Senate debates

Thursday, 4 July 2019


Treasury Laws Amendment (Tax Relief So Working Australians Keep More Of Their Money) Bill 2019; Second Reading

3:30 pm

Photo of Peter Whish-WilsonPeter Whish-Wilson (Tasmania, Australian Greens) Share this | | Hansard source

Let me summarise, in the last few minutes that I have left, that the Greens clearly and loudly reject this government's tax package, its plan, its vision for the Australian economy, which gives more money to millionaires and risks the services that vulnerable Australians so desperately need into the future. These tax cuts will do nothing to help those who need our funds the most. They will do nothing to restructure Australia's economy for the 21st century. They will hamstring future governments from providing the public services, the infrastructure and the vision that will underpin a prosperous and happy Australia into the next century. They will turbocharge already growing inequality. These tax cuts are a $158 billion decision to starve future governments in favour of higher income earners having more money.

The Greens believe in a different future for this country. We have a different economic plan for employing Australians, for tackling inequality, for tackling the great crises of our time. A $158 billion question—that's what we're voting on here today, all on the back of a political imperative for this government to go to an election, to hang onto power. We flatly, openly and loudly reject this unscrutinised legislation, this $158 billion, this attempt to bribe the Australian people to make sure the LNP can hang onto power and give more money to their rich mates.

The Greens will continue to be the opposition in this place until the Labor Party decide to stand up and join us. I know that millions of people around this country voted for the Labor Party because they wanted an alternative to this government and their ideological agenda, and I know that so many of them would be disappointed out there this week, in the first few days, to see the Labor Party tank in their very first game of the season. That is absolutely crucial for this 46th Parliament. We'll continue to be the real opposition in this place and we'll continue to push the Labor Party to stand up. (Time expired)

3:33 pm

Photo of Mehreen FaruqiMehreen Faruqi (NSW, Australian Greens) Share this | | Hansard source

I rise to speak on the government's disastrous $158 billion tax bill that is being rushed through parliament. This is a $158 billion mistake. This is a terribly irresponsible choice that the people of Australia will be forced to wear the consequences of for decades to come. How can this government look the 700,000 people barely surviving on Newstart in the eye and say: 'You know what? We can't afford to increase Newstart. We can't afford to support you, but you won't believe what we can afford to do for the very rich.' Shame on you. I actually half expected you lot over there to be wearing monocles and top hats today, like some British aristocrats. Three million Australians are living in poverty, yet your first order of business is about helping the richest people pay less tax. That is what is at the core of stage 3 of this bill. This giant bribe will turbocharge growing inequality and deliver rivers of gold to society's most well-off, who need it the very least. That's the reality. The majority of the benefits of the Liberal-National plan will go to the top 20 per cent of income earners, including millionaires and billionaires, while the bottom 20 per cent receives just three per cent of the benefits. Let that sink in.

Inequality is rising. We face terrible wage stagnation for working Australians. We know that fewer and fewer Australians are employed in secure, full-time work and that young people face enormous underemployment. Homelessness and poverty are on the rise. Poverty is increasingly feminised, and women face a huge gender pay gap. We know that wages won't rise, jobs won't appear out of thin air and inequality won't reduce without the government planning and investing for it. A climate emergency looms large in the landscape of growing inequality. As the crisis worsens, its health and financial costs will drive a wedge between those who can afford to adapt to the destruction of our world and those who are left to bear the brunt of a total climate meltdown. What would the government do when faced with these twin challenges of inequality and the climate crisis? They would lock the country into a $158 billion giveaway that will only accelerate inequality and leave us without the revenue that we need to build a society that can beat climate change.

While they're at it, they would dismantle our progressive tax system. Why the heck is Labor ditching progressive taxation? Make no mistake, these handouts to the wealthy are nothing short of an existential attack on the principal foundations of our progressive tax system. If the Liberals have their way, our tax system will become less progressive than it has been at any time since the 1950s. They would have us in the absurd situation where someone earning $200,000, nearly four times the median wage, pays tax at the same rate as someone earning less than the median wage. How is this fair?

Tax systems might not be the most exciting thing to talk about, but we can never forget that progressive taxation is the linchpin of an egalitarian society. There's no greater leveller than a truly progressive redistribution of wealth to ensure that vulnerable people are cared for and that we all share in the profits of our labour. At the World Economic Forum meeting at the start of the year, historian Rutger Bregman put it clearly when he said that ending inequality and poverty was quite simple. This is what he said:

Taxes, taxes, taxes. All the rest is bullshit in my opinion.

An effective, progressive system of taxation is the building block of a society that wants to be built on collective good and is not built on individual greed. A progressive tax system recognises that wealth is more often an accident of luck and class than a measure of effort or ingenuity. It places our obligations to each other and society and the betterment of our world at the centre of government. This legislation spells the sad, sorry end of that system.

Debate over taxes goes right to the heart of how governments should serve the people. By choosing to pursue vast handouts to the rich, the government has abdicated its responsibility of life making. That is its responsibility: to give citizens the support, the services and the safety net they need to live a good idea. If we were to accept the idea, as Labor seems to have done, that we should take any opportunity to minimise the life-making work of government and instead give handouts to the most wealthy, then we have already conceded far too much ground to the Liberals' small-government trickle-down crap.

The tragedy of this legislation is not just that the majority of the $158 billion will benefit the most wealthy but that future governments will be unable to use those funds to provide services and infrastructure that benefits everyone. Instead of giving funding to our schools, hospitals, the NDIS and aged care and instead of caring for students, the sick, people with disabilities and the elderly, which is what we need right now, the government is giving tax cuts to millionaires.

We urgently need to lift wages, reverse cuts to penalty rates, fund domestic violence services and raise Newstart and youth allowance. These things are decades overdue, but the government is giving tax cuts to millionaires. We cannot allow the government to forestall the investment and transformation we need to restructure Australia for the 21st century. We could see TAFE and university free for all, fully fund our public schools and make child care free for all families. We could incorporate dental into Medicare and save social housing from the doldrums of underinvestment. We could work to guarantee secure work and a living wage for all Australians. But the government is giving tax cuts to millionaires.

I have to say I am deeply disappointed in the approach Labor have taken to these tax bills. They rightly called the third stage of this plan economically irresponsible and a joke, but then went right ahead and voted for it in the other place and perhaps will do the same here. We need bold, united opposition to the Liberals' giant tax bribe, but instead Labor have been cowed by electoral fear. If they have begun their work in this term of parliament as they intend to continue, then there is much cause for despair. The Greens are fighting the government tooth and nail on this, and I sincerely wish Labor would join us instead of meekly joining the Liberals in taking a wrecking ball to our progressive taxation system and our future. I'm not sure what deals are being done behind the scenes with the crossbench to let this through, but I do know that it stinks. It is exactly this kind of horsetrading and deal doing that Australians hate. Where is the debate of ideas? Where are the principles here? Will you so easily lock Australians out of better education, better health care, better social security? If you go through with this tonight, this affects not only us but many generations to come.

Time and time again Australians say that they want better services. A poll just last week showed that a strong majority, 78 per cent, said maintaining government investments in health and education was the most important thing and it was more important than legislating a tax cut for those on incomes of $200,000. Three-quarters of the sample said people earning more than $150,000 should pay a higher rate of tax than workers earning just $40,000. Yet here we are. This bill is part of the bigger plan to break down our concept of a society where we all look out for each other and instead stoke the idea that people should get what they can and to hell with everyone else. Well, that's great if you're born into money, go to the right schools, are the right colour and have a name that isn't passed over automatically when people are looking at resumes. Please think of these people when you vote on this terrible bill today.

Photo of Sue LinesSue Lines (WA, Deputy-President) Share this | | Hansard source

Senator Faruqi, I just remind you that it's not appropriate, when quoting, to use unparliamentary language.

3:43 pm

Photo of Janet RiceJanet Rice (Victoria, Australian Greens) Share this | | Hansard source

I rise to speak to the 'Slashing Government Services Bill 2019', or should that be the 'Trashing Progressive Taxation Bill' or the 'Increasing Inequality Bill'? I am so angry and despairing that this bill, the Treasury Laws Amendment (Tax Relief So Working Australians Keep More Of Their Money) Bill 2019, is being proposed and absolutely horrified that Labor and most of the crossbench look like they are signing up to this attack on low- and middle-income hardworking Australians. We've heard a lot today about low- and middle-income hardworking Australians. Make no mistake; this bill is an attack on low- and middle-income hardworking Australians, because this bill puts a $158 billion hole in the 10-year revenue forecast. This is on top of the $167 billion hole that the 2018-19 budget tax cuts put in place. So in total it's a $325 billion hole—$325 billion over the next 10 years that the government would rather hand out, largely to high-income earners, than invest in services and in our society. Imagine what we could do with that $325 billion. It's a mind-bogglingly big amount of money. Imagine what that $325 billion would do for reducing inequality and ending poverty in this country. We could invest that money into public housing, raising Newstart, bringing dental care into Medicare and creating a world-class mental health system. We could make free child care available for hundreds of thousands of young families, for the majority of Australians who are accessing child care. We could make TAFE and university free. We could invest billions of dollars into our underfunded public schools. These are the political choices that we are making, that are going to be made in this place today. It is a choice—it's a political choice—as to whether we invest in our society, invest in supporting services for low- and middle- and all-income Australians, or give this massive tax handout to those who already have the most.

How much of a dent could we make on the climate crisis with $325 billion? We could invest in solar, wind, pumped hydro, the electricity transmission network, public transport, our electric vehicle charging network and clean hydrogen exports to wean our economy off coal and gas and oil. How much could we invest in revegetating and rewilding our landscapes, increasing our carbon stocks while helping our regions cope with drought and restoring critical habitat to help stem the extinction crisis? Or imagine the jobs and the nation-building potential of spending $325 billion extra on infrastructure. We could expand and upgrade rail services across our cities and regions. We could expand and electrify our bus services right across Australia so that all Australians have access to fast, frequent, clean, affordable public transport. We could build the long-awaited high-speed rail between Melbourne, Canberra, Sydney and Brisbane. Why is no-one in this chamber other than the Greens asking these questions? Why is it taken as a fait accompli that this is the right way to spend $325 billion of revenue over the next decade?

We Greens accept that the economy needs a stimulus, but there are so many better ways to create that stimulus than giving tax cuts to those who already have a lot. All the measures that I've just mentioned would provide massively more stimuli than handing over billions in tax cuts to the wealthy, who are likely to sock most of it away in their bank accounts, in their shares, in overseas travel. The difference in stimuli is that what happens when you give more money to low-income earners is that you increase Newstart, you increase youth and student allowances, you reduce health costs, you reduce childcare costs and you provide new jobs in green infrastructure, and every single dollar that is spent there is going to flow back into the local economy. Plus, we can expand and increase the low-income tax offset, which would put extra money in the pockets of low-income earners in a targeted way, rather than splashing most of the largesse around to the wealthy, who, frankly, are not going to trickle this money down into the economy. The trickle-down effect is absolute bunkum, and it has been shown to be that over the last 40 years. It has been shown to not exist, to be wrong. All the trickling down that is going to occur from this largesse being given to the richest in our society will be the trickling down of the final drops of one bottle of Dom Perignon before popping open the next bottle.

Yes, this government took this package to the election, but fewer than six million of the over 14½ million Australians who voted in the 2019 Senate election voted for this package. There is no mandate here, except for the fictional one that this government is claiming for this atrocity. The people of Australia elected the government into a minority in this chamber, so let us do some scrutiny. Let's give them some opposition. Let's embrace our mandate to be a check on this government. This bill is a massive failure of vision by the government, by the opposition and by the crossbench. We're three days into this new parliament, and the number one priority of this chamber is giving the richest 20 per cent of income earners a great, big tax cut. Frankly, it is sickening.

The Greens will not stand for it. We need leadership in this country to tackle the challenges of our time, not business as usual. We need leadership to be tackling inequality in this country, to be tackling our climate crisis, to be tackling our extinction crisis. It is not the time for business as usual, where the rich get the spoils and the rest of Australia is left to pick up the pieces. I call on all members of this chamber to rethink their position on this legislation and to vote against what is a dagger in the heart of a fair and equal society.

3:51 pm

Photo of Rex PatrickRex Patrick (SA, Centre Alliance) Share this | | Hansard source

After lengthy discussions with the government to address concerns that Centre Alliance has about rising energy costs, and particularly the high electricity costs in South Australia, Centre Alliance has decided to support the government's personal tax cuts legislation. Supporting the tax cuts will reward hardworking Australians and provide a stimulus to the economy that almost all economists have called for, including the Reserve Bank governor. Controlling energy costs will help people on Newstart, workers, pensioners, small businesses and big businesses, all who have been struggling with high energy costs.

Centre Alliance does have a concern about stage 3, noting there is the potential for a slowing economy, but notes that the government have steadfastly refused to split the bill. We do not want to delay tax cuts and the stimulus effect they provide, and note that the parliament has the ability to react if we have a softening economy, should that occur somewhere between now and 2024, when stage 3 is due to come into effect. The gas measures developed by the government will make the economy more competitive, and that will serve to mitigate risk of a downturn, simply because we are an open trading economy and we need to make sure that our energy costs are competitive. Energy feeds into every sector of the economy. It doesn't matter whether you're cooking fish and chips for a living, running a tuckshop or running a chemical company; they all involve the use of energy. If our energy costs are high, we are uncompetitive, so it's really important that we make sure that these energy costs are reduced. The last thing we want to have happen is for people to get a rebate designed to help them and to help stimulate the economy only to find that that rebate gets gobbled up by energy companies.

Let me talk about gas. As I said, energy is used in every sector of the economy. If energy costs are high, it makes us an uncompetitive economy. Fifty-one per cent of electricity generated in South Australia is generated from gas. It is gas that sets the price in South Australia, Victoria and Tasmania. ACCC Chairman Rod Sims has forecast that gas prices will rise. I think everyone alive to that issue would be concerned about that. I point out that Centre Alliance went to the last election with a promise to force a reduction in energy prices. Let me tell you some gas facts. In 2013-14, Australians paid between $3 and $4 per gigajoule of gas. Then what happened was that six LNG trains were developed at Gladstone, Queensland to allow for the export of gas. In conjunction with that, production of gas in Australia tripled. Except there was a problem: it turns out the companies that were exporting the gas didn't quite calculate things properly and there wasn't enough gas in the reserves that they were planning to use to serve these export markets. As a result, they turned to the domestic market and started buying up gas that was otherwise there for Australians.

In 2017 there were South Australian companies coming to see former Senator Xenophon and me, as his adviser, basically stating: 'It's not the price that concerns us. We can't even get an offer for gas.' That's how short things were in the Australian market. Unfortunately, the gas companies simply decided to make sure they could fulfil their contracts with overseas entities at the expense of Australian companies—a totally unacceptable situation and one that lacks social licence. So Centre Alliance sat down with the government back in 2017—just so everyone can understand, this is a long-running discussion that Centre Alliance has been having with the government—and negotiated with them over concerns about people in South Australia not being able to get a gas offer. We negotiated the Australian Domestic Gas Security Mechanism. I did that with Senator Canavan.

The Australian Domestic Gas Security Mechanism allows the government to forecast supply. If there's a risk that the supply won't meet the demand in the domestic market, they can pull the trigger and, in effect, stop gas exports and then recommence them in a manner that ensures there is enough supply for the Australian gas market. Now, the interesting thing is that that mechanism has never been pulled, but the gas companies know that it's there. As a result, they have made sure there is enough supply in the Australian market now. Unfortunately, they've kept the price tight. They've only just provided enough gas to meet supply, and that has kept the price tight. So we ended up with this gas mechanism, and it did help to resolve the problem; however, we now need to address price. It has clearly addressed supply but not price.

One of the problems we have is that there are very few gas companies here in Australia; there's a cartel style operation going on here. Mostly it's foreign owned companies that are doing this, and I want to just talk to you about some of these companies that are here in Australia, exporting our gas. One of them is Shell Energy Holdings Australia Ltd, and I want to inform you that over the last four years that company has generated—it's thanks to our tax transparency laws that we know this—$53 billion of revenue, from 2013-14 all the way through to 2016-17. Do you know how much tax they've paid? They've paid $1.1 billion in company taxes. So $53 billion of revenue, and somehow, across those four years, they've only paid $1.1 billion in tax. Origin Energy Ltd earned $51 billion over the same period and paid only $108 million in tax. ExxonMobil Pty Ltd took in $33 billion of revenue over four years and paid zero tax in that time frame!

Now, I come from business. I understand the difference between revenue and taxable income. But I also understand the concept that companies need to make profit to survive. If you've got a company that year after year after year is not making a profit, there's something untoward going on, something strange going on, for that to occur. The big problem I have—we were talking about taxes, and the Greens are talking about services and facilities and so forth—is that we find that these companies, in paying no tax, are doing so whilst they benefit from our fantastic education system, where they've got educated workers and trained workers, where they've got workers who have medical cover, unlike in other countries where they may operate. They've got infrastructure that's been provided to them. They've got security provided by the various security and defence agencies in this country, and they've got the rule of law. They enjoy all of that, yet they pay no tax. And that's a totally unacceptable situation in my view. They enjoy the benefits of Australia's civil environment, but they don't pay for any of it.

These companies have lost their social licence. Last year we saw banks and financial institutions become the centre of attention for misconduct. This year it's the gas cartels. I'm calling you out. You are un-Australian. You are not contributing. You are happy to fill your contracts to meet your own commercial objectives at the expense of Australians who are struggling with energy prices. There are people in South Australia, elderly people, who cannot turn on their heaters during winter, cannot turn on their air conditioners during summer—a totally unacceptable situation—whilst these gas companies enjoy our gas to export for their profit that somehow is not booked here in Australia. Just as a general indication to any company that's not paying tax, I have the tax transparency spreadsheet from the ATO, and I'll be using it extensively throughout the next few years, naming the companies that are not paying tax, because in my view it's shameful. I get that some companies don't make a profit, and that's okay. But when you consistently don't pay tax, you are going to get called out.

So, we've had a tripling of production, yet the price of gas in Australia has also tripled. How does that work? We're now paying about $9 per gigajoule. Remember that I said at the start we were paying $3 to $4 per gigajoule. We're now paying 20 per cent more for our gas than our Asian friends are paying for our gas. How broken is that? And we're now seeing a situation where, around Australia, five import terminals are being planned, being looked at for development. We are the largest exporter of gas in the world, yet we are building import terminals? And some people tell me that that's a solution to the problem. It's not; it's a symptom of the problem. We have to do something about our gas prices.

ACCC Chairman Rod Sims said, in a press release about a month ago:

High gas prices remain a critical issue for domestic gas users and could see more businesses move or close on the east coast.

He pointed to an announcement by Dow Chemical that it would close its Melbourne manufacturing plant, in part because of high gas prices. That came after RemaPak, a Sydney-based producer of polystyrene coffee cups, and Claypave, a Queensland-based brick and paving company, entered administration, citing rising gas costs as an important contribution to the decision to go into administration. I'm also reliably informed by industry that some companies are deferring investment in this country and some are simply going elsewhere because of our high energy costs. There has been a market failure here in Australia, and where there is a market failure that is where governments intervene.

Centre Alliance has worked with the government on both short- and long-term actions to deal with our gas market concerns. A policy package will be announced. In terms of transparency—people are worried about something secret that's happened—the government has assured us that, over the next few months, they will announce their policies as they become fully developed. I've indicated some of the things that are likely to be in that policy. I've publicly talked about changes to the ADGSM to deal with the current lack of supply. As I said, there is supply but it's not sufficient supply to drive prices down.

In terms of market transparency measures—that is, measures to deal with the monopoly nature of the east coast gas pipelines—I'm not giving away any secrets there. Go and have a look at the ACCC's east coast gas market report, which talks about that. It says there's nothing unlawful about monopoly pricing, but we do have a monopoly situation with the east coast gas market and the government is looking at that. And we've heard Senator Canavan talking about longer term measures to ensure that projects deliver a surplus supply to the Australian gas market. Those are some of the things that Centre Alliance have talked to the government about, and we will continue talking to the government about them.

Back in 2017 we started talking not just about the ADGSM; we talked about 'use it or lose it' gas policies on retention leases. There were a number of things we talked about back in 2017, and there's been a continuum of discussion with the government about these things. So, whilst the Labor Party have been in their cabinet room working out tactics to play things out in this chamber, we've been working with the government on sensible policies moving forward.

Turning to Labor's criticism of what Centre Alliance have done, of course all we've done is ensure that workers will get a tax cut and we're ensuring that gas and electricity prices will fall. Let me read from The Advertiser editorial on Labor's position on this bill. It says:

Labor, however, dealt it-self out of the equation by a muddled strategy, appearing confused about whether or not to support tax cuts.

I don't think we'll know until later tonight whether they do or don't support tax cuts.

Returning once again to the question of transparency, which was raised in the debate associated with the suspension of standing orders, a draft policy suite has been developed. It's been developed sufficiently for us to understand its effect but not the implementation of it. Okay? So it's not finalised, and the Labor Party ought to know that it is not appropriate to release half-described policies that don't go to the implementation—that could also affect the market, actually. I've been given an assurance by the finance minister, Senator Cormann, that the government will, at some stage, announce these policies, and it's not too far off. They just have to properly bed them down in terms of their implementation. We are quite confident that it will produce results that will complement the tax cuts—lower taxes and lower energy prices, full stop.

Finally, we are mindful of the uncertainty in the economy. Perhaps the economy will turn in a southerly direction but, equally so, it could turn in a northerly direction. If you look at the budget papers, the assumption used for iron ore prices is $55 a tonne, and it's currently above $100, so the budget papers are relatively conservative. We took briefings from Treasury, the Reserve Bank governor, the ACCC chairman—from a whole range of people—looking at whether or not we should trust what was in the budget papers. But, even if it turns in a southerly direction, it is the role of parliament to deal with that southerly change. If, indeed, the Labor Party are of the view that there is a southerly change coming and that these tax cuts are not the right solution, they can embark on a campaign. They can come out and tell people that, at the next election, they intend to raise taxes. That's what they can do. If you think that's the solution, you're quite welcome to do that. You can get out there and campaign to increase taxes, if you really think this is the wrong outcome.

On balance, we think that this is the right direction to go. We recognise that in future there can be further changes. We recognise that the government will continue to listen to us on gas. There's no conspiracy here; just good policy development—good working between the crossbench and the government on this particular issue. So we're quite satisfied that, on balance, this is the right thing to do. Centre Alliance will be supporting the legislation as it currently stands.

4:10 pm

Photo of Pauline HansonPauline Hanson (Queensland, Pauline Hanson's One Nation Party) Share this | | Hansard source

For the majority of workers across Australia, tax is the necessary evil our nation has been built on. It's also the lubricant that keeps a large portion of our society from falling between the cracks. Let's face it, none of us like paying any more than we have to. As Kerry Packer famously said:

Now of course I am minimizing my tax and if anybody in this country doesn't minimize their tax they want their heads read because as a government I can tell you you're not spending it that well that we should be donating extra.

Kerry Packer was right. This government, like the last, hasn't done a great job spending your money. They have managed to double the debt left by Labor in 2013, leaving Australians with a total government debt edging closer by the day to $600 billion.

It's important that this parliament has this debate over personal tax cuts, and let me say from the outset that Australian workers deserve a tax cut. I'll say it again: Australian workers deserve a tax cut. The misconception reported by media that I don't support tax cuts is completely false. Overnight, I wrote to Prime Minister Scott Morrison to reiterate my support for stages 1 and 2 of the bill.

I have no doubt that the people from my home state of Queensland and those right across the nation have been left confused by the government's proposal. For their sake, and for the sake of correcting the record, I'd like to break this down. In the previous parliament, One Nation supported the Treasury laws amendment known as the Personal Income Tax Plan, which was legislated and announced in the 2018-19 budget. The new proposals that this government is here to legislate today are in three stages. As I have said to the government and the media, I support the first two stages but cannot support the third stage, which isn't due to take effect for five years, or two further elections.

Stage 1, which will come into effect immediately, will increase the low- and middle-income tax offset and put a maximum of $1,080 back into the pockets of everyday Australian workers within an income bracket of between $48,000 and $90,000 per annum. I'm happy with that. Stage 2 will kick in from 1 July 2022 and replace the low- and middle-income tax offset by increasing the low-income tax offset to $700 and lifting the threshold for the marginal tax rate of 19c in the dollar from $41,000 to $45,000. Stage 3 is planned to take effect five years from now, or two elections away, on 1 July 2024, and will reduce the marginal tax rate from 32.5c in the dollar to 30 cents. It will apply to people earning up to $200,000 a year. These three stages of personal tax cuts will cost the government a total of $158 billion, but not a single member of the government can guarantee me that our economy will be capable of sustaining the full tax cuts over the next half a decade. It's stage 3 that has me most concerned, because yesterday the national cash rate dropped to one per cent. Australia has never had a cash rate of one per cent. Australia is quite literally on the cusp of a recession and this government is hell-bent on the idea of surrendering $158 billion through tax cuts.

If you ask me, much of regional Australia has been in an unofficial recession, but most of you in the Senate haven't bothered to visit regional Australia. Over the past three years, I have watched the Senate destroy Australian jobs with ever-increasing power prices that have shut down far too many manufacturing businesses and forced others to move their operations offshore. These power costs are also crippling everyday households, including vulnerable pensioners and the unemployed. According to the Australian Energy Regulator's annual report on compliance and performance of the retail energy market, my home state of Queensland recently recorded the highest number of residential electricity customer disconnections. That is 27,910 Queenslanders left in the dark due to ever-increasing electricity prices across the country. Try telling the more than 72,000 people in this country who had their electricity cut off—across Queensland, New South Wales, South Australia, the ACT and Tasmania—that the third stage of tax cuts are good for them! Maybe Senator Lambie should have been more concerned about the 6,664 people in her state who have had their power cut off over the last six years instead of passing stage 3 of the tax cuts. Maybe Senators Griff and Patrick should have given consideration to the 22,826 people in South Australia who have had their power cut off instead of passing stage 3 of these tax cuts.

This government has deceived the people of Australia by saying it is bringing down power prices when the truth is that, over the past 10 years, power prices have risen 117 per cent. That's the truth: power prices have risen 117 per cent across Australia. But, rather than quarantine the third stage of tax cuts for the purpose of building more coal-fired power stations and droughtproofing water projects like the hybrid Bradfield water scheme, this government has ignored the desperate pleas of everyday Australians and will give further tax cuts to those on up to $200,000 a year in five years time. Is it any wonder that so many hardworking Australians are doing it tough and trying to make ends meet with the ever-increasing cost of living?

I have watched my own children struggle to pay their mortgages and electricity bills and put food on the table. My concern with passing the third stage is the future economic stability of our nation. I didn't create and run four successful businesses before entering politics without having an eye on how to manage money, and all I have asked is that the government shelve the third stage in lieu of building much-needed infrastructure. In Treasury's own advice to my office and to Senator Roberts, they agreed that the economy can be stimulated by quality infrastructure projects like those I have suggested in power and water. This third stage will cost the government $95 billion in tax revenue that could be used to fund new coal-fired power stations giving the nation the cheap, affordable and reliable power that is needed to keep our nation competitive and viable on the global stage. But no, this money will likely be spent on whitegoods and TVs manufactured in China, and the rest will be eaten up by the ever-rising cost of living. Anyone would think these tax cuts were tied to the Chinese free trade agreement. Let's face it, it is China that will ultimately benefit from the third stage of these tax cuts because consecutive governments have helped to destroy our manufacturing industry.

It looks like the government will get the three stages of its tax cut package through today by paying off the debt of the Tasmanian Liberal state government or by making further false promises on bringing gas prices down in South Australia. But I have another three years in this place to convince you to bring down power prices by building coal-fired power stations and to droughtproof the country by building the hybrid Bradfield scheme.

I call for these infrastructure projects because they will be there for the long term. Tax cuts that may be passed in this parliament today can easily be taken away from the people by this same government, or by a new government, in time to come. But if we build the infrastructure now—waterproofing Australia and giving cheaper power by putting in coal-fired power stations—that infrastructure can never be taken away from the people and will give us what we need. How many millions of dollars have been spent by this government, when drought affects our country and when we see farmers on their knees because they don't have water? We now hear of pensioners who are actually dying because they can't afford the power to keep them warm. What is happening in this country is absolutely disgraceful.

Like I said, I am all for tax cuts—and we should be, because I think we are overtaxed in this nation—but I think that the Australian people would forgo their tax cuts if they knew that the money was going to be put into infrastructure projects that will give them the long-term relief of being able to run their businesses, their farms and their households and so that we are able to support our pensioners and those who can least afford to pay their bills. Only God knows where the money will come from to pay for these infrastructure projects in the future, but that won't stop me from persisting with my argument and standing up for the ignored people of this nation.

Senator Patrick was talking about gas. One Nation has been talking about gas for over two years now, especially that from the North West Shelf. At the moment we export approximately $54 billion worth of gas to overseas—and he is correct: Japan is getting gas cheaper than what Australia is. Out of that gas that we export we bring in about $400 million in taxes—$400 million out of $54 billion in exports. It is disgraceful. I have spoken to the government constantly about the retention leases. They keep renewing the retention leases, and some of the gas companies have had them for up to 30 years and done absolutely nothing with them.

Senator Canavan spoke today about Browse and how wonderful it is and what we are going to make out of the resources. Browse have just built a pipeline of over 900 kilometres to take it into the Northern Territory because, if it went into Western Australia, they would have to give a 15 per cent domestic gas supply. Western Australia are smart to get that domestic gas supply, unlike the rest of the country. What about the floating platforms. How do we know what gas is taken out? We're getting no money from that. Japan make about $3 billion in excise on our gas that goes into their country. They make more out of our gas than we make selling it.

Senator Patrick is right: we're building terminals here to bring gas from overseas, from America, and we're one of the most gas-rich countries of the world. But no-one wants to listen. It was One Nation that started this discussion with Senator Canavan. We brought to his attention a lot of these issues with the retention leases and gas and what is happening up there—things that he had no idea about. Since we've brought it to the attention of the parliament, I'm pleased to see that the Greens have taken the issues up as well. It is also pleasing to hear that Centre Alliance are now starting to talk about. If we don't start addressing the energy costs in this nation, we are going to lose more businesses. You won't have to worry about getting your tax—well, you will, because the jobs won't be here.

A company I know up in Rockhampton export to 50 countries and they employ 55 people. They actually have a third generation. Their electricity bill is going from $350,000 up to $550,000 in a year. They've put $1.2 million worth of panels on their roof, yet their bill is going to increase. Are they going to stay here in Australia? Will they shut down?

Are they viable? This is only one company, one business, but I hear it all the time.

I don't think you really grasp how important it is that we actually do something about the cost of energy in this country. We are on the cusp of losing so much in industries and manufacturing and jobs unless we do address this. You've been led by the rest of the world to sign up to the Paris Agreement, which is different in every country, and we have been demonised because we have coal. In the UK and Europe, they can actually burn municipal waste and woodchip, which are more harmful to the environment, yet they are not condemned for it. We're burning coal, which doesn't put out as much as what they're burning, and yet we're demonised for it—and you're headed down this path.

I will persist with this matter in this chamber and inform the Australian people of what is happening, because, as I said before, I travel this country quite extensively and I talk to people, and they are doing it bloody tough—extremely tough. Is there job security? Is there a future for their kids? It all comes down to energy prices. If we can actually reduce energy prices in this country, it will make a hell of a difference to a lot of people. These tax cuts are for the workers. Where's the relief for people who are on pensions, those self-funded retirees or those people who are supported by the government? Where's the relief for them? The only relief that we can give them is reducing power costs, reducing their bills, to give them quality of life and make them feel that someone is really listening to them. But, rather than that, we are turning a blind eye to our own people and we are more interested in being told what to do and how to run our country by the United Nations and by other countries.

My job here is to try and represent the people. I've had my say. As I've said, I support the government's first and second stages. I cannot support the third stage and I don't believe it is economically viable for our country. You can give me all your promises about stability, but no-one can promise that we're going to have a stable economy five to six years down the track and that we can afford it. That's not how I run my household, and I'm not going to tell the Australian people that that's how this parliament should be running their country.

4:27 pm

Photo of Stirling GriffStirling Griff (SA, Centre Alliance) Share this | | Hansard source

This bill, the Treasury Laws Amendment (Tax Relief So Working Australians Keep More Of Their Money) Bill, is all about giving the economy the boost it very much needs, and recognising that the 10 million Australian workers deserve a financial break. The Reserve Bank's decision this week to cut interest rates to an historic low of one per cent shows just how sluggish our economy is. The Reserve Bank's aim is to boost spending, which ultimately helps grow jobs, to avoid further stagnation. Putting up to $1,080 in the pockets of those earning up to $90,000, as the immediate stage of tax cuts does, will also help invigorate spending.

Stage 2 of the tax cuts will come into effect from July 2022, and it'll lift the income threshold for people on the 19 per cent tax bracket from $41,000 to $45,000, which, under our progressive tax system, will put a little bit extra into the pockets of most taxpayers. It will also slightly lift the low-income tax offset amount, and these changes will be welcomed by low- to middle-income earners in particular and are worthy of backing, even if they are three years away.

We are less enthusiastic about stage 3 of the tax cuts, which doesn't come into effect until July 2024. No-one can say with certainty what the economy will be like in 2024 and beyond, although I note the government is at this stage predicting a surplus in the years leading up to it. If those surpluses disappear, any future government worth its salt will have an opportunity to modify stage 3, if it needs to be modified, before the flattened tax brackets come into effect and potentially eat into government revenue. Interestingly, this is an option that Labor has left open, which I believe is the fiscally responsible thing to do.

We see that Labor is intent on introducing amendments to the bill, but this would be a fruitless exercise given that the government has steadfastly refused to entertain any changes. We saw this in the last parliament when the Senate sought to amend the Treasury Laws Amendment (Personal Income Tax Plan) Bill 2018, which was passed in June last year. We tested the government's resolve, but it rejected the amendments and handballed the bill back to the Senate to pass it unchanged. An amended bill will not get through the lower house. Ping-ponging this bill between chambers is totally pointless. What is more important is getting these tax cuts through to Australians who need them and to give the economy the stimulus it very desperately needs.

I note that Senator Whish-Wilson also has an amendment that will lift the starting amount for the low-income tax offset to $1,080. I actually think that that is a good idea. It will do what we need to do, which is to put more stimulus into the economy and more into the hands of those who need it most. But, again, this proposition will be rejected by the government and has no prospect of success today.

Of equal importance to us is that money given in one hand isn't taken away by the other. It's important for us that government implements a plan to deal with ever-rising energy costs, which dramatically impact the public and businesses. To us, it's mainly about gas—which is something we have a lot of in this building!—and about gas being available and correctly priced so that industry can be competitive and electricity generation can be more economical. Australia is the largest producer of gas in the world, but we are currently paying three to four times what we used to pay for gas before we started heavily exporting it in 2014-15. Just five years ago, we paid $3 to $4 a gigajoule for domestic gas. Our prices hit a crazy $21 in 2017. They have since come down, but we are still paying anywhere in the region of $8 to $12 per gigajoule. That's a crazy situation that smacks of cartel-like activity, in my view.

Reforms we have discussed with government, in relation to the gas market, will be developed further over the coming weeks and months. Those reforms cover ways to enhance the Australian Domestic Gas Security Mechanism, which was negotiated by Centre Alliance—then NXT—back in 2017. That deals with the amount of gas available to the domestic market through to providing greater transparency on wholesale pricing and more. The likely policy package will be a combination of short-term and long-term measures that will ensure energy security and lower costs for businesses and industry. It will significantly reduce the cost of electricity generation.

This is a very important bill. It will boost the economy and give 10 million Australian workers a welcome financial boost, something that we are very happy to support today.

4:33 pm

Photo of Jacqui LambieJacqui Lambie (Tasmania, Jacqui Lambie Network) Share this | | Hansard source

These tax cuts put money back into people's pockets. That's what it comes down to. It's not perfect. It's not a total shocker either. It's going to help, but it's not going to help everyone. I've spoken to the government, and I've told them my concerns about the Treasury Laws Amendment (Tax Relief So Working Australians Keep More Of Their Money) Bill 2019. I've told them that tax cuts don't help people who aren't able to find a job in the first place or people who are sleeping in their cars or in their tents in Tasmania. I've told them that, if you really care about taking the foot off the throat of people who are doing it tough, you can't ignore those people doing it toughest of all.

Tasmanians have a higher proportion of historic public housing debt than anywhere else, and we have thousands of people who need housing. The list is growing every year, and every year we get a cheque to start to chip away at that list of people who need our help. Instead of putting that money to good use, we split it and send half of it straight back to Canberra. Half of our social housing budget is sent back to Canberra. We have a housing crisis in Tasmania, and we're fighting it with one hand behind our backs. It's not good enough. It's so unfair. It's time we called time on this debt.

People raise their eyebrows at the budget cost of these tax cuts. Tell me what you think about the human cost of telling a homeless single mum that she has nowhere to sleep tonight because Canberra needs that housing money more than she does. I'm not saying everything about this bill is perfect, and I'm not saying that it's going to fix every problem people are experiencing. I'm just saying that if you ask me to choose between helping someone and helping nobody, I know what I'm going to choose every single time—just as sure as day follows night.

The tax cuts we're dealing with should be dealt with on their own merits, not on the deals or sweeteners that come attached. I'm not going to vote away my integrity for anything, because it's all I've got in this place. I'm voting with the government on this bill for what it does, because, on balance, we need something more than what we're seeing out there. I didn't rush into making this decision. I heard the arguments from all sides. I've heard the argument that this tax cut will mean cuts to services. Let's remember that every tax cut reduces the amount of money available to be spent by governments, not just the ones you don't like. Just about everybody in parliament is in favour of two of the three stages of the tax cuts except the Greens, who apparently think people earning $1,000 a week should be paying more tax, not less. When I follow the logic, if everyone here agrees, we should have some service cuts to go along with our tax cuts. What we're really debating is how deep those cuts should go. I don't believe that that's what we're debating, though, and I reckon nobody else here thinks that either, which shows that there's something broken about that logic.

In the meantime, the economy is really struggling. Tasmania's small businesses are practically dragging customers off the streets and into their stores. Those customers don't have money in their pockets either, because the jobs aren't there. I don't have to imagine what $1,000 would do for those struggling businesses and those struggling families and I don't have to imagine what a struggling economy would look like six years from now, because, from where I'm looking, the economy is struggling now. Come see my neck of the woods in Tasmania, and I'll show you why this bill matters so much. People need this tax cut out there, and they need it yesterday.

I've been told that we shouldn't lock in tax cuts years from now because we don't know what the economy will look like then. Can I just say that I hear all the time that people hate the way politicians never do anything or have a vision about the long-term future of this country. Now we've got a chance to do something beyond the short term, and everyone's saying that because we don't know what the world will be like in five years time we shouldn't do anything until we get there. If the economy gets worse between now and then, as this has, it takes a week to change the tax rates. If, in six years time, the economy can't handle a huge tax cut, then people expect their politicians to say so, be up-front and be honest. If the risk is too big to justify, people will understand rolling it back or putting it on hold for the time being.

The only way you can think that the worst bits of this tax bill are permanent is if you believe that nobody in this place can do the right thing and the responsible thing. I'm not prepared to give up on the possibility that parliament can show a little bit of guts and do the right thing when the time is right. I'm not prepared to walk away from tax cuts for low-income workers starting next week simply because we don't know if we'll be able to afford tax cuts for everybody else five years from now. If we can't afford it then, we don't go ahead; it is that simple. But I'll tell you what we can't afford to do either: we can't afford to leave people out to dry by blocking every part of this tax cut. People in Tasmania need this money to make ends meet. While all of this bill is being voted on today, not all of it is coming into effect today. In reality, it's more like something now or nothing now—something for those people struggling on low incomes, who are staring down another year without a pay rise for the blue-collar worker. That's something that makes a huge difference to me, I can assure you.

4:39 pm

Photo of Jordon Steele-JohnJordon Steele-John (WA, Australian Greens) Share this | | Hansard source

I was born on 14 October 1994, and that year, 24 years ago, was the last time that the payment currently called Newstart was actually increased. In that same time, I can't even imagine how much the rate of pay for those of us in this place has gone up. In that time, the cost of living has soared. The cost of power has soared. The cost of simply existing has shot through the roof. And vulnerable people across this nation have cried out and looked to this place to do something about it, to help people who need it. And, for 24 years, this place has done nothing. It has left the most vulnerable people in this country below the poverty line, to the point at which that community is screaming for assistance. And yet this government's first order of business has been to tip $158 billion worth of taxpayers' money into the pockets of some of the richest people in our society.

In my time in this place, I've learnt that politics is ultimately about choices. It is about the decisions that you make. This bill is about choices. This government is choosing to give over hundreds of billions of dollars of public funds to an economic project with no academic basis. There is not a shred of evidence that these tax projects will have a singular beneficial effect upon the Australian economy—or upon our society. It is policy done via a wing and a prayer, and it is so much less than what the Australian people deserve from this place.

People tonight are looking to this chamber, to their Senate, and they are deeply frustrated that, as our first act, we have chosen to act in this way. To give the chamber some idea of the colossal size of these measures, for the same amount of money, we could give dental care to all. We could create thousands of new aged-care places. We could raise Newstart and fund public education. For God's sake—for the same price, we could make university free again. And, yet, we are choosing tonight to take this money and throw it to the wind. It is a complete sham.

As a young person who didn't spend their entire political life crawling up somebody's neck to end up in this place, I have often found what happens in this chamber to be somewhere between perplexing and more than a little bit sickening—and I have said so on many occasions. But I've got to say: this is the polished turd to rule them all. There is not a single economist in this country, nor a credible one in the world, who would tell you that, in the current economic context, it is a wise thing to spend this money in this way. And what really gets me is that so many people during the course of this debate have used the vulnerability of our community members as an excuse for their support of this legislation. Well, tonight, I call crap on that.

Photo of Slade BrockmanSlade Brockman (WA, Liberal Party) Share this | | Hansard source

Senator Steele-John, order! Let's keep our language parliamentary, please.

Photo of Jordon Steele-JohnJordon Steele-John (WA, Australian Greens) Share this | | Hansard source

I shall endeavour. I am from a vulnerable community. I have lived that life. Let me tell you, when you need the doctor, when you need a roof over your head or when you're wondering where your next meal comes from it isn't the couple of bucks in your back pocket, that comes from these tax cuts, that helps you out. You can't take your 100 bucks down to Bunnings, buy a hip replacement and bang it in yourself. You need to go to the doctor, and that is what is enabled with the collective pooling of public funds. Taxation and public contribution are the legislative embodiment of the Australian belief that when you are in trouble, when times are tough, we come together and help out. If you are better off, you pay a little bit more. If you are worse off, you pay a little bit less, and that is fair. For decades, that has been the basis of the Australian tax and contribution system, and that fundamental tenet is being murdered tonight.

With this legislation you are seeking to transform our society into a US-style economy—a savage, predator-style capitalist state which will drive millions of our most vulnerable people into the most crushing forms of economic inequality and poverty.

This is not a joke, folks. You come down to Rockingham. You come down and you meet with those people who are, right now, living in the bush next to grain silos on contaminated land, because they can't find a single place to call their own and pay for it with the amount of money that they are given through Newstart and rent assistance. That is their reality. You are making a conscious decision tonight, in the face of all the evidence to the contrary, not to help those people. Shame on this chamber! There is nothing more shameful than walking past somebody in need and deciding not to help.

To be honest, with one side of this chamber, that isn't surprising. It's why you guys exist to sell the Australian public the idea that your personal greed and your desire to maintain your ownership of property is somehow in the national interest. That's your guiding political principle. Hats off to you. You're doing a terrible job. But this side of the chamber was brought into existence for something better. You, the Australian Labor Party, exist and were created to do better. You have been re-elected to this chamber in the role of the opposition. The role of which, traditionally, is to oppose things. To stare down a government's agenda and say no. What we have seen so far, however, is nothing more or less than a urine-soaked rollover—

Photo of Slade BrockmanSlade Brockman (WA, Liberal Party) Share this | | Hansard source

Senator Steele-John, order!

Photo of Jordon Steele-JohnJordon Steele-John (WA, Australian Greens) Share this | | Hansard source

There's nothing unparliamentary about urine, surely.

Photo of Slade BrockmanSlade Brockman (WA, Liberal Party) Share this | | Hansard source

Withdraw the comment, Senator Steele-John.

Photo of Jordon Steele-JohnJordon Steele-John (WA, Australian Greens) Share this | | Hansard source

I withdraw the comment. A 'water-soaked' roll-over; a 'damp' roll-over; an Albanese backflip. Your supporters are so disappointed in you tonight. They've been contacting my office all day. My Twitter inbox is full of people doing some variant of: 'I have supported the Labor Party for all of my life. I was kicked in the guts by this election. But at least I hoped that there would be some kind of fight in the opposition.' And you have, at their lowest moment, sent them the message that you're just going to let these guys get on with it—these intellectually-vacant swill that have congealed themselves together into a government. You're just going to let them get on with it, because it's too hard—it's too hard, and you're too sad! Oh, you'd got the curtains cut for the windows! You were going to be this minister and that minister! It was all going to go as you'd planned—and it didn't, and you're so sad! It's such a shame! And while you're having your little pity party, you're letting these folks get away with the largest bank robbery that's ever been perpetrated on the public purse!

Photo of Peter Whish-WilsonPeter Whish-Wilson (Tasmania, Australian Greens) Share this | | Hansard source

Hear, hear—shameful!

Photo of Jordon Steele-JohnJordon Steele-John (WA, Australian Greens) Share this | | Hansard source

It is shameful. The best you could do today during question time was to ask these guys whether they'd produce a letter. I mean, for God's sake! Why don't you just give up and go home. It is utterly disgraceful. Folks are so disappointed, and they are rightly disappointed. My generation are staring down the barrel of a climate crisis. The reality that was shouted at you from the gallery upon the opening of parliament—that is our lived reality. We are the generation which will live with the results of your inaction, your craven political cowardice and your disgusting greed. You are gifting to us an unequal and polluted world. And we will not forgive nor forget your betrayal.

This is the moment when the sides are being picked. History records our actions here, and it will look upon neither of you favourably. It is not too late tonight. It is not too late. You could join with the Greens, vote down this damned package and fight for a better Australia. You still can. You still can do that now. You can join with ACOSS. You can join with the social sector. You can join with goddamned John Howard, who advocates an increase in Newstart. I'd never have thought I'd see the day when John Howard was a better advocate for people on Newstart than the Australian Labor Party. What a world we live in! What a brave new political context!

You wonder why you didn't win? Well, today, and tonight, this is exactly why. People want vision. They want hope. They want something to believe in. And they damn well expect us here to fight for them like our lives depended on it—because their lives do! Their lives do. As this miserable measure makes its way through the parliament tonight, none of you can say you do not know exactly what you are doing. When we come back to this place in 12 months time, in two years time, in three years time, desperately grappling with the reality that our economy and our environment are in freefall and we don't seem to be able to find enough money to do anything about it, it will be this moment that began the descent. When you have folks coming up to you and saying, 'Why the hell isn't our parliament fighting for us?'—this is the moment. You could represent your community. You could do what is right. You could fight for a better Australia. But you are choosing tonight—you lazy, greedy rump—to put your own interests and the interests of your corporate donors ahead of the interests of the Australian people.

Let me say this very, very clearly: this is the moment when the mantle of opposition passes from that sad, smoking husk once known as the Australian Labor Party onto the shoulders of the Australian Greens. Ours is now the role of keeping that light upon the hill burning, folks, because you sure as hell aren't in any state to do it! You sure as hell are not. We shall continue our work in this place. People will always have a voice in the Australian parliament while we are here. We shall fight for our planet and for our communities and, together, we will win and we will restore some semblance of what the Australian people deserve to the actions of this chamber.

4:56 pm

Photo of Nick McKimNick McKim (Tasmania, Australian Greens) Share this | | Hansard source

It's a matter of some pride to me, having heard that ball-tearingly good speech from Senator Steele-John, that I'm a colleague of his in this place, and also a good friend of his. He's been extremely articulate in placing the question before all senators tonight, and in explaining—very succinctly, and at times somewhat graphically—the nature of the capitulation of the Labor Party. I mean, can you see the light on the hill from here? No, me neither. Me neither. And there'd be Labor luminaries past and present rolling over in horror at what the Labor Party is doing at the moment. Make no mistake: these tax cuts take the axe to the progressive tax system in Australia.

Senator Gallagher interjecting

And I'll take that interjection from Senator Gallagher saying: 'They're the government; we lost,' and that we should be focusing on the government. Actually, that's your job! You're the opposition! You're supposed to oppose and hold the government to account, not roll over in a craven attempt to drag your bloodied, beaten carcass over the line at the next election. It's your job. But you know what? We'll stand up proudly here today, and we are standing proudly here today, doing your job for you and fighting to defend the progressive nature of the tax system in this country, which was actually built by the Labor Party in times gone by—when there was still a flicker left in the light on the hill.

Senator Gallagher interjecting

When the volume goes up, you know you're hitting some kind of a nerve in this place!

Make no mistake: these tax cuts, these three tranches of tax cuts, are not made up of free money. There is no magic pudding here. These are going to come at a cost, and let me tell you about some of the costs of these tax cuts. They come at the cost of having any hope of getting a decent raise in Newstart any time soon. They are going to come at the opportunity cost of funding public hospitals, health care, public schools in our education system, disability support services, public transport—those public services that people expect their governments to deliver. This is not free money. There are horrendous costs to these tax cuts, and the people who need the support of public services to have any kind of a crack at a decent life in this country are being shafted well and truly today by the Liberal and National parties in here, by the Australian Labor Party in here, by Senator Bernardi, by Centre Alliance and by Senator Lambie. You all ought to be ashamed of yourselves. You're supporting tax cuts for the millionaires and the billionaires at the expense of people doing it tough on pensions and Newstart.

In my state of Tasmania, where the benefits of these tax cuts will be felt less than in any other state, this decision is a tragedy for our health system, our public school system, our transport systems and our public housing systems. This decision is worse for my state of Tasmania than it is for any other state in the country. We have two electorates, Braddon and Lyons, amongst the four electorates that will benefit the least from these tax cuts. Braddon benefits the second least out of any electorate in the country, and Lyons benefits fourth least out of any electorate in the country. What people in Braddon and Lyons need—and what people doing it tough right across this country need—is an increase in the minimum wage. What we need is an increase in Newstart. What we need is significant extra funding going into public education and into our public health system. Those are the costs of the decisions that people are making in this chamber today.

Well, the Greens are going to hold firm. We're going to vote no to these tax cuts because we are unashamedly a party for increasing the scope and the quality of public services in this country. In fact, we're not just unashamedly that party; we are proud to be that party. We're the only party left in this place that believes there should be significant increases to public services in this country.

I've heard all the arguments about some of these tax cuts being off in the never-never and after the next election, but, in the words of Paul Keating, one of the Labor luminaries, who I reckon to be pretty disappointed by this decision from the ALP, 'They are going to be L-A-W law.' That's what these tax cuts are going to be—L-A-W law. Can anyone in this place, even with the most fertile imagination, imagine the Labor Party taking tax increases to the next election? Ha! It's not going to happen. I'll tell you now: it's not going to happen.

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) Share this | | Hansard source

That's right.

Photo of Nick McKimNick McKim (Tasmania, Australian Greens) Share this | | Hansard source

I'll take that interjection from Senator Cormann, who just agreed with me and said, 'That's right.' He knows—look at the smile on his face—that today he's locking the Labor Party into supporting these tax cuts all the way through the next couple of electoral cycles at least. That's why Senator Cormann has a beaming expression on his face as we sit here in this chamber. And that's why Labor members are hanging their heads, because they know that I am right. They are never going to take a tax increase to the next election, because the mythology that's developed in the Labor Party over the last few weeks since the election we've just had is that the somewhat marginally progressive agenda they took to the last election is what cost them government. Actually, that's not what cost you government at all. I'll tell you what cost you government.

Photo of Katy GallagherKaty Gallagher (ACT, Australian Labor Party, Shadow Minister for Finance) Share this | | Hansard source

Oh, good. Thanks for that, oh wise one!

Photo of Nick McKimNick McKim (Tasmania, Australian Greens) Share this | | Hansard source

Thanks for listening, Senator Gallagher. I'll tell you what cost you government. It was a failure to sell your policies and a failure to actually stand up for significant action on climate change. That's what cost you the election—your failure to back in a proper rewrite of the Environment Protection and Biodiversity Conservation Act and your complete disconnect with younger people in this country.

You've just heard from the youngest senator in this place, a fantastic representative of young people in Australia, about how we are engaging in intergenerational theft by passing these tax cuts. We are stealing the future of young people because we are bequeathing to them a climate that is breaking down, that is almost, if not already, past the point of no return. We are bequeathing ecosystems that are collapsing before our very eyes. We are bequeathing them a future where most of them can have no opportunity even to buy their own homes. Because, of course, the Labor Party won't take reform policies on capital gains tax and negative gearing to the next election either because they will be too fearful to do it. This needs to be on the record: we are smashing up the progressive tax system in this country today.

I want to talk a little bit about the deals that are being done, because there is an unacceptable opacity around these deals. We understand there's been a letter written by someone in government to Centre Alliance around some gas policy, but we haven't seen it. It hasn't been tabled in this Senate. It should be tabled, because the Australian people have got a right to know what deals Senator Cormann has stitched up to get the numbers to get this over the line. We also need to know what deal Senator Lambie has done with the government.

I want to briefly talk fractionally about the public housing debt in Tasmania. The Greens in Tasmania—I sat in the Tasmanian parliament for a long time; I had the honour and the privilege of leading the Tasmanian Greens in the state parliament for many years—were campaigning to have the debt forgiven well before Senator Lambie came along. I agree with Senator Lambie. I agree with her: that debt should be forgiven. There is no doubt about that, but I want to know if Senator Lambie has got a deal to get that debt forgiven. And, if so, what is the nature of that agreement with the government? I asked Senator Cormann to address those two points in his closing response, once I've finished this speech and, if he doesn't do it, I'll put it to him again in the committee stages of this legislation. These taxes are going to hamstring the capacity not only of this government but future governments to deliver the public services that so many Australian people rely on.

In my home state of Tasmania—I want to put this on the record—the number of people earning over $180,000 a year is fewer than the number of people in just the Prime Minister's seat of Cook that earn over $180,000 a year. I'll say that again: there are fewer people in Tasmania earning over 180K per annum than there are in the seat of Cook that the Prime Minister represents in the other place. And, in the Treasurer's electorate, there are over twice as many people earning over $180,000 per annum than there are in the whole of my home state of Tasmania. So senators voting for this deal, Tasmanian senators—and that will be every Tasmanian senator except me and Senator Whish-Wilson—are selling our state down the river, because they are making it harder for future federal governments to help Tasmania's health system, to help Tasmania's public education system and to help support people, for example, on Newstart, who are obviously overrepresented in Tasmania compared to the rest of the country. So any time any senator for Tasmania in the future calls for an increase in Newstart, calls for more money to go into the Tasmanian education system or the Tasmanian health system, I will be reminding them: 'You destroyed the chances of that today.' I'm very disappointed that this has occurred. I will be proud, when the division bells ring at the end of this debate, to sit on the 'no' side of this chamber with my friend and colleague Senator Whish-Wilson and my colleagues in the Australian Greens—proudly a party that calls for increases in public services; proudly a party that says, 'Now is no time for these rampant tax breaks, the overwhelming majority of which will flow to the very well-off and the superwealthy in this country.'

Collectively, colleagues, we are making one of the biggest mistakes that I have seen in my 17 years in politics. Believe me, I have seen a few catastrophic stuff-ups by parliaments in my time, but I have rarely, if ever, seen a stuff-up as bad and as damaging to the fabric of our society, to the fabric of our community and to the Australian people who most need the help of this parliament and this government as the stuff-up that we are about to commit in this parliament. The senators supporting these tax cuts are making a $158 billion choice to starve future governments of the revenue that they will need to support our most vulnerable people. I can only agree with Senator Steele-John's political analysis.

To be frank, I expected nothing better from the LNP—the party of the elites; the party of the big corporates; the party that deliberately designed a social security system to punish vulnerable people; the party that put in place the robo-debt system, which has cost lives in this country. People have taken their own lives because the government falsely accused them of owing a debt that they, in fact, did not owe. I expected nothing better from the LNP, and I've learned that consistently over my time in politics. But do you know what? Like many Australians, I do expect better from the Australian Labor Party—I genuinely do—but I think I'm going to have to re-evaluate my expectations in that space because they are walking away from vulnerable Australians today. Remember, the ALP didn't even take a policy of raising Newstart to the recent election. They had a mealy-mouthed review that was actually going to take 18 months to do if they'd formed government.

This is yet more confirmation, if anyone needs it, that the neoliberals have an overwhelming majority in this place. Their ideology, their neoliberal ideology, their trickle-down ideology, holds that, if you pump up the top end so they can get their new model Porsche or BMW, that wealth will somehow magically trickle down to the people at the bottom, in the face of every piece of evidence that you would ever want to see, over decades. We've seen people at the bottom waiting for this trickle-down magic, holding their hands out and waiting for just one drop of the trickle-down magic, for decades, and they've still got dry hands because it's just not trickling down. Trickle-down economics does not work, and these tax cuts are a living, breathing embodiment of trickle-down economics. They hold that, if you look after the top, the bottom will be looked after, but it's not going to happen.

So, Minister, in the short time that I've got left—I know you were taking advice, and fair enough too, at some stages during my speech—I do ask you to address the agreements you have made with Centre Alliance and Senator Lambie. I ask you to table any documents, letters or any other information you might have about those agreements, or at least place on the record what those agreements are. I specifically have interest in any agreement around the housing debt that the state of Tasmania owes the Commonwealth and whether there has been any commitment to relieve part or all of that debt as a result of your negotiations with Senator Lambie. And, if we don't get that from you in your response shortly, Minister, I put you on notice that I'll be raising it in the committee stage of this bill. While Tasmania's housing debt to the Commonwealth absolutely ought to be abolished, even if that is the deal, that is still a dud deal for Tasmania. Senator Lambie's got three years to leverage her position in this parliament—plenty of opportunities—and she should not have made this deal to do over Tasmanians' public services in the way that she has.

So, despite the mutterings from the Labor Party, I stand by the Australian Greens commitment to actually play the role of an opposition in this place. Remember: when the motion was put earlier today for this bill to be referred to an inquiry so that we could understand the true costs, that was voted down, not just by the government but by the Australian Labor Party. They don't even want to know the full story here. This is a political decision made by the ALP. It is not a decision in the best interests of the people they purport to represent in this place.

5:16 pm

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) Share this | | Hansard source

I thank all senators who've contributed to this debate on the Treasury Laws Amendment (Tax Relief So Working Australians Keep More Of Their Money) Bill 2019. The legislation we're dealing with seeks to implement one of the most central commitments that we made in the election campaign, and that is to provide income tax relief to all working Australians. We're doing it in a way which prioritises low- and middle-income earners but which also seeks to take the bracket creep monkey off people's back. If we leave bracket creep unaddressed, over time it will undermine aspiration and it will weaken our economy. A weaker economy is very, very bad for low- and middle-income earners, in particular, wanting to get ahead. There's a reason why the low-income areas of Australia voted for us very strongly in this election, and that is that aspirational Australians, working families around Australia, actually understand this truth: it is aspiration and hard work that drive their opportunity to get ahead, that drive the opportunity of all Australians to get ahead.

We're doing this in a way that is fiscally responsible. We are seeking to boost funding for schools and hospitals and infrastructure. We are seeking to ensure that the budget returns to surplus and remains in surplus all the way through, which is, of course, why we're prioritising tax relief for low- and middle-income earners in the first instance before phasing in more structural reforms over the medium term. If the Senate supports this legislation today, it will mean that, by the end of next week, millions of Australians can start to receive up to $1,080 in tax refunds in their bank accounts.

Senator McKim talks about trickle-down economics. That is not trickle-down economics. That is leaving working Australians to keep more of their money—the money that they work for. That is actually the government making a decision that we take less money out of people's pockets, that we take less money out of the pockets of hardworking Australians. There is nothing trickle-down about this.

Senator Steele-John interjecting

Senator McKim interjecting

Photo of Scott RyanScott Ryan (President) Share this | | Hansard source

Order! Senator Steele-John and Senator McKim, you were heard in silence.

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) Share this | | Hansard source

I understand some of the ideology behind some of the rhetoric around the top end of town. But, honestly, Australia does best when everybody is encouraged to be the best they can be. If we hold any Australian back from being the best they can be, we hold every Australian back. And this view that somehow there is this nasty segment in the population called the top end of town is something we've just got to move away from. It is destructive and it would weaken our country and our economy if we were to persist with that sort of language and that sort of approach.

It's been a long debate during the campaign and also, of course, in this chamber today. Let me just address this question that Senator McKim raised towards the end of his speech. The government is extremely grateful to Senators Lambie, Patrick and Griff, who have joined Senator Bernardi in supporting the government's plan for lower income taxes for all working Australians. We are very much appreciative. Senator Lambie, in particular, was very clear in her remarks to the chamber that she has made the decision to support the income tax relief on its own merits. Senator Patrick and Senator Griff made that same point. The government has also made the point—and we have been quite candid and transparent about this—that, as a government, we are absolutely prepared to work with crossbench senators in relation to policy issues of concern to them and of concern to their constituents. We will engage with the crossbench in good faith and work through issues.

Senator Lambie, who was referenced by Senator McKim, is a fierce advocate for Tasmania. She has provided very strong advocacy around an issue that she publicly raised yesterday. The government has agreed that we will work with Senator Lambie through these issues. I will just refer you back to Senator Lambie's comments. Senator Lambie made a decision, which we appreciate, to support our income tax relief plan on its own merits.

In relation to Senators Patrick and Griff, yes, it's a matter of public record. We have been talking to Centre Alliance for some weeks about our plans to deliver low electricity prices and lower gas prices and to boost the supply of gas into the domestic market. As Senator Patrick rightly expressed in his remarks earlier, he has put a series of ideas, views and propositions to the government on what he thinks and what Centre Alliance thinks could and should be done to achieve our common objective of driving electricity prices down further.

We haven't reached a final landing point in relation to these matters, but we have agreed on some processes to explore these issues further. That will be done in an open, transparent and public way. In the end, we want the right decisions. These are decisions in the public interest and decisions that will be effective and appropriate in continuing our longstanding efforts to drive electricity prices down and to boost the supply of gas into the domestic market. There is nothing wrong with that. That is not the trading of horses. That is not doing special deals. That is engaging in good faith on public policy matters, in the public interest, on behalf of the Australian people. That is what we're here to do. That is what the government is doing.

In closing, the government very much appreciates that—and I appreciate that Senator Lambie referenced this in her speech too—Senator Lambie very carefully considered these matters and the arguments in relation to the pros and cons of our overall plan. She made the decision, which we appreciate, to support our plan. It was the same with Centre Alliance. We obviously welcome that. I would say to the Labor Party, as Senator McKim said to the Labor Party, if you don't agree with our plan to deliver income tax relief to all working Australians, given that the final stage of our plan does not come into effect until 2024-25, then be our guests: go to the next election arguing to roll those tax cuts back. Go to the next election making the case that higher income taxes is what the economy needs. I have to tell you that the thing that completely and utterly confused me is that, having spent five weeks during the campaign arguing that the economy needed $387 billion in higher taxes, over the last couple of weeks we have heard the argument that the economy needs lower taxes sooner. That was even though that would undermine the return to surplus and maintaining the budget in surplus.

The government has a plan that is economically necessary and fiscally responsible. The government has a plan that will put more money into workers' pockets from the end of next week. The government has a plan to help create more jobs on the back of the economic stimulus created by the income tax relief plan that is before the chamber now. The government has a plan before the chamber today to implement structural reform to our tax system that continues to support aspiration and that provides incentive and reward for effort for hardworking Australians. That's so that our economy continues to grow and so that all Australians have the best possible opportunity to get ahead. A stronger economy is going to be central to our capacity to continue to sustainably provide increased funding for all of the essential services Australians rely on. That is another reason why we need to pass this legislation in full. With those few words, I commend the bill to the chamber.

Photo of Scott RyanScott Ryan (President) Share this | | Hansard source

The first matter to deal with is the second reading amendment moved by Senator Gallagher. The question is that the second reading amendment moved by Senator Gallagher be agreed to.

5:32 pm

Photo of Rachel SiewertRachel Siewert (WA, Australian Greens) Share this | | Hansard source

I move:

At the end of the motion, add:

", but the Senate:

(a) notes that the bill does nothing to assist people receiving newstart allowance or youth allowance; and

(b) calls upon the Government to introduce legislation to amend the Social Security Act 1991 to increase the maximum single rates of newstart allowance and youth allowance by $150 per fortnight".

Photo of Scott RyanScott Ryan (President) Share this | | Hansard source

The question is that the second reading amendment moved by Senator Siewert be agreed to.

5:38 pm

Photo of Scott RyanScott Ryan (President) Share this | | Hansard source

The question now is that the bill be read a second time.