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Thursday, 4 February 2010
Page: 535

Senator KROGER (4:31 PM) —At the request of Senator Parry, I move:

That the Senate notes the substantial increases in cost of living pressures on ordinary Australian families under the Rudd Labor Government.

The substantial increase in cost of living pressures on everyday Australian families is directly related to the ineffective decision-making of the Rudd Labor government. Australian families are feeling the pinch like never before. Amidst the increasing pressure on mothers and fathers to make ends meet, the Rudd Labor government continues to waste taxpayer money. Ironically, Kevin Rudd came to power claiming to be an economic conservative—just one of his many political manifestations—but in just over two years he has racked up billions of dollars in debt, most of it with borrowed money and much of it wasted. This is after he has irresponsibly spent the $96 billion surplus gifted to him by the former Howard government in the blink of an eye.

In breaking one of its election promises, the Rudd government has hit the jackpot, awarding an extraordinary $1 billion in consultancy contracts since coming to power in November 2007. Kevin Rudd and his fellow so-called ‘economic conservatives’ have now awarded over 8,400 consultancy contracts worth over $1 billion, despite pre-election promises to cut spending on consultants by $400 million by 2009-10.

So what do we have to show for this? Sadly, not too much. Nothing but government by review, talkfests and a failure to make the hard decisions! The Australian Financial Review reported on the 12 January this year that record spending on legal fees by the Rudd Labor government may be worse than actually first thought. Spending on lawyers in 2007-08 rose by $100 million to $510 million and again to $555 million in 2008-09. This is despite the pre-election promise to cut spending by $15 million per year after the first budget.

Just yesterday in this place, an ANAO report was tabled, revealing that this government wasted $17 million on a failed National Broadband Network proposal. The Age reports today that Minister Conroy received repeated warnings from his department to abort the proposal. By the time Minister Conroy responded, $17 million had been spent and wasted. The Age today reports that this proposal:

… points to a minister so determined to fulfil the government's $4.7 billion election promise that he dismissed advice throughout 2008 to slow down the process determining which private company would be selected to build the network.

Labor has now committed taxpayers to a $43 billion broadband project without even a business plan. Even the smallest business operator could advise him to be more careful and cautious in determining the investment of money for future return.

Prime Minister Rudd does not govern by making the tough decisions needed to govern Australia, but governs by review. Under this government we have seen more than 170 reviews instigated at taxpayer expense. That equates to one review every 4.6 days of being in office, an achievement that, I hate to say, only a Labor government could be proud of, that has ensured that Labor’s wasteful spending is now systemic.

After two years in government, what have we seen: GROCERYchoice, $8 million; broadband, a $43 billion rollout without a business plan; consultancies, $1 billion in contracts in just two years; the education stimulus with a $1.7 billion blowout; pink batts, $200 million wasted; laptops in schools, another blowout, $800 million; the tax bonus—$46.6 million, where some of that money was directed to overseas Australians, that saw the economies of other countries boosted. Kevin Rudd has followed the historical precedence of so many other Labor governments and is squandering the hard-earned cash of Australian people.

In December last year he refused to disclose the cost of taking 114 people to Copenhagen. But it has been well and comprehensively tabled in this place just what the cost of that has been. The total bill was $1,429,707—it is a mouthful to even get out! It is a staggering amount for three pages of a non-binding agreement.

The Rudd government’s ETS is magic-pudding economics because it relies on driving up the price of electricity to drive down people’s consumption. The scheme does not provide a single dollar for direct action, yet it will cost every Australian household $1,100. To date we have heard nothing from Prime Minister Rudd nor Minister Wong about the real cost of the ETS to Australian families. I would even suggest that they probably do not know that themselves.

It was interesting to read the transcript of the Prime Minister’s interview on the Today program on Tuesday this week. May I suggest that the interview demonstrates just how out of touch this Prime Minister is. With the indulgence of the Senate I would like to quote a couple of things that were said. The anchor, Karl Stefanovic, said:

Okay, see there seems to be some confusion here, a lot of confusion over just how much goods will increase. Can I use this as a basic example—can I ask you this question? How much for example will the price of bread increase under your ETS?

The Prime Minister in response:

Well, if you look at the way in which the Consumer Price Index is calculated Karl, it takes together the whole basket of goods. What’s a loaf of bread at the moment—$2.40.


PM: No, $2.40 at the no brand level, up to $4, $4.80 for some of the better brands.

I have to say he obviously does not shop in the supermarket that I have near my electorate office in Deakin. He continued:

That’s the range, approximately. So you apply the increase in the cost of living to that as part of an overall basket, you will see an increase.

STEFANOVIC: But do you know how much?

PM: Well, Karl, I don’t run every bread manufacturing outfit in the country. That is the bottom line …

To me, this is typical of the Rudd-speak that we hear all the time. He does not ever directly address the question and answer with a clear, distinct response so that everybody can understand what he is talking about. The interview went on to petrol, with Karl Stefanovic asking how much petrol will go up, but I have to say that if the implication of what the Prime Minister was saying was not so tragic it would actually be quite funny.

There is a lot of pressure on family budgets. In the lead-up to the last election Mr Rudd suggested that running the economy would be reasonably easy. He has discovered that it is not easy at all, and he has not delivered to the Australian people the prosperity that they have every right to expect. According to a survey commissioned by Hanover, a Melbourne based agency for the homeless, a large number of Australians remain concerned that they will not be able to meet housing and living costs. The survey, of more than 1,000 Australians, showed that close to 85 per cent of people worry about meeting general living costs and a further 70 per cent were particularly concerned about the cost of housing.

We had three interest rate rises in the last three months of last year. There is no doubt that the Rudd government’s refusal to pull back on its spending is putting upward pressure on interest rates. Rising interest rates will cause more pain for all Australians who are facing higher costs as a result of the government’s failure to deliver on its promise to lower the cost of living for working families. Figures released by the ABS on 27 January this year clearly show that the cost of living for Australian working families is on the rise, and dramatically at that.

The consumer price index shows that home-grown inflation is rising fast. Over the year to December 2009, education costs rose by 5.6 per cent, housing costs rose by 5.5 per cent and health costs increased by 4.7 per cent. This is despite the promise that the Rudd government would ‘assist working families’ dealing with all these concerns but, in particular, with the housing affordability crisis. Over 2009, the increases have included: electricity prices up 15.7 per cent, water and sewerage up 14.1 per cent, gas up nine per cent, and pre-school and primary education up 7.5 per cent. We saw in the paper a couple of weeks ago that at a primary school in Victoria the parents were being asked to pitch in to help pay for the maintenance of the toilets. There is a lot of stress on the system at the moment. Another example of increases is motoring fees—charges have gone up six per cent. In 2007 Mr Rudd pledged to Australians that he would do something about household costs. Over the last 12 months alone, we have seen the inflationary pressures in all these areas. Public transport is up by 4.5 per cent. Hospital costs are up 6 per cent. It amounts to a massive burden on Australian families.

In November 2009, Fujitsu Australia and New Zealand released its Mortgage Stress-O-Meter monthly update which found that housing affordability and mortgage repayments leave people under increased levels of stress. I mentioned the electorate of Deakin before. I shall return to it because it is an electorate which one would consider on all measures to represent heartland middle-class Australia. It is certainly not home to any millionaire’s row. Yet last week we saw, in figures for two of the biggest suburbs in the electorate, that Burwood has become the epicentre of the housing boom. So here is heartland middle-class Australia suffering a huge housing boom. In Burwood alone the average house price has increased 23.1 per cent, with the median house price $810,000. In Ringwood there has been a 16.2 per cent increase in the average house price. These are huge prices and huge inflationary pressures. I feel very sorry for those young family householders who are seeking to enter the property market and have to come up with essentially half a million dollars to even consider being able to enter that market. The report went on to say that house prices will rise by up to eight per cent over the next 12 months and suggested that this further stress on affordability for many will continue.

Just last week the Prime Minister was once again exposed as being all talk and no action on putting downward pressure on the cost of living through childcare fees. Revelations indicated that they will rise by up to $200 per week. Media reports revealed how the Rudd government changes to childcare standards will see parents slugged up to $40 extra a day, with 42 per cent of metropolitan centres and 79 per cent of regional childcare centres admitting they would be forced to increase charges.

It is interesting to note that with all these inflationary pressures there is no assurance for Australian families as to what they can expect over the next 12 months. If they reflect on the last 12 months, in the proverbial shopping basket the cost of cheese has gone up by 9.9 per cent, bread by 11.2 per cent, meat and seafood by 7.2 per cent, fruit by 8.6 per cent, and tea and coffee by 8.2 per cent. Critically though, the cost of primary education has risen by over 11 per cent and the cost of secondary education by close to 15 per cent. The Prime Minister promised to keep a lid on the cost of living. This broken promise is one all Australians are paying for every day.