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Wednesday, 2 June 2010
Page: 5126


Ms BIRD (5:57 PM) —I very much enjoyed the parliamentary secretary’s speech on these bills. I look forward to him joining me for the launch of the Energy Pipeline CRC at the University of Wollongong, which I am sure he believes is the second best university in the country—and I am sure I am not verballing him there! I rise to speak in support of the Appropriation Bill (No. 1) 2010-2011 and associated bills, otherwise known as the budget bills. I want to make some comments on the context within which this budget is presented and then go to some of the specific details of the budget which I think are worth endorsement.

I was elected to this place in 2004. It has been an interesting process over a short period of six years. I remember my participation in debates in this place around the time of the 2005 and 2006 budgets. An issue that was raised in 2006 and debated in the 2007 election period was the concern that we had been through a period of a significant minerals based boom in this country and there were some real issues around the impacts of that boom for the growth and prosperity of both the manufacturing and services sectors. Indeed, the former Treasurer, Mr Costello, gave a reference to the Standing Committee on Economics, of which I was a member at the time, asking us to look at the impacts that the minerals boom was having on those two sectors and potentially what we needed to do to support them to innovate and grow into the future so that we retained a diverse base in our economy and did not see a narrowing in the base of the economy. I thought that was an issue that was well worth looking at. The economics committee was at the time chaired by Bruce Baird, who, of course, is no longer in the parliament. I found him to be a very good chair to work with on that committee.

We heard a lot of evidence about the wonderful flow-on effects of the minerals boom on many sectors of the manufacturing and service industries whilst at the same time hearing from other sections of those industries that it had created some real challenges for them. The exchange rate of the dollar was clearly one that we all understood: if you were trying to export, it was not a particularly encouraging position. In particular, when we visited Western Australia, where my colleague who is here with me now is from, we heard a lot of evidence from the tourism industry about labour supply issues. One of their great concerns was short order cooks and so forth being lured away for much higher wages in the mining areas. That was putting real constraints on them and they told us about restaurants in Perth that were closing down and so forth. Clearly it was a real issue. We all valued the mining boom and we wanted to maximise the outcomes of it to make sure that all of the sectors of our economy that could profit from it did so and did so effectively. That was one issue that was going on during my first few years in this parliament.

The other one was the effects on public sector demand that a mining boom can have. By that I mean—and it will come as no surprise to anybody, like me, who comes from a mining area—a boom carries with it a whole lot of issues around infrastructure, skills and training. In my area I have had conversations for many years now with the Australasian Institute of Mining and Metallurgy. The University of Wollongong is a major trainer and supplier of mining engineers and the national organisation has a very active and well-led local branch of mining engineers in Wollongong. My own father was an electrical engineer in the mining industry, so I have known many of these people for a long, long time. They were constantly at my door talking to me about the need to address the severe skills shortages that were developing as the mining boom continued not only in engineering but also in a broad range of skills needs that the sector has.

At the same time you could pick up a newspaper and see stories about ships queued off Newcastle and, in Queensland, a real problem with getting mineral exports out of the country at the rate at which they were being demanded. One of the real problems for the long-term sustainability of the minerals industry was that a lot of that boom was built on the back of high prices, partly determined by constraints on supply because of infrastructure issues. So there was great pressure on government—at that time we were in opposition—to address the infrastructure bottlenecks and the skills shortages. Indeed, the RBA itself issued consistent warnings that these two problems in particular and their effects on demand were becoming a significant inflationary force; hence, a fairly significant and sustained rise in interest rates occurred as the RBA sought to address that rising inflation.

We were elected to government on the back of a promise to get serious about addressing infrastructure bottlenecks and skills and training deficits in this country. That was exactly what our initial budget was about. It was about establishing, for example, Infrastructure Australia—to have an independent national audit of infrastructure that was needed for the growth and productivity of our nation. We see now, 2½ years later, significant investments, as outlined by the Minister for Infrastructure, Transport, Regional Development and Local Government in the House today, providing new roads, new rail and new port facilities to ensure the productivity and sustainability of the minerals industry more broadly and also at the local community level.

In my own area, I have been a great champion for a new rail link. We have a port, the port of Kembla, and we feed into the southern coalfields. We do have a bit of a physical challenge to overcome in our area, in terms of the escarpment. It is a beautiful thing and a wonderful asset in the tourism base of our economy in the Illawarra, but it is a bit of a challenge in terms of the infrastructure base. The Maldon-Dombarton rail line was being built to link the port of Kembla to the southern coalfields and on to the Lithgow coalfields at the time. Sadly, when my good friend from this place, former member Bruce Baird, was the transport minister for New South Wales he cancelled that project, in a very short-sighted manner, halfway through its construction. That was at a time when we saw the downturn occur in the mining industry. When those downswings happen as a result of the international situation in mining, I think that it is wrong to assume that it would not be followed by an upswing. Consequently we have a rail line that is quite an amazing thing to see. There are gorges where you have a rail bridge built halfway across and it literally just stops. You could be forgiven for thinking that someone had cut the photo in half, it is such a dramatic image. We have been supporting the government having a look at the viability of completing that rail line with a view to linking it in to the Southern Sydney Freight Line and having the port of Kembla be part of the solution for the issues of the port of Botany.

At the end of the day, these things have to be done properly, and we as a community understand that governments have to do feasibility studies, they have to make sure that these sorts of projects stack up, and that is what we were agitating to get. The chair of the House of Representatives Standing Committee on Transport and Regional Services—which I was also a member of—at the time, Mr Paul Neville, the member for Hinkler, visited the port with the committee and in his report, The Great Freight Task, he endorsed the need to look at that rail line. On being elected, the Rudd Labor government has committed to the process and at the moment we are undertaking a $3 million full feasibility study into the capacity of that line.

Why is this important in a community like mine? We have a real issue around export and, in particular, the movement of minerals around this country, in that they have to come to the seaboards for export through a port, and you have got growing populations and urbanisation around the coast. So you have got competing interests occurring when people in urban areas are increasingly saying, ‘We don’t want trucks rolling through our town, we don’t want them rolling through 24 hours a day.’ All those sorts of limitations then affect the productivity and efficiency of that freight connection. So it is very important, as The Great Freight Task report said, to get as much of that growing freight movement off our roads and onto rail as possible. Those were the challenges that we were facing, and I was very pleased when we came to government and, in that first budget, we started to tackle not only infrastructure but also, importantly, investing in education, training and skills development. I thought that was a well-overdue response to the issues that have been raised by people like the Reserve Bank of Australia for a very long time.

We then had the intervention of the global financial crisis and the dynamic changed significantly. I agree with the many, many commentators on both the national and the international stage, including international ratings agencies and economic forums, that this government handled that crisis outstandingly well. The Prime Minister, the Treasurer and senior members of the government intervened quickly and decisively, understanding that when private sector money pulls out of not only a nation but also communities, people lose confidence. As a result, you see businesses closing down and shops being boarded up, and that leads to ‘for sale’ signs in yards and to houses staying on the market for long periods of time. As people drive around their communities and see those boarded-up shops and houses for sale, they lose confidence. That loss of confidence feeds on itself and people stop spending. Next you see the little restaurants, takeaways and retail shops shutting down. It is a pattern that has happened in societies whenever confidence is knocked out of an economy.

The really quick, significant intervention that this government took to bolster employment and to bolster local economies was critically important to the success we had with confidence and the fact that we did not end up going into technical recession. The budgets during that period were about the importance of that stimulus. It was always made clear that we had a view that you inject government spending at a time when the private sector is pulling out and you do it in a sustained way and then, as the private sector investment picks up, you start withdrawing and you get your budgets back into balance. This budget sits in that part of the cycle.

This budget is sound and responsible. It is about paying off the debt that was necessary in the context that I have just outlined—necessary in keeping Australia from falling into a recession and, indeed, necessary at a very human level to sustaining communities, families and jobs. This budget will be in surplus by one per cent of GDP three years ahead of the schedule that was identified in the budgets in which we took intervention in the economy. This budget is responsible in that it invests in productivity. It is about human capital and it is about building the future. It is about identifying what we did wrong with the first mining boom and making sure that we do not repeat that with the second one.

There is investment in health and hospitals in particular, which I think is very important, and there is investment in education and skills—a great passion of mine. It also builds on the nation’s savings by increasing the superannuation guarantee to 12 per cent. I do not think people should ever underestimate the fact that we had a trillion dollars in super as a national savings bank in this country. It was a very important part of the financial stability of this nation during the global financial crisis. I sometimes hear people talking about the option of putting this sort of money into some sort of sustained future fund type arrangement. The superannuation of this nation is the future fund. It is not only a future fund for the individuals who draw on that super; it is a national savings bank that underpins a lot of our financial performance.

The budget delivers on the tax cuts that we had promised. Of particular importance in terms of that concept I was mentioning about making sure that all sectors of our economy share in the wellbeing that we experience from selling the minerals that we own, the budget also introduces cuts to company tax and, in particular, an early introduction of the cut to the company tax for small businesses. Additionally, it also allows an immediate write-off for small business assets worth up to $5,000—which I think will be very, very welcome. Certainly small businesses in my area welcomed the interim small business offset we had in place. The budget also invests $700 million in the first year of a new infrastructure fund, which will go towards addressing some of the issues that I outlined were pressing problems at the 2006-07 debate that we were having in this country about infrastructure.

After we finish sitting in this parliament at the end of this sitting session, I will be going to talk to my local division of GPs about some of the opportunities under the superclinics program. In particular, I am very, very pleased to see that part of that program provides an opportunity for existing GP clinics to get up to half a million dollars to upgrade themselves to be able to provide those additional services that a superclinic provides. I will be keen to encourage many of my locals to become involved in that. I should also indicate that I participated the other week in an aged-care forum in my electorate to talk to providers and workers from that industry. Some members of the Combined Pensioners came along as well. I am very pleased that this government will invest $533 million over the next four years to improve access to high-quality aged care.

It is important to indicate the government’s commitment in this budget to reducing Australia’s energy consumption and improving energy efficiency. The budget provides $652 million over four years to the Renewable Energy Future Fund. That is a particularly important fund to support and develop both large- and small-scale renewable energy projects. I think there will be many businesses in areas like mine looking to those opportunities.

I have had people in my area talk to me about the problems with getting the Carbon Pollution Reduction Scheme through the parliament and their disappointment that because both the opposition and the Greens opposed it in the Senate it was not able to be put into place. But it is important to remember that that was one prong of a multipronged approach to tackling climate change issues and it is important to be committed to renewable energy.

I am very pleased that the Apprentice Kickstart bonus program has been extended. It has been a fantastically successful initiative in my own area. Along with the Illawarra Mercury and the Illawarra Business Chamber, we set a target of 500 apprentices and we exceeded that by about 50 to 60 apprentices. I am thrilled and I am sure the local community will come together to make sure more young people get a start.

The last time we had a downturn, in the 1980s, it took 13 years to get the number of apprentices being employed back to the level it was at the time before the downturn started. A significant part of that contributed to the skills shortages that I described earlier. This program made sure that we got back to those levels in one year. For young people—and more broadly for our economy to avoid a future skills gap—this is a really important and successful budget initiative that I commend.

I have talked broadly about the economic situation. You may tell from my comments that I am a great supporter of the resource super profits tax. I have lived with five generations of a mining family and I have at least 10 family members currently working in the mining industry. We have heard the scare campaign every time before. We heard it on land rights. We heard it on Mabo. We heard it on occupational health and safety. We heard it on rolling back Work Choices.

They like to lobby hard, I respect that, and they will respect the fact that I will lobby back just as hard and say ‘You are not going to frighten me off what is in the nation’s best interest by a scare campaign’. I have seen it before. I recognise it and understand it. Go out and do your best but at the end of the day we will make a decision that is in the best interests of the nation as a whole. The mining sector will continue to prosper and I am sure they will be back knocking at my door wanting to talk about their approvals for future development and growth. (Time expired)