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Monday, 25 May 2009
Page: 4108


Mr TURNOUR (5:42 PM) —I rise to support the Appropriation Bill (No. 1) 2009-2010 and cognate bills and to support this budget. It is a budget framed to support jobs to build a nation so that we are well placed for recovery. This is the third phase of the government’s ongoing stimulus and nation-building plan to support jobs in the local economy.

I was out on the weekend in Redlynch, in my community, running a mobile office, meeting with members of the community out there and talking to small business people, mums and dads and workers. I met with one small business man who expressed to me the real struggle that he is finding in his business today. We are in the midst of a global recession. It has swept across the world and it has swept across Australia. It is impacting businesses in Cairns and workers in Cairns. We as a government have responded to that. This businessman welcomed the government’s initiative late last year—the stimulus package—and our Nation Building and Jobs Plan. Seventy per cent of our investment in stimulus is in infrastructure. But, as a small business man, he also particularly noted how important the $900 payments have been for his small business. They enabled him to keep people employed. He is in the hospitality industry. The payments have been a very important part of our Nation Building and Jobs Plan. Similarly, I spoke to a mother with a son who had been laid off by CMC, a construction company that has recently gone into administration. He subsequently got a job with Smithfield Electrics—he is a third-year apprentice—but, unfortunately, they were impacted by the CMC administration, and he subsequently lost his job with Smithfield Electrics.

They are just two examples: a small business owner and another individual that I met on the weekend. The talk is all about the economy and all about jobs. What they have been looking for and what they appreciate from government is a preparedness to act. They want a government that is prepared to take the necessary action in these difficult economic times to support business and to support jobs in local communities. That is the way in which this budget has been framed. This budget builds upon our Economic Security Strategy from late last year and our Nation Building and Jobs Plan; this budget is building infrastructure to support recovery as it comes.

I would like to spend a bit of time on the economic outlook. We are in the deepest recession since the Great Depression. The world economy is forecast to contract by 1½ per cent in 2009. The economies of our major trading partners are expected to contract by two per cent, which is a worse outcome than that experienced during the Asian financial crisis. The economies of eight of our top 10 trading partners are expected to contract in 2009, and advanced economies in deep recession are expected to contract by 3¾ per cent in 2009. So all around the world the economies that we are linked to are in recession and struggling. Our major trading partners are struggling. It is no wonder that businesses in Cairns dependent on the tourism industry and the construction industry are being impacted. Small business owners are having their profits stripped away and workers are losing their jobs through no fault of their own. The Rudd government made a decision that it would act, and that is what this budget continues to do.

When we look at the forward estimates, we can see that unemployment is of particular concern. Unemployment is expected to peak at 8½ per cent in 2012-13, and it is increasing at the moment. In my electorate of Leichhardt, according to the March quarter analysis, unemployment is already at 10.7 per cent. So unemployment is already a significant problem, and it is expected to increase. It is expected to be 8¼ per cent in 2009-10, 8½ per cent in 2010-11, 7½ per cent in 2011-12 and 8½ per cent in 2012-13. That is according to the projections in the budget. So, going forward, we have a major challenge with unemployment. The government have recognised that and that is why we have acted responsibly.

It is also expected that GDP will contract by one-half of one per cent next year before recovering to grow by 2¼ per cent in 2010-11, by 4½ per cent by 2011-12 and 4½ per cent by 2012-13. We are going into a period where the economy is contracting and where the global recession is impacting upon us directly, but we forecast that we will come out in 2010-11 with a growth of 2¼ per cent and 4½ per cent in 2011-12. The opposition have questioned some of this growth forecast. They have been out in the media, questioning the Treasury estimates and claiming that these figures are optimistic. Really, they have been undermining them and suggesting that they are not true. The reality is that these estimates are similar to those for the recession that we came out of in the 1990s and similar to the figures for the recession in the 1980s. There were similar growth forecasts when we came out of those recessions, and we are in a very similar situation with our current forecasts. So we have confidence in those forecasts and we believe they are the best estimates at the moment, and they were provided by Treasury.

Going forward one of the major challenges we face is the decline in our terms of trade. In 2009 we have seen our terms of trade drop by 13 per cent, ripping $35 billion from our economy, from the income of this country. We hear the opposition talking a lot about debt and deficit and suggesting that the Rudd government has basically run the economy into deficit because of irresponsible spending. The reality is that the vast majority of the deficit going forward is due to the decline in our terms of trade, decline in our tax revenue, decline in capital gains tax and decline in company taxes. We are losing large amounts of revenue from our economy and that is directly feeding into the deficit. We made a decision to stimulate the economy through our Nation Building and Jobs Plan, through our stimulus package and through these budget measures. We have also seen our revenues disappear because of the decline in our terms of trade. According to our estimate, we expect to lose $210 billion in revenue. That is an enormous amount of money. It is no wonder that we are in deficit this year and why it is projected that we will be in deficit in the future. It is critical that we also invest in order to support jobs in the economy. We face $210 billion in revenue losses, but we made a decision to stimulate the economy. That was and is the right thing to do.

Moving forward we need to ensure that we have a plan to bring the nation out of deficit and to return the budget to surplus. That is why we have clearly outlined an exit strategy from this deficit. As growth returns to normal—as we have said, growth will decline by about one-half of one per cent next year, by 2¼ per cent the following year and by 4½ per cent the year after that—tax revenues will increase. That will allow revenue to recover and we will see the budget return to normal in terms of income.

We have also made a commitment to keep real growth in spending to two per cent. So we are being fiscally responsible and will hold spending to two per cent. We have made a commitment that any new spending during this period will be replaced by savings. So we do have a plan to return the budget to surplus over a period of time, and we expect to be back in surplus by 2015-16.

The major issues in terms of the deficit are not due to irresponsible spending, as the opposition suggests. They are due to the fact that we have lost a significant amount of revenue, $210 billion, going forward. We have made a very important decision to stimulate jobs in the economy and within our local communities.

In my own electorate of Leichhardt we have seen significant investments as part of our Nation Building and Jobs Plan—our stimulus measures in this budget. We have the Bruce Highway in the southern part of Cairns significantly in need of an upgrade. In the 2009-10 budget we have a commitment of another $5.5 million that builds on the $5 million brought forward in the last budget. This is to do planning and to bring forward a project of $150 million to upgrade and tackle congestion problems in the southern suburbs of Cairns. We have got a commitment of over $15 million towards the Peninsula Development Road to continue sealing this road. It is a very important access road to Cape York Peninsula not only to ensure that people can get in and out but also so that the economy can grow up there. Cattle can come out and tourists can go in, and we can continue to build that community.

Remote community access roads on the cape will also receive another $2 million in funding in 2009-10 to upgrade roads into Aboriginal communities—that sort of work. We have a total Australian government contribution of $10.5 million going forward, with expected completion dates in 2011. The Roads to Recovery program has delivered 15 grants of $4.9 million to local councils. We have the Black Spot Program—five local projects worth $1.385 million. It is fantastic to see some roundabouts upgraded on the northern approaches to Cairns. The Smithfield roundabout will be upgraded on the Captain Cook Highway. We are also seeing work done around Portsmith, Mossman and Mount Molloy Road, Rumula. These are all important works that need to be done. Sadly, we saw a cyclist killed on one of those roundabouts in recent times. This project, this commitment for additional funding through the Black Spot Program, is desperately needed in that local community to upgrade that roundabout. We have seen boom gates provided on five local projects: Aumuller Road, Cairns; Thomson Road, Edmonton; Coombe Street, Cairns; Anderson Road, Woree; and Minnie Street, Cairns. We have seen a number of accidents in the tropical north on railway crossings. People need to drive more effectively and more responsibly, but the commitments to upgrade rail crossings are welcome and they are much needed, particularly in my region.

The Community Infrastructure Program is particularly important as well. We have seen 16 projects worth $3.5 million, projects across my electorate that are supporting jobs and are providing people with jobs in the construction industry, which is hard hit at the moment. There is also support across a range of other areas, including health. The National Rural and Remote Health Infrastructure Program is delivering $131,000. Cairns Private Hospital will be able to refurbish and establish an intervention cardiology service and an intensive care unit within the hospital. The current situation is that you are really in trouble if you have a heart attack in Cairns, because you have got to get to Townsville. This investment is going to support the private hospital being able to do work that it was not able to do before, reinstituting an intensive care facility and enabling it to start to give people much better health services, particularly those facing heart disease.

Other health initiatives that are particularly important include the funding for our $5 million GP superclinic. It was great to have the health minister in my electorate last week to announce the successful tenderer for the GP superclinic in Edmonton. It is a hub and spoke model; it will have links not only through to the centre of town but also through to Smithfield. Balance! have been the successful tenderer and I look forward to their continuing work in building relationships with other health providers in Cairns and also constructing that facility down at Edmonton. Not only will it improve health in Cairns; it will also provide jobs in the construction industry going forward. We have had a range of other health commitments, including new MRIs, in recent times and the oncology services are to be improved at the Cairns Base Hospital. A great commitment in the budget is the $9.2 million over four years for expansion of health services in the Torres Strait Islands, particularly an upgrade in the Saibai Island clinic, and $2.9 million over four years for a mosquito control program. Health is particularly important in the Torres Straits and in Cape York, where we have a lot of Indigenous people who, as we know, have a significant gap in life expectancy. We need to do more to support health and deliver health services in those areas. These are welcome announcements and commitments in the budget.

The area that is really getting the most discussion and is particularly welcomed in my electorate of Leichhardt is the effort that we are going to as part of our Nation Building and Jobs Plan to support primary schools for the 21st century—our National School Pride Program—which supports further construction of education infrastructure in Cairns, as we are all across the country. It does two things. It creates jobs today. In the last month or so I have announced $34 million in the first round for 15 primary schools to build libraries or multipurpose centres across my electorate, and also $8.9 million for 66 schools to do small refurbishments, maintenance and some small construction work in schools, which again not only supports the critical maintenance of schools but also supports the jobs in those local communities.

Our education program, as part of our Nation Building and Jobs Plan, is critically important, particularly nowadays, to support jobs. As I said, I met with a young bloke—a young apprentice who had lost his job twice—and his mother on the weekend. I know there are many others. CMC went into administration in the last few days. They effectively had 500 people working for them. In the construction industry, people have lost their jobs and are looking for work in other areas, and the education funding is providing real work and real support for jobs in local communities like Cairns.

Our Community Infrastructure Program is supporting jobs in Cairns. We had a commitment of $2 million to build a new emergency services centre, which is critically important infrastructure. Cairns is at the far end of this country. We suffer from cyclones—not irregularly—and this new facility will enable us to better plan and coordinate and better respond to cyclones when they come along. So we have a budget and we have a plan that is very focused on ensuring that this country can weather the global recession and can ensure that, as we move forward, we are well placed for recovery. What we are doing is investing in nation-building infrastructure to support jobs today but also to ensure that we are well placed for the recovery that will come in the future.

There is a significant difference between this side of the House and the other side of the House. We have been prepared to act in the face of the global recession. We have been prepared to take the difficult decision to stimulate the economy. Sometimes this has been unpopular, but it is critically important to support jobs in local communities like mine in Cairns. That is a decision we have taken. We heard the member for Herbert a little while ago putting forward some ideas from Malta and other places. Those are really the first ideas in terms of fiscal policy that I have heard from the opposition. They have been going on about debt and deficit but have really put forward no clear plans about how they would deal with the global recession. They have been running a scare campaign.

We have clear plans for the future. They are in the budget. They are in the Nation Building and Jobs Plan. They are in the economic security package that we announced last year. We are getting on with the job of tackling the global recession, supporting jobs and building the nation. Seventy per cent of our stimulus is nation-building infrastructure, economic infrastructure and community infrastructure. That will support jobs today and also ensure we are well placed for the recovery.

I commend this budget to the House. I am out there selling it in my community. It has been welcomed. People appreciate the fact that the Rudd government is not prepared to sit on its hands—it is prepared to take the decisive action needed to support jobs in local communities like mine. I commend the bills to the House.