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Monday, 2 March 2015
Page: 1674

Mr GILES (Scullin) (17:27): It is now March and we are still talking about last May's rotten, failed and unfair budget—as we should be, because it is what the people we represent are talking about and what they are rightly worried about and troubled by. At kitchen tables and lunch rooms it is the unfairness of this government's policies as expressed in this budget that dominates concerns. Let me be clear: Labor rejects the uncaring austerity of the Prime Minister and his Treasurer. Labor rejects the dishonesty that underpins all this—the saying of one thing before the election and doing another after it. And we stand here, firstly, to hold the government to account for its broken promises made before the election but unpicked through this budget.

The government stood, the day before the election, when through the now Prime Minister—then the Leader of the Opposition—said there would be no cuts to health, no cuts to education, no change to pensions and no cuts to the ABC or SBS, then did the opposite through this budget. Labor is committed to calling out those broken promises. Labor is committed to reversing this deficit of trust and to standing up for fairness and trust in government—an approach that puts people first. Labor is standing up for universal health care, for accessible higher education, for needs-based school funding, support for pensions and the vulnerable and, critically, for fighting for jobs.

It is in this context that I rise to speak on the Appropriation Bill (No. 3), the Appropriation Bill (No. 4) and the Appropriation of Parliamentary Departments Bill (No. 2). These bills propose appropriations from consolidated revenue in addition to those appropriated through the appropriations act that were part of the 2014-15 budget. These bills reflect decisions made as part of the MYEFO which was released on 15 December last year. They also reflect, in part, changes to the machinery of government as part of the ministry reshuffle that was announced on 21 December and that took effect two days later.

In summary, bill No. 3 seeks approval to appropriate just under $1.4 billion for the 2014-15 financial year and bill No. 4 seeks to appropriate just under $241 million for the 2014-15 financial year. The parliamentary departments bill is for appropriations from the Consolidated Revenue Fund for the four parliamentary departments: the Department of the Senate, the Department of the House of Representatives, the Department of Parliamentary Services and the Parliamentary Budget Office. The shadow minister, in his contribution to this debate, has touched on those matters that are the subject of these appropriations in more detail. These bills assist with the business and the operations of government, and none of this is particularly controversial in and of itself. We do not, of course, oppose these appropriations. However, it does provide an important opportunity to all of us elected to this place to reflect on the business of government generally and, in particular, the business of this government.

I was fortunate to be in the chamber for the contribution of the member for Kingsford Smith, who drew out two critical elements of this government's decision making as evidenced in the budget. He spoke passionately and powerfully about the impact of cuts to foreign aid—of course the largest cut in this budget—and the impact of these cuts on lives in developing countries, in particular, our neighbours in the South Pacific. These are people who are voiceless in this parliament. He highlighted, which I think was especially important, the impact that these foreign aid cuts will have on women in developing countries. He also spoke about climate change. It was interesting that a few weeks ago, some members of the government—I think including the Parliamentary Secretary to the Treasurer—started talking about fairness, trying to recast the fairness debate. For them it seemed that this was all about debt and intergenerational fairness. Indeed, the member for Dobell, in her contribution, seemed to touch on these issues. This interest in fairness was newfound a couple of weeks ago and seems to have been short-lived, because we have heard very little of it in this debate. But the real issue of intergenerational fairness goes to the question of how we combat climate change. The member for Kingsford Smith very persuasively set out why it is so critical to act early and in accordance with both economic and scientific advice—two things which are beyond this government.

We have a government which is obsessed with emphasising that Australia is living beyond its means. It says that Australia has a spending problem, yet it refuses to seriously countenance issues of revenue. The Treasurer, as we saw today, likes to beat his chest on multinational tax avoidance. But where is the action to tackle this problem? Last Tuesday the Treasurer was asked by a government member about exactly this, and once again he gave us the benefit of his stale and increasingly unconvincing tough cop routine. There was as usual much heat but very little light. Of course, we saw more of the same in question time today. There is a pattern of behaviour here. In February last year, 13 months ago now, the Treasurer stated:

Some global companies aren't paying their fair share of tax anywhere … I am pleased to say this work is on track for delivery at the Brisbane summit at the end of this year … The globe needs to know who is paying tax where.

I am sure that multinational tax minimisers were quaking in their boots when the Treasurer stated later last year:

It’s hugely important for the globe that companies pay tax on their profits. It is theft when someone does not pay the tax due to the nation.

Surely we could expect this government to act on this theft. Instead we saw early in its life the exact opposite, as the Abbott government reopened tax loopholes closed by Labor in government, allowing $1.1 billion in potential revenue to drain offshore. The Treasurer spoke of balance in this debate today. Perhaps this is the balance he was seeking to achieve.

On the other hand, today we have heard that Labor is taking this seriously through the work of the shadow Treasurer, the shadow Assistant Treasurer and of course the Leader of the Opposition, with their announcement of an approach that has been developed in consultation with multinational tax practitioners, academics and industry, and costed of course by the independent Parliamentary Budget Office. It is an approach which draws on the OECD's global plans for countering base erosion and profit shifting. It is a sensible approach to a real problem and is in stark contrast to this government's bluster on the one hand and inaction on the other.

There are numerous examples overseas of foreign tax evasion issues being uncovered. Just recently we have seen the leaked HSBC documents expose tax evasion occurring in the UK and around the world. I note that British MPs under a Conservative government will be holding an inquiry into this. This has been a big deal overseas and it should be a much bigger deal here too—hopefully it will be following Labor's leadership today—particularly for a government that must be seeking to address a serious revenue shortfall. But as yet there has been no effective response from the government, other than—and I will touch on this later—to starve the Australian Taxation Office of resources.

Surely underpinning all of this are questions of priorities. We have a so-called budget emergency, yet the Abbott government does not actually want to go after potential sources of revenue. Instead, this government goes after what it sees as soft targets—pensioners, students, the employed, particularly young unemployed people, who would be offered the prospect of six months without any form of support—and, of course, as I touched on earlier and as the member for Kingsford Smith touched on at some greater length, the world's most poor, the largest and perhaps the cruellest cut in this budget. This list goes on. But because the Abbott government has incorrectly, as I believe it will be seen to be, made the very cynical calculation that it can get away with these cuts, it goes right ahead.

The Australian people have taken stark exception to this toxic government and its toxic budget. I remind the House that this is a budget that all members of the government have supported and have publicly advocated for. There is a great irony here: the Prime Minister and the Treasurer claiming that there is an emergency when it is they who have gone some large distance towards creating one. In government Labor recognised that our economy faced very serious headwinds and made some difficult decisions, but Labor did not attack low- and middle-income earners, because it is unfair to ask them to bear this burden. It is for this government to start to explain why it chose, as just one example, to cut pensions but not look at tax loopholes for the wealthy, particularly in superannuation.

Most Australians, of course, are low- and middle-income earners. They are the backbone of our society and they are under siege by this government. We now hear talk of a families package from those opposite but, frankly, nothing they do now will alter the state of play in Australia. This is from a government, I remind members, that wants to make families, on average, $6,000 a year worse off. After 18 months, Australian families have a good idea about this government's priorities.

Consumer confidence is lower now than it was at the time of the last election, and this is hurting the economy. So much for the much-promised adrenalin charge that this government was going to bring. Who could blame consumers, and who could blame people, for lacking confidence with a government like this one? It was revealed last week that wage growth, unbeknownst to the Treasurer, is the lowest it has been on record, despite their rhetoric around industrial relations.

Unemployment is the highest it has been for 13 years—back to the time when the member for Warringah was the Minister for Employment and Workplace Relations; it seems that he has an unfortunate knack for high unemployment—and youth unemployment is higher still. Despite this, we see cuts to vital programs like Youth Connections and we see victim blaming in terms of the treatment of young unemployed people. While the member for Dobell might laud programs like the Green Army and Work for the Dole, this ignores the evidence that these programs have done very little for unemployment, particularly for youth unemployment and other cohorts, like Indigenous people. They prefer ideology to rhetoric in this as in other aspects of decision making.

We cannot ignore the impact that this budget has made on the economy. It has torpedoed consumer confidence, which has had flow-on effects throughout the economy. This government has made the same mistake that its counterparts made in Europe: it cut during a downturn. They cut in Europe, and it drove many of European economies back into recession. It did not work there, and it is not working here; it is leaving an enormous human cost.

The recklessness of this government is particularly acute because these lessons from Europe had already been learnt by those in Europe. Former advocates who prescribed the so-called tough medicine have conceded as much, yet this government refused to listen or learn from their mistakes or, indeed, from the Australian people. It is very telling that on the occasion of one of the Prime Minister's many failed resets or reboots, when he gave his address to the National Press Club, he spoke of having spent his summer talking to hundreds of Australians—talking to, not talking with and certainly not listening to or hearing.

I spoke briefly earlier on the impact of cuts to the ATO on raising revenue. It is worth noting in the context of this debate that the government is slashing the number of people working in the Australian Taxation Office—by 4,700 by 2017, in fact. Of these, one quarter will come from the audit team, which has already lost 500 staff members to meet an arbitrary target imposed by the government. Alarmingly, that is expected to rise to 1,000 in the audit team alone. The audit team, of course, is responsible for investigating and enforcing tax compliance by individuals and multinational companies and, unbelievably, the Treasurer has told the tax commissioner to double his efforts through more stringent audits of multinational companies suspected of avoiding Australian tax collections. So this government complains about tax-dodging multinationals one minute and the next it cuts the ability of the ATO to do anything about it. Not for the first time, it is what this government does, rather than what it says, which is instructive.

One of the targets of this government's budget that has particular relevance to the Scullin electorate is pensioners, but it is also future generations trying to save for their retirement. This government is implementing a trifecta of cruelty: cutting the pension, which will hurt current and future pensioners; and cutting the low income superannuation contribution and freezing the rate of compulsory superannuation contributions, both of which will hurt people trying to save for their retirement. Whatever people do, there is pain for them from this government.

It was Labor who introduced compulsory superannuation in this country amidst much opposition from the Liberal Party and big business lobby groups. I note that it is the same Liberal Party and big business lobby groups that we see today claiming that the pension system is unsustainable. In the lead-up to the 1996 election, John Howard promised that he would match Labor's pledge to increase the compulsory superannuation contribution to 12 per cent. It was a promise that he broke immediately upon coming to government.

The Member for Warringah has in this place described compulsory superannuation as:

… one of the biggest con jobs ever foisted by government on the Australian people.

The Liberals have always had a hatred of superannuation but also a hatred for the pension system. It is unclear what exactly they expect people to do, apart from live in a state of destitution and penury—something that they have been explicit about for young jobless people. People should be encouraged, where they can afford it, to put money towards their retirement. A policy which did this effectively was the low income superannuation contribution. It was especially aimed at those on low incomes as they are most likely to have insufficient superannuation funds with which to retire on. Labor recognised that we were facing a demographic challenge of people retiring without funds to support their retirement, so we acted to address it. This is one example that demonstrates the difference between Labor and Liberal. In opposing the policies of this dysfunctional government, we do not seek to block supply but we use this opportunity to highlight the impact of this budget on ordinary Australians and on the Australian economy.