Senator SHERRY (Deputy Leader of the Opposition in the Senate)(3.20 p.m.) —It may have been an interesting contribution from Senator Patterson, but we are taking note of an answer relating to the effect of the savings initiative rebate in the budget. One of the two central defects of this rebate is it benefits, predominantly, high income earners. We had yesterday the spectacle of the Prime Minister (Mr Howard) in the House of Representatives having to declare that he was going to give back his $450. We did not hear one word from Senator Patterson about the issue we are debating here today.

As I have mentioned, Prime Minister Howard in question time yesterday in the House of Representatives got caught out. It was pointed out to him that, as a high income earner, he gets this $450 a year—tax free, I might say—yet a low or middle income earner earning less than $33,000 or $34,000 a year does not get the $450. They might have the potential to get $450, but what low or middle income earner has the potential if they are earning less than $35,000 a year to put $60,000 a year in non-super savings and collect a 15 per cent rebate worth $450? I say again: what low or middle income earner who earns less than $35,000 can put $60,000 into non-superannuation saving to collect a $450 a year tax free rebate?

Yet the Prime Minister can. By virtue of our very generous superannuation fund, he can collect the full rebate of $450 a year. But it gets worse. The Treasurer (Mr Costello) bungled again today in question time in the House of Representatives. When trying to bag Labor's fair initiative to contribute three per cent to workers superannuation the Treasurer asserted that our former cabinet ministers were going to receive this three per cent and a benefit of $1,252 a year. That is what the Treasurer claimed in question time today.

But it was a real own goal for the Treasurer, because Labor's three per cent contribution to superannuation was means tested; it was not to apply to anyone earning more than $46,000 a year. The Treasurer struck a real own goal; he got it wrong. The Treasurer was wrong when he said that Labor's three per cent would have applied to cabinet ministers, because they clearly earned more than $46,000 a year. Labor said that no-one got its three per cent contribution into superannuation if they earned more than $46,000 a year.

But the Treasurer has a habit of getting it wrong time and time again. I noticed today that he said that the basic pension is $9,000 a year. It is not; it is a little over $8,300 a year. The Treasurer has to start getting his facts right.

The best example of the Treasurer getting it wrong is this fandangled rebate scheme. It is wrong for two reasons. The fact is that it does apply to high income earners, and that is grossly unfair. If it is supposed to apply to lower and middle income earners, people earning less than average weekly earnings—$35,000 a year—the big problem is that they do not have a lot of spare cash. They do not have $60,000 to put into a non-super product to get back $450, and they do not have $3,000 in spare cash to put into superannuation to get the $450. In fact, very few lower and middle income earners will benefit substantially from this new rebate system. It is skewed in favour of higher income earners.

The other essential problem with this new rebate savings scheme—aside from the fact that it delivers only half what Labor had committed to do and half of what was in the forward estimates that Mr Costello himself had committed to do—is that it does very little for private saving. When we asked Senator Kemp today, `Where are the estimates in this document about the increase in private saving that will result from this initiative?', there is none. All Senator Kemp can point to is the increase in private saving from Labor's initiative.

But they did not put the figures in this document for one good reason: there are none. There will be very little if any increase in private saving as a result of this rebate, because it is primarily going to higher income earners and to people who are already saving. It will do very little to encourage additional new saving. The Treasurer has got it wrong. (Time expired)