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Tuesday, 8 May 2018
Page: 2586


Senator PATERSON (Victoria) (17:34): In my two short years in this place, never have I seen a matter of public importance more in need of a fact check than this one. It is an MPI full of untruths and misstatements, and it is clearly an attempt to mislead and deceive. Let me go through, one by one, the false claims and errors made in the MPI alone, let alone the contributions by Labor senators during this debate.

First the MPI claims that there have been cuts to Medicare. Fact check: it's wrong. In fact, Medicare funding will increase by $2.8 billion over the next four years. That is increased funding from this year to next year to the year after to the year after. This year is record funding, next year is record funding and the year after that and the year after that will also be record funding. That doesn't sound like a cut to me.

Next the MPI claims that there've been hospital cuts. Fact check: it's wrong. Funding for hospitals, in fact, has increased from just $13 billion in 2012-13, when Labor was last in government, to a forecast of $22 billion in 2020-21. That's an increase this year, next year, the year after and so on and so forth to record levels of funding.

There are school cuts, the MPI claims. Again, that is wrong. Over the next 10 years, $25.3 billion of extra funding on top of the already legislated funding that was in place will flow to schools. That represents a 77 per cent increase on current levels in the next decade.

The MPI goes on to claim that there is an $80 billion tax handout to the top end of town. In that one claim alone there are multiple errors. Firstly, it's not an $80 billion tax handout; it's a $65 billion cost to revenue over a decade. Secondly, it's not to the top end of town. As Labor senators know, $24 billion of those cuts, which have already been legislated, in fact go to businesses with less than $50 million in revenue. I don't think, under any Australian's understanding, that that would be the top end of town. Thirdly, the MPI claims that it's a handout. It's not a handout at all. A handout would be giving a company money that it didn't earn but that someone else earned and has had taken from them, but this tax cut just returns to companies the money they have earned themselves and allows them to reinvest it in their business and in their workforce. Also, this $80 billion figure doesn't include the $30 billion of increased revenue that the Treasury estimates will take place as a result of the tax cuts, which halves the estimated cost to government revenue.

I think this draws out an interesting point about the Labor Party's position on tax cuts for companies. Where exactly do they stand? We know they support tax cuts for small businesses with up to $2 million in revenue, and we know that they don't support extending tax cuts to businesses with over $50 million in revenue, but what about the businesses in between $2 million of revenue per year and $50 million of revenue per year? There are thousands and thousands of businesses in this range. They have hundreds of thousands of employees and hundreds of thousands of shareholders. Today, standing here, we still do not know what the Labor Party's plans are for them. If the Labor Party win the next election, will the tax cuts, which have already been legislated for that group of businesses, stay in place, or will those businesses face an increase in taxes? It's up to the Labor Party to clarify.

What's the real issue here? What's the real division between the Labor Party and the coalition here? It's certainly true to say—and I'm happy to acknowledge it—that the Labor Party propose to spend more money than the coalition proposes to spend. They do propose to spend more on health. They do propose to spend more on education. But just because they've promised to spend more doesn't mean that the real increases that this government is delivering today, now, in reality, amounts to a cut. And, although they may be happy to claim that they can make the figures add up and that they can deliver all this increased spending, I have my doubts. I'm waiting to see how it adds up. I doubt, even with the $200 billion of tax increases that they have already promised that they will legislate, that that will even cover the increased spending. Even off the back of low-income retirees and people of modest means who've decided to invest in a second home and are negatively gearing that home in an attempt to grow their family wealth, even off the back of those tax increases alone, I suspect the Labor Party have promised to spend even more money than they will raise in extra revenue.

But let's talk about some of the features that are actually going to be in this budget. One which has been confirmed by the Treasurer and Minister for Finance is a new cap of 23.9 per cent on tax as a percentage of GDP. I think that is a really worthwhile initiative and a really worthy initiative that deserves all of our support, because there should be a limit beyond which government will not grow. There should be an amount of tax that the government says it will not take any more than, and 23.9 per cent is a long-term historical average of federal governments' tax take. The Labor Party have thus far refused to commit to any limit on the amount of tax they'll take from individuals, any limit on the amount of tax they'll take from businesses or any limit on the amount of tax they'll take from retirees. If Labor were left to their own devices, tax as a percentage of GDP would rise far beyond 23.9 per cent. Who knows where it will end? They refuse to nominate any ceiling on the amount of tax they're willing to take.

I want to respond to one other issue that I heard raised in this debate, in Senator Steele-John's short contribution on behalf of young people in this country. While Senator Steele-John is younger than me, I am also a young person and I too have an interest in the future of this country and the future of young people. It amazes me that Senator Steele-John thinks one of the priorities for the budget tonight should be to create taxpayer-funded advocacy services for young people. As a young person now, and as an even younger person in the past, there's nothing I find more patronising than the idea that young people aren't capable of advocating for themselves, that they somehow need a helping hand from the government in the form of taxpayer-funded advocacy and that we should measure the worth of a federal government, with all the things it will do in the budget and all the things it will do, on whether or not there are going to be taxpayer-funded youth advocacy services. But that is a measure of the narrow priorities and the narrow focus of the Greens.