Senate debates

Monday, 18 March 2024

Questions without Notice: Take Note of Answers

Answers to Questions

4:34 pm

Photo of David FawcettDavid Fawcett (SA, Liberal Party) Share this | | Hansard source

I move:

That the Senate take note of the answers given today by ministers to questions without notice asked by coalition senators.

My colleague Senator Kovacic asked a question about government spending. People listening to this question might think, 'Isn't spending a good thing? Doesn't that actually help us?' But the reality is that the spending by the government—and my colleague highlighted some $6.75 billion in one week—is on top of an extra $200 billion that has been spent by this government since they came to office. The problem with that is, when you spend that kind of money, it actually drives up inflation, and driving up inflation means that it drives up interest rates, which affects people's mortgages.

This government has been very quick to try and blame overseas factors, but the reality is that our inflation is running at 4.1 per cent, which is well above the two to three per cent target, and our core inflation in Australia, which is 4.2 per cent, is well above that in the US, Spain, the Netherlands, Germany, Singapore, France, Italy, South Korea, Canada, Japan and, in fact, the entire European Union area. As a result of that higher inflation, the Reserve Bank has had to meet a number of times—in fact, on 19 occasions during this government. On 12 of those occasions, it has raised interest rates, and, on the others, has kept them level. That means there has been no relief and families are paying more. The consequence of this spending which has led to inflation is that, under the Albanese Labor government, Australians have experienced a collapse in their living standards, and there is nothing on the horizon that will point to a reversal.

People are aware of that cost. Even today, in the ABC reporting online, they talked about a gentleman in New South Wales that saw his most recent power bill go from $600 to more than $1,400. Whilst they highlighted that there were some spending pattern factors to that, they also highlighted that, overall, the price for power has gone up by some 40 per cent, which families are actually having to deal with. That combination of real costs going up due to inflation means that real household disposable income fell by 2.2 per cent over the last year and is down 7.5 per cent since Labor took office.

If there were plans ahead to make life better, people might have some hope. But answers from ministers opposite today fell back time and again on the fact that they are pushing down this transition to renewable energy because of the idea that it's going to lower prices. But, in actual fact, the latest report from Net Zero Australia, which comprises the University of Melbourne, the University of Queensland, Princeton University and a couple of management consultancies, highlights that, by the end of this decade, the cost will be some $1.5 trillion with, overall, a need for about $7 trillion to $9 trillion of capital to meet the additional transmission costs that will be required if we are to reach net zero just using renewable power. The reality is that those costs are not factored into things like the GenCost report and so all the statements made about renewable energy being the cheapest form do not take account of all the costs that mums and dads and small businesses actually have to pay.

In the last few weeks, as I've travelled through regional South Australia, meeting with small businesses, including people like caravan park operators, they tell me about the significant increase in costs. So, when those opposite say that the coalition is living in a fantasy around energy, what they're ignoring is the lived experience of countries overseas. We see in terms of cost and time that the United Arab Emirates has just had four reactors built within 10 years at a cost of $20 billion. That's the current price tag that is on the battery of the nation, the Snowy Hydro scheme, and the estimates from experts are that there will be four of those required to be part of the transition. What we see as real costs—actually real costs; that is, Korean contractors in the UAE delivering four reactors within a decade for $20 billion—equals the cost of one pumped hydro project here in Australia, and the estimates are that we need four of them. So the facts are that nuclear power will drive down costs—that's the lived experience—and the pathway that this government is on will push up costs for Australian businesses and families.

4:39 pm

Photo of Catryna BilykCatryna Bilyk (Tasmania, Australian Labor Party) Share this | | Hansard source

Once again, we had questions about the budget and spending and money, which is pretty amazing, when those opposite oversaw a decade of waste and wasted opportunities. They doubled the debt before the pandemic and went on to rack up $1 trillion of debt, with nothing to show for it. They failed to do anything to address skills shortages and the cost-of-living crisis. They abandoned universities during the pandemic, leading to the loss of 40,000 jobs. They didn't bother investing in TAFE and training, resulting in the loss of tens of thousands of traineeships and apprenticeships. Yet they come in here and try to criticise us because we're trying to improve the lot of the Australian people.

They failed to deliver genuine action on things like climate change and even engaged in outright climate change denial. They paid $19.7 billion in JobKeeper payments to companies with rising revenues. They gave away $3.4 billion for submarines that were never built. They failed to get wage growth moving and even admitted their policy settings were deliberately designed to keep wages low. I so remember the day when the former senator Mathias Cormann made that comment in which he said that it was a function of their policy to keep wages low.

On this side, we've delivered a surplus—the first in 15 years—which shows that the Albanese government has and is undertaking responsible economic management. Our approach has helped lower gross debt by $87.2 billion dollars. We've delivered this surplus while, at the same time, providing billions of dollars in cost-of-living relief in those really important areas to Australians doing it tough—those areas of cheaper medicines, child care and energy bills. We remain focused on dealing with the challenges Australians are facing while, at the same time, building a stronger, more productive and more resilient economy. This includes getting wages moving. As I said, the other side wanted to keep wages low. We didn't print the coffee mugs that said 'back in black'; they did. Not only did they print the mugs; but I remember seeing them in here. People brought them in here, as though it was truth.

We've removed the waste from the budget and we've delivered on really important issues like super on paid parental leave. On this side, we believe these things are important. They're not only a net investment in the economy; they make people feel as though the work they're doing is actually valued. Of course, we increased and brought in super on paid parental leave, and where we did, most of the time it affected women the most. Some of those opposite have actually called that a welfare measure. I just find that a bit rude and belittling. It's not a welfare measure; it's part of being able to improve the gap in gender equality concerns.

We govern for all of Australia. Everybody knows that May is budget time. We're coming up to the budget soon, so our side are there once again, fixing up issues that the other side caused when they were in government. We're fixing up termination measures and the hidden black holes that we inherited from those opposite. We will repair the debt burden from their time in government—it was a large debt burden—and we will make the important spending priorities to alleviate the cost pressures on Australians in those important areas of child care, energy bills, super on paid parental leave and cheaper medicines. Those are the things that matter, not the decade where the opposition just wasted any approach they had.

Of course, now we've got them in opposition. I know it's called 'opposition' for a reason, but that doesn't mean that they have to oppose every single thing we bring in here. We know they don't have too many policies on that side. We know it's a problem— (Time expired)

4:44 pm

Photo of Matthew CanavanMatthew Canavan (Queensland, Liberal National Party) Share this | | Hansard source

I notice my esteemed colleague Senator Bilyk mentioned the wages record of the previous coalition government, but she failed to mention the wages record under her own government and probably for good reason. The reason for that is that real wages under this Labor government have declined at the fastest rate on record. That's why people are struggling out there. Today, real wages are back to levels we haven't seen since 2011.

Under this government, under the Labor government, people's standard of living in Australia has gone back more than a decade—that's 13 years ago. Primarily that is because this government has let inflation get out of control, and they have done nothing to actively seek to rein it in. We still have some of the highest inflation rates in the world right now, and it would appear that the inflation dragon is rearing its head again in other countries.

There are still many disruptions to supply chains, including the continuing situation in the Suez Canal. Oil prices are ticking up again. It is still very costly. Everyone can notice that at the petrol pump, and people's energy bills in this country have not declined by $275, like the government promised. In that context, with all of these issues, when inflation is still high and when people's real wages have been eroded back more than a decade, this government thinks the answer is to spend a week spending $6.75 billion. Over the past seven days this government has spent at a rate of almost a billion dollars a day. Where's the justification for it? The government had no defence or justification in question time for why they have been pump priming this already overheated economy and potentially making inflation worse.

There are things the government could do to help with inflation. They are difficult decisions and they require some degree of fortitude, but I want to highlight two fronts the government has almost completely lost control of at the moment that are making the inflation situation that much worse.

Firstly, on migration, we learned in the last couple of weeks that during the last financial year Australia brought in 518,000 people in one year—

Photo of Paul ScarrPaul Scarr (Queensland, Liberal Party) Share this | | Hansard source

In net terms.

Photo of Matthew CanavanMatthew Canavan (Queensland, Liberal National Party) Share this | | Hansard source

Thank you, Senator Scarr. In net terms it was 518,000 people in one year. That's just a bit more than the size of Canberra arriving in one year. When you see, in our major cities, people living in tents and queues like you would at Dreamworld lined up in front of a standard rental house the reason is that this government has lost control of the borders. It is their job to control who comes into this country. That's the national and federal government's job. They have no plan for how to house 518,000 new people.

When we were coming out of COVID there's no doubt we had to open up our borders to let some people back in and bring skilled migrants in. But this government botched our recovery from COVID by simply opening the floodgates to whoever wanted to move to this country, with absolutely zero plan to ensure that those Australians who live here have a house and can survive, with a roof over their head. So many Australians now are unnecessarily homeless because we're taking in too many people. That's adding to our inflationary environment, especially in housing and rents.

The other situation is that the government has completely lost control of our energy markets. We're going to find out this week what energy price will be for the next year, the so-called 'default market offer'. Almost certainly they won't show a $275 reduction. This government promised when they came to power almost two years ago that they would lower electricity prices by $275. The Prime Minister promised that to the Australian people almost 100 times. Since then he hasn't said 'boo' about it because they haven't delivered it. They'll blame everyone for their problems. Apparently it's our fault for proposing nuclear energy—and we're just proposing it. That's not going to change the real world unless we're elected. They're responsible because they're the government, yet they can't explain why their policies are not having the effect they did. They blame the Ukraine war and Vladimir Putin, but that was more than two years ago. We have enormous natural resources in this country. We never before had to rely on Russia for energy security, but now we do under this Labor government, and that's because they won't tap our energy resources. If we want to get energy prices down we have to use our natural resources.

If the government could just do two things: control our borders and use our natural resources, a lot of these inflationary problems would come off the Australian people.

4:49 pm

Photo of Marielle SmithMarielle Smith (SA, Australian Labor Party) Share this | | Hansard source

I really welcome the opportunity to reflect on Senator Kovacic's question at the start of question time today, because it's an opportunity to reflect on the many investments the Albanese Labor government is making in the people of South Australia and in cost-of-living relief, not to mention economic investments, investments in industry, investments in social policy and investments in payments. These are all, in my view, fundamentally good things. They reflect what is a clear distinction between us and those opposite in what you see as the role and value of government.

Now, I believe government can make an extraordinary difference in people's lives by making the right investments in social policy, making careful and considered investments in things like the payment system. I believe it is the role of government to support industry and to support opportunities for economic growth and development. That's reflective of the investments we have made over recent weeks and months and in the years we have been in government. Take a moment to reflect on some of those investments in recent weeks. I don't see anything to argue with. Investments in superannuation on paid parental leave are significant investments that will make a difference not just for the women who receive this payment but for how we conceptualise paid parental leave as a workplace entitlement in this country. It builds on the legislation which passed this chamber this very day and which was about expanding paid parental leave, maintaining the connection between employee and employer, seeing it as a workplace entitlement rather than welfare payment. That announcement was made in recent weeks. That announcement is going to make a significant difference in people's lives and in that reconceptualisation. It will make a significant difference in closing the gender pay gap and in women's retirement incomes.

Increases to indexation and the pension will benefit five million pension and allowance recipients, making a significant difference during what we all acknowledge to be significant cost-of-living pressures on Australians across the board but especially those who rely on them to make ends meet. Those indexation payments will make a significant difference. I don't think that expenditure is not well spent, and neither are the investments in Indigenous housing made in the Northern Territory in recent weeks. They are much-needed investments for communities who desperately need housing, improvements and upgrades, and this will make a difference. There is critical minerals industry support. That's a significant thing which I'm shocked the other side would be opposed to.

When you step back and unpack the investments and expenditure made, I believe you will see these are fundamentally good things which will make a difference in people's lives. That's the difference between our government and those opposite. We believe in spending to support our policy priorities and values. We believe in the role of government to support Australians and to promote and enhance industry. We believe in the role of government to drive increases in wages, which have been long overdue. That's why we advocated for and supported increases to the minimum wage as well as for aged-care workers. Of course, all these things need to be done in a responsible way. Need I remind those opposite that we delivered a surplus last year? You guys ordered the mugs but didn't actually deliver it on paper.

That's something our government has done, and every decision we have taken since coming to government has been designed not to add pressures to inflation, to be done in a responsible way and, of course, to do things that meet our social and economic policy objectives. We come to government to do something. In the Labor Party, we come to government to try to reshape our country and to try to reshape public policy so it's working better for a broader range of people—particularly so it's working better for those who are most likely to benefit from government investments, who are most likely be in need of government support, whether it be for their industry or their particular social or economic situation. We in the Labor Party believe in that. I think it's a quirky criticism to make of us that we would be making decisions like investing in paid parental leave, supporting increases to the payment system and making critical economic investments that will lead to further jobs and opportunities for generations of young people. These are fundamentally good things reflective of Labor values, and our budget as well will be reflective of Labor values because it will be responsible. We know a responsible budget is critical to us being able to deliver for Australians and to deliver for South Australians, as we will continue to do as long as we're in government.

4:54 pm

Photo of Paul ScarrPaul Scarr (Queensland, Liberal Party) Share this | | Hansard source

What we are seeing from those sitting opposite is a government spending like a drunken sailor. There have been over $6 billion worth of spending announcements in the last week. That's unfair to drunken sailors because, typically, drunken sailors are spending their own money. They are not spending the money of taxpayers; they are spending their own money. But this government are spending taxpayer money or they are borrowing money, and the Australian taxpayers will have to pay the interest on that borrowed money for decades to come. We saw from the current Labor government over $6.7 billion of additional spending announcements in the last week—in one week!

What have we seen since the Albanese Labor government came to power? We have seen $379 billion more in taxes collected under the Albanese Labor government since they came to power and an additional $209 billion in spending. Now, in the short term, when you had iron ore prices at record highs, you could cover that spending. But the problem is—and this has always been the case—over the cycle, commodity prices come down and that's what we are seeing now. Since the start of the year iron ore prices, for example, have come down by nearly 20 per cent. Commodity prices are coming down. That taxation revenue from the iron ore industry, the mining industry et cetera which has propped up the government spending is simply not going to be there at the same levels next year. Who suffers? The Australian people will suffer.

The RBA put out a document earlier this year which talked about the fall in real disposable income. This is the cost-of-living crisis. This is not a senator's document; this is the RBA. The RBA said, 'The rate of real disposable income has declined by 5.5 per cent since early 2022'—the time of the last election—'the largest decrease observed in around three decades.' In 30 years, real household disposable income has fallen by 5.5 per cent, the highest rate in the last three decades.

Question agreed to.