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Monday, 4 June 2001
Page: 27215

Mr BAIRD (10:14 PM) —It is my pleasure to rise tonight in support of the Appropriation Bill (No. 1) 2001-2002 and also to commend the Treasurer for the outstanding job that was done in relation to this year's budget. I listened to the member for Batman and his claims that his party are about looking after the battler, not the top end of town. Of course, we well remember the close relationship between the Labor Party and the Alan Bonds and the Christopher Skases of this world—they seemed to be very firmly attached to that group of people when they were in government. I heard him say that they are about providing a fair—mixing his metaphors somewhat—crack at life for the average battler. This in fact is what this budget is about—a fair crack of the whip or a fair crack at life, to use the member for Batman's terms.

Through this budget the government has achieved a continuation of the whole reform program undertaken by the Treasurer and the government, the continuation of $12 billion of personal tax cuts. That is what it is about in terms of helping the average battler—reducing his tax bill. It is also about reducing interest payments. We can look at what the interest rate was under Labor and what it is now: the home mortgage interest rate is now 6.8 per cent; under Labor it was 10.5 per cent—it in fact went to 17 per cent under Labor. That is what it is about—helping the average battler. Inflation is now 2.1 per cent per annum; under Labor it was 5.2 per cent on average and it went up to 11 per cent. In terms of unemployment, the forecast average is seven per cent under this government; under Labor it was 11.2 per cent in December 1992. There have been 100,000 new jobs created. The member for Batman mentioned himself that we should be about creating new jobs. Compare the record of this government with the record of their 13 years in government and it is very clear that this government creates the jobs, this government reduces the interest rates, this government reduces the level of government debt overall, this government allows the average battler to meet their home payments, and this government assists them more equitably.

Of course, it is this budget that assists the older members of our community who have made this country strong. Since the time of Federation we have had a group of individuals in this country who have worked hard and who have made this country more affluent. Now that many of them have gone into retirement, this government is recognising the contribution they have made and is reducing the tax burden on them. In my electorate I have over 20,000 people in the over-55 category and I certainly know that they are very grateful for the changes that this government has made. The $300 means a lot to the average pensioner and it has been well received.

Mr Fitzgibbon —Ha, ha!

Mr BAIRD —The member for Hunter might have his own interjection but, in going around the electorate of Cook, it has been well received. For the self-funded retirees, the threshold of $5,400 before tax cuts in has now been increased to $20,000. For couples it is $32,000 going up on a tapered basis to $38,000. Certainly, in my electorate, this assistance to independent retirees is well recognised. The Labor government, when they were in office, ignored this particular group of people, as can be seen by the tax threshold of $5,400.

This government is recognising the challenges that face independent retirees and, regardless of where they sit in the economic spectrum, it is this government that is giving them considerable assistance, not only in terms of changing the threshold but also in terms of a range of other measures. For the health card, the provisions have been changed to $50,000 for single individuals and $80,000 for couples. Assistance with telephones has been provided. Negotiations have begun with state governments, which of course are going to open up a range of special incentives for older people—self-funded retirees—in relation to issues such as RTA licences, electricity charges and interstate rail trips, et cetera. I was proud to be part of a government that introduced low fares on the suburban network in New South Wales, and that is what we are seeing continued under this government.

Of course, it is important to recognise that this government has also been a great plus for the business community. The fact that it reduced the taxation level last financial year from 36c in the dollar to 34c in the dollar—and, as of 1 July, that rate reduces to 30c in the dollar—is a great boost for the business sector and the corporate sector. It provides real incentives. That is in addition to the other incentives they have received—the halving of the capital gains tax and, of course, the special initiative of this government in allowing input tax credits for new vehicles that are purchased. That has been warmly received by small businesses in my electorate. They see the government as providing real incentives. In my electorate, I have a number of companies that are producing for the international market. Those people who are exporting have no taxes on them now. In the past they had the wholesale sales tax, which put their prices that much above other countries when they were competing overseas. Now that has been taken off. The GST does not apply when they are competing overseas, and that has been warmly received and welcomed.

I welcome the incentives that are in this budget in terms of two key areas in my electorate. The first is small business, which makes up a significant sector of the business community in this country, makes the economy strong and shows the entrepreneurial drive and the talent in this country. Small businesses are being provided with real incentives in terms of the tax rates that have been so significantly reduced in this budget and that are being warmly welcomed and received. Secondly, I welcome the incentives for self-funded retirees and pensioners.

This budget is also about the macroeconomic parameters on which the budget has been based and from which it has been developed. This is the sixth consecutive budget that we have seen the Treasurer bring down, and all of them have been surplus budgets. There is $1.5 billion surplus in this budget. Let us compare the track record of the Labor government when it was in office with the record of this government. The Labor government racked up some $86 billion in debt when it was in power. By the time 1 July comes around, this government will have repaid $60 billion of that debt. That is a fact that resonates very much with the people in my electorate. I have been getting around on Saturday mornings, having community consultation. People repeat to me how much the Labor Party set up the level of debt in this country. What do the repayments amount to each year? The sum works out at some $8 billion per year that we are using to just repay the debt that the Labor Party incurred. Imagine what the situation would have been if the Labor Party had continued in office for the past five years. There would have been a further escalation in the debt. That additional $8 billion to service the debt every year has gone into hospital construction, into school construction, into supporting state governments and into our own programs. It has been used for assistance to pensioners, for assistance to welfare recipients, in establishing Work for the Dole schemes.

They are the initiatives that we are able to undertake because of the way in which this government has run surplus budgets. We have not run the country into debt. The previous government used to spend in an indiscriminate way, without any regard to the future, as if there was no tomorrow. It was just a whole manana complex—just spend and somebody will pick up the debt in the future. It was this government that picked up that debt—that repaid $60 billion of it. We are the beneficiaries of the fact that we can save some $8 billion of interest each year. That amount is a huge plus, and we can see that in the way it has been received.

The benefits are not only in what we have in extra spending. Mr Egan and Mr Carr, when they brought down their budget, were able to remove the BAD tax. Why was this? Because of the increase in funding they had from the GST. As they plan and forecast their receipts, their cash flow, it is this growth tax through the GST that allows all these benefits to be achieved—the new hospitals, schools, roads and police stations that are being built throughout this country. The beneficiaries of the government's GST are the state governments. This is often overlooked. It is a great achievement that we can develop these programs and assist business by the reduction in the corporate tax rate, and at the same time can increase the amount going to the state governments. And, of course, the fact that we can look after our self-funded retirees and our pensioners at the same time is most important.

Mr Beazley and his colleagues talk about roll-back without specifying what they are going to roll back at any point. I thought the shadow Treasurer's performance on the 7.30 Report in the wake of the budget was particularly interesting. The exchange ran as follows. Mr Crean said:

... on the question of the pensioners and the $300, Kerry, why couldn't the Government have gone the full distance in its broken promise and given the $1000? Clearly, they could have afforded it this year because they've got a surplus of $2.3 billion and to instead of just give $300, give the full $1000 that they were promised. They could have afforded it.

Kerry O'Brien said:

... it's easy for you to say that from Opposition, but of course you're also saying at the same time as they're spending all their money to leave nothing in the bank for you. You can't have it both ways.

Simon Crean said, `Well, no.' Of course, that is the whole key to the matter. Those opposite go around the countryside saying, `We'll spend this. We'll give you back that.' I can see one of the shadow ministers at the table. They say to the restaurant and catering people, `We'll take off the FBT for you. We'll do this. We'll do that.' He was not quite so sure when he was confronted with the facts on that.

Mr Fitzgibbon —You've been talking to Teresa Gambaro.

Mr BAIRD —We have our sources. Those opposite have been going around and saying, `We'll take off the FBT. We'll do this. We'll increase the surplus for you.' But in fact the reality is that there is very little that you plan to roll back. In terms of taxation—

Mr DEPUTY SPEAKER (Mr Nehl)—The chair does not plan to roll anything back.

Mr BAIRD —Thank you, Mr Deputy Speaker. Of course, the member for Hunter knows exactly what I am talking about in terms of the plans. It is very easy for those opposite to go around, as they listen to every interest group, and say, `We'll certainly fix your problem for you. We'll reduce the tax for you. We'll give you $1,000—let's make it $2,000—for every pensioner. Why not make it $5,000? And we'll have a bigger surplus. We'll be much more responsible.' Just look at your track record. Look at your track record in terms of small business. Look at your track record in terms of independent retirees. Look at your track record in terms of pensioners. You will clearly see that your credibility is somewhat lacking. Of course, the taxation cuts that you promised, which became l-a-w, did not eventuate at all. The whole myth of roll-back and what you are going to achieve through this whole magic pudding exercise is not borne out in reality.

The Treasurer, the government and the Prime Minister should be proud of this budget. It is a balanced budget that provides a $1.5 billion surplus, provides significant benefits for small business right throughout Australia and provides significant incentives for independent retirees and pensioners. It has resonated well with all of the groups—small business, independent retirees and pensioners—in my electorate. They are very pleased. They recognise that the government is looking after the older people in the community. Small businesses see that we are providing the right incentives to make the economy strong and vibrant. This is a budget which does much for the economic development in this country. I am very proud to support it and to commend the government for the excellent job they have done in formulating it.

Debate interrupted.