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Tuesday, 31 May 2011
Page: 5448


Mr HUNT (Flinders) (20:55): I want to start this discussion of the appropriation bills with an assessment of the government's general fiscal performance and to establish a pattern of fiscal waste and mismanagement not just over four years but over the last nine Labor budgets. Those non-Labor budgets should be remembered by their numbers. Heading back to the five last Keating government budgets, what we see are deficits of $12 billion, $18 billion, $18 billion, $14 billion and $11 billion. Then we see a period of 12 Howard-Costello budgets, of which 10 were surpluses. The first cut the deficit in half and then there was only one deficit of 0.1 per cent for one year during the middle of the tech wreck and the year of the September 11 tragedy, which had such a profound impact on global financial markets. So there were 10 out of 12 surpluses and five consecutive Labor deficits, all greater than 1.5 per cent, and now all of a sudden the moment government changes—and of course there are circumstances but there were always circumstances that governments must face—what we see are four further consecutive Labor governments of $27 billion, $54 billion, $49 billion and then this coming year $22 billion.

Let me run over those figures again because they are profound. What we have first is nine consecutive deficits—$12 million, $18 billion, $18 billion, $14 billion and $11 billion. And then under this government they were $27 million, $54 billion, $49 billion and $22 million—in percentage terms, three per cent, four per cent, -3.9 per cent, 2.8 per cent, 2.1 per cent. Under the Rudd and then Gillard governments there were deficits of 2.2 per cent, 4.3 per cent, 3.6 per cent and 1.5 per cent—nine consecutive massive budget deficits, of over 1.5 per cent. The smallest of those deficits is 1.5 per cent. Events are one thing but a pathology of deficits over nine consecutive budgets must surely cause the House and all members and all members of the public who are aware of this to stop and think: how can it be that one party has nine consecutive budget deficits over two different periods of government and right there in the middle, as soon as another party comes in, the deficits stop and we get 10 out of 12 surpluses, and then as soon as that party leaves the deficits start again? It is not a story of bad luck; it is a story of pathologies, of type, of intent. No matter what the circumstance, that circumstance will be used by the Liberal and National parties to seek to exercise constraint over public spending. No matter what the circumstance, that circumstance will be used by the Australian Labor Party when in power to seek to justify massive expenditure of the public purse. I say this having sat down, analysed the budget figures and seen the extraordinary difference between the almost $100 billion of savings made simply through the cash accounts, let alone the capital, during the course of the Howard and Costello era and the over $200 billion of deficit over a lesser period of time under the Keating, Rudd and Gillard governments—three consecutive governments, nine consecutive deficits: a pathology of expenditure.

Let me give examples. In my own portfolio, the waste and mismanagement under the Home Insulation Program continues to this day. Only last week I received news of an apartment block in Sydney where 86 apartments had been insulated and nobody had sought to check whether this was in any way fraudulent or inappropriate. Given that it was a multistorey apartment building and every one of the apartments—in fact, there were actually only 85 apartments in this Potts Point apartment building, so there was one extra—was fitted out, given that multistorey apartment buildings do not have cavities between the floors and do not need home insulation between the floors, and given that not one actually received home insulation, it could have been prudent if one minister at one time sought to check whether or not this was an appropriate insulation installation job. There was nobody watching.

The result is that we have seen the best part of $2½ billion allocated and $1½ billion spent on extraordinary levels of dodgy, dangerous and inappropriate jobs. The consequence was that, of those 150,000 homes tested under the general Home Insulation Safety Program, 24 per cent were found to have been defective insulation jobs. That is a figure which is extraordinary. It is allied with 200 house fires and 1,500 potentially deadly electrified roofs, and still the government refuses to check the remaining one million homes. In light of last week's news that the fraud continues to remain undiscovered and that dodgy jobs continue to surface, it is time for the government to commit to 50,000 additional random inspections.

The government's justification is, 'We looked at the houses with the highest likelihood of having dodgy jobs.' I do not disagree with that prioritisation of inspections. I do disagree with the fact that, having discovered a 24 per cent failure rate in the first 150,000 homes inspected, nothing is being done for the remaining one million homes. How can it be that a million homes are suddenly assumed to be at an acceptable level of defect when the first 150,000 produced a 24 per cent failure rate? Let us say the rate is lower. Let us say it is only 15 per cent; that is 150,000 defective houses. Let us say it is only 10 per cent; that is 100,000. Let us say it is a relatively paltry five per cent, compared with the extraordinary 24 per cent failure rate; that is 50,000 homes that have either dangerous or substandard insulation. That is the best scenario the government can hope for and that problem is not being addressed. That is why we have called for the government to act. They have money in the kitty. Well over $400 million was set aside to help fix the roofs as part of this year's budget, a continuing figure of over $300 million to the end of this financial year and another $111 million for the next financial year. There is ample scope for the government to conduct these inspections. So tonight I call upon the Prime Minister to intervene where the Minister for Climate Change has refused to act and guarantee that there will be 50,000 random inspections from the remaining one million homes, for reasons of public safety, for reasons of prudence and to ensure that additional cases of fraud are investigated, detected and prosecuted.

That is an example of the waste that has gone into nine consecutive ALP deficits. That is a figure our side perhaps does not raise often enough, because this issue of nine deficits, over $200 billion of accumulated debt, as opposed to 12 budgets and 10 surpluses during the course of the Howard and Costello government is a profound pathology of difference between the two parties.

That is dealing with those items that are on budget. There are of course those items that are off budget. We are about to witness through the NBN the perversion of a good purpose to a bad end. Whether it is $36 billion or $50 billion, ultimately a massive amount of money will be expended for no good purpose. The world is moving to a wireless world. Blackberries, iPhones and tablets—whatever form they are—are the communications form of the future. And we are building a fixed line system, which will be bypassed, which is unnecessary and which will in many ways prove to be stranded over time. And we will do it at a massively inflated cost and in a way that will distort national resources. That debt, as with all other debts, will have to be repaid by our children and our grandchildren. The definition of a responsible generation is one that pays down the debt for their children. The definition of an irresponsible generation is one that leaves the debt and leaves the bill for their children and grandchildren. What we are seeing from this government is the practice, the pathology and the nature of an irresponsible government.

That brings me to the last element I wish to raise briefly in terms of off budget items: the carbon tax. Of course the carbon tax was not in the budget—although $14.7 million for advertising was. The total budgetary impact is likely to be between $30 billion and $40 billion over the forward estimates. That is a profound figure that was excluded and which we will ultimately see. My challenge to the Treasurer this evening is to guarantee budget neutrality for each of the years that will see the carbon tax introduced. In the first financial year, in the second financial year and in the third financial year, which go to the three out years of the forward estimates, we expect the government to make a full statement as to whether or not it is budget neutral. If it is not, it will be a tax grab or it will be an assault on the surplus.

It is very clear that the government is beginning to walk away from the language of budget neutrality. They are now saying 'over the cycle'. The cycle was defined during Senate estimates as 'the seven- or eight-year period heading towards 2020'. What we see is that the express, clear and absolute pledge of budget neutrality is beginning to collapse under any close inspection. It is about being budget neutral in each of the years. That is what they implied; that is what they set out at the beginning.

In that context, let me make one other point. Professor Garnaut today—and we may have our disagreements but I have always been publicly respectful—let the cat out of the bag. Professor Garnaut made it absolutely clear that petrol will be taxed and that the price of petrol will increase every year as a consequence of the government's carbon tax. The test for the Prime Minister is to say whether she will rule out a new tax on petrol. It is time for the Prime Minister to rule out a new tax on petrol. The cost of living is hurting almost every Australian family. Maybe it is not hurting a North Shore movie star so much—that is a hypothetical—but the cost of living is hurting almost every Australian family. The Prime Minister's plan—her proposal, her objective—is to increase the cost of electricity, petrol and gas. The test of the Prime Minister this week is to rule out, once and for all, a permanent increase in petrol excise which, even if it did not begin in the first year, as Professor Garnaut has said, will continue after year one, every year ad infinitum. Each year new weight will be put on the price of petrol. (Time expired)