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Tuesday, 27 May 2003
Page: 15092


Dr EMERSON (7:01 PM) —I rise tonight to speak on the Appropriation Bill (No. 1) 2003-2004. This is a very Liberal budget. It is a budget that, more than any other before it, gives true expression to the Liberal way, to the Liberal philosophy; that is, that everyone should take full responsibility for their own health care and their own education. I happen to believe that those with the financial capacity—higher income earners and those from more privileged backgrounds—should take greater responsibility for their health care and their education. But I am a vehement opponent of applying the principles of social Darwinism, such that those without the capacity to pay nevertheless are required by the national government of this country to fend for themselves, to use whatever meagre financial resources they might have to secure for themselves a second-class health system or an education which is not on a par with the education available to the sons and daughters of the privileged few. Yet this is at the heart, it is the essence, of this budget.

The centrepiece of the budget is the destruction of Medicare. The centrepiece of the budget is a package of measures that will continue the destruction of Medicare by stealth, a strategy upon which this Prime Minister embarked from 1996. The best way to go about destroying Medicare by stealth is to preside over bringing bulk-billing rates down to alarmingly low levels. We know that with bulk-billing collapsing there will not be the community support for Medicare that we of the Labor Party want always to exist. The Prime Minister of Australia, when he was much more forthright about his plans in relation to Medicare in 1987, leading up to the 1987 election, said it clear, said it loud and said it often. He said, `Without punning too much I will take a scalpel to Medicare.' He said, `I will pull Medicare right apart.' He said, `Bulk-billing is a rort.' He said, `Medicare is a disaster.'

Of course, he lost that election because the Australian people did not agree with the now Prime Minister, they did not agree with John Howard, the opposition leader, and he learned from his error. He learned not to publicly say that he would pull Medicare right apart, that he would take a scalpel to Medicare and that he would finish bulk-billing. Instead, when he did become Prime Minister, he hatched a plan to destroy Medicare by stealth. Year by year, each and every year, under the Howard government the rate of bulk-billing has fallen. So to hammer the final nail into the coffin of Medicare, the Prime Minister has come out again more publicly and released his plan that would destroy Medicare. Labor do not want to see a two-tiered health system. We do not want to see a second-class health system, an Americanised health system, for those on very low incomes. All Australians should be able to receive good, decent health care irrespective of their capacity to pay for it.

The Liberal way, the Liberal philosophy, is also given expression in the package of measures developed by the Minister for Education, Science and Training and outlined in this budget, because those measures would take a university education out of the reach of most Australian families, purely and simply. Those measures would take Australia back to the pre-Whitlam era, back to the days when only the sons and daughters of the privileged could get a top-class education in this country and when those from less privileged backgrounds were shut out of a university education. Labor says that an education should be available to open up to the talents of all young people, regardless of the incomes of their parents, but the government says we should return to the days when education was the domain of the privileged and the underprivileged did not get a fair go, a flying start in life.

The conundrum in all this is that, while it is withdrawing services in vital areas such as health and education, this government nevertheless is the highest taxing government in Australia's history. We have to ask the question: where is the money going? We have done some analysis of where the money is going and the answer is, in part, that the money is going to fund the Prime Minister's secret corporate welfare.

Take the strategic investment coordinator scheme, for example, where $650 million of taxpayers' money has been doled out to companies in deals done behind closed doors and the basis of the decisions—the so-called benefit-cost analyses that have been done—is not released to the public. Who knows what favours are returned? We will never know, because we are not meant to know. The strategic investment scheme is secret corporate welfare. On behalf of Labor I have announced that we would scrap that scheme. The Treasurer of this country says, `You've got all these plans. Where's the money coming from?' Clearly, that is one area in which savings can be made, and funds redirected towards Labor priorities and away from John Howard's secret corporate welfare.

Where else is the money going in the budget? I will not spend the entirety of my time tonight listing all of the areas. I will take a few examples. Income tax exemptions for foreign company executives are provided in this budget. When will this government start behaving in Australia's national interest? When it is cutting support for health and education for children from disadvantaged backgrounds, what is the reason for giving priority to providing income tax exemptions on the overseas earnings of foreign company executives? That is why I say that this is a true Liberal budget. Labor built Medicare and only Labor will save Medicare. Simon Crean announced in his budget reply our plan to save Medicare. The battle lines are drawn as to the sort of Australia we want to see and the sort of Australia the Howard government is determined to create.

This budget allocates $2½ billion extra for defence and national security. Essentially, I consider that to be necessary because Australia does need to defend itself and provide for the security of its citizens. But this government has increased the risk of terrorism in Australia and against Australians overseas. In large measure it has done that through its involvement in the coalition in the attack on Iraq. It has become quite evident that the rationale all along for the Australian government's involvement in Iraq was regime change. That was the real reason all along—not dealing with a clear and present danger created by an Iraq that possessed weapons of mass destruction. Yet the government needed to pursue the argument that Iraq possessed such weapons because that was the only way to have any hope of securing United Nations support for the attack on Iraq. In the event the case was not made, and the United Nations indicated that it would not support such an attack. Nevertheless, the government said, `We are sure that weapons of mass destruction do exist in Iraq.' It has now been quite some time since the end of hostilities in Iraq, and the search for weapons of mass destruction has finished. Either there was a massive failure of the intelligence that was provided to and relied upon by the Howard government and the governments of the other nations forming the coalition of the willing or this government so wanted to believe in the existence of weapons of mass destruction that it was keen to rely on that intelligence when its true objective was regime change.

Notwithstanding the fact that Saddam Hussein was a brutal killer and dictator, the tragedy of that war is that the coalition of the willing now considers it valid and acceptable to attack a country to achieve regime change. I emphasise that the regime in Iraq was murderous and brutal. But we do need to appreciate this: dangerously, it has been validated for countries to attack each other if they do not like each other's regimes. That is the world in which we now live—a world in which it is all right to attack another country if you do not like its regime. Australia has been part of setting that example. I know that it is not popular to make these observations after the war in Iraq, because there is a general sentiment that the war was successful and that it was somehow completely justified by its outcome. But we have moved into very dangerous territory, where it has now been validated that one country or group of countries can attack another country to achieve regime change.

This budget furthers the government's philosophy of taking Australia down the low road of low skills and low wages. It provides for cuts to the New Apprenticeships scheme and it cuts the Jobs Pathway Program. It has no commitment to lifting the skills base of this country. The government's philosophy—again, given full expression in this budget—is to take most Australians down the low road of low skills and low wages, competing against other countries on wage costs. There are countries in our region that will always beat Australia on wage costs. The journey down the low road of low skills and low wages not only would be futile, because we will never be able to compete on low wages with a number of countries in East Asia; it would guarantee that, for most Australians, wage rates would be depressed. Therefore, Labor considers that it is complete folly to take the low road. But that is what this government has been doing. In doing so it has been returning Australia to a farm and a quarry. The budget reveals that, in this current year, net exports will have stripped 2¾ percentage points from Australia's economic growth rate. That is an appalling trade performance. It is so bad that it is the worst trade performance since Melbourne hosted the Olympics in 1956. It is also forecast in the budget that, in the coming financial year, net exports will further detract from economic growth.

In taking Australia back to a farm and a quarry, the Minister for Trade's strategy is to pray for rain, because he blames the drought for this appalling trade performance. But any analysis of our performance in relation to sophisticated manufactured exports tells a very sorry story, because the growth in sophisticated manufactured exports under this government has slumped 60 per cent, compared with the growth in the comparable period of the previous Labor government. This government has said, `We will take Australia back to relying on the sheep's back, back to relying on Australia producing mineral output; that's good enough for us.' Well, it is not good enough for the people of Australia; because, for most Australians, going the low road means low wages, low skills and a reliance on good seasonal conditions. We have heard, of course, that seasonal conditions have not been good. It has been a severe drought, but that does not explain why our performance in relation to sophisticated manufactured exports has been so abysmal. Notwithstanding the fact that we have been, according to the Treasurer, in the worst drought in 100 years, primary commodity exports account for 63 per cent of Australia's merchandise exports—up from the 59 per cent of Australia's merchandise exports in the last year of the previous Labor government. So this government have failed to continue the diversification of Australia's export base that was begun by the previous Labor government and that was going so well.

I will list just a few hostilities towards the goal of a high-skill, high-wage country that have been committed by this government. The Export Market Development Grants scheme, a very successful scheme enjoying wide support amongst exporters, was capped by this government in its first budget at $150 million. Through the passage of inflation since then, the real value of the EMDG scheme has fallen by more than 11 per cent, and in this latest budget it remains capped at that 1997 level.

One of the first decisions of the incoming Howard government was to cut the R&D tax concession from 150 per cent to 125 per cent. The consequence of that became almost immediately clear. When that R&D tax concession was introduced by the previous Labor government, in each and every year subsequently business spending on research and development rose as a share of GDP. But, once this government said to the business community of this country that it was not committed to research and development, that it was not committed to the high road of high skills and innovation and that it was cutting the R&D tax concession from 150 per cent to 125 per cent, in each and every year of this government business spending on research and development has fallen. What has the government done about it? It has done worse than nothing.

For smaller businesses, there is a separate scheme, and that is the R&D Start Program. Last year, the Minister for Industry, Tourism and Resources belatedly confirmed that the R&D Start Program had been frozen. The reason given was that spending on the R&D Start Program had exceeded the budgeted amount. But, in this budget, it is clear that that was never the case, because this budget shows that actual spending on the R&D Start Program was $16 million less than the amount that was allocated in that year. So, far from simply being frozen, the R&D Start Program was cut.

The government now has legislation in this parliament that will tear away the safety net for low-paid workers in this country so that the journey to a low-skilled, low-wage country can be completed.

The consequence of all of this is that Australian families are struggling to make ends meet; and, as Australian families struggle to make ends meet, so does Australia as a nation struggle to make ends meet. That explains why foreign debt has crashed through the $350 billion barrier. When Peter Costello drove around in his debt truck, foreign debt was $180 billion. He and the Prime Minister said, `We will fix foreign debt.' Fix it? They have almost doubled it to $354 billion. By the Treasurer's own favoured measure at the time he was making these promises, foreign debt for every man and woman in Australia was $10,000, but now it is $18,000. Fix it? They have almost doubled it. This government have addicted Australia to debt, because Australians struggle to make ends meet under the draconian policies, the Liberal philosophy, the Liberal way, the low road.

Labor will take Australia along the high road to high skills and high wages. Labor will support an innovative Australia, the lifting of the skills base of Australians and a decent and affordable education for all young people. Labor will support fundamentally the restoration and the strengthening of Medicare so that we can make sure this country is returned to a fair society instead of a divided society where the privileged few get on very well under the Liberals but where those who cannot afford to are expected to fend for themselves. (Time expired)