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Friday, 22 June 2012
Page: 4224

Senator FIFIELD (VictoriaManager of Opposition Business in the Senate) (10:30): As I start the debate on these appropriation bills I should acknowledge the circumstances in which we find ourselves now, and that is that the previous bill, the Social Security Amendment (Supporting Australian Victims of Terrorism Overseas) Bill, was guillotined. I know that Senator Edwards was particularly keen to speak on that bill but he was denied that opportunity by the guillotine. It is appropriate at both the start and the end of debates, and indeed during every contribution, on each bill over the remainder of today and next week that we recognise the opportunity that has been denied to senators to talk to legislation that is important to their constituents. It is important to acknowledge that up front.

Appropriation Bill (No. 5) and Appropriation Bill (No. 6) 2011-12 seek appropriations totalling some $390 million. The key measures for which funding is sought by these bills are $112.6 million to the Department of FaHCSIA for the Family Support Program; $44.1 million to the Department of Health and Ageing for increasing payments in 2011-12 for primary care financing and for rural health services; $34.7 million to the Department of Broadband, Communications and the Digital Economy to assist commercial and national broadcasters to vacate digital dividend spectrum; and $43.7 million to the Department of Regional Australia, Local Government, Arts and Sport to fund a range of sports and grants that have been announced for things such as the Western Sydney football stadium and the Jim Stynes Achievement Scholarships.

I can remember when $390 million used to be real money. When we see numbers of this sort, although they may be for good purposes, we should always recognise that this money has come from taxing Australian citizens; that it is not our money—it is not the government's money and it is not the parliament's money—and we should always take a moment to reflect on that as we appropriate. As I was reading through the departments for which money has been appropriated, many of which have very long titles, I get a little bit nostalgic for the days when Commonwealth departments had simple titles like the department of health or the department of transport—it is just a personal preference and I look forward to a time when we have departments that have shorter, more straightforward titles.

In looking at these appropriation bills for 2011-12 it is relevant to consider the overall budgetary context, including the budget that has just been delivered. The government, in our view—and you may disagree, Madam Acting Deputy President—has resorted, in the budget that has just passed, to accounting tricks, money shuffles, the purpose of which was to manufacture a wafer-thin budget surplus, or what I like to call a 'technical' budget surplus, because it is not a real budget surplus; it is a manufactured budget surplus. We might call it dodgy; you might not, but it is a case of shuffling the cards to create the illusion of a budget surplus.

One thing that strikes us as particularly curious, if the government really believes in this budget surplus—which is not really a surplus at this stage; it is just a forecast of a surplus—is why the government is moving to increase the Commonwealth debt limit from $250 billion to $300 billion. That just strikes us, in passing, as ever so slightly curious—that the government might lack faith in its own budget forecasts. And there is good reason for the government to lack faith in those budget forecasts of a budget surplus, because this government has yet to deliver a single budget surplus. Budget surpluses on budget night are really wishes, hopes and prayers. They have yet to amount to anything more than that.

The Treasurer did not mention in the budget night speech his intention to increase the Commonwealth debt limit. I can understand that, because he would be a little embarrassed. It would be betraying a lack of confidence in his own ability to follow through and actually deliver that forecast budget surplus. At one level I can understand him not mentioning that, but it does remind me a little bit of that famous budget night speech.

I am sure you know, Madam Acting Deputy President, that journalists around Australia, budget aficionados and those of us in the opposition sit there on budget night waiting to hear what the forecast figure is for the budget bottom line. Will it be a surplus? Will it be a deficit? What size will it be? Indeed, that very number is the main reason for all of the budget lock-up. All of the budget security is because that budget bottom-line figure is market sensitive.

I remember well that famous budget night where the Treasurer, Mr Swan, did not ever actually mention what the budget bottom line was in his budget speech. He did not actually mention the size of the budget deficit. I went back at that time through budget speech after budget speech, and it was the first time that a Commonwealth Treasurer had not mentioned the actual budget bottom line, so ashamed was Mr Swan of the budget deficit forecast that he was delivering.

When Mr Swan—going back to the budget just passed—was asked why he needed to lift the debt limit if he was returning the budget to surplus, he replied, 'Well, very simply, this is no big deal.' It might not be a big deal to him, but I can tell you that it is a big deal to the taxpayers who would have to fork out additional taxation to service the borrowing requirement of the budget going even further into deficit.

This government has done one good thing, I have to say, in relation to budget accountability. I know we are often critical of the government in relation to budget management, but it has done one very good thing—that is, it has made it much easier to identify deficit budgets and to identify surplus budgets and to tell one from the other. You would be well aware of the excellent economic record of Treasurer Costello, who delivered 10 budget surpluses. When Mr Costello was the Treasurer, the budget papers were white. Budget one was in surplus; two, surplus; three, surplus; four, surplus; five, surplus; six, surplus; seven, surplus; eight, surplus; nine, surplus; and 10, surplus—and you will notice that they are all in white covers.

The Swan budgets are all in deficit, and, very kindly, Mr Swan changed the colour of his budgets so that we could identify very easily the budgets which were in surplus. Whenever you see a white cover, it is safe to assume a surplus budget; whenever you see a blue cover, it is safe to assume a deficit budget. So here we have one deficit budget, two deficit budgets, three deficit budgets, four deficit budgets. We have a forecast budget surplus for this financial year—but, then again, we had a forecast budget surplus in Mr Swan's first budget speech. I think the budget for 2012-13 will end up being as much a work of fiction as the preceding four budgets. That is my prediction. We will see if I am correct; I suspect I will be. But, again, I think it is useful for all of us to observe that surplus budgets are in white and deficit budgets are in blue.

We find ourselves in the situation whereby this government has delivered cumulative record deficits of $174 billion. It is not, as this government says, because of revenue write-downs. We hear all the time that the budget has deteriorated fundamentally because of revenue write-downs. But if you look at the reason this budget will eventually go into deficit and the previous budgets were in deficit, it is overwhelmingly as a direct result of policy decisions by government. By 'policy decisions' I mean decisions to spend more money. That is the reason this government has delivered consecutive budget deficits, that it has cumulative deficits of $174 billion. It is not because of revenue write-downs; it is because of policy decisions by the government.

The government needs to be honest about that, it needs to be upfront about that. Whenever it talks about the revenue write-downs, it seeks to leave the impression in the minds of the Australian public that the budget is in surplus simply because of circumstances beyond this government's control—that it is a cruel world out there, that there are storm clouds on the horizon that have caused reduced business and consumer confidence and that therefore revenues are down and that—gee, shucks—therefore the budget is in deficit. It is not true. Yes, there are some storm clouds on the horizon. Yes, consumer and business confidence is down. But that is not the reason this government has delivered successive budget deficits. It is because of spending decisions by this government. The ultimate example of that was this government's stimulus package—this government's program to respond to the global financial crisis.

Senator Sterle interjecting

Senator FIFIELD: I heard Senator Sterle say that the Howard government never had a global financial crisis. We did not have a global financial crisis, but we had an Asian financial crisis. And let me let this government in on a secret: Australia is much more directly enmeshed in the Asian region than it is with the United States and than it is with the United Kingdom.

Government senators interjecting

The ACTING DEPUTY PRESIDENT ( Senator Moore ): Will senators on the right please stop shouting across the chamber.

Senator FIFIELD: So, despite the fact that during the Asian financial crisis our region was not growing, Australia continued to grow. When I hear from the other side that we had it easy when we were in government—that we had no challenges—I say that the Asian financial crisis was a big challenge. Our region was not growing, and we continued to grow. One of the reasons we continued to grow was that the Australian people had confidence that the government of the day knew what it was doing. The Australian people had confidence that if there were external shocks, external challenges, we would make the right call. One of the reasons business confidence and consumer confidence have taken a hit under this government is that the Australian people have lost faith in this government to make the right calls when there is a challenge.

With the global financial crisis, the Australian people know that the government made the wrong call when it came to massive spending on school halls. They know the government made the wrong call when it came to massive spending on pink batts. And they know that e reason we did not go into recession was not due to those spending measures. It was because of demand from China for our mineral resources. It was because the Reserve Bank cut interest rates. It was because we had a floating exchange rate. They are the reasons we came through the global financial crisis. Also, we had the world's best prudential regulatory environment, courtesy of Mr Costello's reforms. That is why we survived the global financial crisis in relatively good nick. When looking at these appropriation bills we must look at why we are in the situation that we find ourselves in today. The reason is the policy decisions made by this government. This government acts as though it is just a victim of circumstance: it is a bad world out there, things happen that are beyond our control—gee, shucks, revenue is right down and we cannot balance the budget. That is not true; it is because of policy decisions. The important thing with this government, and indeed with all governments, is to look not at what the government says but at what it does—to look at the policy decisions it makes.

One of the reasons I find myself becoming increasingly frustrated in my disability portfolio is that when you look at the forecast debt interest costs for the next financial year, you see that they are $7 billion a year. Debt interest of $7 billion a year represents an opportunity forgone. Every one of those seven billion dollars is going towards absolutely nothing. They are going to fund not a single school, not a single hospital, not a single supported accommodation place and not a single port; those dollars are going to support absolutely nothing. If this government had managed its affairs better, if it had lived within its means, there would have been enough money today to fully fund a National Disability Insurance Scheme. The additional ask for an NDIS is $7½ billion; $7 billion to $8 billion will be the annual interest bill for this government. It represents an opportunity forgone. It is frustrating, and it is tempting to say, 'It does not really matter if the government goes into debt.' It does matter, because that debt has to be repaid, with interest, and those dollars represent an opportunity forgone. That is why I want to see government live within its means. That is why I want to seek government not go into debt unnecessarily. Debt compromises the ability of governments to do the things they need to do, such as implement an NDIS. I suspect that is part of the reason why this government allocated only $1 billion for the NDIS over the forward estimates rather than the $3.9 billion recommended by the Productivity Commission.

I will leave it there, because time is short. We know that the guillotine is going to come down and I know that Senator Brandis is champing at the bit to make a contribution.