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Thursday, 11 February 1999
Page: 2504

Mr O'CONNOR (1:50 PM) —I am quite amazed by the contribution that has just been made by the member for Fisher to this debate on the appropriation bills. We in this House know that the member for Fisher is a man of change, and we do hold out some hope that, at some time in the near future, he will change his views on the issue on which he has just addressed the House. We know he is a member for change because many years ago he used to be a member of the National Party. Indeed, I think he came into this House as a member of the National Party then, in typical fashion, he jumped the fence. He was defeated, I believe—I don't know what happened up there—and came back into the House as a member of the Liberal Party. We on this side of the House live in great hope that the member for Fisher some time in the future approaching this vote on the republic will indeed jump the fence yet again.

Mr Fitzgibbon —He hasn't told us how he is voting.

Mr O'CONNOR —The member for Hunter is in the dark. However, I am not in the dark as to where the member for Fisher is on this particular issue. Let me say to all coalition members: we have had to drag you one by one by the nose into the republic debate and we have had this arrogant Treasurer that we have here in Australia putting himself up, when he sensed that the Australian public might cop a republic, now saying, `Well, yes, maybe. Maybe I will vote for it.' Then we have his ministerial colleagues who are still wedded to the Queen Camilla line on the issue. The coalition is split right down the middle on an issue that is fundamental to the Australian people.

I say to the honourable member for Fisher: go home tonight and before you go to bed simply say these words, because tomorrow you will come to this House a new man, a reinvented man, `I would like an Australian as Australia's head of state.' It is easy.

Mr Fitzgibbon —No, he wants Queen Camilla.

Mr O'CONNOR —You will drop Camilla and certainly jump on board with those in the republican movement and opt for an Australian to lead Australia and be Australia's head of state.

Day after day we have had a bevy of government ministers and members from the other side of the House parade into this parliament singing the praises of the GST. We on this side of the House call it Costello's curse. That is what they call it out in the rural and regional areas of Australia because they simply know that, like Paterson's curse, Costello's GST curse is going to ravage the pastures of their income. Over in the Senate the clinical evaluation of the Howard government's GST tax package has exposed it for what it is: a fraudulent exercise that at the end of the day will destroy jobs, increase inflation and leave many low and middle income Australians much worse off than they would have been were it not introduced.

We have now reached the pinnacle of conservative economic vision for Australia. It is really back to the future stuff. We have a Prime Minister locked into a 1950s mentality proposing a 1960s tax as the panacea for Australia's problems. The one great vision for the new millennium as far as the Liberal Party is concerned is to propose a tax package which has at the heart of it a 1960s tax that will be overtaken in a very short time by the march of economic events in the new millennium.

There are some things that we know the GST will do and there are some things that we know that it will not do. We know, for example, from the evidence that has been given to the Senate inquiry that this new Liberal tax, Costello's curse, will increase inflation and increase compliance costs for small businesses and cripple them. We know that to be the case. The Howard government is going to introduce this tax at a time of record bankruptcies among small business under the Liberal Party of Australia. So we are going to have foisted on the small business community a tax that is going to drive their compliance costs through the roof.

We know what this tax will not do. It will not appreciably reduce the unemployment rate nor will it appreciably lift the growth rate. If that is the conclusion that is coming out of the Senate inquiry into the GST, one must simply ask the question: why are we having it? In my electorate of Corio we have a high percentage of low income earners and pensioners. They will be more than a little concerned at the evidence that has come out of the Senate inquiry in relation to the inflation effects of the GST. The Treasurer gave an assessment in the tax package that the inflation effects of the GST would be in the region of 1.9 per cent. We now know this to be the central deception of the Howard government's tax package.

Mr Slipper —Absolute rot.

Mr O'CONNOR —It's absolute rot? Thank goodness the Australian people will never be in a position where they will have to suffer this tax, because I am sure it is going to be defeated in the Senate. The Treasurer's own department estimated that the inflation rate would be 3.1 per cent and the Treasurer and the Liberal Party say it would be 1.9 per cent. The Treasury says 3.1 per cent and every economist who has ever evaluated the introduction of a GST around the world says the rule of thumb is that the inflation rate will be approximately half the level at which it is introduced—10 per cent divided by two, give or take a per cent. You can count on the inflation rate here being four per cent. That is your deception and that is coming out of the evidence of the Senate inquiry. The real inflationary situation will be that inflation in Australia will go up by four to five per cent. The great Liberal achievement in its tax package will be an increase in inflation of four to five per cent. That is really some achievement.

Let me comment on this arrogant Treasurer who parades himself here day after day telling us what a good state the Australian economy is in. He had the gall to quote the ACTU's living wage submission in question time yesterday about what good shape the Australian economy is in. It is in good shape because we put it in good shape, very simply. Let me take the economic imbeciles who sit on the other side through it. Your Prime Minister left this country with 11 per cent inflation. He left this country with a 10 to 11 per cent unemployment rate. He left this country with a negative growth rate. That was the economic shambles that Labor had to rectify when it came to power. Here we have the Treasurer gloating that there are sound macro fundamentals of economic growth—

Mr Slipper interjecting

Mr O'CONNOR —We gave you that. We gave you low inflation when your Prime Minister, who has just come to the table, left us with 11 per cent. We gave you a growth rate of an average of five per cent when he left us with a growth rate that was negative. You don't have to be a real bright spark to appreciate the points that I am making. I am glad the Treasurer has come into the House because the Treasurer gloats that he is really responsible for the reduction in the inflation rate. When Labor brings it from 11 per cent, which his Prime Minister left it at, to two per cent, we think that is some achievement. But, when he brings it down from two per cent to one per cent, he parades himself as a paragon of virtue.

Mr SPEAKER —Order! It being 2 p.m., the debate is interrupted in accordance with standing order 101A. The member will have leave to continue speaking when the debate is resumed.