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Wednesday, 1 April 1987
Page: 1608


Senator CHANEY (Leader of the Opposition) (3.13) I move:

That, in the opinion of the Senate, the following is a matter of urgency:

The need for the Government to reverse the policies which have severely reduced family living standards.

At a time when the Government is determined to concentrate on nothing more than the identity card, the farcical nature of which is being demonstrated in debate over current days in the Senate, I think that there are many more problems which are concerning the people of Australia, and none more than the increasing pressure which is being felt by the families of Australia. I am not vaguely surprised that the Government is trotting up the Special Minister of State, Senator Tate, to defend its record in this area. He has the distinction of being a bachelor, and I would say that only a bachelor would have the cheek to come into the Senate and suggest that families are not under immense pressure in Australia today.

I just want to take some little time to say to the Senate that it is the view of the Opposition that the pressure which Australian families are feeling at the moment is very much the fault of this Government. At the moment we have the spectacle of the Government trying to blame everybody else for the difficulties that are being faced by its constituency. The Opposition is raising the plight of families again because we see families as being vital to the future of this country. We see the preservation of families as being a central duty of the Government, and we see this as a matter of central political interest. It is not, of course, a matter about which it is peculiar to political parties to express this sort of concern. The United Nations, in its Universal Declaration of Human Rights, declared that:

The family is the natural and fundamental group unit of society and is entitled to protection by society and the State . . . motherhood and childhood are entitled to special care and assistance.

Those sorts of comments, which are echoed by many people in Australia, including the churches and many social welfare organisations, do reflect the view of this Opposition, and we believe that the Government is simply not living up to its responsibilities. The fact that families are central to the concerns of Australians-indeed, I have no doubt they are central to the concerns of Senator Tate, who has expressed at a personal level an interest in the welfare of our community-is demonstrated by the fact that 98 per cent of Australians have been shown as believing that a happy family life is the most important thing in their lives.

Mr President, I would ask you to remember, when Labor was in opposition, the lectures that were read to the then Government by Senator Grimes and others, who suggested that one of the formulas for a happy family is a reasonable degree of financial security and reasonable protection from excessive financial pressure. It is in those circumstances that the economic plight in which families find themselves today assumes overwhelming importance.

This debate is taking place in an economic context in which the Government stands up every day in the Senate and says that Australians will have diminished living standards. Their living standards have diminished; they will diminish further. That is borne out by every current economic commentary, and it is an open admission from the Ministers of this Government. The Government points, of course, to the loss of value of our exports, what they call the fall in the terms of trade, to blame for that. So it is that we get a situation where there is much wringing of hands and much blaming of everybody else.

The fact of the matter is that in this worsening situation, which itself is the fault of the Government, we have the tragic circumstance that families are being asked to bear a more than proportionate share of the burden. They are paying a bigger share of taxation than they were paying when this Government came into power, and we have seen under this Government the loss of a whole series of rights and benefits which were available to assist people to meet their family responsibilities. We have seen under this Government, for example, no adjustment for inflation for family allowances, but rather the removal of family allowance from some categories of parents; in fact, those parents who have the care of student children in certain circumstances or who have an income above a certain level. We have seen the loss of tax deductions for education expenses. We have seen the loss of tax deductions for health insurance. We have seen a reduction in the right of parents to choose medical treatment; and, of course, we have seen the dreadful spectacle of 100,000 Australians waiting in queues for surgery. There are all these things which are Government caused and which impact on the economic and social welfare of families in our community.

The first element of this debate which is brought forward by the Opposition is to say that this diminishing circumstance of families is first and foremost a responsibility of Government; that it is the Government itself which by its policies has produced this squeeze on the whole Australian community and on families in particular. In the course of this debate I will deal with the first Government alibi. Do honourable senators remember the alibi that it is just the fall in the value of our exports that lies at the heart of our difficulties? Looking at this peculiar animal that seems to have suddenly appeared on the political scene-this loss of our terms of trade, this diminution of the value of our exports-I think it would surprise most Australians to know that our terms of trade have been going against us since 1951. During the whole period of the Fraser Government, in every year but one, the terms of trade moved against Australia. Indeed, in one year, in 1977-78, the terms of trade went against Australia by 9.1 per cent-very similar to the figure for the movement against Australia in the terms of trade last year. I do not remember Labor speakers getting up-nor do I remember Government speakers doing so-and blaming the situation in Australia on our diminishing terms of trade. I seem to remember that the Labor Party claimed that any difficulties that we then faced were caused by government policy, and I do not remember us trying to use the terms of trade as an excuse; indeed, we did not.

I will seek to incorporate in Hansard a table which shows the percentage change in the terms of trade in the period 1973-74 to 1985-86. That table shows that it has been a constant in Australian politics that the terms of trade have moved against us. There were two years-1978-79 and 1979-80-in which the terms of trade moved slightly in our favour, but in every other year of the Fraser Government they moved against us. In 1983-84, when this Government was in power, the terms of trade moved in our favour. So that alibi is nonsense. Of course, it is true that the terms of trade affect our economic management. Look at Japan, which has faced the most drastic destruction of its terms of trade, with the two oil shocks, and which now faces the shock of the appreciated yen, an exactly similar circumstance, and compare the way in which the Japanese are coping by managing their economy properly with the present moaning of this Government, which tries to blame everything on external circumstances. I seek leave to incorporate in Hansard this table, the source of which is the Australian Bureau of Statistics, showing the percentage change in our terms of trade over the period I mentioned.

Leave granted.

The table read as follows-

TERMS OF TRADE

1979-80=100

Year

Index

Percentage

Change

73-74...

121.95

na

74-75...

114.26

-6.3

75-76...

109.20

-4.4

76-77...

105.45

-3.4

77-78...

95.87

-9.1

78-79...

96.60

+0.8

79-80...

100.00

+3.5

80-81...

99.45

-0.6

81-82...

97.52

-1.9

82-83...

95.60

-1.9

83-84...

99.10

+3.7

84-85...

96.60

-2.5

85-86...

87.14

-9.8

Sept Qtr 86-87...

83.16

Dec Qtr 86-87...

80.30

Source: ABS GDP

Price Deflators


Senator CHANEY —I thank the Senate. So much for the move against us in the terms of trade, which does pose a problem of economic management. The question is: What is the remedy for Australia? What action should Australia be taking to try to protect the Australian people and Australian families against the destruction of our standard of living?


Senator Hill —Start by throwing this Government out.


Senator CHANEY —I welcome Senator Hill's interjection. The first thing to do is to throw out the Hawke Government, because it has shown itself to be totally incapable of facing up to the fact that its high spending Budgets and its subservience to the trade union movement completely distinguish our economy from those which have been successfully managed during this period of difficulty. Indeed, those economies which have been properly managed, those with a flexible labour market and with a lack of reliance on government expenditure, are booming in the current climate and are not suffering the sort of agonies that are being suffered in Australia. It is this Government's actions, the bringing in of the three highest spending Budgets in Australia's history, which have produced the terrible circumstances which now afflict us and which are causing such pain to the men and women of Australia.

The excessive expenditure by this Government and the resultant interest rate regime it has brought about mean that Australians are paying interest rates of 20 per cent or more on some transactions. The tax situation has moved steadily against individual taxpayers, and the Government is taking more and more of our national wealth in tax. Comparatively, our inflation rate is the worst in our history, and the state of our industrial relations is again worsening and undermining some of the Government's proudest so-called achievements, such as the steel plan. When we look at all those things, we can see that this Government has let the Australian people down in every respect.

This Government insists on trying to blame the previous Government and the terms of trade. Is it not amazing? This Government has now brought down four Budgets and, all of a sudden, it is saying that everything that is wrong is the fault of the previous Government. I remind honourable senators, in particular the Minister at the table, that in 1984, after the Labor Government had brought down its second Budget, it made it clear that it had solved Australia's problems. I quote what the Government said in 1984 about the state of our economy. As early as January 1984 Mr Hawke said:

. . . the basic promise I made in the election campaign of turning the Australian economy around.

Now manifestly, we've achieved that.

The economy had been turned around by January 1984. In March 1984 Mr Hawke said:

What we have done is to create the best climate for business investment that they will have seen for many years . . . they have created for them the best environment they have ever had.

That was Mr Hawke's description of the Australian economy a year after he had taken office. He was not complaining about the Fraser Government then because, of course, he had been piggy-backing on the Fraser Government wage pause. But by March 1984 Mr Hawke was claiming the best economic environment for investment that had ever been seen-the best climate for business. All of a sudden, we find that he can gracefully hurdle his successes of 1984 and blame Australia's current predicament on the actions of a previous government. That is manifestly absurd. Let us look yet again at what Mr Hawke was saying by the end of 1984 regarding a fall in interest rates:

I do not want to be precise as to amounts. What I can be certain about is that there will be a continued downward movement in interest rates.

In November 1984 he told a business audience:

The outlook for interest rates is as bright as it has been for more than a decade . . .

I think he must have been talking to people with savings, not people who had to borrow money. It is the savers who are getting interest on their money who have had the brightest prospects for decades; it has not been the men and women of Australia who are trying to buy a house or consumer goods, or run a farm or a small business. I see Senator Brownhill sitting in the chamber. He knows that many of his rural constituents are being forced off the land. The rural constituents of us all are being forced off the land by the interest rate regime which has been brought about as a conscious act of policy by this Government.

I am sure that Opposition senators who will speak later in this debate will concentrate on the direct impact of these policies on Australian families and the perilous position in which Australian families find themselves today. I am anxious to lay the canard that this Government can in some mysterious way escape responsibility for the extraordinary hardship which is being inflicted on Australian families by the reductions in their after-tax incomes, by the high interest rates they are paying on their housing loans, and by the other disabilities which have been inflicted on them in the current economic decline. It is pointed out in the Organisation for Economic Co-operation and Development report which came out today that the changes which are required in Australia are precisely the changes which have been urged upon the Government by this Opposition over recent years. There is no excuse for the Government, and it must change its policies if the pressures on families are to be relieved.

I turn to what the actual impact of this Government's mismanagement has been on the families of Australia. When one looks at the tax position, for example, one finds that even after the Government has delivered further tax cuts on 1 July Australian families will be paying a bigger proportion of their income in tax than they were when Labor came to office. In March 1983 a single income family in receipt of average weekly earnings was paying 17.5 per cent of their income in tax. What is the position after the great Keating tax cuts? I can tell the Senate that the position is that, after the great Keating tax cuts, they will be paying 20.5 per cent of their average weekly earnings in tax. We find that the weekly disposable income of an Australian family at that level has declined by $31 a week since the election of the Hawke Government in March 1983.

Look at the things on which they have to spend their money. Look at the price of petrol. Petrol is a pretty important budget item for most Australian families. Mr Hawke was going to reduce the price of petrol by 3c a litre. When he came to office petrol was 44c a litre. That was the average price for the first three months of 1983. The average price of petrol for the last three months of 1986 was 55c-an 11c a litre increase from a government that promised to reduce the price of petrol. We find that the cost of the car in which one puts the petrol has gone up. The price of a Laser has gone up by 53 per cent, a Holden Commodore by 42 per cent and a Falcon by 33 per cent. These basic accoutrements of suburban family life in Australia are being priced beyond the capacity of people to buy them.

In regard to those Australians who use Bankcard-and that is a substantial proportion of Australian families-the rate of interest that they pay has risen from 18 per cent to 22 per cent. If they are home buyers-and a diminishing proportion of Australian families can afford to be home buyers-the percentage of their family income spent on home mortgage repayments increased from 21.6 per cent in March 1986 to 26.7 per cent in September 1986. In other words, the interest payments for an average Australian family have gone up by nearly 25 per cent. If one looks at the actual figures paid by people in each State, one sees increases of several hundred dollars per month in most States. These are the facts which are causing anger in electorates and in suburbs around Australia. Most importantly, these are the facts which are making the meeting of one's family responsibilities steadily more difficult in Australia today. Let us look at the family that wants to insure for private health cover. For a family on average weekly earnings, that cost $9.66 before Medicare; it has gone to $14.30 at the end of 1986, an increase of almost 50 per cent.


Senator Brownhill —Socialist progress.


Senator CHANEY —Social progress. Is it not the classic socialist approach to assisting the needy? This Government came in after grossly criticising the health care system, it took over the system, introduced its own system and the result is that 100,000 people are waiting in queues for operations. They cannot get into hospital to have an operation because this Government has so distorted the delivery of health care that the system cannot cope. I do not think people have got sicker, although I have to say that the Government makes me sick from time to time, and perhaps I am being too charitable to the Government. The reality is that, as in welfare housing, there are grossly extended queues since the Government came to power, more money, more socialism, more government intervention, longer queues--


Senator Hill —More bureaucracy.


Senator CHANEY —More bureaucracy. I am getting a great deal of assistance from Senator Hill on this matter and from my colleague Senator Newman.


Senator Newman —Would they go to an election with that record?


Senator CHANEY —We can only hope that the Government will go to an election and display its record, because the people of Australia are fed up with the fact that there are those great queues, that there are those deficiencies, and that many families are cracking under the pressures that are being imposed upon them by this Government. I suppose that there are people who are not in families who would ask why the Opposition should put so much emphasis on the family as against those who for some period of their lives are living by themselves and not involved in a family.


Senator Tate —Like Senator Tate.


Senator CHANEY —Like Senator Tate. Why should we be more concerned about families than others? Let me refer to some of the research that this Government has done to explain why that additional concern is required. The Government social security review paper on family payments has calculated the effects on family income of the dependent spouse rebate and family allowance and has looked at the comparative costs of families with dependants and people without dependants. What is pointed out under what are called the equivalent scales is that a couple with no children is calculated to be 15 per cent better off than a couple on the same income with one child and 25 per cent better off than a couple on the same income with two children. The Opposition makes no apology for saying that it believes that it is essential that we have a tax system which contains a clear bias in favour of a family with dependants, because we believe that those people carry a very heavy additional burden and that that burden deserves some recognition. The reality is that in economic management this Government has failed the family. It has put enormous pressures on families because of increased taxes, increased interest rates and all the other curses that it has brought upon the Australian community, such as increased youth unemployment.

Many things can be laid at the door of the Government, but the unforgivable thing is that in those areas which are simply and directly within the control of the Government, in the shaping of the tax system and our social welfare system, it has ensured that the burdens borne by families with dependants have got heavier rather than lighter. We have seen the family allowance and supporting spouse tax allowance lose value under this Government. At a time of generally increased taxation, the result of that means that people who are doing their duty, whether by their spouse or by their children, are continually being put down. In my view, this Government will be long remembered for its decimation of Australian families.