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Thursday, 30 May 2013
Page: 4684


Mr FRYDENBERG (Kooyong) (13:17): I rise to speak on Appropriation Bill (No. 1) 2013-2014 and Appropriation Bill (No. 2). The standard supply bills will see money allocated from the consolidated revenue fund for the services and programs of government. Appropriation Bill (No. 1) covers $78.1 billion; Appropriation Bill (No. 2) covers $4.77 billion. There is also the Appropriation (Parliamentary Departments) Bill (No. 1) 2013-2014, which will seek to appropriate $184.7 million.

This is an opportunity for me to critique the government's failed economic management, to look at its rising debt and its deficit and the burden that it is creating for future generations. Let us remember when Kevin Rudd became the Prime Minister in 2007. He promised the Australian people he would be an economic conservative, that he would continue the proud tradition that existed under the government of John Howard and Peter Costello, which saw 10 budget surpluses, saw more than two million new jobs created, saw inflation and unemployment at three-decade lows, saw a 22 per cent increase in real wages, saw a AAA credit rating, and saw all government debt—$96 billion of government debt that we inherited—paid back and that in its place $70 billion was left in the bank, including a $20 billion surplus.

But the Australian people should have known, because the last time the Labor Party delivered a surplus was way back in 1989. And since the time of the Rudd and Gillard governments, we have seen the five biggest budget deficits in the history of the Commonwealth. This is despite this government—the Prime Minister, the finance minister, the Treasurer—promising more than 500 times that we would see a surplus this coming year. Instead, we have a $19.4 billion deficit, with an $18 billion deficit the year after. This country is soon to break through the $300 billion debt ceiling for the very first time. On the forward estimates we are going to a $400 billion debt. As a result of that bill, we will be spending more than $8 billion just meeting the interest payments. That is the price of eight new teaching hospitals right around Australia. That would pay for the Gonski reforms plus half the NDIS, or that would build the East West Link or West Connect. That is what the interest bill alone is costing the Australian people.

We have seen falling productivity and higher unemployment. We have seen more than 20,000 new public servants and, I am afraid to say, there are now 1,600 staff employed in federal departments as spin doctors, managing communications, media, marketing and public affairs. We have seen nearly 30 new or increased taxes, the daddy of them all being the carbon tax and of course there is the mining tax. We have seen more than 20,000 new regulations—red tape and green tape hurting big and small businesses alike. We have broken promises—not only the carbon tax. What about the government's commitment not to affect the rebate on private health insurance? What about the government's promises to deliver family tax benefits, increases in family tax benefit A in particular?

We have seen more than 100,000 jobs across Australia go in manufacturing, the most painful being the recent announcement by Ford that it will be closing down its operations in Geelong and Broadmeadows. We have seen more than 250,000 jobs go in small business. We have seen emboldened unions. In the Fair Work Act there are 120 areas where unions have more control than ever before. We have seen days lost from industrial disputes dramatically increasing and as well the number of unfair dismissal claims going up.

We have seen the tragedy of 42,000 unauthorised arrivals making a mockery of the government's border protection policies. This has led to a $10 billion blow-out in this government's budget. Let us not forget that in the years between 2002 and 2010 just 10 boats came to Australia with less than 250 people on board. And since this government has unwound the successful policies of the Howard era, more than 42,000 unauthorised arrivals have come. The Australian people could never have imagined that it would be this bad. Indeed, even Gough Whitlam, a hero to those on the other side, produced a budget surplus. This government will never do that.

You simply cannot take this government at face value with anything it says. Not only did it promise recently that we would have a budget surplus, which has not eventuated, but now it is promising that we will have a budget surplus in 2016—that is, after the Treasurer said in 2008 that the deficit was 'just temporary'. As Joe Hockey has said, by that standard World War II was temporary. Just six years of temporary deficit: I do not believe it. It is going to be many more years than that. In fact, the Treasurer began announcing last year's budget with the line:

The four years of surplus I announce tonight …

That is extremely laughable. Can you believe that the Treasurer said on 22 May this year:

No other government in our history— in the history of the world, ever, throughout time—has done what we have done in this recent Budget, which is bring the Budget back to surplus over time …

Is Wayne Swan a comedian? If he is, he is a very bad one at that. Again in this budget the government is cooking the books. The mining tax currently brings in $200 million of revenue. This government wants us to believe that by 2016-2017 the mining tax will produce $2 billion of revenue. That is a 1,000 per cent increase on current numbers. What about the changes in the dollar? What about the changes in the terms of trade? In fact, the terms of trade today are 15 per cent higher than in any year of the Howard government.

In terms of the carbon tax, this government has us believe that when it moves to a floating price the carbon price will be $12 a tonne, when it is currently around $4 equivalent a tonne in Europe and just 85 cents in New Zealand. Then in Senate estimates, when officials were asked how they came to that number of $12 a tonne, moving up to $38 a tonne over time, they said, 'We have taken the straight-line method'. What is the straight-line method? Why would you not be looking at market trends?

The point here is that this government does not have a revenue problem. In fact, revenue is up $80 billion from the last year of the Howard government. This government has a spending problem. More than $192 billion has been spent more than it has raised over the last five years. Expenditure as a percentage of GDP is higher every year under Labor than under the last two years of the Howard government. In fact, spending today is $120 billion higher than in the last year of the Howard government.

Again, it was laughable to see the Treasurer of Australia say on 21 April that they had a revenue black hole, that revenue was down by $7½ billion, because—do you know what, Mr Deputy Speaker?—the Prime Minister came out a week later and said that revenue was down $12 billion. And then you had the finance minister come out a week later and say that revenue was down $17 billion. This was not revenue; this was their forecasts! Revenue is not their problem; it is $80 billion higher than in the last year of the Howard government.

We know that this government is creating a high-cost, low-productivity environment. We have just had the head of Ford say that if he were to produce a car in Europe—that highly regulated environment of Europe—it would cost twice as much as to produce it in Australia. If he were to produce a car—

A division having been called in the House of Representatives—

Sitting suspended from 13:27 to 13:34

Mr FRYDENBERG: As I was saying, this government has created a low-productivity, high-cost environment. We have seen that with the closure of Ford and the statements by the head of Ford about the costs of manufacturing a motor vehicle in Australia compared to making a comparative vehicle in Asia or in Europe, which are both much more cost-effective than Australia.

We have also had the announcement by BHP that they would not proceed with the $30 billion-development at Olympic Dam, and also the Port Hedland extension, which did not proceed. These are just some of more than $100 billion of national projects which have been either cancelled or postponed because of the high-cost environment.

It is no wonder that costs have gone up, when the unions have taken control of the workplaces around Australia. In fact, this government has abandoned and abolished the Australian Building and Construction Commission, which came out of the Cole royal commission and was designed to deal with lawlessness in the building and construction sector. I know in my own state of Victoria, where nearly 10 per cent of people are employed in this sector, that the abolishment of the ABCC has had a dramatic impact. We have seen some of the stand-offs with unions with the Grocon-Myer Emporium and also at other places around the state.

Jac Nasser, the head of BHP, said that in the Queensland coal business alone in 2011-12 there were more than 3,000 examples of industrial disputation. There were 301,800 days lost to industrial disputes in 2012. This compares to just 49,700 in the last year of the Howard government.

Because of this government's woeful economic performance there is little money for the things that are really important to our community—for example, universities. This government has ripped billions of dollars out of universities, devastating what should be an important sector in lifting our productivity as well as being an export earner for attracting the best students to our country. Fred Hilmer, the Vice-Chancellor of the University of New South Wales, said:

With these cuts coming we will have to slow down hiring and slow down our investment in technology. How you reconcile that with the Asian Century ambition is just a joke.

What Fred Hilmer, a non-partisan figure, is saying is that the government's words about the Asian century were purely that: just words, not backed up by deeds.

In terms of infrastructure, important projects like the East-West Link in my state of Victoria, which received a $1.5 billion funding commitment from the coalition, does not receive anything from the government. Public hospitals have seen money taken away retrospectively by this government, which has led to bed closures and the cancellation of elective surgery. Cuts to private health insurance will drive up the costs for all people with private health insurance, including 5 million Australians who have a household income under $50,000—and that is their annual household income, but they have taken the decision to take out private health insurance.

Non-government schools have also seen their funding cut. We have seen cuts to superannuation, we have seen $375 million ripped out of the aid budget in order to fund border protection. And of great concern to me, we have seen cuts to national security: the AFP has seen $200 million taken away in the last two years, the Australian Crime Commission has seen up to 200 staff lose their jobs and the ASIO budget has been slashed by over $16 million in 2011-12. Customs has seen 130 staff cut and Defence spending is at its lowest level since 1938 at 1.56 per cent of GDP. In fact, in GDP terms, we are the 65th country in spending on defence—the 65th country!—when we are the 12th or 13th biggest economy in the world. That is a disgraceful record on behalf of this government.

This government has no answer to the demographic challenges facing this country. It has no answer to the structural deficits; it has no answer to how we can end the age of entitlement. We, on the other hand, have a blueprint for reform in manufacturing, advanced services, education, health, agriculture and, of course, resources. This will be based on our commitment to smaller government, personal responsibility and individual freedom. Forget the chance on 14 September. We will not only produce a budget surplus once again but ensure that all Australians are better off.