Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Current HansardDownload Current Hansard    View Or Save XMLView/Save XML

Previous Fragment    Next Fragment
Monday, 18 June 2001
Page: 27832


Mr BARTLETT (8:55 PM) —This budget does three main things. Firstly, it continues this government's record of sound, responsible economic management—management that is careful, sensible and sustainable. Secondly, it provides incentives for people to become self-sufficient, an approach that this government has taken over its five years, in sharp contrast to that of the former government. Thirdly, it addresses areas of need. Let me tackle each area in sequence. This budget is a responsible budget and is part of this government's proud record of responsible economic management. This budget is the coalition's fifth surplus budget in a row. This government is living within its means. It is delivering essential services and is doing so within the capacity to pay. Compare and contrast this with the former government, a government that ran five deficits in a row in its last five years, averaging $14 billion—that is, $14,000 million, a year. The former Labor government, outrageously, lived beyond its means and mortgaged the future of our children and grandchildren to pay for its profligacy and irresponsible spending.

Not only is the coalition government living within its means but it is repaying the massive debt built up by Labor. Already this government has repaid $50,000 million of Labor's debt. By the end of this year it will have repaid $60 billion of government debt. As everyone in this country knows, in its last five years alone, the Labor government ran up Commonwealth debt from $27 billion to $97 billion, an increase of $70 billion—an outrageous legacy of debt heaped onto the shoulders of the next generation. This government, by its careful management, has already managed to repay $50 billion of that debt. The other point that needs to be made about debt is that not only did Labor run up $50 billion of debt by spending more than it raised in revenue but it sold off everything that was not nailed down and still managed to increase debt by $70 billion.

The third thing is that by repaying this $50 billion of debt—$60 billion by the end of this year—this government will be saving taxpayers that considerable annual drain on taxpayer revenue that goes in interest payments to service debt. When we came into office in 1996, $8 billion a year—that is, $8,000 million a year—of taxpayers' hard earned money was spent just washing down the drain to pay interest payments on the debt that the Labor government had so irresponsibly racked up in its last five years. That annual interest payment has already been reduced from $8 billion to $4 billion. Now, because of this government's sound management, we are saving $4 billion a year of taxpayers' money. Instead of being wasted on interest payments, that saving is now able to be spent on schools, roads, infrastructure, health, defence and family assistance, on essential things that this country needs—not the legacy of debt but the legacy of sound, responsible management over five years of this government.

Many other key indicators give evidence of this government's sound and sensible approach to management. When we came into office, home loan interest rates were 10.5 per cent; they are now 6.8 per cent. The average mortgage holder with a mortgage of $100,000, as everyone knows, is saving over $300 a month because we have reduced the pressure on interest rates. We have reduced the pressure on interest rates because the government is not in the market borrowing massive amounts of money—$14 or $15 billion a year—and putting upward pressure on rates. That is the benefit of living within one's means.

Over Labor's 13 years, home loan interest rates averaged 12.8 per cent. They are now 6.8 per cent—six full percentage points below what they were on average over the 13 years of Labor. This is a massive benefit for home buyers and a massive benefit for businesses borrowing money or running overdrafts. This is one of the benefits of responsible management.

Look at unemployment figures: when we came into office, 8.6 per cent of Australians were unemployed; now 6.8 per cent are unemployed. Over 800,000 jobs—most of them full-time jobs—have been created under the government because of our strong approach to managing the country. Over Labor's 13 years, unemployment averaged 8.7 per cent, peaking at 11.2 per cent in a deliberately created and heartless recession. The government are responsibly managing the country and, in doing so, are not just correcting the bottom line but providing real, tangible benefits for the average working Australian.

This budget is based on a forecast growth rate of 3¼ per cent—further evidence of the proceeds of good management. We have a world that is going into recession. Most Asian economies are going backwards and the US economy is in a very shaky position, yet the Australian economy looks like it will grow at over three per cent in the next financial year. It does not happen by accident; it happens because the government provides the parameters, provides a sound framework and provides a confident environment in which Australians can invest, expand, produce and employ.

Further, the outlook is for inflation to fall to the 2¼ per cent forecast for the next year. If you want to look at other indicators, look at our trade performance. We have an improving balance of payments outlook. In fact, we have an outlook that has the current account deficit at less than three per cent of GDP—a figure rarely achieved over the past 20 years. It is 2.8 per cent of GDP at the moment. Look at Labor's record. Several times under Labor the current account deficit reached over six per cent of GDP, but the government have got it down to three per cent of GDP. Why? Because we have encouraged exports. Why? Because we have reduced $3½ billion worth of taxes for our exporters. Why? Because we have provided low interest rates to stimulate business investment. Why? Because we have had the Australian government out there forming strong deals with other countries and marketing our exports.

This government is a government which delivers benefits for Australian consumers, benefits for Australian families, benefits for Australian businesses and benefits for Australian retirees because of its strong management of this country. Just look at the contrast. Quickly contrast the record under Labor with the record under this government. Under Labor, there were massive budget deficits, averaging $14 billion a year for Labor's last five years in government. Under this government, for the last five years there have been budget surpluses. Under Labor, there was exploding debt—$70 billion of debt notched up in its last five years. Under this government, we have already had the repayment of $50 billion of debt. Under Labor, there was high unemployment. Under this government, there is falling unemployment. Under Labor, there were cripplingly high interest rates. Under this government, there are low interest rates. Under Labor, there were high, uncontrolled current account deficits. Under this government, there are low, controlled current account deficits. Under Labor, there were high and growing taxes. Under this government, there are tax cuts.

There are cuts in income tax. Last year we had $12 billion of cuts in income tax. Last year we had a two per cent cut in company taxes—from 36 per cent to 34 per cent—and in just two weeks time there will be a cut of another four per cent from the corporate tax rate. We had removal of the wholesale sales tax last year and we will have removal of financial institutions duty from 1 July this year. This government's record is one of which we can be proud and one which has really set up the future for our children and our grandchildren.

Look at the alternative. Labor has already indicated the foolishness, impossibility, contradiction and hypocrisy of its approach. Labor is claiming on the one hand that it wants to roll back the GST, yet it is saying that it also wants to increase spending. We have had a number of speakers in here tonight already saying, `We want to increase spending on this. The government hasn't spent enough on that. We want more money to go into something else.' How in the world is Labor going to increase spending on everything that it can think of and yet roll back the GST and promise not to go into deficit without raising taxes?


Mr Wilkie —We cut back your extravagance.


Mr BARTLETT —The future is clear under Labor. Labor wants to raise taxes. The member opposite wants to talk about cutting back our extravagance. I would ask the member for Swan: which government programs would you cut? Would you cut the $1 billion that we have allocated for the Natural Heritage Trust that is doing so much good for our environment? Would you cut the allocation of $23 billion extra for defence spending over the next 10 years? Would you cut the $900 million increase in funding for health? That would come to less than 0.1 per cent of total government funding.

What you are suggesting is an absolute farce, and you know it is a farce. You want to increase spending. Which taxes would you raise? That is the bottom line. Would you double capital gains tax again? This government cut capital gains tax by half. Labor members opposite, would you double capital gains tax again? Would you raise income tax again? Would you raise the company tax rate from 30 per cent back to 36 per cent? Would you introduce a death duty? Would you raise GST? Would you re-introduce wholesale sales tax? Several of those things would have to happen if you were to continue with your policy. Labor has no future. It has been caught out with empty rhetoric, promises of grand spending and roll-back, with no way in the world to fund any of those promises.

This budget does a couple of other key things. Besides continuing this government's program of responsible management, it provides incentives in key areas to encourage, assist, motivate and reward people who look after themselves—firstly, by assisting people to get back into work. It is not about removing the welfare safety net; it is about encouraging and assisting self-sufficiency. We know in this country that the only way to get people off welfare is to give them incentives and assistance to stand on their own two feet. The McClure report made it clear that the best thing we can do to assist people on welfare is to help them get into employment. This budget does this. It continues the commitment to mutual obligation—the commitment that we have already seen in the very successful Work for the Dole program.

This government is about active welfare, not passive welfare, not the debilitating passive approach of the Labor Party which further entrenched dependence. This government's approach is about providing incentives and assistance for people to stand on their own two feet. This package allocates $1.7 billion over the next few years for Australians working together. There are a number of programs that I will not go into in detail which include: the Working Credit initiative, Jobsearch training and Work for the Dole, expanding places in literacy and numeracy training to remove those barriers that prevent young people getting into work, and more Work for the Dole projects, which Labor is opposed to. Labor fought us every inch of the way when we tried to introduce Work for the Dole, yet that scheme is working effectively in getting young people in particular off the unemployment queues, out of long-term unemployment and into work.


Mr Wilkie —No, it is not.


Mr BARTLETT —It might not be in the Swan electorate. Perhaps the member for Swan is not supporting his Work for the Dole projects. In my electorate, it is very effectively getting people off the dole and into work. One of my electorate's Work for the Dole schemes has a board up called the `victory board'. On this board they list the names of people who were formerly on unemployment benefits who have gone on to full-time training or into employment. They are up to their fourth or fifth board with people actually getting jobs. Work for the Dole, which Labor opposes, gives parents assistance and encouragement to get ready to return to work as their children grow up. There are some 7,000 new disability employment assistance programs and a number of other programs to train people with disabilities to prepare for work, to provide assistance and rehabilitation programs and to give those people opportunities to get back into the work force.

I do not have time to go through the details of the many very beneficial programs here in the third main area of the budget, which comprises targeted—and I have got to say in contrast to Labor—and affordable programs that will address key areas of need. The first is to reward retirees who have made an effort, worked and paid taxes all their lives and have put aside money to invest wisely for their own retirement. There are a number of benefits here. This government for the last five years has been working to assist self-funded retirees.

We raised the tax-free threshold some four years ago for low income self-funded retirees. This budget goes a step further: self-funded retirees receiving up to $20,000 will receive the full pensioner rebate that pensioners receive and effectively pay no tax. This phases out up to $37,840 for singles and some $58,000 for couples. Further, as well as raising the tax-free threshold, the seniors health card now becomes available for self-funded retirees: for singles up to $50,000 and couples up to $80,000—something the Labor Party never thought of doing—and there is the exemption of the superannuation assets for over-55s.

A couple of weeks ago I was out doorknocking, as one is wont to do in a marginal seat. I was speaking to one gentleman about some of the benefits in this budget and, totally unsolicited, this self-funded retiree said to me, `You know, Labor never did anything for self-funded retirees.' Labor never did anything for self-funded retirees because Labor's approach is not to encourage self-sufficiency; Labor's approach is to encourage dependency. This government is about rewarding, encouraging and assisting those people who want to make an effort and want to stand on their own two feet.

There are many other benefits in this budget: the $300 tax free for people on full or part aged pensions; the benefits for veterans of a $25,000 tax-free non-assessable grant to POWs of Japan; the repat Pharmaceutical Benefits Scheme benefits for people who served in the British Commonwealth allied forces and who have been in Australia for over 10 years; and the granting of the war widows pension to those war widows who married before 1984.

Another very important benefit is the increase in defence spending and the strong commitment that this government has to rebuilding our defence capabilities, so badly ignored by Labor during their 13 years in office. This budget contains the first step in implementing the government's strategy outlined in the defence white paper, $500 million extra this year. A 10-year increase will see an extra $28 billion spent on defence. I firmly believe that one of the key responsibilities of any government is to ensure the security of its citizens. This government is committed to ensuring the security of its citizens by substantial ongoing commitment to increasing defence spending, with real increases of three per cent per annum over the next 10 years. This government is serious about this obligation. Other aspects of this program include an increase of nearly $600 million over the next five years for customs and quarantine.

I could mention the increased spending for education, increased spending for health and increased spending for the environment. I just want to make a final couple of points about education. This budget delivers an extra $238 million for schools over the next four years on top of the increased funding allocated under the states grants bill earlier this year. This includes programs for literacy, numeracy, online curriculum, science, maths, technology, enterprise career education and the Jobs Pathway program.

Eighty-seven per cent of these increases will go to public schools. Public schools by the end of this year will have received increases of 42 per cent in direct funding under this government. This year, public schools in New South Wales will receive from the federal government an extra 5.3 per cent increase in direct funding, yet the New South Wales government, which has prime responsibility for state schools, is only going to increase funding for its state schools by a paltry, miserable 2.3 per cent. The federal government is doing far more for public schools in New South Wales and, indeed, across the country than the state governments are doing, and certainly more than the Carr-Aquilina government is doing. Over the last four years in New South Wales the state government's funding for public schools has fallen from 26 per cent of its budget to under 23 per cent. It is failing its public school students miserably. This federal government is trying to pick up the pieces while the state government is letting the team down.

Increased money for vocational education and training means a record $7.6 billion over the next four years. There is an extra $230 million for ANTA and extra funding for apprenticeships totalling up to $2 billion over the next four years. When Labor left office apprenticeships in this country were at a 30-year low. This government has worked hard to rebuild apprenticeships and traineeships in this country, reaching a record level this year. This budget delivers. It delivers responsible management. It continues to reward and assist those people who want to try to stand on their own two feet, and it delivers assistance and affordable funding to areas of need. (Time expired).