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Tuesday, 29 May 2018
Page: 4803


Mr HILL (Bruce) (12:30): I was just saying to my colleague the member for Macquarie that I might take that speech, pop it on my iPad and file it under fiction, and should ever I need a sleeping tablet I'll try that speech first. At the last election, Labor called out the government for its plan to privatise Medicare. Facts were revealed. The intent was clear. The secret task force had started its work. This was an attempt not just to privatise the core functions but to introduce co-payments and shift more costs to the private consumer. Australians were shocked. Labor members were not, because we remember the history of Medicare. The Whitlam government started to introduce it and the Fraser Liberal government got rid of it. The Hawke Labor government tried to introduce it and the Liberals fought it every step of the way, at election after election. Prime Minister Abbott came in and started to try and dismantle the notion of a universal, fully available public healthcare system, but we campaigned hard and we scared them off. The privatisation of public services is in the Liberal Party's DNA. It's part of why it exists. Nothing has really changed, and this con of a budget accelerates the P-word—privatisation. I'll focus first on Centrelink and touch later on the growing mess that is the visa-and-citizenship processing function in the Department of Home Affairs, or whatever they call it this week.

It's no understatement to say that millions and millions of Australians are fed up to the back teeth with the ever-worsening mess and service from Centrelink. The very name causes people to groan now, to shudder: 'Please, no, mum! Don't make me sit on the phone to Centrelink! I may die waiting.' Hours and hours and hours of people's lives are wasted on the phone trying to get basic things done. Last year we heard—this is last year; we'll wait for the new figures out of Senate estimates—there were 55 million unanswered phone calls at Centrelink. The Abbott-Turnbull-Joyce-McCormack Liberal government just cut a further 1,280 jobs in this budget. That's on top of 5,000 jobs that have been cut from the Department of Human Services and Centrelink since they were elected five long years ago. This budget, sadly, continues the privatisation agenda.

To give them credit they're at least being upfront with this one, unlike with Medicare, and are not trying to hide it anymore. At least they put it in the budget papers and have stopped telling lies. But the people don't know the actual costs, of course. Last year, the first sign of this emerged. In the budget papers, buried on a page way up the back, was a mention of a trial of 250 jobs being outsourced to a call centre. It was a trial. The cost was listed as NFP—not for publication—it was a secret. I said at that time in my speech in the budget debate: 'What a load of BS. Privatisation has started.' I was screamed at by those in the chamber: 'You lie! You're exaggerate! It's not the case.' It turned out I was a prophet. This year they're ramping it up. Another thousand jobs have just been privatised to Serco. Let's google Serco. I did this morning, just to refresh my memory. It's astounding to see what comes up. Serco is a British based company, well known for snatching up any chunk of any public sector around the world that it can get its hands on for a tidy profit. It's become a byword in many countries for privatisation: immigration detention centres, prisons, the NDIA call centre, defence assets, Centrelink. Whatever, it will do it. In my view, companies like this expand like an organism, a parasite that feeds off the taxpayer. I quote from a gardening website:

Parasitic plants have the ultimate plant lifestyle. They get their food or water from another plant instead of making food or obtaining water on their own. The host does the heavy lifting and the parasite benefits.

In this case, the taxpayer, via the public, is the host, companies like Serco the parasite, offering cut-price services on the cheap, at least at first. But, of course, as we've seen this record, this movie, play over and over again worldwide, the truth is that, like most parasites, the ultimate aim is to suck the life out of the host and kill its capacity, because, over time, once the loss of capability in the public sector is complete, it's a seller's market and prices go up. At the core, this is driven by a mistaken ideological belief that the private sector is inherently more efficient—always more efficient, always better. It is also driven by the desire to transfer operational and political risk to the private sector and away from ministers. This is based on a prayer that these benefits then somehow will outweigh the profit margins.

The last five years in Britain are very instructive, and I encourage members interested in these matters to have a look at what's happening there. The warning signs for Australia and the path that the Liberal government is on with the increased privatisation of core public services are clear. The notion of 'too big to fail', which we've heard about in the banking sector, is now part of the common lexicon in Great Britain regarding these big service delivery companies that have hollowed out government departments and trashed their capability to deliver public services. It's openly talked about in the media, by government audit officers and by members of parliament across the spectrum. The recent collapse of Carillion in the UK meant that the government had no choice but to step in earlier this year with government-backed loans to contractors and suppliers because they simply couldn't do without this private company that had gone bust through bad management.

It's not just costs, though; it's issues like accountability. We've seen deaths in detention centres, loss of ministerial control, plausible deniability—'It's not me, it's the contractor; I'm not responsible for anything'—lack of transparency, not being subject to FOI, no public reporting and no transparency on multibillion-dollar contracts and the profit margins that are being made on them. The tax affairs are mysterious—opaque—to say the least. I've been raising the issue of why we can't require these contractors to disclose their domicile for tax purposes so that, if you're going to get a big government contract, a fat, juicy government contract, you've at least got to be up-front about where you pay tax and the taxpayer will be able to see that you actually pay some tax. Apparently that's too hard. Integrity is a big issue. There are no public sector values, no obligations and no code of conduct like those that have always applied to public services. We see the scandals, and the employment practices, as we're seeing with Serco and the call centres, are simply about cutting people's wages.

People are fed up with these as outcomes and sceptical about more privatisation. Survey after survey show it. We've seen criminal investigations in Great Britain into Serco and G4S, and five years ago the British National Audit Office raised concerns about major contractors. They explicitly queried whether this growth was in the public interest. I know the public interest for many is an old-fashioned concept. It's one I believe in. It is society and community deciding to do things collectively in the interests of the many not the few. Of course, there is a role for genuine niche contractors and consultants where we need that expertise and capability, but this odious ideology which underlies the large-scale privatisation of core public services is increasingly discredited, and the place it leads to is not somewhere we should go.

In Australia, this is driven in part by the abject nonsense under this government of arbitrary staffing caps for all government departments. What they did was they came in, they got elected and they said, 'I know; we're going to return to the glory days of the Howard era. We're going to impose random staff numbers, completely divorced from any assessment of capability or what a government agency may need to do for society. We're going to just put a staffing cap on, despite growth in population, demands and so on.' It's a blunt instrument, as the secretary of the Prime Minister's own department has described it, and it's a completely irrational method of resource allocation. So you're told you can't employ a public servant to do a job but you can employ a more expensive private contractor.

The ABS has finally told the truth to the Public Accounts and Audit Committee in the last couple of months. They admitted, in evidence, that the cost of a labour-hire ICT contractor—IT workers do computers, which is why the ABS needs them—is 200 per cent more than just employing that person as a public servant. The only reason they can't employ that person as a public servant, the only reason they're wasting taxpayers' money is that the government won't budge on the staffing cap. They said that this is going to be an increasing problem over the next few years. They're going to need to do more and they're going to need to waste more money on labour-hire contractors to privatise services because of this stupid ideology.

I think it's about time we pushed back hard not just against further privatisation. It's time for a debate on insourcing—having a look where things have gone too far, saying that, after three or four decades of this stuff, perhaps there are areas where we've gone too far and it makes economic and fiscal sense to rebuild public sector capability in the interests of not only costs but service quality, integrity and so on.

There are two obvious examples I would raise, which have been well debated and ventilated time and time again—IT services and also engineering, particularly in the case of the states and territories. I've mentioned the ABS example, which puts numbers around it, but in ICT we've seen decades of outsourcing, no internal capability left, a litany of stuff-ups by government departments, time and time again, every time they try and do a big IT project—because, as someone in the private sector said to me, 'The problem with government departments now is that they're not an informed purchaser; they actually have no-one left who understands this stuff and knows whether they're buying $200 million of crap or not.' That's a direct quote, and it's fair. In my view, great societies have great public services. To do that, you need highly skilled, highly capable public servants—who knew?—people who can actually scope, administer, evaluate and deliver services. The government should stop this ideological tack and effort to privatise critical public services. It makes no meaningful contribution to improving service delivery in our society.

This budget ramps up the Liberal government's avoidance of scrutiny and its complete lack of integrity. I'll give a couple of examples. Surprisingly, shockingly, over the next four years this budget bakes in $26 million of cuts to ASIC's core operational funding. This is not the special projects stuff; this is the everyday core funding that the regulator of the financial and banking sector needs to do its job. You might think that's a 1 April joke coming in the context of the scandals emerging from the banking royal commission—the royal commission which the Prime Minister, the former investment banker himself, had to be dragged kicking and screaming to actually have. There is shocking evidence emerging of mismanagement, cultural problems and a failure of the regulator to act. There is scrutiny now on handshake deals. You commit a crime, you get found out and you get popped in a room where the regulator says: 'You've been a bit naughty there; let's negotiate a penalty.' And you say: 'I don't want to pay that much.' And they say: 'All right, what about a bit less?' You say: 'I don't want to pay that much.' They say: 'What about a bit less?' You say: 'All right, we'll cut a deal on that.' The regulator has been shown to have a lack of resources, yet the government is cutting funding to the banking and financial services regulator. You'd think even the boneheads in the government who put the budget together would realise this is not the time to cut the funding to ASIC.

But while they are on a roll, from the end of this year the budget also ends funding for the Serious Financial Crime Taskforce—just as the banking royal commission winds up! It's going to be magic: 'We'll have an election by then; we can go back to normal programming.' This is a task force consisting of the Commonwealth Director of Public Prosecutions, the Australian Federal Police, ASIC and others investigating the most serious crimes in the financial sector. They've admitted they have 22 ongoing matters. They won't be wrapped up by the end of the year. Who knows what will happen? The government should send a leadership signal and a cultural signal to this sector right now that this stuff will not be tolerated and there is going to be a strong cop on the beat rather than cutting funding to ASIC and winding up the task force that is actually trying to do something about it.

It comes amidst $205 million of cuts to the Australian Federal Police. Apparently the Prime Minister says that's not the case, yet you've got the Federal Police saying it is. I don't know who is lying now. We'll let the public work that out. There have been 4,000 staff cut from the ATO since this government was elected five long years ago, many of which, we have proven, have been replaced with short-term labour-hire contractors that actually cost more. This is not a cost-saving measure; it's an ideological attack because of those staff caps. And there has been no support for a national integrity commission.

Labor has committed to introduce a national integrity commission ensuring that the public sector, MPs and the Governor-General—everyone in the public sector—are subject to proper scrutiny. The Attorney-General finally fessed up last week in a letter he wrote back—an outbreak of honesty moment. He said, 'The government believes there is no persuasive evidence that we need this.' He used to say that he wasn't close minded. Now he says 'no persuasive evidence', so we presume he's now closed his mind. It's suggested by that letter that the government will therefore fall well short of any anticorruption body with broad-ranging powers. It's important to note that anticorruption bodies are very different from fighting crime: they're proactive, they're investigative, they have compulsion and they provide a much stronger effect on the system of deterrence, as we've seen in the states and territories. Admittedly, there are flaws in some of the state and territory bodies, but I don't think anyone in the real world, in the general public, would say that they have not served an important purpose overall in flushing out corruption in the public sector and setting a better culture in deterrence. I think the case has been established on its merits and made quite thoughtfully by the Leader of the Opposition and the shadow Attorney-General. I also think it's a step—it's not sufficient but perhaps a necessary step—to starting to rebuild some of the public trust which has been lost in a very damaging way between citizens, those elected to serve them and the public sector more broadly.

This is an issue for which I'd encourage the Liberal backbench to focus for once on something useful. I don't mean the member for Bennelong; I think his comments on cities, affordable housing and so on are laudable. But, instead of advocating for the watering down of legislation so the priority would be to let people say more racist stuff by weakening the Racial Discrimination Act or for burning coal—the Monash Forum shamefully appropriating the name of Sir General John Monash for purposes against the wishes of his family: burn coal, burn coal—perhaps this is something the Liberal backbench can focus on. Otherwise, Australians can rightfully ask, 'What have you got to hide?'