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Wednesday, 30 May 2007
Page: 86

Mr DUTTON (Minister for Revenue and Assistant Treasurer) (3:38 PM) —I welcome the opportunity to talk in this matter of public importance discussion in relation to the costs of living, because it gives the government the opportunity to talk about an issue which is, of course, very important to the Australian people. It is important to the Australian people because they have costs that they need to meet each week, each month, to balance their budgets in order to provide support to their families. It is an issue that the government are very keen to talk about and to offer a view on because we believe we have been a significant part of providing more affordability, in housing in particular, over the last 11 years.

We have had the capacity to manage the economy well and to bring interest rates down from the 17 per cent highs experienced under Labor. We have had the capacity to manage the economy to reduce taxes so that people can provide more support to their families. In our management of the economy over the last 11 years we have had the capacity to say that we will provide more support for families who choose to use long day care or other forms of formalised child care. This government has provided significant funding for child care and for all those other measures that we are very proud of.

We are very proud of the fact that we have been able to release some of the pressure that applied when Labor was last in government. This debate today really gives the government the opportunity to say to the Australian people that the election that is due in only a few months time really will be about who is best able to support those families and small businesses as we go forward over the next decade. We maintain that the coalition will always be better for families, for those in small business and for the balance in the Australian economy and community, because we have a principle of running well-managed economies and providing dividends to families in the interim.

Of course this government recognises that families have debts to pay. They have home loans to pay and credit card debt to pay. They have motor vehicles and school fees and all those other things that go into a family’s budget each fortnight. There are petrol prices to deal with, holidays and those sorts of expenses. The government is the first to recognise that it needs to provide support for families to help them to meet all of those obligations.

I say this is an important debate today because it is an opportunity to say to the Australian people that the next election will be about whether, with the levels of debt that they have today, they can afford higher interest rates under a Labor government. One of the crucial messages that we now understand from the way in which Labor manages the economy not just at the federal level but at the state and territory level, where they have forced up taxes and have gone into debt to borrow on the government’s behalf, which in turn puts upward pressure on inflation and interest rates, is this: can families in our country today, with the levels of debt that they have, afford to return to Labor’s interest rates of 17 per cent? That is the question that the Australian people need to ask themselves in the run-up to the next federal election.

People who at the moment are paying eight per cent on their mortgages—for argument’s sake, if they are paying for an average mortgage of, say, $350,000, in an area like mine that might mean that their current interest repayment is about $2,713 per month. If interest rates were to go up, as they did the last time Labor were in government, if they are elected—let’s be generous and assume that they only go up to 12¾ per cent under the ALP, that would mean that their interest payments would increase to $3,882 per month. By my quick calculations that is an increase of about $1,169 per month. So the question to the Australian people is: can you afford to vote for a Labor government? Can you afford to return your family to 17 per cent or to 16, 15, 14 or even 13 or 12 per cent interest rates, as they were when Labor were last in government?

When we are talking about the very important issue of affordability, not just in housing but also in other costs of living, people need to ask themselves whether the Labor Party would return them to a better position than this government would be able to after the next election. That is a crucial point that needs to be underscored. This government has been about managing the economy well so that we can return dividends to the Australian people. We know that people in this country have levels of debt and that they need to service those debts; we know that they have obligations to raise their children, to send them to school and to meet all of those costs. We respect all of that but we say to you, when considering the opportunity at the next election to cast your vote, if you take the decision to cast it for the Labor Party what will that mean for your family’s household budget?

Much has been said today by those opposite, including the member for Sydney, about housing affordability and about the way in which house prices have increased in this country over the last three or four years in particular. No mention was made by the member for Sydney about the role of the state governments in that very important issue of housing affordability. No mention was made by the member for Sydney about the way in which some of the green policies of some of the state and territory governments have tempered some of the supply of land and how that, in turn, has forced up the prices of land. Nobody from the Labor Party has mentioned in this debate about how in some states planning schemes are imposed on local council authorities and about how other taxes and levies need to be raised by councils to meet their obligations under state government legislation, all of which adds to the end cost for the consumer.

If we are going to have an honest debate about housing affordability and the cost of living in this country, we need to recognise how it is that Labor at a state level have managed these issues over the last decade or so. When you take a close inspection of the way in which Labor have managed their state economies, the way in which they have pulled back on the supply of some land, you need to recognise that that is what is causing some Australian families pain out there in the community this very day. The member for Sydney referred to developers as being happy with their land stocks, not being happy at seeing any more land come online. Has she asked herself why that is so? Has she said to herself: ‘I’m a socialist, but I have to try to understand some basic economic policy’? Perhaps it is because the developers are happy for land prices to remain high, for supply to be pulled back so that they can maintain those high prices.

The thing that people should know about Labor is that 80 per cent of them come from a union background. Nobody in the Labor Party has made any real effort to employ people and, as they proved when they were last in government, nobody in the Labor Party has the capacity to manage the economy well. The majority of the Labor Party—80 per cent of them—come from a union background, where they have never employed anybody and never had a job outside of the union movement. In the run-up to this election, they ask the Australian people to believe that they are now ready to manage the Australian economy. Let us imagine that Labor were elected at the next election, and the Labor government cabinet first met to talk about economic policy. When you look around the cabinet table, you see that they have five former ACTU bosses, and the balance of the people have never had experience in small business, never had experience in employing staff. Can anybody for a moment believe that that assemblage of union hacks would have the capacity to make good economic decisions in the best interests of Australian families? Does anybody in small business today believe that the reintroduction of unfair dismissal laws by the Labor Party or a return to control by some of the union hacks and lunatics in the union movement would be good for small business? Does anybody in small business, in particular, believe for a moment that the Labor Party would create opportunities for business to grow?

When you look at Labor’s record on unemployment, you see that when they were last in government unemployment was in double digits—it was over 10 per cent. One million people were in the unemployment queues in this country due to the economic policies of the Labor government. If we want to have a serious debate in this parliament about affordability, about the cost of living, let me say to those opposite—in particular, to the member for Sydney—that somebody who is unemployed; who is forced out of a job because the economy turns sour, as it did under Labor; who does not have the opportunity to own their own home; who is lining up in the dole queue—there were one million when Labor was last in government—who does not have the capacity to put their children through education, which they might want to afford themselves of; who does not have the capacity to create wealth by saving for their retirement, or to create a better position for their family, feels the pressure of higher petrol prices and the pressure of all of those taxes that are passed on to small business. And somebody who was in the unemployment queue when Labor were last in government would realise that the Labor Party do not stand for helping families in this country with respect to home affordability.

The Labor Party really contributes to people’s capacity not to be able to afford housing. The Labor Party, through its bad economic management, now contributes at a state level—as it did previously at a federal level—to people being priced out of their homes, to people not being able to afford to run their cars or to small businesses not being able to afford to expand. All those points need to be reinforced to the Australian people, as they are approaching a very serious time in this country’s history and they will be reminded about them in the run-up to the next election.

I also want to talk today a little about petrol prices and to say to the Australian people that the government does understand the difficulty when the prices of petrol rise. We do understand that families, which need to fill the family car to run the kids to sporting events, or people who need to travel distances to work, or people who just want to take their family to the beach or to a movie on the weekend, have expensive costs in running their cars and filling them with petrol when it is at a higher price. We do understand that. The reality, though, is that those opposite, on occasion—in a moment of honesty—have recognised that petrol prices are largely out of the control of the federal government. Petrol prices are determined by international factors. If petrol prices increase, the government does not benefit. From a federal government perspective, if the price of petrol is $1 a litre and it goes up to $1.30 the revenue that flows to the Commonwealth remains the same.

The point needs to be made that we do recognise the difficulty that families face in relation to petrol. We do recognise the difficulties of people who have high levels of debt because they have purchased a new house, put an extension on or accessed equity in their home. We do recognise that they have expenses. But what we say to Australians who find themselves in that position is: if you were in the position that you are in today 10 years ago, when Labor was last in power, you certainly would not be able to afford to stay in your own home and you certainly would not be able to afford to maintain the lifestyle that some people are able to maintain today. We have cut taxes in this country. We have brought down unemployment and interest rates in this country. We have managed the economy well solely so that we can return benefits to the Australian people.

When we talk about good management of the Australian economy, people need to recognise that if Labor is elected at a federal level then all that we know today about the Australian economy would be at grave risk. We say to Australian families and to people in small business that the Labor Party are dominated by, and answerable and accountable to, the Australian union movement. The election of a Labor government would be a bad outcome for them and for the future of this country. This MPI moved today by the Labor Party is a farce. It is a joke. If they were serious about these issues then they would confess their own failings when they were in government and come out and criticise state governments—who are solely responsible for the way in which housing prices have increased in this country. What we know about the modern Labor Party, at both a state and federal level, is that they do not have the capacity, the wit or the understanding to manage the Australian economy. (Time expired)