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Wednesday, 23 February 2011
Page: 1220


Dr MIKE KELLY (Parliamentary Secretary for Agriculture, Fisheries and Forestry) (5:48 PM) —As we speak about what is, in effect, a disaster relief measure, I would like to add my voice to those who have already been heard in this chamber expressing their sympathy for and condolences to our New Zealand brothers and sisters. In particular, I would like to send out my greetings to the members of the New Zealand Defence Force, good friends of mine who I know will be very busily engaged right now.

It is very disappointing to be here participating in this debate on the Tax Laws Amendment (Temporary Flood Reconstruction Levy) Bill 2011 and cognate bill. This should have been a moment in time when the chamber united behind the flood levy measure. It is extremely disappointing that, instead of sending that message of unity and cooperation, we are divided and engaging in partisan political debate over this issue. It really does underline what we are experiencing with the coalition leadership of the Leader of the Opposition. I know there are many fine and decent men and women on the opposite benches. I have great respect, of course, for the member for Wentworth, who is at the table, and many others of his colleagues. We are seeing now, I believe—I hope—a line being drawn on the descent we have seen the Leader of the Opposition take his party and his coalition on.

I must confess that I am a fan of the TV series Red Dwarf, which was on the ABC. It was a wonderful series. The other day, the Leader of the Opposition put me in mind of something: it was an episode of Red Dwarf that described a creature that was a shape-changing, parasitic mutant known as a polymorph, a creature that fed on negative emotions. In this parliament, we have now seen the incarnation of the polymorph in the Leader of the Opposition. He is a man who trawls this country seeking out and feeding on negative emotions, and seeking to play partisan political point-scoring with those negative emotions. He has nothing to contribute, no policy direction to offer this country, and this discussion on the flood levy is a prime example of that. I do hope that we have now reached the limit of the direction that the Leader of the Opposition had been taking, with the well-timed and commendable revolt we are seeing on his back bench.

In relation to the specific targets of the flood reconstruction levy, getting out and touring the flood affected areas of New South Wales was part of my responsibilities this summer—towns like Dubbo, Parkes, Narromine, Wee Waa, Narrabri and all of those places in New South Wales that have suffered tremendous damage to infrastructure, including damage to roads and bridges. We saw a bridge near Wagga where the bridge itself was still intact but the approaches on both sides had been completely washed away, leaving a major engineering challenge.

This will require a major effort. It is not just that crops were destroyed in the process of this flood and damage done to farming properties. For the crops that still remain, the challenge is to get those crops to market and, for the future crops that will be planted, to take advantage of the ground moisture we now enjoy. It is very critical that we tackle this infrastructure challenge.

That challenge cannot be met by any other means than by the Commonwealth weighing in heavily to assist the states. This measure of course, bringing in this levy, will help us do that and perform at the same time the very necessary task of enabling us to return to surplus in 2012-13. I should emphasise that the money that is being deployed through this levy and through the overall sums that will be used in this challenge also include areas outside Queensland and those areas in New South Wales that I mentioned. At this stage the proportional amount indicated was $1 billion, but of course that will relate to the overall sums that are determined when the damage is fully assessed. So those areas in New South Wales and even in my own electorate stand to gain from that investment and that deployment of funds.

Returning to surplus in 2012-13 is extremely important. It is important for the reasons that we should well understand of taking the pressure off private capital out in the open marketplace and thereby contributing to good sound fiscal policy and alleviating pressure on interest rates at the same time. It sends a very important signal to the market and to all those out there who are seeking capital, that the government is going to play its part. But also, very importantly, we have to understand that we cannot foresee the future, and nothing should have illustrated that more effectively than the follow-on cyclone that we endured following the floods. So what lies out there now for us in the future, what further challenges will there be? It is important that we return to surplus as soon as possible in order to meet those potential challenges, those challenges that we cannot foresee even today. So it is important on those particular grounds to return to surplus.

It is an interesting phenomenon to see the opposition debating the question of levies. It has been well aired in this chamber that the Howard government certainly resorted to this measure many times in its lifetime. Of course we know about the superannuation surcharge from the 1996 to 2005 of 15 per cent, and the gun buyback levy has been referred to many times. But very interestingly, when you look at the subsequent levies that were introduced, in 1999 to May 2006 there was the stevedoring levy which was introduced when the government was in surplus to the tune of $4.3 billion at the time. We had the milk levy in relation to dairy deregulation, which was imposed over a period of 10 years and which raised effectively the same amount of money that we are talking about in relation to this flood levy. At the time, the government was in surplus to the tune of $13 billion. The East Timor levy that was proposed in 2000 was also in the context of a government surplus of $13 billion. The Ansett levy that was introduced in September 2001 through to June 2003 was when the government was in surplus to the tune of $5.9 billion. From January 2003 to November 2006, the sugar levy that was imposed was when the government was in surplus to the tune of $7.4 billion. So the Howard government was a regular resorter to levies even when they were significantly in surplus. It is highly hypocritical of them to take issue with this measure at this time in the context of the current budgetary situation we are in.

Further to that, in my own portfolio responsibilities I am charged with signing off on increases in levies in relation to specific industry support. I think it might interest the chamber to know that we in fact have about 70 industry levies in place at this time that the government is engaged in with sectors of industry—in other words, a levy is raised from the industry and the government provides matching funding. It has been an excellent mechanism for improving the research and development of many of our sectors. They are wide and varied levies. There are 29 in the horticultural sector—almonds, avocados, bananas, cherries, pears, chestnuts. You can go through an extremely long list. There are nine grain levies, 14 livestock levies, three wine levies and about 17 other different ones including a queen bee levy—which maybe Julie Bishop might be interested in, but there are certainly a wide range of levies there that have been in place—


The DEPUTY SPEAKER (Hon. Peter Slipper)—Order! I remind the parliamentary secretary of the provisions of standing order 64. He ought to refer to the Deputy Leader of the Opposition by her title.


Dr MIKE KELLY —Certainly, Mr Deputy Speaker. The Deputy Leader of the Opposition might be interested in that one. There are 70 of these levies in place and it demonstrates quite clearly and quite effectively, I think, that this country has always resorted to and relied upon and accepted the levy mechanism as a way for the people of this country to work as a team. We work as a team nationally when we face particular national challenges and we work as a team sectorally when there are advantages to be gained from particular industrial sectors. So the levy mechanism has been a fine tradition in this country. It is a way of dealing with issues like this equitably so that the burden is distributed equitably, but also efficiently as well.

We know that the donations that have come in from a very generous and compassionate Australian community are being directed towards those specific victims’ domestic homes and people who have suffered loss, and they are helping those people directly. It is a wonderful thing. Those direct donations are tax deductible in themselves. But those people who are benefiting from many of the provisions that we have put in place to alleviate the suffering will not find themselves the subject of this further levy action. It is a very small price to pay, I think, for those who will be asked to pay. We are talking about 60 per cent of taxpayers having to put forward only about $1, and of course this is in the context of all the tax relief that has been delivered by this government. The three tax cuts in a row have certainly put those people in a much better position in any event, so this one-year levy for this tiny amount of money will not have a significant impact on those tax cuts they have already received from this government.

What we have seen from the coalition in this discussion is the offer of ‘savings’. It has been very interesting to see the sorts of savings they have offered. It really does underline the farcical budgetary circus we saw right through the campaign last year with the $11 billion black hole and their inability to come to grips with putting a budget together, with counting, basically, in some cases.

When I look specifically at the offerings the coalition have put forward, it shocks me because it underlines further the deeply evident lack of understanding in relation to our security needs and basic market dynamics. For example, to propose cuts to the water buyback program fails to understand that right now is a good time to engage in these buybacks because it is the cheapest time to buy. So we will be achieving significant savings out there in the marketplace in relation to the water buybacks. Certainly that system is being refined, but the principle of buying in these good times is one that should be well understood and well appreciated. This is a good time to buy. So it is a false economy that the coalition proposes with respect to the water buybacks.

More deeply concerning to me—and I know it is deeply concerning even to a range of conservative commentators in the community—has been the proposal to cut the Australia-Indonesia Basic Education Program. It is a program that the Howard government introduced, to its great credit. I spoke here in this House in the Afghanistan debate and I emphasised in that speech that what we are facing is not a war on terrorism; it is a war on ignorance. Those were the words that I used. When you look at the tactics and the approach of our enemy in this respect, you see that they are waging a battle for the human mind. When the Taliban overran the Swat Valley in 2009, what was the very first thing they did? The very first thing they did was to blow up 100 schools and in their place establish radical madrassas. That is the challenge we face: the battle to win the minds of the Muslim world, to encourage and support the moderate thinkers, moderate Islam. The way we do that is by running these very programs in Indonesia, our great friend and neighbour who is facing the challenge of attempts to infiltrate and influence their community by radical Islamic extremists. As the Minister for Foreign Affairs said, this program will only be smiled upon by the Leader of the Opposition and by Abu Bakar Bashir. It really emphasises the failure of the Leader of the Opposition to understand where our national security interests lie and how to pursue the security future of this nation. I think the Leader of the Opposition will be universally condemned and will continue to be condemned for that fact.

I know issues have been raised in relation to the oversight of the reconstruction task. It should be well noted that that has been significantly and securely addressed by the introduction of the Reconstruction Inspectorate. The inspectorate includes Mr John Fahey, a former federal finance minister, as the chair, and also Martin Albrecht, Matt Sheerin and Brad Orgill, who performed such good work in oversighting the BER Implementation Taskforce. So the issue of oversight is well and truly addressed. There will be rigorous scrutiny of rebuilding contracts. The task force will inspect projects to ensure that they are meeting progress milestones and will investigate complaints et cetera. So the mechanism is in place. It is definitely a good way to deal with this issue. But in this debate we have seen the lack of a moral compass, no fiscal responsibility and no understanding of national security by the coalition. (Time expired)