Senator GEORGE CAMPBELL (3:12 PM) —A number of alarming things have come out of the budget that was handed down by the Howard government last night. The first issue is the creative accounting that has delivered a phoney surplus in this budget. My colleague Senator Cook has already gone to that issue. Once again, it demonstrates the tricky nature of the way in which this government attempts to deceive or deal with the Australian public. The second issue that is transparent when you look at the budget handed down last night is the impact that the GST has had on the economy and the inaccuracy of the MYEFO forecasts that are now there for everyone to see. We have seen the slump in housing investment, in retail investment and in household consumption, and dwelling and nondwelling construction have all been GST reduced. But the MYEFO forecasts for the introduction of the GST were hopelessly inaccurate and have now been revised to show the full effect. On top of that, economic growth has fallen; it was negative in the last quarter. Domestic demand is down, employment growth has plummeted and new capital expenditure is down by five per cent.

The third issue is that we have a government that is running scared of the electorate and has used the budget—as Senator Cook said, a political budget—to try to buy votes in order to hang on to office. It is a budget that has no vision for the future of this country. It is a budget that is not about laying a foundation for the future economic wellbeing of this country. It is a budget that has simply targeted its impact over the next two or three months to give this government the best chance of clinging on to office, which is pretty tenuous for it at the current point in time. The reality is that—despite what is said by Mr Costello, the Prime Minister and other people on the other side of this chamber—this government is the biggest taxing government in the history of this country. If you look at the figures in the budget, taxes will increase by 7.8 per cent for the year 2001-02, by 11.9 per cent for 2002-03 and by 12.2 per cent for 2003-04.

The fourth issue is innovation. The government released a statement in January entitled Backing Australia's Ability, in which they targeted $2.9 billion at innovation. What they did not say when they introduced that package was that they had already taken $5 billion out of the economy over the previous five years. So, despite that package, there was a net loss to innovative programs and our economy of something like $2.1 billion over the time of this government.

Let us look at what happened in the area of research and development. The government introduced an R&D package in January. It has not even got up and running, and it has already cut the funding. It has cut the funding in the R&D START program by $38 million. This is a government that says it is committed to research and development and to innovation, yet it has cut the funding that it committed in January before the program has even got up and running. The government's net outlay on the R&D premium is a total of $5 million. The government's position in respect of these issues is an absolute disgrace.

There is a minister in this parliament who does not understand his portfolio, does not care about his portfolio and does not care about the development of industry in this country—the current Minister for Industry, Science and Resources, Senator Minchin. He has done nothing to drive innovation since he has held that portfolio. He does not understand the issues, he does not care about the issues, he does not understand what is needed in terms of getting our industries up and running, and that is very obvious from the outcomes for research and development in this budget. (Time expired)