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Thursday, 24 May 2012
Page: 5605

Mr CIOBO (Moncrieff) (11:33): I rise to speak about yet another federal Labor government budget—yet another great disappointment for my constituency on the Gold Coast and yet another squandered opportunity. The reality is that this was a typical Labor budget in that, despite its headline surplus figure of $1.5 billion, it will in reality be another significant budget deficit. We have remarked that it will take 100 years of Wayne Swan surpluses to repay four years of Wayne Swan deficit. The fundamentals are this: Labor are bad economic managers. That Australia is still in relatively good shape is a consequence of the longevity of the reforms that were implemented by the Howard government and the very strong economic footing that the Howard government provided the people of Australia with and indeed the way in which our institutions were funded and the debt repaid.

There are several inescapable facts. Most fundamental of these is the key driver of Australia's debt-to-GDP ratio, which was 100 per cent a consequence of the fact that the previous Howard government and the then Treasurer, Peter Costello, left Australia with zero public debt—zero public debt. In fact, Australia was left at the end of the Howard government's period in office with net assets of $70 billion. In the short four or five years since the Labor Party was elected, we have seen that position erode from a $70 billion net asset position to now a negative $130 billion of debt. That is, for all intents and purposes, a $200 billion turnaround in the space of about four years. That, of itself, speaks volumes about the Australian Labor Party.

If you listened to the Australian Labor Party, you would think that this complete erosion of our nation's finances was a consequence of external factors. If you listened to the narrative from the Australian Labor Party, you would think, 'Look, we just happened to be in the wrong place at the wrong time, and that is why Australia's finances have been completely eroded.' That is a nice cover, but it is not the reason for the turnaround. The reason Australia's finances have gone backwards at an incredible rate of knots is the reckless spending and the badly applied use of taxpayers' funds by this Labor government. We have seen billions upon billions upon billions of dollars utterly wasted by this government; which, frankly, in my view, borders on economic incompetence.

Speakers from the government in this debate have stood up, puffed their chests out and said: 'We are proud to give money out to Australian kids through their families. We are proud about what we did with the Investing in Our Schools Program.' Do you know what? I do not share that pride. It is not because I begrudge Aussie kids having brand-new school halls. It is not because I think that parents are going to waste money. The reason I begrudge the Australian Labor Party, when they stand up to crow about their so-called economic achievements, is that those Aussie kids that they talk about—who are sitting in those school halls, whose parents are receiving $800 or $900 or $1,000 in cash handouts from this Labor government—will be paying off the debt that Labor has left us for the next 20 years. So, when they sit in a school hall, they are not sitting in that school hall with the full knowledge that that school hall was built by borrowing money from overseas, money that those kids will have to pay off for 20 years before Australia is even back in the position of starting to save for our future. That is the real legacy of the Australian Labor Party. It is entirely consistent with Labor's form when it has been in federal government before and with Labor's form in every single state across this Federation.

It is extraordinary when you look at the state of Queensland. For so long Queensland was the economic beacon of Australia. We were the lowest taxed state in the Federation and we were the central hub for economic activity in our Federation. After 20 years of Labor government in Queensland that has all been erased. Queensland is no longer the lowest taxed state in the Federation. We are about third or fourth. Queensland no longer is the epicentre of economic activity. Population growth in the state has declined to now being in net terms nearly zero. Economic growth has slowed down. The previous Bligh and Beattie Labor governments have left Queensland with debt of around $60 billion to $80 billion.

It is a farce that members of the Australian Labor Party stand up and try to whitewash these things, as if in some way they are good, because they care about the people, because they want to hand out money hand over fist, and say that it is the coalition who are the problem because we say no. That is right; we do say no. We say no repeatedly to this government when it comes to economic stewardship, because this government has frankly no idea. It is not bold. It is not visionary. It is not good governance to say: 'We want to hand out $900 here. We want to build $16 billion worth of school halls there. We want to spend money doing this and that and the other. It is the coalition who always stands in our way.' That is right. I am proud to stand in the way of the Australian Labor Party. I am proud to say to the Australian Labor Party, 'Your reckless spending must stop,' because I have two children and I know that it is my kids who will be paying off for decades the debt that the Australian Labor Party leaves behind.

At what point does the Australian Labor Party wake up, look in the mirror and say to the next generation of Australians, 'I am sorry; we have betrayed you'? At what point does the Australian Labor Party say to the Australian people, 'I am sorry; whereas the previous coalition government meant that we paid zero when it comes to paying off interest on debt, we now have to pay $8 billion a year in servicing interest that this government has racked up'?

I recall when the Labor Party first came to office, roughly four short years ago. At that time they wanted to increase Australia's debt ceiling to $75 billion. They said: 'Don't worry about it. We'll never reach it. $75 billion will be more than enough to see us through. We are never going to get to it.' Well, guess what? We got to $75 billion. So then the Labor Party said: 'We need to increase our debt ceiling to $100 billion. But don't worry. We'll never get to it. It is just a precaution. It is just there as part of our financial manoeuvring.' Guess what? We reached $100 billion. Then the Labor Party said: 'We need to increase our debt ceiling again, up to $200 billion.' And now the current debt ceiling is at $250 billion. Do you know what Labor is doing in these budget papers? In these budget papers the Labor Party says: 'Look, we are going to have to increase the debt ceiling again. We are just going to push it up to $300 billion. But don't worry about it. We will never get to it. $300 billion. It is okay. Our debt to GDP ratio is low by world standards.'

The audacity of the Australian Labor Party is extraordinary—their spending and the way they portray themselves. They constantly sap people's aspirations in this country by punishing those that are successful by saying, 'If you earn over $150,000, we are going to effectively tax the bejesus out of you.' It escapes them that this erodes the desire to move ahead in this country. They punish those who are successful, they punish those who generate wealth, they punish those who create employment, they punish the industries that are the entire reason the Australian economy is still moving forward, and then they redistribute all of that and give it to those who are not in that situation. Then they wonder why Australians say: 'Do you know what? This is just too hard. We would rather take our money and invest our capital elsewhere.' They seem to think that we live in a closed environment, where Australians do not have options to invest that capital in overseas markets—which they are doing, because that is more profitable for them than retaining their capital here.

In addition, it is important to recognise the opportunity cost of the way Labor wastes money; there are two ways Labor has wasted money. We have seen the billions of dollars that have been wasted on the school halls program, the pink batts scheme, GroceryWatch, Fuelwatch, the green car fund—the list is endless. You name it. Billions upon billions upon billions of dollars of money has been channelled into all of these harebrained schemes that Labor backs wholeheartedly the one minute and walks away from the next. That is the first opportunity cost.

The second opportunity cost relates to the fact that now, as I said, we are paying an interest bill of $8 billion a year. Under the coalition that $8 billion a year could have been spent on programs. There could have been new hospitals, new roads, infrastructure spending—a whole range of different things. That is what the coalition did.

What we are doing now as a direct consequence of Labor's spending is paying $8 billion a year in interest. I have to say to my constituents: 'I am sorry; we can't extend the heavy rail down to Gold Coast Airport—a cost of $2.8 billion—even though that money would have been available, because now that money has to go towards servicing Labor's debt. We cannot have $30 million for a cruise ship terminal on the Gold Coast—something that would drive employment and tourism—because now that money goes on repaying Labor's debt. We cannot find $2 billion to cover the cost of hosting the Commonwealth Games—something that would showcase my city and indeed all of Australia to the world—because now that money has to be spent on servicing Labor's debt. And we can't find $280 million for the cultural precinct at Evandale, because now that money has to be spent on servicing Labor's debt. We cannot find $1.8 billion to pay for light rail on the Gold Coast, because now that money has to be spent on Labor's debt.' n fact, one of the announcements that I made prior to the 2007 election was for $455 million for the widening of the M1 between Nerang and Tugun. Guess what? This government, in collaboration with the Queensland Labor government, tore that money away from the Gold Coast, ripped it away from my constituents and funnelled some of that money up the road. Instead of having an eight-lane carriageway on the M1, a national road between Brisbane and Sydney, we now have parts that are three lanes and other parts that are two lanes in each direction. That is Labor's legacy.

When people of the Gold Coast in my constituency look around and say, 'Where is the money for the light rail? Where is the money for the Commonwealth Games? Why aren't we improving heavy rail to the Gold Coast airport? Why aren't we doing something with the cruise ship terminal? Why aren't we seeing more funding like, for example, the local Roads to Recovery program, which was a coalition initiative—why aren't we seeing more funding there?' the answer is straightforward, and there are two reasons. Firstly, because that money now has to be spent to service the massive debt that the Labor Party has left us and, secondly, because that money was simply blown. Wasted. It may as well have been thrown on a fire and gone up in smoke; ridiculous programs, like their pink batts scheme—so-called stimulus programs.

If you want a good example of the way that this government has just absolutely wallowed in ineptitude, look at their set top box scheme, an announcement that I think was in the last federal budget. An allocation of around $450 per set top box installation to transform an old analogue TV to be digital-ready now—$450 per installation. The simple fact that you can buy a 42-inch plasma screen, delivered and installed, for less money than that—go to if you need to verify it—escapes the Labor Party.

The reality is that this certainly has all the hallmarks of a Labor budget. It is a failed budget, and it fails because their centrepiece of this budget—which is to crow about additional compensation for Australian families as part of Labor's attempt to buy them off, frankly, before the introduction of the carbon tax—is nothing more than a laundering exercise. It is a laundering exercise, because Labor is borrowing that money from overseas, then taking that money and giving it to Australian families and saying, 'Aren't we great?' But there is a little asterisk at the end of that sentence. That little asterisk is this: that those Aussie kids who are supposedly the beneficiaries of that money will be the people who for the next two decades are forced to pay higher taxes in order to repay the massive debt that this government has racked up in four short years. One hundred years of Labor Party surpluses are required in order to repay four years of Labor Party debt and deficit. The Labor Party stands condemned for their reckless spending, for the opportunity costs that they have brought about on the Australian people and, most fundamentally, because they have betrayed future generations of Australians, who will have to repay the debt in order to get Australia back to square one. (Time expired)