made and when the person who is to be paid is no longer alive. I would be very, very concerned about how tactfully and sensitively that is handled. Of course it is reasonable for the government to reclaim payments that are made to people who no longer exist, but it is such a difficult and fraught area for people around them, who in most cases may also be recipients of benefits themselves. So this would certainly be an area that must be done very, very sensitively.
The last case I want to talk about is the recoverable advances that are made in conjunction with other payments. The example given here is that in 2009 a batch of about 228,000 co-contribution payments that were valued, all up, at about $43 million had been processed with an error in the calculation of the interest attached to 1,165 of those payments. The error was worth about $17,000. Of course, within that whole framework it would cost more to try to get the money to fix the error than to allow the error to stand and therefore for the ATO to receive about $17,000 less than it might otherwise have received. Even though it would have been more efficient and effective to allow the payments to proceed, without the recoverable advance legislation that is now going through there was a risk that the ATO would in fact be non-compliant with section 83 of the Constitution. So the proposed changes here would let the tax commissioner allow payments like that to proceed, with the excess amount then being treated as a recoverable advance if it were worthwhile to proceed with that on that basis.
Whilst, as I said, the coalition supports this legislation in principle, we continue to be concerned, and the Australian people are concerned, about this government's ability to implement its legislation in a way that is in the public interest. So I ask that vigilance be completely maintained on this.
I must protest, Mr Deputy President, that this is the third time—third time lucky—that I have tried to speak today, and I have eventually made my way. There were some bills this morning that I was keen to speak on to support my colleagues in their views. However, I have been denied this opportunity. I again look at Senator Whish-Wilson over there—our newest senator elected to this place—who has taken his seat today. He must wonder what he has walked into. We have two weeks of sitting in which 36 bills will be guillotined. I look at the people in the gallery and I ask: is democracy served? No, it is not. Do we want to have a say? Absolutely.
I rise to speak on the Financial Framework Legislation Amendment Bill (No. 2) 2012. This bill looks to make technical amendments to 21 acts across six portfolios, constituting part of a continuing program of reforming the efficiency of the financial framework as issues arise. The coalition does support these reforms in principle. This is the 10th financial framework amendment bill since 2004. This bill is designed to rectify inconsistencies and further clarify and remove anomalies across government legislation. In doing so, it will seek to keep legislation up to date with current and efficient financial practices. It is totally consistent with constitutional rigour.
This bill contains 140 items of amendment—and, understandably, I will only talk on some of them. This is one of the few bills the government has introduced to make legislation simpler, more efficient and less burdensome for those working underneath it. It is a sad reflection on this government that they have not taken this approach with more of their legislation and programs they have foolishly embarked upon. The government promised a one-in one-out approach to new regulation. As we all know, however, this government is all talk and spin and very little action. In reality, 18,089 new pieces of legislation have been introduced and just 86 items repealed—86 items of the 18,089 new pieces of regulation.
This is a government, in conjunction with the Greens, that just want to come and live in your homes. They want to dictate how you live your life. Make no mistake all of you who are listening to this: we should be vigilant in ensuring that this does not continue to occur. Take, for example, the financial advice bills that came before the Senate earlier this week. I had planned to speak on those bills but was unable to because the government, in collusion with the Greens up there, right under your noses, gagged the debate on those bills as they have done for most of the bills this week. The FOFA bills are a good illustration of the government's bungling of financial legislation. Certainly doing business has become a lot harder and more complex in Australia. That legislation will lead to increased costs and reduced choice for Australians seeking financial advice—a poor outcome for Australians badly bruised during the financial crisis, when a number of high-profile Australian financial service providers collapsed.
In the one minute I have left I will move to some concluding remarks. While the coalition offers in-principle support for the reasonable changes contained within this bill, we believe there has been a frank attempt to improve the efficiency of the financial framework. As I said, it is a shame the government has not been as studious with the other pieces of legislation. Of course, being a Labor government in power, it cannot resist introducing new regulations and more red tape—this despite another top-level talkfest called by the government to reduce red tape only a week ago in Brisbane. More regulation is part and parcel of the Labor Party's DNA. The Labor Party takes too much notice of vested interests and has its own financial reasons for wanting legislative changes.