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Tuesday, 5 June 2001
Page: 27295


Mr O'CONNOR (8:04 PM) — The appropriation bills we are debating in this House today give legislative effect to the Howard government's latest crude attempt to save its political skin. This budget is ample evidence for the astute commentator that this is a government in an advanced state of terminal political decay. For those who are students of the political process, the seeds of that decay were certainly not planted in this budget but in the deceit and lack of vision in previous ones. This crude and, some would say, politically obscene attempt to buy votes ahead of the federal election later this year is but one symptom of a desperate government in panic mode, confronted with the realisation that it has only itself to blame for its current political position.

You can tell a desperate panic-stricken government by the way it seeks to arrogantly manipulate the voting intentions of groups like the elderly. This government seems oblivious to the deep sense of cynicism and betrayal that important groups in our society feel when they are so manipulated. But the telltale signs of terminal political decay for this government go back many years. They go back to the abandonment of ministerial standards by a Prime Minister who, before he was elected, portrayed himself as a paragon of political virtue by promising to lift them. We all know the dismal record of this government in this particular area. In its first term no less than seven ministers—and it should have been 10—hit the fence in scandal after scandal as the government was rocked by allegations of rorting and conflicts of interest. Another telltale sign of that political decay is when a national government governs for sectional interests and elites, while convincing itself in a prolonged bout of self-delusion that it is really governing for the many—in this instance `the battlers', in Howard government parlance. We have seen this in evidence with the massive amounts of money that this government has allocated to category 1 schools under its education funding formula.

The accusation that this government is out of touch and governs for the big end of town is not a charge made by the opposition in isolation. It is a view expressed by government backbenchers and the view of the current President of the Liberal Party, Shane Stone, no less, who documented for posterity the rather perceptive political observations by Queensland MPs in his now infamous memo. The Parliamentary Secretary to the Minister for Industry, Science and Resources is here at the table, and we know how colourful he can be at times with his language. It would appear that his honest perceptions of his own government—given that he is part of the government—made their way into the infamous Stone memo.

Another important sign of that political decay is when a government lacks vision and direction and substitutes advertising for political substance and seeks to cover its political and policy tiredness and laziness by cultivating through the advertising medium an impression of political activity. This government has driven advertising expenditure to obscene heights at the Commonwealth level and has spent over $1 billion on consultancies and advertising over the three years to 30 June 2000. The government, in its desperation to convince Australians to accept a tax that the Prime Minister said he would never, ever introduce, and one the Australian public did not want, blew out the advertising bill on the GST alone to $210 million.

The waste of this government is staggering. It is of little comfort to the hundreds and thousands of small businesses in this country which have been turned into tax collectors for John Howard and Peter Costello that, as they give up their precious family and business time to fill out their BAS and meet their legal requirements under the government's new tax system, John Howard and Peter Costello are indulging themselves in an orgy of expenditure on advertising and consultancies to save their political skins. Labor intends to halt the drunken sailor mentality that appears to now propel this government's advertising agenda. We intend to cut spending on consultancies and advertising by $195 million over three years and we will use it to fund the national fight against cancer, a disease that most Australian families have experienced first-hand somewhere in their lives.

Probably the most telltale signs of the Howard government's political decay are the divisions that now rack the coalition leadership and the deep rifts that now exist between the Liberal and National parties coalition partners. Good government and fiscal responsibility require unity within the government of the day, yet we have seen with the Stone memo and the way that it was publicly released just how paper thin the veneer of unity between the Prime Minister and the Treasurer really is. When the Stone memo became public the political panic set in within the government. It is that political panic that has formed the backdrop to this big taxing, big spending Liberal budget, which has now reached new heights of fiscal irresponsibility.

The now infamous memo by the Liberal Party president catalogued for the Prime Minister the advanced state of political decay his government is in. These are not the opposition's words; these are the words of the Liberal Party's number one political organiser and operative. How was the government described in the memo? These are not the opposition's words; these are the government's own words, the government's own description of itself. The Stone memo described the government as mean, tricky, dysfunctional and out of touch. A harsh and accurate description of the Howard government it is but really confirming for the Australian people what they already knew. Pensioners know how mean the Prime Minister is, because he undercompensated them for the impact of the GST. And they know how tricky he can be: he is the master of the non-core and the never, ever promise.

We need to examine this memo, because it is quite instructive about the current state of the government. You might recall, Madam Deputy Speaker, that we had the dream team in opposition—`the young and the restless', as it was called—the Downer-Costello leadership team. We can hardly remember it, but there it was. We had the young and the restless. Now we have got the mean and the tricky. We have got the Prime Minister and the Treasurer, but we are not quite sure who is the mean one and who is the tricky one.

I hear from a very reliable source at the Liberal Party—cash-strapped as it is, with its funds drying up, and the National Party the same—that they are going to put this saga on the big screen. You know, Madam Deputy Speaker, that famous spaghetti western called The Good, The Bad and The Ugly. The Liberal Party is now going to put their saga on the big screen. It is going to be called `The mean, the tricky and the dysfunctional'. We have trouble with the casting. We know who the dysfunctional one is. That is the President of the Liberal Party, Shane Stone. He has displayed that dysfunctionality over a fair period of time in the Northern Territory parliament. But we are a bit worried about the casting of the other two. Is it Tricky John and Stingy Pete, or is it Stingy John and Tricky Pete? We are not quite sure who is who in this new drama.

If you happen to look at the definition of `trickery', it means `magician'. We know the Treasurer is a magician. He can make a tax appear out of nowhere, even though he is part of a government that said it would never increase taxes or introduce any new taxes. He made these appear out of nowhere: the wine equalisation tax, the petrol tax and the new milk tax. He is a magician because he has made the surplus disappear before your very eyes. When you look at the state of unity within the coalition, you realise that it is rotting at the seams. Out there in voter land the Prime Minister can advance his bribes—and that is all this budget is: a crude attempt at bribery—he can do whatever he likes, but the polls are now reflecting how the people of Australia regard this thinly veiled attempt to claw back some political capital after the Prime Minister and his government have lied to them over the last five years and driven the boot into especially rural and regional Australia.

The budget before us is an admission of political failure. What we have here is a document cast in political panic, designed with one objective in mind: to save the political skins of the Prime Minister and the Treasurer. But for the majority of working people, pensioners, businesspeople and self-funded retirees, this is a budget that fails to deliver. Where are the initiatives in this budget to assist Geelong families to cope with the ravages of the GST on their income and the inadequate compensation that came through to them in the government's new tax package? Where are the real measures to lift the GST burden on Geelong's small businesses? The $300 to Geelong pensioners is, by itself, an admission that they were undercompensated for the adverse effects of the GST on their standard of living. It fails to deliver on the $1,000 promise that was made to them by the Prime Minister.

For the benefit of the parliament, I will quote from two letters that I have received from pensioners in my electorate, one of whom I will name because I know the gentleman concerned, George Vansetten, who lives in Manifold Heights. He has documented for me the extent of the GST he has paid and the difficulty that he is having on a pensioner income coping with the ravages of the GST. Before July 2000 he was regarded as a low-income earner and he paid no tax. He has had a minimal pension rise over the period to compensate him for the impact of the GST. I will not mention the name of the pensioner who sent me the other letter, as I do not have his permission to do so, but he had this to say about the Prime Minister and the GST:

... the Prime Minister stated on TV that the pensioner was generously compensated for the GST. This man either lives in noddy-land or is just a callous, cold-hearted individual.

Whichever description of the Prime Minister is more apt, this pensioner has documented for me the extent of his GST payments since the GST was introduced. He has paid a total of $825.38 up to this point. A significant part of that was a payment of $567 to a funeral director's service on the death of his wife. If it was not enough for this pensioner to have this tragedy in his life, he has had to fork out GST on the funeral of his partner. When you look at the trend in that GST expenditure, you can understand why the pensioners in my electorate of Corio in the Geelong region are so disillusioned by this government and feel so betrayed. The promise that was made to them is but one of many promises that have been made by the Prime Minister and broken. The Prime Minister adds insult to injury to every Australian voter by saying that a promise that he made is a non-core promise. I was raised on a dairy farm. My father was a generous man, but he was a firm man. If I had said to my father that I had made him a non-core promise, there would have been hell to pay in our household.

We know that the other measures announced in the budget aimed at self-funded retirees will be accessed only by one-quarter of them. The worst admission in this budget is the government's own assessment that the unemployment rate will remain at seven per cent over the next year. After nine years of growth in Australia, Geelong's unemployed, along with others around the country, face a declining prospect of improving their employment status. What the Corio electorate saw of this budget was not a vision for their nation but simply a crass attempt by the Prime Minister and the Treasurer to buy their votes.

Make no mistake: this is the highest taxing and spending government in Australia's history. The government is at its trickiest in trying to claim that the GST is not a Commonwealth tax. Of course, we know it is. When the $24 billion raised by the GST is counted in Commonwealth revenue, then the tax to GDP measure—the tax measure that the Prime Minister is fond of—is massively increased.

The taxing record of this coalition government is quite extraordinary. In 1996 the Prime Minister promised that there would be no new taxes and no increase in existing taxes. The public record, courtesy of the Clerk of the Senate, now shows that in his first term the Prime Minister broke that promise 63 times. That was obviously a non-core promise. We now find that that figure is up to 114 new taxes. He also promised to simplify the tax system and to cut red tape for small business. Is it any wonder that small business cannot wait for the election so that they can pay out on the government? The tax act, once 3,000 pages in length, now runs to 8,500 pages. The new tax system has been amended some 1,800 times. No wonder small businesses in my electorate are tearing their hair out at the complexity of the new tax system. This budget, the first in the new century since Federation, presented the government with a unique opportunity to lay out some markers on its vision for Australia's future, and the government failed the test.

In concluding, I might make some comment on the continuous bellyaching that comes from government members about the terrible years of Labor. Many of us here have a long political memory. We go back to the terrible years of Liberal rule when the Prime Minister was Treasurer. The Liberal Party left Labor with a double digit unemployment rate—can you believe it?—of 11 per cent. The Liberal Party left Labor with a double digit inflation rate, with double digit interest rates, with the highest level of industrial disputation on record and with one of the worst national savings performances in the industrialised world. It left it with an outdated, ramshackle, inward looking industrial base and it left Labor with a budget deficit. That was John Howard's legacy—a budget deficit in current dollars of $25 billion.

What of Labor's legacy to the coalition? We broke the back of inflation, we brought the unemployment rate down to single digits from the Liberal Party's double digit figures, we did the same with interest rates, we modernised the economy and we lifted the government's national capacity to save. The government lost $12 billion, by market expectations, on the sale of the first tranche of Telstra. They have now blown $24 billion on a tax that nobody wants. It is a great vision for a nation in a new century to introduce a tax that belongs in the previous century. That is the extent of the coalition's vision, and the Australian electorate can't wait. (Time expired)