Ms GEORGE (11:14 AM) —In speaking about Appropriation Bill (No. 3) 2002-2003 and Appropriation Bill (No. 4) 2002-2003, I take the opportunity to make some general comments about economic mismanagement by the Howard government. I do so on the basis that, as a newly elected member of parliament, the last budget was the first one that I had the opportunity to sit through as an elected member. It came with great surprise, because the government members have always prided themselves on being great economic managers. There I was in the chamber sitting through my first budget as a member of parliament, and, despite years of record economic growth—a lot of it of course bequeathed by the legacy of Labor in power—it ended up being a budget that was in deficit, brought about by people who profess to the Australian community that they are great economic managers. That came as somewhat of a surprise.

The second surprise that has come to me over the past year is the fact that the Howard government is now the highest taxing government in all of Australia's history. The community were told, weren't they, that with the introduction of the GST there would be a rationalisation of the tax system, the burden of taxes would be lifted and a growth tax would be provided that could be relied on to fund essential community services? We have a situation where not only do we have a budget that is in deficit but we have a government which is the highest taxing government in Australia's history.

Down the line, we are not seeing the benefits in basic services that were supposed to come with this new growth tax. Everywhere you look, basic services are under a great deal of stress, whether it be in the area of health, with significant declines in the rate of bulk-billing; in higher education, where massive cuts to outlays are putting greater pressure on students and their families; or at a local level when you look at child-care provision, as I have recently done in my electorate. There is enormous pressure to cater for the needs of an increasing number of families where both parents are in the work force and are unable to find places to care for their children before and after school hours.

In racing parlance, we could talk about the trifecta; but unlike the racing trifecta, where the punters think it is going to provide some gain and some benefit, the trifecta from this government has produced the exact opposite—the first leg of the trifecta is a budget in deficit; the second leg of the trifecta is the highest taxing government in Australia's history; and the third leg of the trifecta is that basic services everywhere are being cut and families are under pressure. People are seeing through the rhetoric of the government, which professes to pride itself on being a great economic manager. Ordinary families are saying, `Why is it that with all the promises that were made we are finding it harder to make ends meet?'

Tax from income is the highest ever as a percentage of gross domestic product. The irony is that Australians are paying more income tax than they were before the GST. The GST alone will reap the government about $30 billion this year. If that was not bad enough, it seems that the government cannot resist imposing more and more taxes—be it the dairy tax, the sugar tax, the medical indemnity tax or the Ansett ticket tax—which, on top of the income that comes with the GST, are adding further burdens. So life is becoming harder for the average family in this society under this government that professes to care for the plight of families and the battlers in our society. Debt levels are exploding. The average household debt is now about $81,000. And families as consumers are being slugged everywhere with high credit card interest rates and bank fees. With record levels of credit card debt, it is no wonder that Australians are saving less than ever before. More and more families are finding it harder to get ahead.

Many families in my electorate of Throsby fall into the category which we describe as the increasing numbers of working poor. Many are realising that a bit of extra overtime or a hard-won pay rise simply is not worth it after this government takes its unfair share of that extra income by way of the tax system. As my colleague the member for Chifley mentioned in his contribution, we all know that bracket creep is pushing many ordinary struggling families and workers into the very top tax rate for every dollar that is earned over $60,000. Far from the promised review of the tax system easing the burden and eliminating the duplication and multiplicity of taxes in the system, we are finding that the top tax rate is now penalising many workers who are out there struggling to make a living to provide for their families.

I want to quote from a letter which I recently received from one of my constituents. It is easy to fall into the jargon of `effective marginal tax rates' and `looking at the global picture' without appreciating the impact this is having on ordinary people. The letter I received a week or so ago from one of my constituents, Margaret Geeves, says it better than all the figures in the world. She says:

She goes on to say that her husband, again because of work performance, is expecting another bonus later this year but that, when they did the calculation at home, they found that for each thousand dollars over the threshold they actually lose lots of money. She says that, with $1,000, you take out the tax—minus 47 per cent, so that is $470—and then another 30 per cent, or $300, because the government takes back 30c in every dollar from Family Allowance for being over the threshold. She says that, out of this $1,000, they are left with $230 which, when spent, incurs 10 per cent GST, leaving them just $207 extra coming into their household which is not affected by tax. That is not much of an incentive, she argues, for being a stay-at-home mum and losing Family Allowance, especially with teenage children who cannot get part-time jobs. She continues:

She ends her letter to me as follows:

I raise that case because I have looked at the raw data. We talk a lot about how people are punished through bracket creep and by the loss of family support and other benefits that government provides. But here is a real case—one of many, I am sure, in my electorate—of a family that is struggling to do the right thing under a system which is penalising low- and middle-income earners.

I want to say something about a government that has little regard for the growing inequalities in our society. It does not appreciate the predicament of middle-income earners on one income, and it does not realise or deal with the growing inequality and injustice that we see everywhere around us. One-tenth of Australians now own 50 per cent of our nation's wealth, yet the poorest 50 per cent control just seven per cent of our nation's wealth. So the rich are getting richer, the middle is being squeezed out and the poor, while nominally making ends meet, are not sharing in the benefits of the kind of economic growth that we are seeing in our country. As a result of this, I think in this country we are losing our notion of a fair go. One thing we have always prided ourselves on is that there are opportunities in this country for families who are at the lowest socioeconomic end; wealth is not the measure of the opportunities open to people. Wealth was never the measure of whether you could access quality education and quality health care or—as is increasingly becoming the case in my electorate—ever see the front door of a tertiary institution.

As these economic disparities grow, they are impacting on our regions. The further away you are from the capital cities, where the big growth has occurred in many of the industries that are part and parcel of an increasingly globalised economy, the harder it is for many families and their communities. I am appalled to think that this government is refusing to support a modest increase in minimum wages in our nation. The ACTU is seeking a $456 minimum wage per week. I know that people say that politicians live in an ivory tower, divorced from the realities of life, but I put it to you, Mr Deputy Speaker, that we are well away from understanding the pressures of raising a family on less than $25,000 a year. While the income of the top 100 CEOs in our country is now in the order of $38,000 a week, this government—which professes to be on the side of the battlers—is denying battlers a wage increase which would bring the minimum annual wage to something like $25,000. The government washes its hands of regulating executive salaries, sits back while the golden handshakes are there in abundance and says very little other than a few tut, tut, tuts. It is denying people at the lowest end of the income scale the opportunity to raise their wages to $12 an hour, or $456 a week before tax.

Again I looked at the data, because I think sometimes simple comparisons prove the point I am making. The minister, the member for Warringah, comes into the chamber beating up on the low paid. Let us look at the comparisons between his electorate and mine. In my seat of Throsby, just under 30 per cent of families survive on an income of below $500 a week. This places Throsby in the bottom third of all electorates. It is a startling figure when you compare it to a number of blue-ribbon Liberal seats. A good example is the seat of the minister for workplace relations, who comes into the House telling us that we should not support a rise in minimum wages, arguing the furphy that somehow it will cost jobs. In the minister's seat of Warringah, only 10 per cent of families have an income of below $500. So the comparison is 30 per cent in Throsby and 10 per cent in the electorate of Warringah. Conversely, 53 per cent of families in the minister's seat of Warringah earn $1,500 or more a week. In Throsby, less than 19 per cent of families can claim that level of income support. The median weekly income in Throsby is $859; in the minister's seat it is almost double that at $1,572.

That small example proves the point I am making: this government is presiding over an economy that is not delivering benefits to all people. While the government talks a lot about being on the side of battlers, it has no idea what a struggle it is for families in my electorate and in many electorates throughout this nation to make ends meet. Families are finding it harder to make ends meet because of the economic mismanagement of this government. About 70,000 people in my electorate receive some form of Centrelink payment. The example that I cited from one of my constituents, Margaret Geeves, shows that, when the family comes by an unexpected wage bonus because the husband has met performance criteria at work, the family allowance is reduced and the family is pushed into the marginal tax rates which the millionaires in this country never have to face.

It is a sad indictment of this government's economic policies and its mismanagement of the economy that it produced a trifecta where the budget is in deficit, it is the highest taxing government on record, and the GST is imposing additional burdens because it is a regressive tax. People at the low end of the income scales are hit severely by that. We are also seeing basic services in areas like health, education and child care continue to suffer. In a few weeks time, as a newly elected member I will participate in the second budget brought down by the Treasurer. With the budget last year the government exposed itself as not having the right to claim that its members are great economic managers. They benefited from the legacy of the Keating and Hawke years in opening up the Australian economy. They have traded on the benefits that low inflation and high productivity brought with them. They should stand condemned for their failure to manage economic growth on the basis of delivering fairness and justice across this nation.

It will not be too long before people understand that the kind of wealth inequalities and regional disparities we are seeing under this government mean that it is not a government that governs in the interests of all. This government has its eye on protecting those with the greatest economic advantage at the expense of all others. A government is elected to govern with the quality of life and living standards of families always at the centre of its concerns. The government over the last seven years has failed in that. More and more families are under pressure as this society becomes increasingly unequal, unfair and unjust. (Time expired)