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Monday, 9 December 2013
Page: 1962


Mr HOCKEY (North SydneyThe Treasurer) (16:13): I move:

That the requested amendment be made.

The government has agreed to the proposed amendments by the Greens to repeal the statutory debt limit and amend the Charter of Budget Honesty Act to improve transparency regarding government debt. We have worked together to resolve this issue and provide certainty to the markets about the government's capacity to finance the budget and ancillary debt. We have done this with no thanks to the Labor Party. They created the debt. They have done nothing to find a credible solution to us approaching a binding debt limit of $300 billion. It is just that their legacy is debt that well exceeds $400 billion. Today we are removing the instrument for parliamentary brinkmanship that was introduced by Labor—in fact, by the member for McMahon back in 2008—when they created a legislative limit on debt of $75 billion. So they created the debt, they created the debt limit and now they are trying to prevent us from dealing with their problem. In fact, they are making it worse.

Labor had to increase the debt limit three times, so they introduced a $75 billion limit and said they would never get there, and they did. Then they introduced a $200 billion and they said they would never get there, and they did. Then they introduced a $250 billion limit and they said they would never get there, and they did. Then they introduced a $300 billion limit and brought down a budget that had peak debt of $370 billion, and then tried to prevent us from dealing with it. It was an artificial construct. It was never intended to be a target, but it did end up being a target under Labor. And congratulations to Labor; they hit the target every time.

We have a clear plan to fix the budget and to start paying down Labor's debt. It involves getting rid of the mining tax and associated expenditure of over $13 billion, and we will take that off the debt. We have a plan to get rid of the Clean Energy Finance Corporation, and that immediately prevents us from proceeding with further debt-raising to finance an operation that involves a total of $10 billion of borrowed money.

Even the Labor Party, which have become pious in opposition—not that they were particularly pious in government—have proven just how hypocritical they are. They are seeking to oppose their own savings, which they took to the last election, including $2.3 billion of savings associated with the higher education proposal to fund the Gonski education initiative. The tax cuts that they announced would not be necessary because they were terminating the carbon tax they now want to proceed with. So Labor are not only asking us not to continue with our initiatives, they are voting against their own initiatives, which are all about trying to live within the means.

Today we have also agreed with the Greens on a number of measures to enhance transparency around government debt reporting in the budget papers. In particular there will be a debt statement published in every budget, every Mid-Year Economic and Fiscal Outlook and every pre-election economic and fiscal outlook.

Mr Danby: In bed with the Greens again.

Mr HOCKEY: I will come to that in a moment. These debt statements will include information about Commonwealth stock and securities on issue at the time of the report for the financial year to which the report relates and for the following three financial years. They include: the value of Commonwealth stock and securities, including their market and face value and their value as a proportion of GDP; the total expected interest expenses relating to the stock and securities; and a breakdown by maturity and interest payments of the stock and securities on issue at the time of the report. An additional debt statement will also be published should debt increase by $50 billion or more since the last debt statement or additional debt statement was made. These additional debt statements would set out the reasons for the increase in debt, including the extent to which the increase was caused by lower than expected revenue, higher than expected spending, capital purchases and/or, alternatively, grants to state and territory governments for infrastructure. In addition, debt statements and additional debt statements will facilitate a parliamentary debate on government debt. At a minimum a debate will be held twice a year and more often if debt is increasing at a rapid rate.

We commend the Greens for coming to the table with sensible proposals to enhance transparency. Before the member for McMahon gets up to speak I would just remind him of his own words in relation to dealing with the Greens. When he said on Saturday, 'Sitting down and doing a deal with, of all people, the Greens,' he was criticising us. Madam Speaker, I seek an extension.

The SPEAKER: Under standing order 1 interventions and speeches are limited to five minutes. You are at liberty to seek the floor again if there is no-one from the other side.

Mr HOCKEY: I seek the floor again.

The SPEAKER: Granted.

Mr HOCKEY: The member for McMahon is a cracker. The member for McMahon, in 2010, said: 'The Greens are a party who have a very clear policy objective but also a party that you can sit down and discuss policies with.' That is what he said in 2010. And how about this, he said: 'We go into discussions of a very intense nature with the minor parties and there is often brinkmanship to the last minute, but we have found the Greens accommodative to good policy.' So the member for McMahon is the complete hypocrite in any judgement. He is out there saying that it is absolutely ridiculous—

The SPEAKER: The minister will withdraw that.

Mr HOCKEY: I am sorry; I am just giving him a free character assessment.

The SPEAKER: Just withdraw 'hypocrite'.

Mr HOCKEY: Hypocrite? He contradicts himself on a regular basis.

The SPEAKER: The minister will resume his seat. The Manager of Opposition Business.

Mr Burke: You just asked the Treasurer to withdraw and he did not do so, Madam Speaker.

The SPEAKER: Yes, I did. I would ask the honourable Treasurer to withdraw.

Mr HOCKEY: I withdraw. The member for McMahon contradicts himself on a regular basis with no underlying principle. He criticises us for doing a deal with the Greens when, in fact, he has recommended doing a deal with the Greens in the past.

Mr Husic interjecting

The SPEAKER: The member for Chifley.

Mr HOCKEY: This is the same member for McMahon who does not know the difference between net debt and gross debt. Come on! He was actually Treasurer just for a few days, but he does not know the difference between net debt and gross debt. I thought it was a bit of a slip of the tongue; like the time he came into this place and described the Chinese currency as the yen.

Honourable members interjecting

Mr HOCKEY: Yes, he did. I know it is hard to believe, but he did. I thought it was just a bit of a slip of the tongue and I gave him the benefit of the doubt, and he did come into this place and talk about the debt limit applying to net debt, but I still gave him the benefit of the doubt. I tried with this man; I really tried. Then, when he wrote to me and said that he was going to distribute it to the whole world and talked about net debt being subject to the debt limit, he did not know the difference between net debt and gross debt. I thought, hang on, this guy is not fit to run a tuckshop let alone to run an economy. And, as we know, the member for Watson is over there preying on him.

What we do know is that when it comes to credibility the Labor Party has none. Do you know why they have no credibility? Because they have no principles. Not only do they vote against our savings, they vote against their own savings. Not only do they not know the difference between net debt and gross debt, they created the problem and they are trying to stop us from fixing it. That is the Labor Party way. Here is a tip for a new opposition: you actually have to be a little bit consistent. You actually have to believe in something. I know you believe in debt. I know the Labor Party believes in debt; I know the Labor Party believes in racking up the credit card.

You save him, Tony—good idea. He needs your help like he needs a bullet in the head.

Mr Burke: Madam Speaker, I rise on a point of order. The Treasurer should be speaking through the chair. He is making terrible allegations against you, unless he is speaking through the chair.

The SPEAKER: I think I can avoid the effrontery, but I would ask the honourable the Treasurer to speak through the chair.

Mr HOCKEY: I will tell you what: there is no way on God's earth the member for Mackellar would do anything other than act responsibly when it comes to debt, handling debt and paying down debt, because the member for Mackellar knows, like every other member who is mature about this sort of debate, that you do not play Russian roulette with a loaded gun when it comes to debt. The Labor Party has been playing Russian roulette with a loaded gun and it has gone bang in their face, because they have been dealt out of the equation by, of all people, the Greens. Now the Greens are proving to be more middle-of-the-road, more responsible, than the Australian Labor Party who have consigned themselves to somewhere way past the Democrats at the bottom of the garden; they have buried themselves along with their lack of credibility when it comes to handling the economy. I would say to the Labor Party: one day, for just one day, have some integrity, have consistency, have some principles—actually, do us a favour and stick to your election promises, especially when it comes to paying down your debt.