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Tuesday, 3 June 2003
Page: 15863


Mr BAIRD (5:24 PM) —I rise today in contrast to the member for Watson, who gave a litany of sad excuses as to why the opposition languish in despair, rudderless, without direction and without any comprehension of what they could do for the economy.


Mr Leo McLeay —You did not even write this.


Mr BAIRD —I certainly did. It is all in my hand. I am not like you, having it written out for me and having to use my finger to follow the point.

I actually did a check on the parliamentary information web site and went through the Leader of the Opposition's speech to find how many times he used the word `economy'. The fact is, if you look at the opposition leader's speech—a speech made when he had rent-a-crowd up in the gallery cheering every three lines he said and looking for his despairing leadership—the sad thing is that it did not appear once; not once. The reality is that the opposition have no idea of how to manage the economy. That is why they sit where they do; that is why they continue to fall in the polls.


Mr Leo McLeay —Mr Deputy Speaker—


The DEPUTY SPEAKER (Hon. B.C. Scott)—Order! The honourable member for Watson, do you have a point of order?


Mr Leo McLeay —Of course not. I have a question.


The DEPUTY SPEAKER —Then you are out of order.


Mr Leo McLeay —I have a question. Read the sheet in front of you go on. That's right, show him.


The DEPUTY SPEAKER —You are seeking to ask a question?


Mr Leo McLeay —I am indeed.



Mr Leo McLeay —Can't answer the question, eh?


The DEPUTY SPEAKER —The honourable member for Cook has the call.


Mr BAIRD —As I said, the Leader of the Opposition did not mention the word `economy' once in his sad, orchestrated groupie session which had everyone calling out from the gallery. He has no idea what it is all about. I believe we should be commending the Treasurer for his res-ponsible budget and for the wide acceptance it has received from the community. It is finan-cially responsible. It assists Australian farmers in a time of drought. It continues our efforts against international terrorism. It also introduces new initiatives in health and education, as well as providing personal income tax cuts. It is not like the 1993 budget, which we all re-mem-ber, when the then Prime Minister promised we would have tax cuts; they were l-a-w. This government actually delivers on tax cuts. As much as the opposition do not like us providing any type of tax cuts or concessions for the Australian population and the Australian community, we actually delivered. At the same time as doing that, there was a cash surplus of $2.2 billion, something the opposition did not understand as they racked up, in their reckless spending, a debt—which they left for this government—of some $84 billion. Fortunately, this government have repaid some $66 billion of that $84 billion in debt that they racked up. We are about providing surplus budgets. The surplus this year is $2.2 billion and the OECD projections show that most OECD countries are expected to record budget deficits in 2003 and 2004. We provide a different approach. That is one of the reasons why we are expecting strong growth in this country, growth of 3 per cent.

If you look around the world you will find some of the stellar performers such as the UK, the USA and Japan have zero or very modest growth rates compared with Australia. Three and a quarter per cent in these uncertain economic times is a great achievement which has been made possible by doing the responsible thing of keeping down debt and not spending as though there is no tomorrow, as happened during the Labor years.

The unemployment rate is expected to remain steady and inflation is expected to be within the target band, an amazing achievement. The government has reduced net debt by some $32 billion and is committed to maintaining low levels of net debt. The government has also, as I said before, repaid some $66 billion of the $84 billion in debt.

In terms of the reaction by the media to the comments in Mr Crean's speech, the Sydney Morning Herald editorial of 17 and 18 May was headed `Crean fluffs budget lines'. The editorial says:

In trying to woo back the Labor disenchanted, the party must be careful not to spurn others for cheap political expediency. The Crean speech consciously eschewed business in the wishful thinking that wage-earners will be attracted by the old us-and-them divide.

Of course, that is very right, because that is what Labor are about: the old rhetoric and the old class warfare—instead of saying, `Let's all get together; let's work out the way forward.' That is not the way of the Labor Party and that is shown in the reflection of the Sydney Morning Herald in its editorial on Mr Crean's speech.

The personal tax cuts have certainly been very welcome in my electorate. There were $2.5 billion worth of tax cuts, and that of course follows the record tax cuts in July 2000—the largest tax cuts in Australia's economic history. That is a great achievement by this government. It is a further extension, recognising factors such as bracket creep. The government has returned this amount of money to the Australian community.

After having criticised us with the sandwich and milkshake approach, which was not enough, the Leader of the Opposition was given the opportunity to outline the tax cuts that he would introduce. We listened and we listened, in between the rent-a-crowd response up in the gallery, but we did not hear one word about any tax cuts that they were going to provide. So they talk the talk, but they do not know how to walk the walk. When they were in government they promised tax cuts and said that the cuts were l-a-w, but in fact we found it was all smoke and mirrors, as normal.

In addition to the $12 billion the government provided in tax cuts before—which included personal tax cuts, corporate tax cuts and removing the GST from exports—in this budget we have an increase in the thresholds. Those on $35,000 a year will have a reduction of $208 per year, those earning $55,000 a year will have a reduction of $448 per year, and those earning $75,000 a year will have a reduction of $573 per year. There is also assistance for low-income earners. The member for Watson talked at length about the assistance being given to people in his electorate—that the low-income tax offset has been raised from $150 to $235 per year. This means that those eligible for the full income tax offset will not pay tax until their income exceeds $7,382 per year; it was $6,882. The phase-out rate lifts from $24,450 to $27,475—again, that is significant assistance to low-income earners. I think it should be the concern of all members of this House to look after those who are less fortunate than others.

Of course, there is a further benefit for senior Australians. In fact, some 18.5 per cent of my electorate of Cook are over 65 years of age, so I know that in the provisions of the budget there are some welcome changes. There will be no tax paid on annual incomes up to $20,500 for individuals, which is up from $20,000 previously, and up to $33,612 for couples—that also is a significant increase. The Medicare levy threshold will be increased to ensure that senior Australians do not pay the Medicare levy until they begin to incur an income tax liability. These are the benefits of the budget.

In this budget there are $2.5 billion worth of tax cuts, in addition to the $12 billion worth of tax cuts that were provided in July 2000. They are the most generous tax cuts we have seen in the history of Australia. There is special assistance for low-income earners, and thresholds have been lifted for older Australians, for both individuals and couples, before they actually pay tax. I believe that is a very significant step forward. It is modest but, given the constraints of the war on terrorism, our participation in the war in Iraq, the problems farmers have been experiencing with the continued drought, and expenditure on education and health, I believe that modest tax cuts are welcomed by everybody.

It is important to look at the key spending priorities of this government: $2.1 billion for the Australian Defence Force; and $411 million to identify and respond to security threats, in addition to the $1.4 billion that was allocated over five years following September 11—of course, the terrorism threat to Australia is an important aspect that all Australians are concerned about; the additional expenditure of $411 million in this budget is welcome—$1.5 billion for reform of higher education; $917 million over five years for the Medicare package; and $42 billion over the next several years for public hospitals.

The health budget initiatives, which have been maligned by the members of the opposition, have also been misunderstood—and deliberately so, in terms of the claims of the spin masters opposite. I see in my own local paper that the state member for Miranda says that it is very unfortunate that the changes to Medicare will mean that more and more people will not be able to have the benefits of bulk-billing. Quite the reverse is true, because Medicare was established on the basis of three pillars—that there should be access to primary care providers such as GPs, public hospitals and the Pharmaceutical Benefits Scheme. In order to ensure that more people have access to doctors, $917 million is being spent in this financial year on the Medicare package. We currently spend over $8 billion a year. This will ensure that there is greater universality of Medicare and greater access to bulk-billing, with the aim that all Australians will remain eligible to be bulk-billed.

In particular, incentives are provided for those who have concession cards. I think that is a question of fairness and equity in the community. Are we in favour of concession cardholders receiving these additional incentives which the government has provided? It is certainly a very big ask to provide concessions to everybody in the community. The problem with that is that there is no tomorrow in terms of the huge level of expenditure. This is targeting the expenditure on Medicare to those who are in the disadvantaged group in the community: the concession cardholders. If the doctor chooses not to bulk-bill some other patients, these patients' upfront costs at participating practices will be reduced.

An additional $295 million is provided for extra doctors and nurses. That will of course be significant, especially in rural and outer metropolitan areas. Mr Deputy Speaker Scott, I am sure that you, representing a rural area, will benefit from more doctors being provided with incentives to go into rural areas. There is $157 million for people's out of hospital medical costs which relate to X-rays, ultrasounds, biopsies, radiation, oncology, and visits from doctors. All of this assistance will be provided once costs exceed $1,000. I think that will be welcomed by many people. As they are faced by increased costs in the medical area, this assistance by the government to ease the cost is very welcome. Under the current five-year Australian health care agreement, the government delivered a record $32 billion—a 28 per cent real growth—to the states and territories in public hospital funding. That is of course very welcome.

The Australian health care agreements increase the amount going to free hospital treatment from $10 billion to $42 billion over the next five years. That is an unprecedented level of funding for public hospitals. Nationally, this represents a 17 per cent real increase in the Commonwealth's commitment. The growth in public hospital funding provided by the states and territories as a whole has not kept pace with growth in the Commonwealth funding. The states' and territories' share in total funding decreased from 47.2 per cent in 1997-98 to 43.4 per cent in 2000-01, and the Commonwealth's share increased from 45.2 per cent to 48.1 per cent over the same period. So we hear a lot from the state governments about the Commonwealth not paying the full amount, but here we find that the states are decreasing their amount while the Commonwealth's percentage share goes up. There is assistance in terms of private health insurance, private hospital admissions are up by 12 per cent as a result and of course our PBS assistance is $5 billion. The budget is further strengthened in terms of the focus on prevention.

Then there is the question of this budget's improvement to education standards. We are providing $15.8 billion for education, science and training which reinforces the coalition's commitment to this sector. There is an extra $1.5 billion provided over the next four years for higher education. Over time, when the reforms are fully in place, this will represent $870 million per year being spent by the government on higher education: an extra $775 million on universities over the next four years; state schools receive $129 million, which is a 5.5 per cent increase; $210 million is provided for the standards for literacy and numeracy; and $123 million is being provided over four years towards the cost of education in regional campuses.

Of most significance is the amount provided by the government under the new higher education loans program from 2005 to improve access to higher education. By reforming the system, students will be able to access loans and receive a low interest fee which will be of assistance to all of these students. Much has been heard from the members opposite about the difficulties of this. I know that I had to go to university at night because no such schemes were available. When I eventually received a Commonwealth scholarship, that became a little different. But this assistance is available right now to students to go to university on a full-time basis and not pay the fees until such time as their earning capacity is there to meet it. The HECS threshold is going to be lifted from $24,365 to $30,000 a year. This is hardly a significant impasse.


Mr Ripoll —That is where it was.


Mr BAIRD —It has gone up from this amount. Whether you measure it in real terms or actual terms, there has been a significant increase in the threshold. The figure of $30,000 a year is a point where graduates can afford it, and all these comments about how difficult it is to meet the amount that is required is just stretching the truth. This is actually only when it starts in at the most modest level. It is a scheme which does allow for many students to participate in higher education. It does lift the threshold for HECS students, it does mean that more and more people will be able to undertake tertiary studies, and it does provide for students to participate and contribute to their own education rather than simply relying totally on the taxpayer. I think it provides an excellent balance in what we want to achieve. There is $161 million provided for teachers and nurses, $162 million in scholarships and 375,000 apprenticeship places. There is also benefit for international students, generating some $5 billion.

We have a responsible, balanced budget of $2½ billion. It provides significant assistance to drought affected farmers, continues the war against terrorism that provides assistance to our defence people, significantly assists those in the tertiary sector, and significantly assists the Medicare system and extends bulk-billing. It continues the strong economic performance of this government and I commend the budget to the House.