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Tuesday, 11 September 1984
Page: 1017

Mr WELLS(8.12) —I thank the honourable member for Moreton (Mr Donald Cameron) for his closing remark. I draw his attention to the fact that one does not need a university education to know what the Australian people want. All that one needs is a certain amount of common sense which the honourable member opposite seems to lack. Tonight we are debating a number of Bills relating to the Budget. One would have thought that this would be a great opportunity for the Opposition to make incisive criticisms of the Government's performance. However, from the Opposition's point of view, this debate will go down as one of the great missed opportunities in parliamentary history.

Firstly we heard the honourable member for Bennelong (Mr Howard), the former Treasurer, telling us that the economy really was not terribly healthy while he was the Treasurer but insisting that if only we had gone on doing the same things for a few more years things might eventually have got better. We have heard that before. The Australian people know that within one year of more sensible economic management the economy has improved rapidly, unemployment and inflation have gone down, the number of jobs created has increased dramatically, interest rates are down, manufacturing output is up, capital investment is up, consumer confidence is at its highest since figures have been kept and Australia has the highest rate of growth of any industrial economy.

Mr Robert Brown —A magnificent achievement.

Mr WELLS —As the honourable member for Hunter said, it is a magnificent achievement. The Australian people know that the prescriptions of the honourable member for Bennelong do not work. When he was Treasurer he presided over chaos and disaster and now as Opposition spokesman for the economy he has the effrontery to criticise success.

The next speaker on the Opposition side was the honourable member for O'Connor (Mr Tuckey). He gave a very interesting speech, consisting as it did mainly of points of order as to whether he was speaking to the Bills. The honourable member typifies the second approach of the Opposition to economic debate. The first approach, typified by the honourable member for Bennelong, is to go on making prescriptions which the Australian people have seen do not work. The second approach, typified by the honourable member for O'Connor, is to try to avoid talking about the economy altogether, even when that is the specific subject of a debate before the House.

The third speaker for the Opposition side was the honourable member for Dawson (Mr Braithwaite). It was not always easy to follow what the honourable member was saying. The profundity of his thought processes did not seem to be matched by his capacity to articulate his ideas into intelligible prose. However, he made an attempt to refute my colleague the honourable member for Bendigo (Mr Brumby) who pointed out that the restructuring of the taxation system in the Budget would benefit pensioners. The honourable member for Dawson said that there was in fact no change in the threshold at which pensioners would begin to pay tax. This is simply not true. I have often said in this place that we should be doing more for pensioners, especially those on the lowest incomes. I have also said that we should have at the earliest opportunity a further increase above the level of CPI adjustments for pensioners.

The Opposition has failed even to recognise what has been done. As a result of the 17 per cent cut in tax for those on the lowest incomes, the pensioner tax rebate will go further, so the threshold at which pensioners will begin to pay taxes will increase from $5,428 to $5,534. The purpose of this is to protect pensioners who have no other private income. In fact, it goes further than that and protects and excludes who are in receipt of up to nearly $17 a week from the category of taxpayer pensioners. This is an increase over the previous level of $14 a week. The honourable member for Dawson simply got his facts wrong.

The honourable member then continued with an exercise which in National Party circles would probably count as a piece of higher mathematics. He added the total sum of the national deficit to some other figure which he pulled out of the air and told us that this was 31.2 percent of domestic gross product. He then told us that 31.2 percent was the same as one-third. In the honourable member's mind it somehow followed from this that the budgetary situation was worse than it had previously been. In fact, the truth of this matter can be worked out by addition and subtraction rather than by percentages. Budget receipts are up from $48,000m to $57,000m. Budget outlays are up from $57,000m to $63,000m. Obviously, revenues have gone up by more than outlays and consequently the deficit has gone down. This Government has reduced the deficit. All the Opposition did when it was in government was to increase the deficit.

The next stunning piece of intellectual activity from the honourable member for Dawson was to argue that, because Budget receipts had gone up, it follows that Australian taxpayers are not getting real tax cuts. It has probably not occurred to the honourable member for Dawson, as he sits here now, that the reason for the big increase in government revenue is the fact that there are more taxpayers . Not only are people who had been forced on to the dole by the policies of the previous Government now working and paying taxes but also a number of friends of the Opposition parties who had plenty of money but who were able to avoid paying taxes under the previous Government are now having to contribute a little to the running costs of the Australian community. It is precisely because of these facts that this Government has been able to provide a tax reduction, which would never have been possible under the contractionary policies of the Fraser Government.

We were next treated to a speech by the honourable member for Moreton who, in his own dogged way, delivered most of his speech with his left leg raised up on the bench which the taxpayers provide for his colleagues to sit on. His main point was that various categories of employees previously below the 46 per cent tax threshold had now reached the status of average weekly income earners and were consequently paying more tax. What the honourable member failed to grasp was that a category of employees previously receiving less than the average weekly income pay tax as a result of having gone above the average weekly income because they are now doing better than they were previously. The honourable member for Moreton might regret this fact but such people do not regret it. Although they may find the extra tax an irritation, they are very glad of the increases in income which necessitated those extra tax payments.

Mr McGauran —Go faster. Hansard can't keep up with you!

Mr WELLS —The honourable member for Gippsland has interjected. The last time I heard him talking he spoke about the dairy industry. The honourable member knows nothing at all about cows, although he has, I imagine, in his legal firm had a deal of experience with a great deal of bull. The honourable member for Moreton admits that there was a degree of erosion of living standards of middle income earners under the Fraser Government. That erosion was caused by inflation and by soaring interest rates. Under the Hawke Labor Government, those interest rates and the level of inflation have gone down. Taxes have been cut by $7.60 for all middle income earners on taxable incomes below $28,000. The honourable member for Moreton previously was a supporter of the Fraser Government and all its policies. Now he is born again; now he is the friend of the low and middle income earners. I think that this conversion is just a little bit spurious.

I turn now to the bank account debits tax which was introduced in the last Fraser-Howard Budget in 1982 and which, as a result of administrative procedures set in train by the previous Government, commenced operation in April 1983. From the moment it began, large numbers of backbenchers, including me, received numerous representations from community groups, especially parents and citizens and parents and friends groups, working within the schools systems complaining justly of the fact that these non-profit community organisations were having their hard-earned funds taxed through their cheque accounts.

Mrs Darling —Very hard.

Mr WELLS —The honourable member for Lilley says that they were very hard earned. Indeed they were. Like a number of Government back benchers, I made numerous representations to the Treasurer (Mr Keating) to have such charitable groups excluded from the ambit of the tax. In response to these representations, the Treasurer informed us that the tax would be reviewed. This Bill is the result of that review. It exempts debits made to the account of an organisation whose sole function is support of a specified public benevolent or religious institution, hospital, school, college or university. It also exempts debits of less than $1. This amendment to the bank accounts debit tax is a triumph for community action concerted with local members. It testifies to the fact that the Hawke Labor Government is responsive to community feeling. It is fair to say that a just grievance fully expressed to local Federal members and supported by community feeling will always be redressed by this Government.

Mrs Darling —Good lobbying, Deane.

Mr WELLS —The honourable member for Lilley and the honorable member for Hunter ( Mr Robert Brown) were particularly articulate on this matter and I would like that to be recorded. I turn now to the Medicare Levy Bill. This Bill imposes a one per cent levy for the years 1984-85 and 1985-86. This fact alone gives the lie to hysterical Opposition claims that there is going to be an increase in the levy. The Minister for Health (Dr Blewett) has stated frequently and explicitly that there is no planned increase in the levy and here are the Budget Bills which prove it. The Opposition is prone to this sort of argument. Since it really cannot criticise what this Government has done, it instead argues: But what if they did something else instead? The former Treasurer admits that the deficit is down but he asks: 'What if it went up?' The honourable member for Dawson says things of this nature so often that he tends to believe them.

Mr Braithwaite —Like what?

Mr WELLS —The honourable member for Dawson has asked what he said. If he cannot remember what he said I will tell him. He said: 'It is freely admitted that there will be a mini-Budget to take back what was given in this Budget'. He obviously thinks his side is still in government. What he is doing is freely admitting that the Opposition did it before and it will do it again if it has half a chance. It will not get half a chance. The honorable member has not grasped that good economic management has made it possible for the Government to stimulate the economy further by giving real and lasting tax cuts. It has also made it possible to legislate for no increase in the Medicare levy. This is a redistributive Budget. The honorable member for Tangney (Mr Gear) has pointed out that the highest cuts in tax have gone to the lowest income earners. Along the same lines the Government has been able to afford relief from the levy to a greater proportion of low income earners. The threshold for payment of the levy will now be $7,110 for individuals and families will be exempt up to $11,803 with a further $1,330 added to that for each dependent child or student. These Bills go a long way to giving effect to the Government's objectives of social justice and sound economic management and I commend the Bills to the House.