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Thursday, 13 May 1999
Page: 5394


Dr WASHER —My question is addressed to the Treasurer. Can the Treasurer advise the House how the 1999 budget compares to the 1993 budget in terms of government delivering its commitments? To what extent is there a contrast between these two budgets?


Mr COSTELLO (Treasurer) —I thank the honourable member for Moore for his question. Last Tuesday night when the government introduced its budget it was able to deliver on all of the promises that it made in the October election. The government, having fulfilled all of those commitments, seeks the right to introduce in full all of the commitments it undertook with the Australian people in October of last year, and in particular we seek to implement in full the largest cut in personal income taxes in this country's history.

Average Australian wage earners deserve income tax cuts. Only one thing stands between income tax cuts and a go for average earners in Australia, and it is the negative, obstructionist, Labor opposition under the leadership of the current Leader of the Oppo sition, who believes that the only thing you win a mandate for when you win an election is a mandate to break your promises, not to keep them. After all, that was his experience.

During 1992 was the last time that Australia had access to general income tax cuts. Families had access to income tax cuts under our family tax initiative, but the last time that legislation was put in place to cut income tax was in 1992 with the Tax Legislation Amendment Act 1992. Mr Speaker, this is a copy of the act, No. 197 of 1992. The Labor Party went the 1993 election not promising income tax cuts, but with that piece of l-a-w. After the 1993 election the Labor Party, having won an election on the basis of the l-a-w law Tax Legislation Amendment Act of 1992, introduced a bill called the Taxation Deficit Reduction Bill (No. 3) 1993. They changed that l-a-w so that some part of those tax cuts would apply in 1993-94, but the full benefit would apply under section 2(3) of the act as follows:

Part 2 commences at the beginning of the financial year fixed by regulations made by the Governor-General for the purposes of this subsection. The financial year must be later than the financial year beginning on 1 July 1994.

The Governor-General has been sitting out there at Yarralumla since 1 July 1994 waiting, waiting, waiting—waiting for the Treasurer of the day, waiting for the finance minister of the day to come out and to say to him, `Oh, Governor-General, please let us implement our tax cuts,' which were not a promise; they were l-a-w. They won an election on them in 1993. All they had to do was hop in the Comcar on any one of those days and go out to Yarralumla and ask for them to be put in place. The thing that is interesting about that l-a-w, which is still on the statute books and never applied to one dollar for one day—the member for Dickson knows all about this, don't you; you had quite a lot to say about it at the time—is that it does cut income tax rates generally, but I think it was deficient in one respect. The one thing the Labor Party never had in the l-a-w was an income tax cut for lower income earners.

Mr McMullan interjecting


Mr COSTELLO —The member for Fraser says, `We had already done that.' You would think the Labor Party would, therefore, having been embarrassed by never delivering on the l-a-w, be supporting income tax cuts now. No, now they have decided that it is unfair to cut income tax rates, even though this government is cutting the lowest marginal rate, a proposal which Labor never had. This is complete hypocrisy, breathtaking hypocrisy. When they took away the l-a-w in that budget they took away $3.5 billion of income tax cuts. Instead of that—on the votes of the Australian Democrats, whose spokesman is now the Labor member for Dickson—they increased all—

Ms Kernot interjecting


Mr COSTELLO —Your interjection was?


Mr SPEAKER —The Treasurer will address his remarks through the chair.


Mr COSTELLO —The member for Dickson says, Mr Speaker, that people should keep their promises.


Ms Kernot —No, you said that.


Mr COSTELLO —That was certainly what you were saying at the time. But on the votes of the member for Dickson, not only did the l-a-w never come into effect but all rates of wholesale sales tax were introduced with a $1.3 billion slug on the budget night and another one per cent. What the Labor Party said in 1993 was that winning an election gave you a mandate to break promises. That was the last election that Labor won. What we say on this side of the House is, `Winning an election gives you a mandate to implement them.' That is why—with the member for Dickson saying that people should keep their promises, being elected to keep the Bs honest in the Senate—the Senate ought to give this government the opportunity to make sure it delivers on those commitments. When the Leader of the Opposition stands up tonight, he could look the Australian people squarely in the eye and say why he failed to implement any of the promises he made last time and why they have any basis to believe him ever again.