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Wednesday, 13 November 2013
Page: 206

Mr CRAIG KELLY (Hughes) (18:32): Madam Speaker, before I rise to speak on this bill I would like to congratulate you on your appointment to the Speaker's chair. I would say that, seeing you sit there for the first time, it looked as if that chair was actually made for you.

Today, we commence the almighty task of cleaning up the absolute financial mess that the previous Labor government left and we inherited. This bill, the Commonwealth Inscribed Stock Amendment Bill 2013, is effectively increasing the limit on our nation's credit card. The government seek to raise the limit from $300 billion to $500 billion. As the Treasurer said, 'To raise the debt limit is simply an unfortunate but necessary step that the coalition must take as we commence to clean up this massive financial mess that the members of Labor left us.'

There is some urgency, for we know that in a few weeks time, maybe as soon as 12 December, we will crash through that $300 billion current debt limit. That raises the question: why didn't the previous Labor government take this step when they knew—as the Assistant Treasurer, the member for McMahon admitted—that they would go above that $300 billion limit. This is a job that should have been done by the previous Labor government. We know why they did not do it. It was because they were too ashamed of the six years of the waste, the mismanagement and the reckless spending, which started with them inheriting $50 billion in the bank and saw them crash through every single debt limit that they set. They were simply too ashamed before the election to go ahead and do what was needed, and that was to increase the debt limit, and they are now leaving that to the new coalition government.

Let us wind the clock back six years to see where we were. Australia did not even have a debt limit then. We did not need one because the previous coalition government not only paid back the $96 billion of the previous Labor government's debt but, along the way, paid back $50 billion worth of interest on top of that $96 billion. Then, after that, they managed to put $50 billion away in the nation's bank account. That is what the previous Labor government inherited and, when they came into the government, the interest that they were receiving was $1 billion a year. So, $1 billion a year was coming into the federal Treasury to be spent on all the things that are necessary for the government to provide because the previous coalition government had that $50 billion in the nation's bank account.

We know the history. We have seen reckless spending and waste on an unprecedented scale in our nation's history. What has that resulted in? We have seen the fastest deterioration of debt outside of wartime. Look at how we were promised, time after time, that the debt ceiling would be set and there would be no need to break it. If we go back to July 2008, before I became a member of this place, Labor raised the debt limit to $75 billion. I remember at the time listening and watching the speeches in this place. They talked about it being a one-off temporary deficit. They said that there would be no need to go above the $75 billion.

Fast forward to February 2008. They said, 'Now we need $200 billion. Let's raise it to $200 billion, but we'll never need to go above that.' Then, when I was in this place at the budget of 2011, Labor again had to raise that debt, up to $250 billion. Then we heard on over 500 occasions, time after time in this place, the then Prime Minister and then Treasurer promising to return the budget to surplus. The $250 billion would be the cap—it would never be broken—but, come the budget in 2012, again Labor could not keep their promises and they had to raise the debt limit to $300 billion.

What Labor members often forget, and they never mention this, is that this debt comes at a cost. Now the incoming government has to pay $10 billion in interest payments every year. That is close to $192 million every single week that we need to take from the economy to pay the interest bill on the debt that Labor left. What is even more concerning is that something like 75 per cent of that money, three-quarters of that money, is actually sent overseas. It is sent overseas to foreigners. I would like every member of parliament to think about the many things that they need or would like to see money spent on in their electorate. We could each have over a million dollars a week to spend in our electorates if it were not for Labor's debt, the wasteful spending and the interest payments that we must now make. Every single week throughout the country there is $192 million less money that we have to spend on hospitals, less money that we have to spend on roads and less money that we have to spend on kids with disabilities that simply pays the interest on Labor's debt. We have to do that until we start paying that debt down.

I have seen criticism of the coalition government for having to take this step, but to do so is to confuse cause and effect. To criticise the coalition government for coming in, fixing up this mess and unfortunately having to raise our debt limit is simply akin to criticising a fire brigade when they turn up to a house to put out a fire, lit by an arsonist, because they might cause water damage.

We have heard the Treasurer refer to the 'spiders' that Labor have left in almost every cupboard. I think there is another analogy that could be added to that: booby traps. There are not only spiders but also booby traps in every single cupboard that we go through. We know that Labor were unable to achieve a surplus and that even in their attempts to do so they cooked the books. They used every accounting trick under the sun. They pulled revenue forward and they pushed expenses years into the future. Just look at a few. They raided over $5 billion out of the Reserve Bank to bring into their budget numbers to try and make them look better. One of the tasks of cleaning up Labor's great mess is that we have to recapitalise the Reserve Bank. We have also seen the ACCC, the Competition and Consumer Commission, reach the stage where they have simply run out of money and may no longer be able to fulfil their role. They need an injection of close to $100 million just to make sure that they can continue to do their function.

There is also the repayment of the unclaimed money that Labor looted from the accounts of everyday Australians. You may remember that legislation, where they changed the law on unclaimed money. They determined that, for any bank account in our nation, if the deposit holder had not put in a deposit or made a withdrawal in the last three years, that money was all of a sudden unclaimed. We know that the raids on the accounts of mums, dads, kids and pensioners who had put money aside netted Labor $640 million. All that money went into their coffers while they were in government and now, as Australians open their bank balances and find at times that their money is gone, it is up to the coalition government to repay the money that was taken.

Labor has got us into a financial mess and the job of turning it around is like turning around the Queen Mary. We know that on current trends we are going to exceed $400 billion before the coalition has a chance to turn the ship around. And we know that the Australian Office of Financial Management has said—and the former Treasurer himself tabled the advice that he had in parliament—that any prudent government should have a buffer of $40 billion to $60 billion above any projected peak debt to allow for any unanticipated events. That is simply all the coalition want to do. We hear the shadow Treasurer, the member for McMahon and other Labor members trying to stop this important legislation when they know it is urgent. Instead, they should be hanging their heads in shame; they should be cringing with embarrassment that this step is necessary. Instead, all we are seeing is political game after political game.

It is regrettable that we have to raise the debt limit to this amount, but it is not raising debt; it is simply raising the limit. It will be a very long and hard road to pay that debt back down, but the coalition have done that before. The coalition have a track record of success in paying back Labor's debts, and we will do it again. The way we will do it is to cut the waste and the reckless spending. We will cut the feel-good projects simply designed to win votes that were, sadly, simply the hallmark of the previous, Labor, government. And we will grow the economy, because that is truly the only way to pay back debt and that is how the previous coalition government did it. We will grow that economy by making sure that we give the opportunities to people out there in our small business community; we will encourage them to innovate and experiment, and to develop those new businesses that will take our nation forward and to repay this legacy that Labor has left us.

So we hope that the Labor government does not continue to play political games. We hope that they will admit the error of their ways. We hope that they will acknowledge that this is an unfortunate but appropriate number, as a prudent government would do. We also hope that they realise the urgency. There is urgency that this bill passes, because, as the Treasurer said, come 12 December we will breach that $300 billion debt limit. It will be breached because of expenditure that Labor has locked in. So I call on the members of Labor and the Greens to do the right thing by the nation: stop playing political games, get behind us and do not block this legislation.