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Thursday, 26 March 1987
Page: 1609

Mr KEATING (Treasurer)(3.52) —It is nice to welcome the Leader of the Opposition (Mr Howard) back to the mainstream of economic debate. We had last Tuesday's balance of payments figures, last Thursday's national accounts, significant declines in bank bill rates-all manner of events-and not a comment from him. But he said last week that he would debate the fiscal policy of the Government--

Mr Carlton —That is rubbish. He is telling lies again.

Mr DEPUTY SPEAKER (Mr Leo McLeay) —Order! This is the third time that the honourable member for Mackellar has been cautioned and asked to withdraw for accusing other members of telling lies. The honourable member for Mackellar will withdraw the interjection he just made.

Mr Carlton —It is not other members, Mr Deputy Speaker; it is one member.

Mr DEPUTY SPEAKER —The honourable member for Mackellar will withdraw.

Mr Carlton —I withdraw.

Mr KEATING —By indulgence last week, the Leader of the Opposition said that he would be happy to debate his $16 billion credibility gap. We looked forward to debate on Tuesday's matter of public importance, Wednesday's MPI and even today's MPI. There has been not a murmur about the list of Opposition commitments, which the Government has annotated and handed to the Opposition on a number of occasions, only to see the lists ripped up to date. Today we are back to some synthetic, supposedly tear-jerking proposition about the Government's treatment of the aged-but not to the real issue of the Leader of the Opposition's credibility and his failure to be able to establish a decent fiscal policy for Australia and to articulate one that would not crush Australia into a rapid recession.

It is very interesting that this week, on Monday, 23 March, we saw on the front page of the Australian Financial Review and in the Australian reports of a leaked document from the Liberal Party of Australia. The Australian Financial Review had the headings `The Liberal Party's secret agenda' and `Howard's $5bn spending cut plan'. They referred to a freezing and a non-indexation of pensions. In the course of that day we had a denial that that was the Liberal Party's policy. But on the same day a spokesman for the Opposition Leader made a statement to AAP-Reuter, which came up on the Reuter screen as follows:

A spokesman for Federal Opposition Leader John Howard has defended the leak of a secret report showing he would make giant spending cuts if elected Prime Minister.

It is a case of talking to one audience on the one hand and then shuffling the pack on the other. The Leader of the Opposition has said to the financial markets: `Look, I will cut $5 billion out of outlays'. A document goes out showing how the Opposition would cut pensions, tighten eligibility, abolish all employment programs, et cetera. On the other hand, he said that he would not do that. But on the Reuter screen it shows that he would. Then that night he said:

And I have never in my political life been unwilling to do a difficult or unpopular thing. I don't think anybody who aspires to be Prime Minister of this country, if they can't do difficult unpopular things on occasions, then they're not worth the job.

In other words, he is not backing off from all that stuff. He is not backing off from cutting pensions and the rest. But then on another program he said:

I don't offer pie in the sky. I mean what I say and frankly I see it as a virtue and not a vice in our present economic circumstances to be committed to heavy expenditure cuts.

We on this side of the House know that the heavy expenditure cuts can come only from the big programs. That is why the freezing of pensions was mentioned. But, of course, once that became a public issue, we saw a backdown. Can the pensioners of this country feel confident that the Liberal Party's secret agenda would not be the agenda if it became the government-that pensions would not be frozen, that all the other benefits would not be cut? Let us have a look at the Opposition's record. In the period of the previous Government, when the Leader of the Opposition was Treasurer--

Mr Wilson —You froze them yourself.


Mr KEATING —Pensions fell from 25 per cent of average weekly earnings to 22.7 per cent--

Mr Wilson —Which governments have ever cut or frozen pensions?

Mr DEPUTY SPEAKER —Order! The honourable member for Sturt will cease interjecting.

Mr Wilson —He doesn't reply because he knows that what I am saying is true.

Mr DEPUTY SPEAKER —Order! I warn the honourable member for Sturt.

Mr KEATING —Pensions fell from 25 per cent to 22.7 per cent of average weekly earnings. We have brought that figure up from 22.7 per cent to 24.1 per cent. In other words, let me put it his way: During the Fraser-Howard years the real value of pensions fell by 2.4 per cent. Under Labor there has been a real increase of 5.7 per cent. Under the previous Government the figure was minus 2.4 per cent. This is the previous Government's record on the treatment of pensioners.

The Opposition keeps talking about pensioners. The previous Government ignored the poverty traps for pensioners. Pensioners could earn only a pittance without losing part of their pension. Yet this Government in its tax reform package has allowed for $200m in 1987-88 to put an extra $30 a week in the pockets of pensioners. In other words, they can earn more because we have opened up the free area in which a pensioner can earn-that is at the bottom end of the work force and the top end of the social security system-so that these people can earn more money without losing their pensions. In the Howard years as Treasurer, if people earned only a pittance their pension was cut.

We have these constant crocodile tears about rent and mortgage repayments diminishing the disposable incomes and the pay packets of Australians, while in the same breath the Leader of the Opposition says: `Freeze their wages. Give them no wage increases. Do not add to their pay packets to meet their mortgage or rent payments'. No, he complains about those problems and tries to make capital out of them; but, when the Government and the Conciliation and Arbitration Commission say that in the circumstances modest wage increases are due, Mr Howard says: `No. Give them nothing'.

What he says to the Liberal Party audiences, to the National Party audiences, to the rednecks, is: `No wage increases; cut their wages'. He says to the financial markets: `We will freeze their pensions'. But if trapped in the House or cornered on the front steps, he says something different. He says: `Oh no, of course we would not cut the indexation of pensions'. Does any pensioner believe, on the Opposition's record, that it would not cut the indexation of pensions? Does anybody believe that it would not do to pensioners what it would like to do to wage and salary earners, that is, cut them down?

Opposition members talked about an indirect tax of 8 1/2 per cent. Then when Joh hit Opposition members, they backed off. Now the Leader of the Opposition is talking about some broadening of the indirect tax base, knowing that in those fuzzy words there is no need for a compensation package for pensioners. When this Government considered consumption taxes, we had full overcompensation for pensioners for the cost of the indirect tax. There is no talk about that. The Leader of the Opposition would belt them with an indirect tax and watch their real incomes fall as the prices of all the goods in the supermarkets rose by the amount of the indirect tax.

Whenever we talk about funds for hostel accommodation to get people away from the intensive medical services and nursing home care which many people do not need, although they need the accommodation at the hostel, the preparation of their meals and some medical services, we are attacked for it. Yet those opposite funded these moneys to nursing homes in the 1970s because their mates were in the nursing home investment business.

Mr Hodges —That is rubbish.

Mr KEATING —That is true. Nursing home beds were traded at $5,000 and $10,000 a bed. There is actually a public rent on nursing home beds at $5,000 or $10,000 a head when nursing homes are sold. The previous Government was not interested in getting people into hostels to give them some company in their old age, some dormitory accommodation, some central preparation of food and some general medical attention if they needed it. No. What about the home and community care program? What about this Government's humane service to people to keep them in their homes? What about HACC? The previous Government was never interested in pensioners. It has always regarded them as electoral fodder to be abused, to be played with an elections and to be frightened because those opposite think they are elderly and cannot understand the complexity of the issues.

Mr Hodges —I rise on a point of order. I ask the honourable member for Perth to withdraw the offensive remarks he just made.

Mr DEPUTY SPEAKER (Mr Leo McLeay) —The Chair did not hear any remarks that the honourable member for Perth may have made.

Mr Hodges —Mr Deputy Speaker, I request that you ask the honourable member for Perth to withdraw the remarks he just made about me.

Mr DEPUTY SPEAKER —If the honourable member for Perth made unparliamentary remarks he should withdraw.

Dr Charlesworth —I withdraw.

Mr KEATING —If ever there were parties of high cynicism about people who are either in the working class or have been in the working class, it is the Liberal and National parties. This Government, in the course of its wage discussions over the last three years, has now provided in accord mark 2, ratified by the Australian Conciliation and Arbitration Commission, for occupational superannuation for the whole work force. The Opposition said about future retirees: `Deny it to them. Give them nothing. Send them out on the pension and try and reduce that. Do not provide any retirement income for them. But we will take the assets test off so millionaires can get a pension. That is okay. We will take away the capital gains tax. That is okay. If people take their income as capital, we do not expect them to pay tax on it'. But if one is a slave, one gets fully taxed. If one is on a pension, one can live on a pension without indexation. But if one picks up $2m or $3m off the stockmarket, or if one has a heap of blue chip stocks and the market goes up by a couple of hundred per cent under Labor, the Opposition says: `Take it away from them. Let those people have their income free of tax because it is capital'. There is no difference, according to the Opposition between income and capital: `Our people are used to getting the capital. How dare you touch the capital. Do not tax it'. But if one happens to work in a railway yard on $18,000 with three kids: `Belt them, give them no wage increase'. If the Opposition was elected, it would say: `Do not worry about the pensioner lobbies'. If they turned up in Parliament House, the Opposition would treat them with contempt. It would freeze their pensions and cut their pensions, like it did when it was the government of Australia.

The Opposition has never cared about ordinary Australians. It has always been the party born to rule-the born to rule squad out there to run the rest of us. The only place where the Opposition got into trouble is that a few of us on this side of the House think that we are born to rule the Opposition. And we are doing a pretty good job of it, and we will keep on doing a pretty good job of it.

The Labor Party is the only party in Australia that ever cared about the minority groups-about pensioners, the poor, people who cannot protect themselves and children living in rented accommodation with single income parents, in poverty. The Opposition says: `No, do not give them an increase. Never give anyone an even break'. That is the Opposition's attitude. But it will always have all the tax avoidance things in there-oppose all our legislation in the Senate, oppose the Australia Card and oppose the bottom of the harbour legislation. It lets people fall through the tax system.

The Opposition never even did anything legitimate for the people it represented. It left the double tax on dividends for 30 years. It treated the legitimate people struggling in business-the small business brigade-with the same contempt as it treated people on pensions. It was interested only in the fat cats of business. The thing about them is that they are mostly pretty smart. They have since given the Opposition away because it ran their businesses into the ground. It watched unemployment go up to 11 per cent of the work force. Those opposite talk about poverty. What credibility have they got at all to talk about poverty when the single greatest generator of poverty is unemployment, together with the way that the Opposition treated the Social Security System?

It will take more than some mock indignation and the pull of an earnest face on the part of the Leader of the Opposition to convince the pensioners of this country that they would get any better go under a Howard government than they ever got in the past out of Howard and Fraser, who did nothing but reduce their pensions and their entitlements. The Opposition cries: `Isn't it a shocking thing that living standards in this country have temporarily declined?' It is a shocking thing that we have lost $10 billion off our national income by drops in commodity prices. How in the one moment can the Opposition talk to the financial markets on Reuter screens and say that, yes, it knows that living standards have to temporarily fall in Australia, but then get up on these motions and, with crocodile tears, say that it is a shocking thing that mortgage repayments have gone up and that interest rates are up? The Opposition ignores that we are funding a $40 billion current account deficit. Really!

The Opposition has $16 billion of commitments which it will not face up to or repudiate. It expects London, Tokyo, Melbourne, Sydney and the financial markets to say: `Yes, we would have a Howard government back and we would fund its current account at the prices the Labor Government funds its current account deficit'. It will not. Those markets will never tolerate the Opposition, and nor will the Parliament.

Mr DEPUTY SPEAKER (Mr Leo McLeay) —Order! The Treasurer's time has expired.

The discussion is concluded.