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Monday, 15 November 2010
Page: 2175


Mr CRAIG KELLY (12:00 PM) —I rise as the 1,077th member of this House, as someone who is proud of his country, proud of its history and proud of its traditions. I also rise as someone who owes a debt of gratitude to past generations of Australians whose sacrifices and struggles have given us the freedoms and opportunities that we enjoy today. I also understand that I have an obligation—in fact, we all have an obligation—to pass this great nation onto our children and grandchildren in better shape and with greater freedoms and opportunities than we inherited.

My first duty in this House is to thank the electors of Hughes, who have given me the privilege and opportunity of being their representative. I am conscious of the trust they have placed in me and I will not let them down.

The electorate of Hughes is named after Billy Hughes, who served as Prime Minister from 1915 to 1923. Billy Hughes had a parliamentary career spanning 58 years, during which he changed parties no less than five times. Having started as a Labor member in 1901 he then, after 44 years, became a Liberal, completing his distinguished career as the member for Bradfield. Billy Hughes’s example reminds us that maybe—just maybe—there is still hope for those who sit opposite. But they are always welcome to come across and join us should they see the light.

The electorate of Hughes is a snapshot of modern Australia. Right across the electorate, families are paying the price for this government’s misguided policies. They are under pressure from surging electricity prices, rising mortgage repayments and some of the developed world’s fastest accelerating supermarket prices. Their quality of life is threatened by a mad and dangerous plan to cram over seven million people into Sydney, stacking them pallet-like in high-rise apartments, forcing parents to spend more and more time in gridlock traffic and reducing the time they spend with their families.

Hughes is also proud to be home of the defence personnel serving at Holsworthy Army base. Holsworthy has a long and proud tradition and I acknowledge its great contribution to the defence of our nation.

A little over one year ago I was not a member of any political party, and I never had been, but I was someone with a fundamental belief in our free enterprise system. I was just an average Australian, someone working ridiculously long hours in a small family business and trying to do the best for his family. But I became deeply troubled that Labor governments not only had lost their way but had completely lost the plot and at every turn were heading our nation in the wrong direction.

I owe my presence here today to the democratic traditions of the Liberal Party, a party that embraces all those who share its values and a party that gives opportunities to those who join later in life.

I come to Canberra keen to put almost 30 years of hands-on experience in manufacturing, wholesaling, international trade, retailing and franchising to good use. I am proud to say that in my career in the private sector I won export contracts in over 25 countries throughout the world and this has given me the unique opportunity to travel extensively and to learn from different cultures, including the way they approach business.

I was born in Sydney, the eldest of three brothers and one sister. We were all educated at the local state primary school and high school and I would like to pay tribute to the many wonderful and dedicated teachers that I encountered.

In winter, our front lawn at home was a football field and, in summer, a cricket pitch, with a garbage bin for a wicket, where I and my brothers and the other kids in the neighbourhood would play until it was too dark to see the ball. But I wonder if today our kids are really any better off when we pack them into housing where they no longer have the room nor the freedom to hit a real ball with a real bat in their own backyard but are restricted to playing simulated impersonal computer games.

My father was one of Sir Robert Menzies’ ‘forgotten people’—a small business man who grew his business by reason of dealing fairly and justly with his customers, suppliers and employees. He developed his business in the days when one’s handshake was one’s word and when the term ‘good faith’ was just the way business was conducted. I am proud that he is here in the gallery today with my mother Raima, who has always given us unconditional love and support.

Sport, especially team sport, is one of our greatest educators. I am thankful that our Australian way of life has provided me with the opportunity to participate in a wide range of team sports, including rugby union. Over the years I have packed my head into many a rugby scrum, although no doubt some would say ‘maybe one scrum too many’. In the early 1980s I had the opportunity to travel to Japan to play rugby and while at Tokyo airport I met a young Chinese student who upon learning that I was from Australia commented: ‘Ah, Australia. You are a wealthy country because you have treasure buried in the ground.’ But he was only partly right. The greatest source of our national wealth arises not from the coal seams that stretch down our eastern seaboard, nor from the iron ore deposits in our outback; our greatest source of national wealth arises from the entrepreneurial culture of our individual citizens, our Australian spirit of risk-taking, of ‘having a go’. But today, the very essence of our Australian entrepreneurial culture, the sacred principles of equality of competitive opportunity—that of the freedom and liberty for an individual to start their own business and to succeed or fail on merit, free from predatory and discriminatory practices, rights that our forefathers fought for and died to protect—are under threat from misguided competition policy: a flawed view that ‘big is better’.

Over the last few decades, due to government policy, either intentionally or unwittingly, many sectors of our economy formerly open and free to the small business person have degenerated into states of hyperconcentration, of duopoly and oligopoly, through a rising tide of market concentration. Today in our grocery sector just two players control 87 per cent of our nation’s full-line supermarkets, and the supermarket duopoly have extended their tentacles further and now control up to 50 per cent of liquor and petrol sales. Our hardware retailing sector is heading in the same direction.

This rising tide of concentration in our retail sector has led to further concentration at all levels throughout the production chain. Here are just a few examples. Today, of the milk we drink, more than 80 per cent is processed by just three corporations. Just two corporations brew 90 per cent of our beer. These levels of unprecedented market concentration that currently exist in Australia are more akin to those in former Eastern bloc countries than the free market system foreseen by the father of capitalism, Adam Smith.

While we talk of a free market, the reality is that the field of free and open business has become more and more restricted, as anticompetitive price discrimination has become rampant across the nation, destroying competitive opportunity. In America’s greatest days, the anticompetitive practice of price discrimination was considered such an evil, so dangerous to the free enterprise system, that it was made a criminal offence. And if our American friends are looking for the reason as to why their economy has gone pear-shaped I suggest they need to look no further than their failure to actively enforce their antitrust laws. Under the current legislative settings of competition policy in Australia, we are heading for a future where all the necessities of life will be controlled by a few giant corporations. This is not the future that I want to see for my Australia.

The friends of duopoly and oligopoly may argue that society operates more efficiently with a top-down, semi-authoritarian control, where vast sections of the economy are controlled in the hands of a few elites. Such an argument is seductively simple for those indoctrinated by theory but light on practical experience, for they do not understand the efficiency paradox. While economies of scale do exist, they have an evil twin: that of bureaucratic inefficiencies. When an organisation grows in size, although it may initially benefit from economies of scale, any gains quickly give way to a rising tide of bureaucratic inefficiency.

I believe that the greatest efficiency that any market has is that of entrepreneurial efficiencies, as shown by small business. This is why I am convinced that as a society we get the most efficient outcomes whenever the decision- making process is decentralised and decisions are made by the individuals working closest to the coalface. Therefore, where today we have two entities centrally controlling more than 2,000 retail outlets throughout the nation, I say that we would have a stronger economy, more vibrant local communities and lower prices if instead those 2,000 centrally owned stores were owned by 2,000 local independent business people, all in competition with each other.

Over 200 years ago, Adam Smith, the father of free market capitalism, warned us that the public ‘must always be against any narrowing of competition, as it will allow the dealers to levy, for their own benefit, an absurd tax upon the rest of their fellow citizens’. One only has to look at what has happened to supermarket prices in Australia to see the result of failing to heed Smith’s warning. As the market has degenerated in levels of hyperconcentration, prices in Australian supermarkets have shockingly risen faster than almost anywhere else in the developed world.

But the real danger to our economic prosperity from these levels of hyperconcentration is not just higher consumer prices. What should really concern us is the effect of monopsony, or buyer power. When one or two players control 50 per cent or more of a market, for a supplier to say no to any demand from a buyer with such dominance is to cut one’s throat. So when a market becomes overly concentrated, the so-called ‘invisible hand’ of the free market is replaced by the ‘visible fist’ of market power, and that is the type of market that many producers in Australia face today, especially our farmers. And this risks destroying the very productive resources that our economy relies upon to generate its wealth.

Our banking system provides another example of the risk to our economic prosperity from overly concentrated markets. Our banking system should be the oil that greases the wheel of the free enterprise system, not the other way around. If our banks are now ‘too big to fail’ and require government protection and taxpayer support, what sense does it make to allow even greater concentration in our banking sector? The danger of a highly concentrated banking system is not only that Australian consumers pay some of the highest bank fees and charges in the world; the real danger arises from reductions in opportunities for small business to obtain finance. So while the banks gorge themselves on the fees, charges and the excessive margins they charge to small business, they are in fact weakening the very foundations on which our economic prosperity is built.

In short, for those who believe the best path to our collective prosperity lies in the free enterprise system, for those who believe in equality of opportunity, for those who believe in the freedom of the individual, strong local communities and strong family values, the rising tide of market concentration is contrary to everything that we hold sacred.

I often hear the mantra that small business is the backbone of our economy, but it is not only that. It is also the backbone of our society and provides an immeasurable element of strength to our nation. To my new friends that sit with me on this side of the House, I say that when push comes to shove, if we as the natural friends of small business do not stand up for a fair go for small business people, then we risk them remaining the forgotten people. We must never overlook the fact that the free market—or, more accurately, the free enterprise system—does not arise naturally. It is a system, like our democracy, that must be protected by a set of rules and, also like our democracy, one that we must be ever vigilant to protect.

There is an unsung group of heroes working across Australia today, what we may well call our neglected people: our carers and children with disabilities. For parents caring for the physically or intellectually disabled child, it is a lifetime’s task. For most carers there are no days off. There is no sick pay. There is no holiday pay. There is no superannuation. And when carers grow old, they do so worrying about what will happen to their child when they are too old or frail to nurse them.

Carers may never hear their child say the words: ‘I love you’. So it is little surprise that when parents have a disabled child the statistics show that the chance of marriage breakdown almost triples. Yet as a society we ask our carers to provide over one billion hours of unpaid work a year which, if we the taxpayers had to pick up the tab, would cost well over $30 billion. Simply, as a society we are asking our carers to do more than their fair share of the heavy lifting.

To parents out there with a special needs child that believe that politicians do not know what it is like, I want you to know that you have someone who stands on the floor of this parliament that walks in your shoes. My son, Trent, was born 14 years ago with Down syndrome and autism. He has no speech. My wife and I will need to care for him our entire lives. I am proud to say that Trent is in the gallery today.

I would like to take this opportunity to express my debt of gratitude to all the teachers of our special needs children, such as the teachers at Bates Drive, who have cared for Trent and the other children as they would care for their own. The special experience I have had with Trent has made me a better person. It has made me fully appreciate that each individual has a real value of their own and that the dignity of every individual must be respected. But most importantly it has awakened me to the fact that as a nation we need to do more, much more, for our children with disabilities and their carers—something that people like Tony Stevens have been fighting for all their lives. We are a wealthy and compassionate country. We must find a way, without any of the old excuses, to provide a generous and practical response to the needs of people with severe disabilities and their carers. I pledge that during my time in parliament I will be fighting to ensure that our carers and our children with special needs are provided with the resources they rightly deserve and need.

At the end of the day we here in parliament are the spenders of ‘other people’s money’, and when the government of the day is running a deficit, the ‘other people’s money’ that we are spending is that of our children and grandchildren. But, regrettably, over the past few years government spending of ‘other people’s money’ has been characterised by palpable waste. As our recent experience clearly shows, we must always be on guard against a government, a big-spending government, brimming with expensive and grandiose plans to spend our children’s money, no matter how well-intentioned those plans may seem. And, as Adam Smith reminds us of such grand government spending plans, they:

… ought always to be listened to with great precaution, and ought never to be adopted till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention.

And whether we are spending $1 million or $43,000 million, to engage in the spending of ‘other people’s money’—that of our children—on the lick and a promise of a hastily cobbled together plan based on ideology and untested assumptions without a vigorous cost-benefit analysis is a reckless abrogation of our responsibilities.

I consider myself an environmentalist. As our cities and roads become more and more congested, I am concerned about the health effects from fine particulate matter in diesel exhaust, as studies in California show that diesel exhaust leads to 9,000 premature deaths annually. That is why I oppose Labor’s intermodal freight terminal at Moorebank.

In conclusion, we have many other great challenges ahead of us as a nation, including water and food security, national security, immigration, population and housing affordability. If we can get the policy settings right, if we can end the reckless spending and if we can free the hands of our small-business entrepreneurs with effective competition laws, our nation’s best days are ahead of us.

I believe that no-one could ever stand here without the support of a great team, and I am no exception. Firstly, a big thank you to my loving wife, Vicki. I understand the challenge that you face with having Trent, and I would not be here today without your support. Also, a special thank you to my daughter, Tara. I have seen you grow into a lovely young lady and I am very proud of all your achievements. I promise that over Christmas we will catch up on those 120 hours you need to get your L-plates.

To the Hon. Danna Vale, the previous member for Hughes, I thank you for your support and guidance. You have left me with big shoes to fill.

To the rest of my family—my brothers, Philip and Jason, and sister, Tracy—I thank you for your support over the years, and I do feel a tinge of guilt at leaving you with the fort to look after.

To Professor Frank Zumbo, the free enterprise system knows no greater friend, and I am proud to have you sitting in the gallery today. I would not be here without your friendship and advice.

To Malcolm Ky, you have survived and triumphed through the perils of the killing fields—perils that I cannot even begin to imagine. I am proud to call you my mate, and in this country we do not let our mates down.

To Paul Dracakis, Peter Polgar, and my other friends from the Warringah Club, I thank you for your support—as I do to Paul Signorelli.

To my campaign team: Chris Hall, Elizabeth Hughes, Simon Newport, Kate Schouten, Jon Childs, Geoff Grasso, Susan Kelly, Steve Iacono, Brett Thomas, Peter Colocino, Kent Johns and Naji Najjar, Gary Law, Coral Slattery, Russel Vickers, Daniel Mcilgorm, Jennifer Hunt, Doroles Gonsalves, Robert Leigo, Aaron Findlay, Magdi Mickail, Matthew Minehan, Jim Daniels, James Parrish, Ben and Rebecca Haack, Ned Marnoun, Paul Blizzard, Pat White, Steve Simpson, Jim and Eileen Gallagher, the Bowen, Busa, Di Mauro and Garland families, and the other 300-plus volunteers that so freely gave up their time to make sure that Hughes remained safely in Liberal hands, I say thank you. I owe you a debt that I will never be able to repay. To Alan Jones, Jason Morrison and Helen Wellings, thank you for giving me a chance to have my say on behalf of small business and consumers.

A special thank you goes to Tony Abbott for the tremendous faith and support you have given me throughout. Thanks also goes to the shadow ministers who assisted in Hughes: Julie Bishop, Bruce Billson, Joe Hockey, Scott Morrison, Ian Macfarlane, Sophie Mirabella and Senators Connie Fierravanti-Wells, Marise Payne, and Barnaby Joyce.

To Lee Evans, the next member for Heathcote; Melanie Gibbons, the next member for Menai; and Glen Brookes, the next member for East Hills—I say thank you. I look forward to sitting in the gallery of the New South Wales parliament when you all make your maiden speeches.

I thank you for the indulgence, Mr Speaker. I stand here ready to serve as part of a united team, determined to follow in our great Westminster tradition—and that is to hold the government of the day to account for poor policy, poor execution and maladministration. It is already self-evident that we will have much work to do. I thank the House.