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Wednesday, 23 May 2018
Page: 4283


Ms BURNEY (Barton) (10:16): I follow the member for Calare, and I remind him that it was under Prime Minister Rudd that we avoided the global financial crisis because of the very measures that he was running down. When it comes to vulnerable Australians, I'm glad the minister is still in the chamber. I spoke to the member for Bruce yesterday, and, if anyone's attacking vulnerable Australians, it is the government. There is a gentleman in his electorate who is eligible for the age pension, and it's taken 12 months for that pension to be approved. So let's not be fooled by the member for Calare's comments.

I rise to support the amendment moved by the member for McMahon to the second reading motion of the Treasury Laws Amendment (Personal Income Tax Plan) Bill 2018, for the following reasons. What the Treasurer and the Prime Minister expect us to do in relation to this budget—of course, the hallmark of the budget being the company tax reduction and the Personal Income Tax Plan—is to take a leap of faith when it comes to these plans and to this budget. The expectation is unacceptable not only to the opposition but to the Australian public. Despite repeated questions to the Treasurer over the past few days in question time, the true costings are still unclear. The Treasurer refuses to provide those costings for 2018, 2022 and, particularly, 2024. The leap of faith I'm talking about is for the government to fully implement its proposed tax plan. We have to go through three election cycles before it can be fully implemented, and I think that is a mark of arrogance and a mark of, as I said, the leap of faith expected of the Australian people, who will be so affected by this.

Labor have said repeatedly we will support the government's measures to begin on 1 July this year—the component of this bill that is geared towards relieving low- and middle-income earners. We know, as the government knows, if we provide tax cuts to these groups of people, that the money will be spent and it will benefit the economy enormously. That is one of the main reasons that Labor have said that we will support the first tranche of the tax cuts, for 2018. But the stubbornness of the government and, in particular, the Treasurer, in refusing to split the bill so that we can support the first tranche of tax cuts to low- and middle-income earners, is just mind-boggling. I suspect that if The Australian newspaper is correct in what it has on its front page this morning then the tax plan is pretty much in tatters, and I suspect there's a fair bit of scrambling going on at the moment within the government. The intransigence of the government in not splitting the bill is really a slap in the face to those people that would benefit from tax cuts in 2018. The measures that I am speaking about in the bill are to introduce low- and middle-income tax offsets—a non-refundable tax offset of up to $530 per year for taxpayers earning up to $125,000—and to increase the threshold of the 32.5 per cent personal income tax bracket from $87,000 to $90,000. However, as I said, the government is refusing to split the bill. The reality is that the government is holding low- and middle-income earners hostage by sticking these cuts to cuts for high-income earners. We find that completely unacceptable. I suspect that the logic and the thinking of government members would find it unacceptable as well, but that is what has been hung around the government's neck.

According to the government, the total cost of those cuts would be $13 billion over the forward estimates and $140 billion over the medium term. We need more information on the rest of the proposal. As I've said, we've been asking the government to explain the numbers in parliament, and there is a ridiculous refusal to do so, and people are not going to find that acceptable. Last week the Australian Bureau of Statistics released its wages data, which completely threw into doubt the government's overly optimistic wage growth forecast and casts doubts over the government's budget forecast. The government is, as we know, married to its company tax cuts, and we know that that will benefit not the needy but the people and companies—some of them overseas companies and some of them banks—that need it the least.

Honestly, it is clear that in this budget the government is not only getting the proposals wrong but getting the narrative wrong too. Once again, a leap of faith is expected through to 2024. The nonsense of that to everyone is: who knows what the economic conditions will be globally in 2024? We are being asked to take that leap of faith and to assume that the global economic conditions will be favourable from now through to 2024, and there is no guarantee of that, of course. The government is locking in policy commitments that don't come into force for seven years, and that is unacceptable when we talk about the tax plans in the government's budget. The reality is that low- and middle-income earners are not the priority of this government. We understand that. This government is more preoccupied, as I said, with the company tax cuts.

Labor's plan will deliver larger and fairer tax cuts for 10 million working Australians, and we've made that very clear. With Labor, someone earning $80,000 a year will receive a tax cut of almost a thousand dollars a year. That's $398 better than the Liberals' policy. As has been articulated, a teacher on $65,000 will receive a tax cut of almost a thousand dollars a year. A couple earning $90,000 and $50,000 respectively will receive a tax cut close to $2,000 a year.

Labor will support the government's measures that begin on 1 July, as I've said, and a Shorten Labor government will deliver larger tax cuts from 1 July 2019. With Labor there are more substantial tax cuts than with the Liberals, and that means schools, hospitals and pensioners will be better off. Our plan—which is costed, I stress, by the independent Parliamentary Budget Office—will be $5.8 billion over the forward estimates. Labor can deliver larger tax cuts to low- and middle-income earners, and that is where, as we know, it will benefit the economy the most.

It is clear from the government's budget that it's priority is not low- and middle-income earners. The plan's studies have said that up to 20 per cent of income earners will see the largest percentage increase in their income tax cut. The government's plan will create a less progressive and more inequitable tax system, and that is surely not what this country needs. The government says it can afford an $80 billion tax cut for big business and a $17 billion handout to the banks, which is part of the $80 billion. Our argument is that that is not appropriate and that where that funding should go is to funding the things that people rely on—things like health, education and supporting people on pensions.

Of course, the government is also being seen to be cutting the energy supplement to pensioners by $14 a fortnight and forcing people to keep working until they're 70. I think the member for Solomon articulated that very well. That might sound fine for people who have jobs that aren't demanding on their bodies, but to expect a construction worker or a shearer to work to 70 is a nonsense. The government must surely realise that. The government has even placed a freeze on Medicare rebates for specialists. The truth is that this government simply does not get it and is out of touch, whether they argue the toss or not.

Under this government, the cost of living will increase. Workers in retail, food and accommodation industries stand to lose up to $77 a week. Families and pensioners are paying $20 a week more, or $1,000 a year, for private health insurance. We know childcare costs have increased dramatically. Also, the record cost to see a GP, particularly one who doesn't bulk-bill, is increasing. There is unemployment, and that is trending upwards, despite the government's rhetoric in relation to how many jobs have supposedly been created. We know that wage increases are not keeping up with inflation, and we know that very clearly. People out there in the community know that. People know that they are struggling to pay their bills, which are increasing while their wages are not. We also know that public sector wages grew by 0.5 per cent in the quarter and 2.3 per cent over the year. This is lower growth than in the last quarter.

I will finish in the next four or five minutes by summarising what I also wanted to put on the record. Despite the rhetoric from the government, real wages continue to stagnate and ordinary Australians—people out there whom we serve—continue to struggle to keep up with the ever-increasing costs of living. We only have to look at our power bills to understand that. Wages growth is barely above inflation, and we are hearing some horrific revelations from the royal commission into banking and financial services, yet the government persists with the nonsense of an $80 billion tax break to big business, and, as I have said, $17 billion of that will go to the banks.

I will finish up by pointing out that in Human Services, the portfolio that I have responsibility for, we are seeing the burden of balancing the budget placed on schools and hospitals and also on Australians who require income support. While the government has been dragged kicking and screaming to the royal commission, we are seeing the pursuit of innocent Australians for false and inflated Centrelink debts. I have said on numerous occasions that if there is fraudulent behaviour then, of course, any government has the right to pursue and recoup that money. But, in many cases—and we know that in the robo-debt debacle it was 20,000 cases—Australians were accused of owing Centrelink money when they in fact did not owe any money or owed much less than the debt articulated. We've heard horror stories from vulnerable income support recipients who received harassing and threatening correspondence from debt collection agencies sent out by the government. We've heard shocking reports about the government's issuing of inaccurate and unlawful debt notices. We've also heard of Centrelink making errors, like overpaying people over a period of months and even years, despite the fact that those people were trying to point out to Centrelink that there was a problem. We've heard those stories over and over again. Meanwhile, the government has taken an axe to Centrelink jobs, slashing 1,200 in this year's budget and 1,180 in last year's budget. Centrelink is understaffed and under-resourced; we understand that.

I finish up by saying to the government: split the bill. Split the bill, and we will support that first tranche of tax cuts. You will have to split the bill invariably, so stop being so intransigent about it. The issue out there in the community is that tax is complex. Many people find it difficult to understand the facts and the figures, but what the community understands very well indeed—and every member of this House also understands it, because the community is telling us this—is that the company tax cuts the government is proposing are unacceptable. It's unacceptable because of the flat wages growth and it's unacceptable because the government is refusing to split this bill and get tax relief to those that need it most urgently, low- and middle-income earners. I do not understand the government's tactics, and I suspect that the government's tactics are unravelling at a rate that is very, very fast.