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Wednesday, 4 February 2009
Page: 324

Mr NEVILLE (8:50 PM) —I too would like to speak about the so-called Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 stimulus package and its cognate bills. Today in the Daily Telegraph the headline ran ‘Kevin Rudd’s fistful of dollars’. If we follow through with that analogy no doubt we will be back in this chamber in the not-too-distant future debating the sequel, For a few dollars more, produced by Kevin Eastwood and starring Clint Rudd. There in all his glory is Clint Rudd with a cowboy hat, a cheroot in the corner of his mouth and a fistful of dollars—a very potent image. I do not seek to besmirch Clint Eastwood, a great actor and one whose movies I really like. By way of an aside, I can recommend to colleagues that they see his new movie, Gran Torino

Mr McMullan —Hear, hear! That’s the only thing you’ve said so far I agree with.

Mr NEVILLE —Thank you, Bob. A fistful of dollars and For a few dollars more came out during the spaghetti western cycle. Let us continue the analogy a bit further and compare it with the political cycle. The spaghetti western was made in a rush and pushed out to the public. The storyline was generally thin, the bit players did not enhance the plot—hence the star was somewhat diminished—and as the audience left the theatre they were probably feeling that they had been taken for a ride. So it is with this package. It has been made in a panic and pushed onto an unsuspecting public—to say nothing of the briefest of time given to the opposition to analyse it. So it has been really rushed. It has a very thin plot and a not well thought out script. There are the bit players on the government benches trying to defend it—feebly in many instances. The star, in the person of the Prime Minister, is demeaned by the package and its predecessor, the December cash splash. Finally, in a few months time, as we step out into the daylight of the reality of this package, we will all know that we have been taken for a ride.

The Daily Telegraph had it right. The Daily Telegraph had a very potent image of what this package is all about. What we see in this package is an unfocused, panicked response by the government, rather than a measured stimulus for our economy which will protect and create jobs, support small business and strengthen our economy on an ongoing basis—not flash-in-the-pan stuff but on an ongoing basis. Instead, this package is cost-shifting from the state governments to the Commonwealth—albeit self-imposed by the government—and it is throwing one-off bonuses at people rather than ongoing support, as it neglects some of those most in need, such as pensioners and self-funded retirees.

The $42 billion spending package is all borrowed money and it will leave a $2,000 debt for every man, woman and child in Australia. So you will get, in many instances, a $950 bonus and acquire a $2,000 debt to pay back over the coming years. It has a similar element to that most despised of all institutions, the pay day lender—the person who sleazes up to you at the pay office and will give you a short-term loan but you have to pay it back with a lot of pain. But even more worrying, in an innocuous one-page bill, the government wants to increase our national bankcard by lifting its borrowing capacity from $75 billion to $200 billion. That is the equivalent of $10,000 debt for every single Australian. Just over a year in power and we are already learning that the Labor leopard has not changed its spots. If the government had a clue, if it genuinely wanted to release a stimulus package that would keep our economy afloat through rough circumstances, it probably needed only to spend around $20 billion in a measured and responsible way. We have to recognise the importance of keeping a reserve in case future packages are needed for some yet unseen struggling sector of the economy. And I highlight for example health and aged care.

In the pre-Christmas package, pensioners and welfare recipients were paid $1,400 for a single person and $2,100 for a couple. While I am sure many people put that to very good use, when it ran out you were back on the base pension. Lots of people come into my office and tell me that the real estate boom and the subsequent rise in rents, petrol and certain food lines, the drought and so on have put them in a position where the base pension is no longer adequate. Pensioners desperately need an ongoing week-to-week, fortnight-to-fortnight increase in their pensions which can be relied upon well into the future. There is no security in solus one-off payments.

I believe it would have been infinitely better in the first package to pay a $500 bonus and then increase the pension from that day forward by $30 or so, and, if it needed adjustment, to do that in the May budget when the government gets its much vaunted report on pensions. This would have had another salutary effect in the community because the additional money going to pensioners, part-pensioners and welfare recipients would be reflected in week-to-week spending right across the nation—and that would stimulate sales. Some economists believe that up to two-thirds—and we heard tonight in the debate that it could even be as high as 80 per cent—of the pre-Christmas package may have been hoarded. So that is not doing a lot of stimulating. I do not know if that is the case, and one of the reasons this new package should not have followed the Christmas package—or not followed it so closely—is that we do not yet know the real outcomes of the pre-Christmas package. If we knew that, then this package could have been better directed.

Once again, with this new package, I am sure lots of people will find the $950 very helpful. I certainly do not begrudge it, but I can see some sectors amongst the $950 recipients where an increase on a weekly or fortnightly basis over a continuing period of time would be much more helpful. Let me take for example Austudy. Students and parents tell me that it is not enough and parents now have to heavily subsidise their children who have gone away to university and other forms of training. Here also, $30 a week would provide a great deal of comfort and reliability to students, and this money would be spent in the community on an ongoing basis in a variety of ways. In other words, it would be stimulating the economy.

Targeted, strategic spending with a permanent increase to pensions would be the best foundation of all, along with the immediate implementation of personal income tax cuts. What would they have meant? If we brought forward the two tranches that were set three years ago, the average family on $80,000 would be $1,700 better off over the next two budgets, and that is roughly the equivalent of twice the $950 payment. Instead, we are racking up a huge amount of debt, much of which will find its way into the poker machines and savings accounts of the nation. Saving is prudent and I am not criticising that. What I am saying is that when this money goes through a savings account—or, even worse, a poker machine—it is not stimulating anything. It was reported to me that in the fortnight or three weeks immediately following the cash splash one club in my electorate saw its poker machine revenue increase by 42 per cent. In saying that, I certainly do not believe that that was indicative of the vast majority of recipients; I know that others, because of the fear of uncertain times, tended to hoard their payments. Those two subgroups do nothing by way of stimulating the economy. I suspect that, in the new package, a lot of lower and middle income earners receiving payments will use them to reduce mortgage debt—and, again, that is prudent. But if the government’s goal was to stimulate the economy by way of spending then these payments may in many instances have missed their mark.

About as much thought has gone into this package as went into the $10 billion cash splash that was given away in December. Approximately $500 million of that was sent to 70,000 Australian pensioners living overseas. I have got no problems with pensioners living overseas getting regular increases in their pension—none whatsoever. But that particular $500 million, meant to stimulate the Australian economy, went to the cash registers of Italy, Greece, Turkey, Croatia, the UK and so on. It did nothing for our own economy. It gives us a crystal clear look at the forethought and planning abilities of the government. I reiterate that I am not against pensioners getting a better deal. This is something I have argued even in the coalition party room and even in the last year of the previous government, and I have no doubt that a lot of people used that $1,400 or $2,100 wisely. But we must give pensioners and welfare recipients ongoing certainty in these very uncertain times.

The greatest sleeper and the greatest injustice of this package is ignoring the self-funded retirees. They are caught in a three-way squeeze. It comes about this way. The failure of the international shares and security market has diminished their superannuation funds by as much as 30 per cent; I have heard of some diminishing by as much as 40 per cent. The action of the Reserve Bank in reducing interest rates has meant that funds in fixed investments based on bank interest have also been reduced dramatically. Finally, they have very few entitlements from other government mechanisms to support their way of life, and they are really hurting. The irony of this is that they are good spenders. They are people who are still active, who pride themselves on being self-reliant, but now that their pool of money has been so dramatically reduced they are not in a position to go out and do the things they have done in the past. They could be out there boosting our economy. The exclusion of self-funded retirees from this latest package will hit my electorate very hard. Independent retirees from around the country have flocked to Hervey Bay, Bundaberg, Bargara and surrounding communities. In fact, 20 per cent of the Wide Bay Burnett statistical region population is aged 65 or over, so you can imagine just how this has bitten in my electorate.

Let me move to schools. This package allocates $14.7 billion to school infrastructure. I am not altogether sure that I consider tarting up schools that have been neglected by state governments for 10 or 20 years as being infrastructure. But we will accept that it is infrastructure. It is one of the biggest cost-shifting exercises I have ever seen. The idea of building school halls, libraries and laboratories, while laudable, is of little consequence if the state and territory governments will not take responsibility for their own infrastructure. The Rudd government is all the time bailing out its bankrupt state colleagues. Quite frankly, if this funding is going to be doled out it would be far better and more effective and efficient if it were done along the lines of the former coalition government’s Investing in Our Schools Program, which, as you all know, was one of the most popular school funding programs ever. Current government members told me so at the time.

I have no faith in filtering billions of dollars through state governments. They have an appalling track record of being slow and of siphoning off funds into their own coffers. I know of a state school which received a half a million dollar grant to build a new administration centre. To my utter amazement I found out that 40 per cent of those funds were eaten up with state charges. I know of a state school that acquired Investing in Our Schools funding to install air conditioning, only to find that its electrical system did not have the capacity to drive the air conditioners—and they were not big air conditioners.

Anna Bligh says that she is pulling out all stops to cooperate with the Commonwealth in spending this largesse quickly and efficiently, and I ask: why not up until now? What is the point of having a Taj Mahal at the bottom of the oval when the rest of the school is full of asbestos and has wiring hanging out of the ceiling and no air conditioning? I ask: what capacity have the state Labor governments demonstrated that they are capable of doing this job? I urge the government to have a look at that.

We have had a lot of threats here tonight from the government, saying that people will punish us if we do not spend this money on the schools. People know we spent a lot of money on schools. Those opposite talk about farmers. I am sure that, to many farmers, especially those in drought conditions, the $950 will be quite welcome. But, once again, I ask: when that is over, what follows it? I think the member for Barker made an eminently sensible suggestion tonight. What about, on an ongoing basis, reducing interest by a two percentage point interest rate subsidy? That would have an ongoing effect for, say, three years, until we get through this crisis.

I would like to talk briefly about level crossings. I see my colleague from the South Coast in here tonight. We did a very interesting study into level crossings, one that we were all very proud of. This particular study identified three types of crossings that need to be treated, and not just by saying, ‘We’ll spend $150 million on 200 $750,000 boom gate crossings.’ That is quite commendable; I am not knocking that. But level crossings have to be treated holistically. There is another type of level crossing that needs treatment, which is one that just has a flashing light. It is perhaps not used very often; it might be on a branch line or something like that. Then there is a third type. It might be a cane train line or a grain line that is used only once or twice a week. On that one you do not have lights or boom gates because, quite frankly, you cannot afford to do it. There are thousands of these crossings around Australia—not 200 but thousands. On that one you need to put down a strip of bitumen with rumble strips in it so that as you come up against the level crossing you get the ‘bumpety, bumpety, bumpety’ effect that alerts you that you are coming up to a level crossing. If there had been a holistic package in this about level crossings, rather than a populist one, I would have praised the package a lot more.

In this debate I also lament the dishonest representation of the Leader of the Opposition. Members opposite said that he opposed the package. He did not. He wants a package but he wants it well directed. The member for Forde called for expertise in this debate on the ongoing problem of the economy, and he praised the entry of the member for Higgins into the debate. But colleagues in the government have to recognise that, if you want that sort of cooperation, you also have to be fair. You do not give the documents to the press at 10.30 yesterday morning and give them to the opposition at 12 noon and then come into the House and give your speech—as the Prime Minister did at 2.30 pm, giving the opposition leader his speech at one o’clock. That is not playing the game fairly. This is the biggest package in Australia for 35 years and there was not one day’s notice. That is appalling. The government stands condemned for that and it has little justification in criticising the opposition for doing what it should be doing and opposing these measures.