Senator BUSHBY (3:25 PM) —Who would have thought before the election just 16 months ago that we would be standing in this place today taking note of answers to questions about a proposal to deficit finance a package of $42 billion to jumpstart an ailing economy? Back then, the future looked rosy: 11.5 years of hard work by the coalition government had eliminated the $96 billion of debt accumulated through a series of ‘temporary deficits’ under the Hawke and Keating governments. We were consistently running surpluses, with an economy and tax revenues growing to such an extent that we were able both to put away billions of dollars for future needs and to provide billions of dollars in tax cuts to Australians. Employment was at a record low, and the only economic issues that we faced were those occasioned by growing pains as demand for goods, services and skilled labour outstripped supply.

But here we are in February 2009 facing a vastly different scenario. Sure, the international economic crisis has put an end to the good times, with many consequences for Australians. Even government revenues have been affected. According to the most recent Treasury outlook, a drop of $9 billion is predicted, and here we are looking at going back into debt—and not just in a small way but massively going into debt. We have a request to permit the government to expand the limit on its credit card from $75 billion to an enormous $200 billion. As any Australian knows, once you get into the debt interest trap of a large credit card limit, it is very hard to pay it off.

I do not have time to look at the causes of the crisis, but what we must look at is the government’s approach to this issue as set out by ministers in this place today. Where is the money to decrease the cost of employing people? Where in this package do you go to small business and say, ‘We want you to employ more people, so we’re going to make it easier and cheaper for you’? There is nothing. Where is the money for new hospitals or for improving the health system? What have we heard around this country for the last three or four years? The biggest government funding problem facing Australians is the lack of finance in the health industry. There is nothing in this package—not a cent. There are no new hospitals, nothing to improve the health system, no new doctors and no new nurses. Where is the money to help those who have been most affected by the crisis. Self-funded retirees, people who have been carefully putting aside money in superannuation and share portfolios for the whole of their working lives and never asked anything of government, are finding that all their careful planning and the sacrifices they have made throughout their working lives have been completely undermined by this crisis through no fault of their own. Where is the assistance for them, the people who really need it?

I have heard a lot of government senators in this place today talk about how this package will help Australians deal with the impact of the global financial crisis. If Australians are suffering negative impacts, it is a good thing to look after them. There is no doubt that all Australians who receive some money from this package, if it goes through, will appreciate it. Who would not appreciate getting a cheque for $950 in the mail? They are all going to take it, and they will enjoy it.

Senator Cormann —Except it’s going to cost you 10,000 down the road.

Senator BUSHBY —Thank you, Senator Cormann; I am getting to that. Not all Australians have been negatively impacted by the crisis at this point. If you have a stable income and your job and income are not threatened, in recent months you have enjoyed lower interest rates and lower petrol prices. You probably have more disposable cash in your pocket than you had before. Giving you an extra $950, as welcome as it is—and I do not begrudge people getting it—is not really necessary to offset the negative impacts of the global financial crisis.

There is a well-accepted economic proposition that deficit finance should only be used to fund long-term infrastructure that will provide direct benefits to those who will be paying for it, through taxes to cover interest and principal repayments. Despite the rhetoric and spin of the government, there is nothing in this package that provides such long-term benefits. What benefits will my children and their children receive for the taxes that they will be paying for many, many years to come to cover this massive exercise in political pork-barrelling? I contend that they will receive absolutely no benefits but they will be paying taxes for years if not decades to come to cover the costs. It is simply inequitable to place the burden of interest and principal payments on people who will not receive the direct benefits. This package will only increase economic activity in the period in which it is spent. (Time expired)

Question agreed to.