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Thursday, 2 June 1994
Page: 1221

Senator MARGETTS (4.14 p.m.) —The Labor government has indeed presided over a widening gap between rich and poor. It is ironic, however, that this motion comes from the opposition, since its policies are so similar to those of its economic fundamentalist colleagues from the ALP. Policies include cutting public spending, privatisation, corporatisation and introduction of user-pays funding wherever possible, particularly with respect to services for the general public. Opposition members claim, however, that the concept of making the wealthy or corporations pay would interfere with corporate profitability and would not encourage investment or economic growth.

  The government has also followed policies of deregulation of industry and trade, which has led to a situation where the nation is increasingly dependent on transnational corporations, and consequently the government has very little scope to influence the fundamental factors of the economy, except through the offer of yet more incentives for overseas corporations so they will come here instead of finding somewhere else to exploit. While this motion decries the creation of a permanent underclass, I feel the issue is more appropriately the growing concern in the community that the maintenance of an economic fundamentalist approach to public policy has patently created this gap between rich and poor.

  The consequence of pursuing that economic philosophy is not unexpected. Companies have shown huge profits and little or no responsibility. That lack of responsibility or concern for this nation is evident in their continual reminder that they can always go somewhere else and will do so if investment attraction is greater. An example of industry attitude can be found in an article on the front page of the West Australian of 20 May 1994. It stated in part:

Corporate Australia notched up pre-tax earnings of almost $6 billion in the March quarter—a 13% rise on the December quarter.

But big WA employers insisted that they must serve their shareholders first. They were not responsible for curing society's ills.

They pointed to the corporate bible, the Australian Corporations Law, which says nothing about helping unemployed people or the national interest.

  One of the basic ways government can promise good profits to the rich is by holding down costs. Two main costs government can control are taxes and labour costs. Reducing taxes, as governments have done, means cutting services and finding someone else to pay for what services we keep. Since the someone else is generally the ordinary people of the community and services cut are services used by that section, both changes have negative impacts on the public. To reduce labour costs will also impact on normal people. While real wages for wage earners declined, salaries for corporate executives skyrocketed. The rich get richer at the expense of the poor.

  The white paper has done nothing to address this situation. In fact, the government's recent initiatives will result only in a situation in which this nation develops a growing number of working poor. Many of these people will join the social security merry-go-round as they go from training schemes back on to the unemployment queue because there are no real jobs for them to go to.

  The basic strategy of both government and opposition is that to increase jobs it is necessary to increase profits for the rich so that they will have to come here to invest. To attract the rich we try to guarantee them certainty. This is a one-way agreement, since there is no reciprocal guarantee that the rich will invest in anything productive or contribute to the communities in which they operate. It is a formula for increasing the difference between rich and poor.

  The issue of this gulf is of concern. We have had clear evidence that the rich have gotten richer and they have done so even during the recession. The BRW rich 200 charts the incredible increase in wealth for the rich. Mr Packer's official wealth jumped 80 per cent to $5.5 billion. The Murdoch fortune increased by only 20 per cent to a figure of $5.5 billion. The combined increase in wealth in these top 200 was a staggering 30 per cent and reached a cumulative $36.7 billion.

  We know the government disputes the idea that people were actually worse off, although some memory of the last 12 years should provide ample intuitive evidence. I have obtained some interesting evidence from an unusual source—a report commissioned by the ACTU from the Social Policy Research Centre. This report, entitled Funding options for unemployment, industry and regional development confirms that indeed this gulf between rich and poor has grown. In section 1 of the report, which examines changes in income distribution between 1983 and 1993, the author, Phillip Raskall, states:

. . . in summary then all the available data indicates a dramatic increase in inequality over the decade from 1983 to 1993. The beneficiaries were the highest income earners and the losers in relative terms were low-to-middle income families . . .

In examining the reasons for this growing inequality, Mr Raskall states:

. . . the clear conclusion—

  The ACTING DEPUTY PRESIDENT (Senator Childs)—Order! Senator Margetts, your time has expired.

Senator MARGETTS —I seek leave to table this document.

  Leave granted.