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Tuesday, 14 February 2012
Page: 1127

Mr HOCKEY (North Sydney) (15:13): The government really is concerned about just one job; it is not concerned about the jobs of everyday Australians. Let us look at its economic record. It promised jobs, jobs, jobs in last year's budget but, for the first time in 20 years, there was no jobs growth. The Prime Minister in her speech to the Australia-Israel Chamber of Commerce said that employers would be looking at changes in the economy, which she described as 'growing pains'. Last year the government promised increased workforce participation, but in fact participation fell. At the beginning of last week it promised lower interest rates for workers, as the Treasurer appeared on the Insiders program and suggested that banks are hugely profitable and should be in the business of passing on any impending full interest rate cut. So at the beginning of last week Australians were expecting interest rate cuts and at the end of last week ended up with interest rate rises. It promised bank competition so that people could shop around if they were getting an unfair deal from a bank. Yet, under the Labor Party, the Big Four have now gone from 75 per cent of market share to 86 per cent of market share. The government promised budget surpluses over time. They say they are fiscally responsible, yet we are still waiting for the Labor Party to deliver the biggest fiscal consolidation since the early 1950s—a $38 billion turnaround—which they say will deliver, not promise, a budget surplus in 2013. We will not know it until September 2013. They promise that productivity will grow, yet productivity stalls. Out of all of this comes the fact that Australians are facing higher everyday costs of living—and they are at the hand of the government—be it the carbon tax, flood levies or the fact that the government have introduced 19 new taxes since they were elected in 2007.

To compound all of that, the government are leaving Australians with a litany of waste—the waste of the BER that they were so proud of today. Over the last four years, we have seen $900 cheques go to dead people; we have seen the most expensive per square metre construction jobs ever in the education system—thanks to the failed BER. We have seen pink batts go into people's homes causing house fires and deaths. And not only that, but the continuation of the waste lies in the fact that, even in the Labor Party's current jobs programs, as was revealed more recently, an infrastructure jobs program cost $150 million and the Labor Party did not create one job.

The challenge for Australia today is that the economy is undertaking its own structural change; but, during that change, Australians are yearning for confidence. They are yearning for consistency in government policy. They want the government to make the transition easier, not harder. The best evidence of the incompetence of the Labor Party in this area is in their denial of the impact of the carbon tax on the aluminium industry. As the Treasury modelling reveals, the impact of the carbon tax on the output of the aluminium industry is over 60 per cent. Even the statement from Alcoa in relation to Port Henry identifies that the carbon tax is going to increase its cost burdens.

When the government cries crocodile tears about jobs, whether it be at Holden or Toyota, look at the dead hand of the Labor government there. The carbon tax itself will increase the cost of a motor vehicle by $400. Our motor vehicles in Australia compete directly with imported cars made in countries that do not have a carbon tax that imposes a $400 extra cost on a motor vehicle, let alone our car exports trying to compete in overseas markets, where industry is trying to forge new opportunities, particularly in Asia, but where our cars end up being punished at the production line for the incompetence of this government.

The first thing you need for the stability of the household budget is a job. You need regular income. You need to have the opportunity to carefully plan with confidence the family budget going forward—the burden of the mortgage, the burden of school fees and the burden of healthcare costs. At every point, the Labor Party makes it harder. At the moment there is nothing more pressing than the government's own decision to increase the cost of private health care by abolishing the rebate for more than two million Australian families. Out of all of this, what does the Prime Minister say? She dismisses the job losses across Australia over the last few weeks as growing pains: Westpac 400 jobs nationally; Royal Bank of Scotland, 200 jobs; ANZ, 1,000 jobs.

In the last 24 hours, the Labor Party have spent far more time talking about the job of the Prime Minister than they have about the 1,000 workers at ANZ who are being turfed out. They are spending more time talking about the job of the Prime Minister than they are about the 100 jobs at Holden, the 350 jobs at Toyota that have gone, the 155 jobs at BHP, the 190 jobs at Reckitt, the 70 jobs at Manildra, the 150 jobs at Norsk, the 100 jobs at Tomago, the 50 jobs at Thales, the 31 jobs at Don and up to 1,000 jobs worldwide that are going from Macquarie Bank. On top of this, we are seeing the threat of further job losses at Alcoa but also at Kell and Rigby and at Sleep City, as revealed today on the front of the Sydney Morning Herald. These are working Australians—the working Australians that the Labor Party feigns concern about. If they were really concerned about working Australians, they would be talking about how they can get these people back to work, how they can deliver the smooth transition to the new economy that we recognise is occurring. Unfortunately, the government are making this harder, not easier.

I want to compare the Labor Party's record on jobs growth to that of the coalition. When we came into government in 1996, we inherited an unemployment rate of 8.7 per cent. We more than halved that. When I finished as minister for employment in 2007, we left a legacy unemployment rate of 4.1 per cent—in fact, under the Howard government we even got it down to where there was a three in front of it. In February 2008, unemployment reached its low of four per cent, the lowest in 20 years. Labor inherited from the coalition strong participation rates and the strongest employment growth in a generation, and then they blew it.

Of course, the challenge of unemployment or underemployment grows with a deterioration in the cost of living. When it comes to interest rates, the Treasurer believes, for example, that the cash rate is what people pay. I know the Treasurer does not have a mortgage so he is not familiar with what people actually have to pay, but there is no-one in Australia who pays 4.25 per cent on their home mortgage, which is the Reserve Bank cash rate. He keeps talking about the Reserve Bank cash rate. What he has to do is look at what people actually pay. After the Treasurer was leading Australians to believe that there would be a full interest rate cut at the beginning of last week, at the end of that week ANZ customers saw their variable home loan increased to 7.36 per cent, not the 4.25 per cent that he keeps referring to. Westpac customers have gone to 7.46 per cent; Commonwealth Bank customers to 7.41 per cent; National Australia Bank customers to 7.31 per cent. Bendigo and Adelaide banks have increased rates from 7.3 per cent to 7.45 per cent. The Treasurer says, 'Shop around,' but the four major banks now control 86 per cent of the market whereas they used to have 75 per cent. There might be a whole lot of good reasons for that, including the challenging aspect of the potential failure of Bankwest. It also might be the case that others were under funding pressures. But the bottom line is you cannot shop around if the competition is not a better deal.

What is the greatest contributor to the increase that people are facing? It is that the banks have to get more and more finance from offshore. That reveals the Labor Party's state of mind. When you have a government that is borrowing $100 million a day, and almost 70 per cent of that has to be borrowed from overseas, that is in direct competition with the banks themselves. The banks have lots of sources of money, including pretty expensive deposits at the moment, but when they have to go into the capital markets there is an 800-pound gorilla right next to them competing for the same limited money. That is the Australian government trying to fund its $38 billion deficit—an Australian government that is increasing gross debt to near the debt limit of $250 billion; an Australian government that is completely indifferent to the impact of its debt funded National Broadband Network and the impact that is having on the cost of funds for everyday Australians.

The government's own hand confuses the market and makes it harder. The government claims that its own banking reforms made it easier and not harder to shop around. Yet the government's own Treasury advice released under freedom of information stated:

Banning mortgage exit fees will remove a fee that is designed to address the legitimate cost of offering a mortgage product … As such, mortgage providers will need to find alternative ways of covering their costs … increasing interest rates … increasing other fees …

We warned about this. We warned in this chamber that the government's own hand would have a negative impact on competition and a negative impact on interest rates. We warned about it and the government did not heed the warning. Treasury went on to say:

As exit fees are generally higher for credit unions and building societies this measure may adversely affect these institutions more than the major banks and therefore reduce the ability of credit unions and building societies to effectively compete.

So not only have we seen the majors get more market share but we have seen the government by its own incompetent hand make it harder for credit unions and building societies to compete.

Do you remember the days when the Treasurer was running around saying he would create the fifth pillar in banking? What happened to that? Where is this fifth pillar? Where is it? Is it in the despatch box? Is it under the table? Where is the fifth pillar that is meant to be the great saviour of competition in the banking sector?

I will tell you what we look at, as people that understand the challenges of everyday Australians. We look at what people actually have to pay. The standard variable mortgage rate under the coalition was on average lower than it has been for Labor—even when the Labor Party had the most significant drop in the cash rate for many years. Under the coalition the standard variable mortgage rate averaged 7.26 per cent; under Labor it is 7.51 per cent. That makes a difference.

What is more telling is our beloved small business being hit. The average small business unsecured overdraft rate under the coalition averaged 8.89 per cent; under the Labor Party, 10.23 per cent.

Mr Billson: The spread is getting wider.

Mr HOCKEY: The spread is getting wider and the challenge is getting greater. The government stands up here and says it cares about small business; yet what we are seeing is the challenge for small business getting greater. The challenge is getting harder. For so many small businesses, that overdraft matters. They often go so far as to secure their own home to try and keep their business afloat. And this indifferent Labor Party does not care.

It does not care about its own Fair Work laws and their impact on small business. It does not care about the fact that inconsistency in regulations makes it harder for small business. It does not care about the fact that there is inconsistency in its interest rate message—it sends a confusing signal when people start the week with an interest rate cut and finish the week with an interest rate rise. It sends an inconsistent message to small business when the government says it is fiscally responsible and it is careful with taxpayers' money and then goes and sends $900 cheques to dead people, or it goes and wastes money on pink batts, school halls or on billiard table references committees. It wastes money right across the nation. This is becoming symbolic of what the Labor Party really is—a party that does not understand the aspirations of Australians. It does not understand the aspirations of small business. It does not care about the workers and it does not care about the economy.