Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Current HansardDownload Current Hansard   

Previous Fragment    Next Fragment
Tuesday, 23 April 1985
Page: 1355

Senator CHANEY —My question, which is addressed to the Minister for Finance, follows the question asked by Senator Vanstone. I refer the Minister to Budget Paper No. 1 for the last two years. At page 257 of Budget Paper No. 1 for 1983-84 it was pointed out:

Decisions have been made to reduce expenditure by $1,214m on a range of programs inherited from the previous Government.

At page 273 of Budget Paper No. 1 for 1984-85 it is pointed out that the Government pruned the forward estimates by $1,315m. I ask the Minister: Does not this indicate that the much vaunted $1,000m cuts that the Prime Minister announced yesterday amount to something less than has been achieved by the same Government in each of the last two years and that, therefore, the announcement is scarcely relevant to the international concerns which exist about the Government's programs and that this is simply the puffing of the normal procedures of preparing a Budget?

Senator WALSH —I take it that the purpose of that question, consistent with the actions of the Liberal Party in February 1983, is to try to talk down the Australian dollar. The Opposition is again engaged in economic sabotage. Members of the Opposition are economic traitors practising economic sabotage. The present leader of the Liberal Party said in 1983 that if a Labor government were elected there would be a massive flight of capital from the country and the dollar would have to be devalued. There was a flight of capital from the country, as a result of which Australian taxpayers, through the Reserve Bank of Australia, lost hundreds of millions of dollars to international currency speculators. That was a result of the sabotage perpetrated by the present Leader of the Opposition. The dollar, of course, is now floating and Australian taxpayers cannot be robbed by foreign speculators, as they were in 1983. Nevertheless, some damage can be done to any country if a disloyal opposition insists on continuing to run a policy of economic sabotage. That is by way of introduction.

I do not know whether the figures quoted by Senator Chaney are correct because I do not have the two relevant Budget Papers here. However, I take it that the implication of his question is that the Government is obliged every year to make expenditure cuts of greater magnitude than it made the previous year. I do not regard that as a reasonable expectation of or a reasonable demand to be made upon any government. The further any government goes in exercising control over expenditure and reining in the irresponsible spending of its predecessor-in turning around the wild spending spree upon which Mr Fraser and Mr Howard embarked in their last year in government-the more difficult it becomes every year the exercise proceeds. Having shaved off, so Senator Chaney tells me, something in excess of $1 billion in the previous two years, I think any government which manages to take off a further $1 billion in the third year is practising an extremely disciplined approach to public expenditure. This Government is doing so.

Senator CHANEY —I ask a supplementary question. I refer to the document relating to the 1983-84 Budget and ask the Minister for Finance whether he acknowledges that in the same Budget the Government introduced new policies with increased outlays of $2.485 billion. In other words, instead of practising restraint, the Government increased expenditure by $2.485 billion. I ask him whether, in light of that fact, he will reconsider his answer about restraint being shown by the Government and admit that the Government's present budgetary problems are totally of its own making, its having increased expenditure to record levels in the last Budget.

Senator WALSH —There was a significant element of new policy in the 1983-84 Budget. I cannot say off the top of my head how much it was, but certainly there was a significant element of new policy in it and, therefore, of increased outlays attributable to that new policy. The reason for that is related to an answer I gave earlier; that is, the subterfuge employed by the Fraser-Howard Government when Mr Howard was Treasurer of concealing the true level of outlays by transferring them to tax expenditures, by substituting tax expenditures for Budget outlays. In that case, as I said earlier, that subterfuge had the additional advantage of sending the cost of that wild spending spree on to the next Government instead of the previous Government having to pick up the bill for it. That was a bonus as far as the previous Government was concerned.

A significant extent of our new policy spending in 1983-84 with a carry-over into 1984-85 was that this Government terminated many of the tax expenditures of the previous Government and converted them to Budget outlays. The first of the two biggest items-there were a number of others-was the conversion of the previous Government's taxation deduction for interest paid on housing loans into the first home owners assistance scheme, a scheme which was much more equitable and cost-effective because it was targeted on the marginal home buyer instead of being an across the board handout. The other major change was related to the introduction of the Medicare policy and the transfer of what had been a tax expenditure under the previous Government to a Budget outlay under this Government.