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Monday, 21 May 2012
Page: 4772


Ms JULIE BISHOP (CurtinDeputy Leader of the Opposition) (16:18): This is a budget that makes no secret of its class warfare motivations and the government's shameful desire to pit Australian against Australian and suburb against suburb in order to reverse Labor's lagging fortunes and save the ruinous career of a desperate Prime Minister. Her embrace of envy as a political strategy must be the final action of a Prime Minister with nowhere else to go. The Prime Minister is cornered between the electorate on one side, angry with her because she has broken promises and the fact that she has consistently put her interests above those of the Australian people, and on the other side a Labor caucus that is now readying itself for another political kill. The Prime Minister is torn between buying the votes of the electorate and the votes of her party room colleagues who keep her in power. Rather than lifting the nation up and encouraging the men and women of this country to aspire to their greatest hopes, dreams and ambitions, the Prime Minister has dragged the nation down into a bitter contest of us versus them, fostering the divisive sectionalism of long-past generations. The Prime Minister has singled out some of our highest achievers for public attack, going so far as to name them individually in press conferences and in the parliament—acts that are beneath the office of the Prime Minister. As one media editorial said, what we need from this Prime Minister is 'more class, less warfare'.

This is a budget that seeks to divide rather than unite, and to tear apart rather than create. It is, as the Treasurer has admitted, a typical Labor budget. It is full of the usual tricks and sleights of hand that one has come to expect from this government. It has worked the numbers to create the mirage of a minuscule surplus, pushing expenditure out of 2012-2013 into other financial years. It has forecast a generous increase in tax revenue at a time of mounting concern over Europe's economic future and fears of a slowdown in our major export markets. Given that the government's projected $23 billion deficit in last year's budget blew out to some $44 billion in this year's budget, there is little hope that Labor will deliver on even this small sliver of a surplus. Australians are right to be wary of a government that has delivered an accumulated $174 billion in deficits in just four years, yet claimed year after year that it was committed to budget surpluses. At the same time as it talks up its success in saving Australia from further Labor debt, the government plans to introduce measures to increase the country's borrowing limit by an extra $50 billion to $300 million. No government that truly believes its forecast for a budget surplus should be increasing the debt ceiling—the government's borrowing limit—by another $50 billion. I remind the House that the debt ceiling inherited by this government in 2007 when it came to office was nil. Labor has raised the debt ceiling time and time again to $250 billion dollars, and now to $300 billion.

Having squandered the nation's wealth on pink batts, overpriced school halls and cash giveaways, the government has now chosen to tear up our national defence, destroying years of hard work and patient investment by the Howard government. The Labor government has been so reckless with Australia's finances that it can no longer even fulfil the first and basic responsibility of government—that is, to secure our nation's sovereignty and its interests. This should not come as a surprise to anyone who has witnessed the disinterest and disregard of this Prime Minister in matters of foreign affairs and national security. From sending her bodyguard to cabinet's national security committee meetings to doing away with the National Security Statement to parliament—an event that was apparently meant to be as frequent as the annual budget—the Prime Minister has consistently failed in her duties. Australia is situated on the edge of the most dynamic and rapidly changing region in the world. The economic re-emergence of Asia is driving a shift in global power from Europe and North America to our neighbourhood, the Asia-Pacific/Indian Ocean. There is a growing acceptance that this region is in the middle of an arms build-up the likes of which has not been seen since the Cold War and which is heightened by the level of uncertainty felt between nations. Faced with the option of preparing Australia for this new strategic reality or closing her eyes to the challenges, the Prime Minister has chosen the latter. The Gillard government will slash funding for defence to just 1.5 per cent of gross domestic product, taking the share of Australia's wealth spent in this crucial area back to a dangerously low level not seen since the days before the Second World War.

Australia needs and deserves a government capable of planning for the future, not just for the next leadership ballot. The chasm between reality and Labor's rhetoric is as starkly apparent in the Foreign Affairs and Trade portfolio. As it has done with so many of its other promises, the government has trashed the bipartisan commitment to increase Australia's official development assistance to 0.5 per cent of gross national income by 2013. Labor's promise to reach the target amount in the following year is nothing more than Labor spin designed to minimise the political fallout. Should this government hang on and still be in office next May, there is no doubt that even this deadline will also be pushed back. This government's actions in pushing the aid commitment out beyond the forward estimates has made the task of reaching even this new deadline virtually impossible, and the government knows it. As Professor Stephen Howes, former chief economist at AusAID and panel member on the independent review of aid effectiveness stated:

Even with a year’s delay, it will be a steep climb to get to 0.5, requiring, on average, increases of about $1 billion for each of the next four years from 2013-14 to 2016-17. The aid program has never had an annual increase of anything close to $1 billion. The biggest increase was $626 million in 2008-09, the second biggest $500 million in 2005-06. Even with looser fiscal constraints, it will not be easy to sustain support for a single $1 billion increase, let alone for four such increases consecutively. Yet this is what it will take to get to 0.5% under the new timetable.

In retrospect it appears that the government never intended to meet its 0.5 per cent of gross national income commitment by 2015.

One need only read the Department of Foreign Affairs and Trade portfolio budget statements from last year to appreciate the extent of the government's failures over the past twelve months. According to its strategic direction statement, the Gillard government would 'intensify its engagement with China'; instead it has stumbled from one mistake to another. Its schizophrenic handling of the relationship has left baffled Chinese officials who want nothing more than the consistency, coherence and respect provided by coalition policies. Far from intensifying our engagement with China, the government has placed the relationship under immeasurable strain. The departure of the former foreign minister earlier this year was reportedly welcomed as a fresh start for both countries. As Linda Jakobson, director of the East Asia program at the Lowy Institute for International Policy and respected China expert, has stated, 'The "Rudd factor" has been an underlying tension in China-Australia ties for four years.' The failure of an Australian government representative to attend the Boao Forum for Asia, China's leading platform for discussing the pressing economic issues confronting the region, was a deliberate snub to China. It was only through a last-minute dash by the Australian ambassador in Beijing, as the Australian's Michael Sainsbury wrote at the time, that complete embarrassment was avoided. That Italian Prime Minister Mario Monti could find the opportunity to attend the Boao Forum despite his immense domestic challenges highlights the complete lack of interest and disregard shown by the Australian government.

So much of foreign affairs is about building productive working relationships. For countries that are crucial to our national interest, this exchange must occur at the highest levels. Despite the rhetoric of enhanced engagement, there has only been one prime ministerial visit to China since 2008. As foreign minister, the member for Griffith visited China only twice; neither of these visits was considered official. Former Prime Minister and Labor leader Bob Hawke has joined the criticism of the Gillard government, accusing it of letting the relationship languish. It was recently revealed that Labor's infighting held up the establishment of an annual summit involving key ministers from both countries. According to reports, the Treasurer refused to accept any arrangement that would result in the then foreign minister leading discussions. The Treasurer clearly had no such concern about putting Australia's national interests to the side while the government focused on its leadership tussle. Any positive developments that have occurred in the relationship with China during the past year have been in spite of the approach of this government, not because of it.

According to last year's strategic direction statement, the Gillard government sought to expand cooperation on security, trade and people-to-people links with Indonesia. That policy lasted less than a month before the government took the drastic step of suspending live cattle exports. The decision was made without any warning to or consultation with the Indonesian government. That is no way to treat a friend and strategic partner. The Indonesian government rightly registered its frustration at being kept in the dark. The consequences of the government's action have become clear as Australia suffers reduced access to the Indonesian market. The government is yet to learn from its mistakes. It has pushed ahead with the Illegal Logging Prohibition Bill 2011 despite the concerns of countries such as Indonesia that the government has failed to adequately consult with them.

Papua New Guinea, on the other hand, does not even rate a mention in the government's list of priorities. Despite being our closest neighbour, it is grouped together with other Pacific island countries. This omission is symbolic of the government's current approach to Papua New Guinea. The foreign minister's cavalier approach has done immense damage to the relationship at a time of sensitive political developments in Port Moresby. In response to suggestions that the election in Papua New Guinea be postponed until later in the year, Senator Carr declared that Australia would have 'no alternative but to organise the world to condemn and isolate Papua New Guinea'. He went on to say, 'We'd be in a position of having to consider sanctions.' Threatening sanctions is a powerful diplomatic tool, not the plaything of Sussex Street strategists. Such a move would have placed Papua New Guinea alongside such countries as Iran, North Korea and Syria as targets of Australia's autonomous sanctions. Senator Carr was rightly derided in Papua New Guinea for his amateurism.

As the recent political crisis in PNG has shown us, it is essential that Australia's political leaders, particularly the foreign minister, maintain the closest working relations with our colleagues in Port Moresby. This can only be achieved through close and consistent contact at the highest level. It was unfortunate that the foreign minister could not attend, nor send any representative of the government to be the keynote speaker, the annual Australia-Papua New Guinea Business Council forum in Brisbane last week. This was attended by former Prime Minister and cabinet minister Sir Mekere Morauta, and I was honoured to step into the vacuum left by the government and deliver the keynote address on behalf of Australia.

Last year's strategic direction statement also highlighted the government's intention to pursue a range of free trade agreements with countries in the region. Yet since the member for Rankin became Minister for Trade Australia has dropped the ball on free trade agreements. The minister is personally disinterested in pursuing them and he has even gone so far as to state that a free trade agreement with China is 'overrated'. If Australia is to benefit from the growth in Asia's middle class and consumer class, strong leadership at a government level is needed.

Given the scandals surrounding the government's handling of the Australia Network tender process, it is little wonder there is no mention of Australia's public diplomacy effort in the strategic direction statement. Nothing better captures the incompetence and base student-politicking this government has brought to the national stage than its involvement in what should have been a fair and transparent tender process. As the Australian National Audit Office stated:

The manner and circumstances in which this high profile tender process was conducted brought into question the Government’s ability to deliver such a sensitive process fairly and effectively.

In response to the ANAO report, the Australia Network Channel took aim at the government, stating:

The Australia Network tenders represent a failure of public administration and highlight the potential risk to a commercial organisation of engaging in business with the Commonwealth, particularly when a government owned entity is the competitor.

The costs involved with taking the tender to market, only to scrap the process when the result could not be changed to suit the government's preference, are considerable.

Given Labor's failings in the Foreign Affairs and Trade portfolio in the past 12 months, the Australian people can have no confidence that the coming year will be any different. What Australia needs is a foreign minister capable of working patiently behind the scenes, not a dinner party conversationalist who blunders from one mistake to another. Rather than address Labor's woes, Senator Carr's arrival in Canberra has only added to them.

From his repeated mistakes about troop levels in Afghanistan, to his embrace of the Taliban as part of the Afghani government, to Papua New Guinea and reports of his strange behaviour in Fiji, he has shown himself to be a liability rather than an asset to the government. His return has been compared to a reserve-grade footballer coming out of retirement to play first grade. So far his record contains nothing to disprove this assertion. The time has come to put an end to this charade and give the people of Australia a chance to rid themselves of this chaotic mess of a government.