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Thursday, 20 March 1997
Page: 2641


Mr LATHAM(5.37 p.m.) —No wonder the member for Paterson (Mr Bob Baldwin) is claiming that he is losing so much weight. It is not speed walking, it is speed talking that is trimming him down. Good luck to him.

It is said that if you live long enough you will see and hear everything. Even at my tender years I am getting to that point with this piece of correspondence from the office of the Assistant Treasurer (Senator Kemp). It is a letter that has been written to Neil Hammond of Ferny Creek, Victoria concerning the fact that earlier this year Mr Hammond's house was unfortunately burnt down in the Victorian bushfires.

He wrote a letter to the Prime Minister (Mr Howard) requesting some relief for the reconstruction of his house—a temporary sales tax exemption on the building materials. That letter was sent to the Prime Minister on 27 January. A response did not arrive from the Prime Minister. It was sent on to the Treasurer (Mr Costello), who in turn sent this minor request on to the Assistant Treasurer. A letter addressed to Mr Hammond came back on 7 March and I believe it deserves to be written into the full record of the parliament and the Hansard. It states:

The Assistant Treasurer has asked me—

that is, Virginia Lo Pilato, the adviser on taxation—

to respond to your letter.

I sympathise with the situation that now faces you and your family. However, the Government receives many requests for reductions in tax burdens. To agree to individual requests would often only have a small impact on the Budget. However, if all of the requests were to be granted it would increase the budget deficit by billions of dollars. Such a blowout in the deficit would be unacceptable, as it would place pressure on interest rates to rise (thereby increasing unemployment and reducing economic growth) and would reduce national savings (and could therefore further increase Australia's foreign debt).

I trust this information will be of assistance to you.

Yours sincerely

Virginia Lo Pilato

Adviser (Taxation)

The information is of no assistance to Mr Hammond. It is a letter of a mean spirited, mealy-mouthed government that does not have the commonsense to respond to a request for compassion in sensible terms. There is no sensible response here. It is a response of the absurd. It is theatre of the absurd to say to Mr Hammond that his minor request for a concession on sales tax to help rebuild his home that had been burnt down will blow out the budget deficit by billions of dollars, will send up interest rates, will increase unemployment, will reduce economic growth, will reduce national savings and could further increase Australia's foreign debt.

The minister at the table, the Minister for Schools, Vocational Education and Training (Dr Kemp), should have a word with his brother about this standard of absurdity coming out of his office. I have seen some economics in my day but never the economics of chaos theory. This is like saying that if a butterfly flaps its wings in Brazil there will be an earthquake in Western Australia. It is like going back to the old domino theory used in economics.

Instead of having the downward flow of communism into Australia, it is the downward flow of national bankruptcy: if a fellow receives a taxation concession to rebuild a house that was burnt down in a bushfire it will send the country broke. That is to say that if Mr Hammond sneezes Australia's 17 million people will catch colds. The office of the Assistant Treasurer is saying that if he builds his house one day the next day the IMF and the World Bank will be knocking on his door to blame him for national bankruptcy.

This is a response of the absurd. If a government cannot give a serious response to a family and a citizen who has suffered under the very sad circumstances of having their house burnt down then they should give no response. If they cannot give a serious response in a compassionate situation it is better to say nothing.

What sort of government is so mean spirited and absurd that they cannot write back in proper terms to Mr Hammond giving him a sensible response. Instead of having Costello-omics, we have got chaos theory in the economics of government policy, we have the domino theory—that one person's small taxation concession on building materials will send the country broke—we have Mr Hammond sneezing and the nation catching colds and we have him being told that if he builds his house one day the IMF and the World Bank will knock on his door the next and say that he has sent the country broke.

This is a government that is mean spirited across the board. It cannot even come up with legitimate, sound reasons to justify that set of attitudes. It has to go into the absurd. If this is the best that the Assistant Treasurer and his office can do, then they will be headed the way of Senator Short not too long from now and off overseas where they belong.