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Wednesday, 9 May 2012
Page: 4351


Mr BUCHHOLZ (Wright) (16:55): I rise to add my contribution to the discussion on this matter of public importance—in particular, the failure of the government to properly manage the budget. This budget comes down to who you trust. As a nation, who do we best trust to run the economy? What we have been hearing is rhetoric from the government with reference to a delivered surplus or delivering a surplus. Guess what? The reality is, with reference to this delivered surplus, it is a budget with a forecast next year for a budget of $1.5 billion. They have not actually delivered a budget, but that is the rhetoric and the spin. The spin doctors of Labor are better than ours. They will have you believe, through some of the speakers, that they have actually delivered a budget. In the next couple of weeks we will get to see the effect of Labor's forecasting, with the real deficit they will produce.

I will take you back a little bit, to the 2010-11 MYEFO. In the next couple of weeks, the Labor government forecasted that they will be looking at a $12 billion deficit. In 2011-12, in the budget, they revised those figures to $22.6 billion. That was just 12 months ago. Then we had the MYEFO budget, six months ago, for the 2011-12 MYEFO. They revised their deficit figures again to $37 billion. Who knows what the deficit is going to look like? I would say it will be well in excess of $40 billion.

When you look at the government's capacity to accurately forecast a figure into the future, be it a surplus or whatever, you need to look at their credibility and track record of effectively being able to forecast. On those figures, when it comes to dealing with the deficit or potential surplus, they do not—they could not hit the side of a barn with a forecast. You will also hear the Labor government make the comment about having the fastest fiscal consolidation in history. With the four largest record deficits that this government has produced, I use the analogy that with the fiscal consolidation—for those of you who do not understand what it is, it is the capacity for a government to pay down debt—what you are going to see is similar to a contestant going on the Biggest Loser and whacking on 50 kilos before they go on the show, in order to rip it down a lot quicker.

The amount of spending that this government has undertaken, and which has left us with a massive debt, is going to assist the government when talking about its fiscal consolidation. But it comes back to trust. This budget is about trust. It is about whether or not the nation can trust this government. It is whether or not the people of my electorate can trust this government. It is the hardworking mums and dads who are suffering under the cost-of-living pressures. It is the business houses that are struggling under 26 new taxes. And the government says it is representing families and has given a budget for families. If you want to help families, get your hands out of their pockets—stop taxing them. There are 26 new taxes. This is unprecedented. Farmers are copping it as well, and I have a number of them in my electorate. Then the government goes on and asks us to trust them with their assumptions as to their forecast $1.5 billion surplus. When you make your assumptions on the top of a resources sector peak and commodity prices are starting to come off, you leave yourself vulnerable as a nation on trying to find the coin. If you go back and have a look at this government's track record, the way they will try to create the illusion of a surplus—which I really do not believe will happen—will be through a process of cooking the books.

But when it comes to trust, who can forget the Prime Minister of our nation, before the last election, staring down the barrel of a camera and saying, 'There will be no carbon tax under a government I lead'? Who can forget that? And when you are working out who you can trust, ask: can you trust this Prime Minister?

But do not let the Treasurer, who has put this budget up, get off scot-free, because within days of the Prime Minister making that comment, he was also asked about the carbon tax and his comment was:

We have made our position very clear. We have ruled it out.

So here you have a Treasurer, with a track record of not being able to be trusted, walking into this parliament, delivering a budget which talks about some hypothetical surplus in the future and trying to convince the nation that they are worth trusting. Well, I implore this nation to think very hard about who they trust when it comes to the management of the economy.

I want now to speak briefly about the off-book expenditure and the tricks that this government will use to try and create the illusion of a surplus. I will try to bring it back into a business context. One example of off-budget expenditure that the government are using is the NBN—around $36 billion—and another is the clean energy fund, which is about $10 billion—$2 billion a year over five years. So when you look at the way they are doing it, it would be the equivalent of someone in a family budget not eating—showing on their balance sheet that they did not eat for the whole year but that they bought a big wodge of groceries and stuck them in the pantry for the first half of the year and then saying that in the second half of the year they will go and do another grocery run. It is accounting trickery and it is deceit shown by this government.

The government talks about the cash rate and says that it was lower under Howard. I want to make the point as a business owner: I encourage Labor to go and talk to their businesses and go and talk to those people with mortgages. I would be surprised if you did not find out that no-one can borrow money at the cash rate. So while you make the point that the cash rate may have been lower under Howard, what we need to really focus on is the spread and what the variable rate is; and I can assure you that the variable rate under this government does not come anywhere near what we had it at under Howard.

As to spending ratio, as a percentage, to GDP instead of the tax to GDP: again, these are just tricks—

Mr Dreyfus: What—tax to GDP is a trick?

Mr BUCHHOLZ: No—spending as a ratio of percentage to the GDP instead of tax. The point I want to draw your attention to is your spending—spending to GDP.

The Assistant Treasurer recently made a comment on Sky that running the budget was not that dissimilar to running a household budget. With the full record deficits, could you imagine buying an $800,000 home, not making a payment on it for the first four years and then going in in the fifth year and saying, 'Listen, I would really like to service some of my debt, and I've got $2.60 to give you,' because basically that is what it comes back to as a percentage when you start looking at the $1.5 billion potential surplus that may eventuate in the future—to start drawing down some of these record deficits that this government is continuing to bash us around the head with.

I cannot lose the opportunity of speaking about the increase in the debt ceiling from $250 billion to $300 billion. Today we were advised in the House that, 'We just need to have a buffer.' Well, did we need to have a buffer when we took it from $150 billion to $200 billion? Did we need to have a buffer when we took it from $200 billion to $250 billion? But guess what? They are saying they are not going to draw down on that. They just need it there as a buffer. When you go and have a look at the budget forecast, they have actually taken a provision for the interest to service that debt into the future. In 2015 they are making provisions for the interest on that debt, which they try and tell you that they are not going to draw down on. Who can you trust? When it comes to this government, when will they learn that you cannot tax and legislate a nation into prosperity?

In closing, I just want to make a quick comment on the AAA credit rating. When Standard and Poor's and Moody's give credit rating assumptions for nations around the world, they give us a thing called a comparative rating. Why is it that, when we were in government and had money in the bank, and no debt, and now here we have a nation with unprecedented debt and very little capacity to service, with structural deficit—

Mr Dreyfus: This'll be good! You never got a AAA rating while you were in government!

The DEPUTY SPEAKER ( Ms Vamvakinou ): Order! The member will be heard in silence.

Mr BUCHHOLZ: With comparative credit rating, as other nations around the world soften, by default, Australia ends up with a AAA credit rating. It is unprecedented, unthinkable, that this government would blow their own horn to say that they are managing the economy when they are producing record deficits. I will make the point that they are structural deficits.

In closing, I would also make this point: electricity prices under this government are up 66 per cent since Labor was elected, gas prices are up 39 per cent, food prices are up 11 per cent, petrol prices are up 11 per cent, education and health costs are up 25 per cent. My message to the government is: get your hands out of the pockets of mums and dads; get your hands out of the pockets of businesses and let them flourish. (Time expired)

The DEPUTY SPEAKER: Order! The discussion is now concluded.