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Monday, 24 May 1993
Page: 1081


Senator SHERRY (Parliamentary Secretary to the Minister for Primary Industries and Energy) (3.34 p.m.) —I intend to reply in some detail to the accusations—that is all they are, frankly—by Senator Kemp in leading for the Opposition in this discussion of a matter of public importance. He embellishes his speech with his usual flowery rhetoric, flushed with the defeat of the last election and flushed with the Opposition's ongoing agony over its own internal leadership problems. I do not intend to give ironclad absolute commitments on behalf of the Government because, as Senator Kemp well knows, I am not in a position to do that. I wish I was but I am but a humble Parliamentary Secretary who is not a member of the Cabinet, who does not serve on the Cabinet committees and who is not presiding over the Budget process. Unfortunately for Senator Kemp, the people of Australia keep voting for us at election after election and they keep rejecting the Opposition.


Senator Kemp —They will learn.


Senator SHERRY —Senator Kemp can laugh, but if I were sitting on his side of the House, I would not be laughing; I would be crying into that glass. The Opposition finds itself in an unfortunate position. The Government's medium-term objective has been made very clear: it intends to reduce the Budget deficit to one per cent of gross domestic product by 1996-97 without the alleged widespread breaking of commitments that Senator Kemp and many of the other Opposition spokespersons have been alleging over the last couple of weeks.

  The Government is not complacent; it knows that it will be difficult to address the issue of the Budget deficit. But it still regards it as a high priority issue to be achieved in the medium term. We are not going to see billions of dollars cut off the Budget deficit in the next year—it is not possible for any government to do that. This year we will be laying the foundations for continuing the progress towards that one per cent of GDP objective.

  Through good policy and effective programs the Government is setting out to implement its election commitments, and is not—I stress this—walking away from them. I was interested to hear Senator Kemp say that this Government had guaranteed an $8 a week pay rise from 1 July. I had not heard about that, and no doubt it would be a surprise to the ACTU and most Australian workers. That is an interesting interpretation of industrial relations announcements.


Senator Kemp —I have the press release.


Senator SHERRY —Senator Kemp is getting very excited about a press release. He should have learnt long ago that in politics one does not rely on press headlines to guide one about matters of fact. He has gone to find the press release. He might find it, but what the press says and what the Government does are often different things. My good friend and colleague Senator Cooney will be covering that issue of the so-called pay rise promise.

  Before going into the details of the Government's election commitments and how it intends to keep them, I remind the Senate of the difficulties of changing economic circumstances.


Senator Kemp —You are in office.


Senator SHERRY —Even Senator Kemp would agree that the Government's action in regard to the crisis in the wool industry—a crisis caused by the drought and low prices—has added to the Budget deficit. As Parliamentary Secretary to the Minister for Primary Industries and Energy, I have been directly involved with this matter. A couple of weeks ago the Minister for Primary Industries and Energy (Mr Crean) announced a package of some $55 million to address the problems of the wool industry. We do not hear the Opposition condemning us for being irresponsible with government expenditure and increasing the Budget deficit, for addressing those sorts of issues. The occurance of these issues is often beyond our power and expectation. For example, we were not to predict the collapse of the Soviet Union and the effect that that would have on the wool market. We have had a massive drop in demand for our wool, a massive drop in price and ongoing effects to our economy. That is an example of unpredictable contingencies.

  As Senator McMullan said in Question Time, every year we go through this great wallowing of speculation about what will be cut in the August Budget. The Opposition does it every year, and I cannot blame it. Every year it wallows in rumour-mongering about what is going to be cut and what taxes are going to be increased, and every year most of the speculation turns out to be absolute nonsense. The Opposition is used to making these accusations about us breaking our promises and proposing tax increases.

  So much of this is just wild speculation. It is pointless and, quite frankly, counterproductive. Again, I can understand why the Opposition has not got much more to do because it is still trying to work out what its position is on the republic, what its position is in terms of policies, which policies cost it the election and who should be its leader. So I can understand why the Opposition has to try to deflect a bit of flak and analysis away from its own performance. It has been pretty poor over the last decade, at least. But in relation to tax cuts—and Senator Kemp has challenged me on behalf of the Government—the income tax cuts have been legislated for.


Senator Kernot —He voted for them.


Senator SHERRY —As Senator Kernot pointed out, he voted for them; that is right. Senator Kemp voted for those tax cuts. What better commitment can a government give than to actually implement its tax cuts before the election and legislate for them? The Australian Democrats, as I am sure Senator Kernot will argue, are willing to reverse them at some stage in the future, by the sound of it. But this Government has given a commitment; it has passed the legislation, and one could not hope for any more commitment from any government. The income tax cuts are legislated for and they are in place.

  Let us turn to some of these other alleged commitments and breaking of promises. I intend to run through about eight or nine matters that Senator Kemp referred to in his speech, and that I am sure other speakers opposite will also refer to. The Government has reduced company tax down to 33c in the dollar. That was announced in Investing in the nation during the election campaign. That will be introduced as soon as possible. I am very confident we will see legislation on that. Actually, I am not so sure we will see legislation on that, given the slow pace of the Senate in the last couple of weeks due to the procrastination of the Opposition. If we could get over those sorts of problems we might be able to get the legislation passed a little more quickly. We have had nothing more than filibustering by the Opposition over the last three weeks. But legislation will be introduced to reduce the company tax to 33c in the dollar.

  I have already mentioned the package of initiatives for the wool industry. In fact, that package was announced two weeks ago and I dealt with that matter in the Senate here last Thursday evening. It was quite late in the evening, I recall, too—yet again due to the filibustering of those opposite. Therefore, a package that was announced after the election was brought through the Senate and the House of Representatives in two weeks—quick smart time. That must stand as almost a record for the time taken for a government initiative to be implemented.

  The Office of Regional Development has been established within the portfolio of the Minister for Industry, Technology and Regional Development (Mr Griffiths). He has also announced that a task force on regional development will be established very shortly. We have also referred to the income tax cuts. Legislation has already been passed to bring into effect from September of this year changes to the income test and the waiting period arrangements to help the unemployed and changes to ease the pension assets test. That has been passed, so that is well on the way.

  Work on the details of the implementation of the home child-care allowance and the new dental health care program is proceeding. I do not know what the Opposition expects. Perhaps it believed that as soon as the election was over—and of course it lost—these initiatives announced by the Government were going to be in from day one. They could not be introduced from day one. They have to be finalised in the Budget context, they have to be properly costed and there have to be ongoing discussions with the States about their implementation. They are not things that we can, with the wave of a magic wand, implement the day after the election.

  Work on the implementation of the provisional age pension for the long-term unemployed aged 60 and over and work on the seniors health card are also well advanced. But, again, these are not things that can be introduced from day one. The legislative amendments to introduce the working parents child-care cash rebate has been introduced in this sitting, so it is waiting to come through the Parliament. The Australian Law Reform Commission is proceeding with its review of equality before the law. Again, we have heard a great deal about that over the last couple of months. In terms of the review of labour market programs, Dr Bruce Chapman of the Australian National University has already been appointed to develop ways to improve assistance to the long-term unemployed.

  There was some comment about the tax treatment of pensioners, and I will quote from a letter from the Treasurer (Mr Dawkins) to the Secretary of the Australian Pensioners and Superannuants Federation detailing the way in which the Government intends to deal with that issue. The Treasurer said:

Let me make it entirely clear—all pensioners who are currently not paying income tax will continue to be exempt from tax.


Senator Kemp —Not the promise.


Senator SHERRY —Just hang on, Senator Kemp. I can understand why the honourable senator is excited. He is back in opposition, anxious to prove himself and anxious to get to the front bench and dislodge a couple of his colleagues who did not perform well enough to get the Opposition into government. I can understand why he is flush with wanting to get to the front bench. I ask him to hang on and be a bit patient. The letter continues:

The Labor Government has been concerned to help those Australians who rely on the pension as their sole or major source of income. Since 1983, pensions have been increased by $78 a week—a real increase of 15%.

I do not want Senator Kemp to forget that. That is one promise we definitely kept: real increases for pensioners exceeding 25 per cent of average weekly earnings. It is a great record compared with what those opposite did when they were in government. I will quote further:

For pensioners renting privately, the real value of payments has increased by nearly 23%.

So not only has our commitment to the pensioners of this country been kept, but also we have pension levels exceeding 25 per cent of average weekly earnings. The letter goes on:

The Government has also provided other forms of additional assistance to retired Australians. For example, Commonwealth fringe benefits will be extended to all pensioners from April 1993. I understand that the Pensioner Health Benefit Cards are being distributed at the moment.

Let me also reaffirm that the Government will:

.   introduce from September 1993 a more generous pension assets test, which will help over 40,000 non-pensioner and part-pensioner retirees. For example, a single part-pensioner with assets of $150,000, excluding the family home, now receiving $81 a week pension will benefit from a pension increase of $19 a week;

And so it continues through the correspondence.

  Then in a press release headed `Dawkins sees the light', Norah McGuire of the Australian Pensioners and Superannuants Federation welcomed what the Treasurer had to announce. The press release states:

"The AP&SF has led the debate about the most effective and equitable means of achieving this and the Treasurer has acknowledged this in his letter," stated Mrs McGuire. "Indeed, it was the AP&SF which first raised questions about the fairness of spending more than $1 billion on a commitment which would only benefit the top 30% of the pensioner population.

So the pensioner organisation and the representatives themselves have welcomed what has occurred in this area.

  I want to turn to one other matter: this hullabaloo over the Christmas appeals matching grants which Senator Crowley responded to in Question Time. I do not know what those opposite are doing. They really must be struggling to find issues and, frankly, the media have been falling into this trap. Let us look at this so-called breaching of the promise.


Senator Kemp —You have five minutes to go.


Senator SHERRY —I am well aware that, due to the filibustering of the Opposition, we have had our speaking time cut from half an hour to 20 minutes. The Prime Minister announced the Christmas appeals matching grants in December of last year in order to assist major welfare organisations to help those in hardship in our community with the added expenses of the Christmas period. Originally, both donations and matching grants were required to be expended fully on cash and material aid by 31 January this year. The Prime Minister determined that this would be extended to 31 March this year. We did not cut it back; we extended it in recognition that the hardship experienced by people in financial crisis extends beyond the period immediately following Christmas.

  What was the result in terms of cost to the Government? We do not complain about it. It resulted in the estimated $8 million cost to the Government being increased to $12.5 million.  If it was a breach of the promise, then I hope these organisations cop this breach every day because it actually led to an increase of 50 per cent in the amount of money allocated to these Christmas appeals; the amount went from $8 million to $12.5 million. So the Opposition has a strange interpretation of the meaning of breach of promise.

  I would like to conclude my remarks today—and my colleague Senator Cooney will be following shortly—with the apparent contradictions of the Opposition. The Opposition has said that we should not be reversing the income tax cuts, and I agree with that. The Opposition has actually denounced its own tax package which included a consumption tax, and since the election—


Senator Kernot —Do you agree with that?


Senator SHERRY —We agree with that. But since the election, the Opposition has been at it as well. It has been announcing a new range of initiatives but, of course, no costings accompany these initiatives. The new shadow Treasurer, the honourable member for Mayo (Mr Downer), is going to have to learn fast. The Opposition opposes any increases in taxes whatsoever. It is on record as doing that. It just says that the Government should cut back on expenditure. It does not detail where these cutbacks should occur, but it does detail some interesting increases in government expenditure.

  For example, the Opposition advocates tax exemptions for capital gain rollovers for small business up to a value of $5 million. It proposes limited tax rebates for bank savings. It does not say how much that is going to cost but, according to the last costings that I looked at on this issue in the superannuation promise that the Opposition made, it was some hundreds of millions of dollars. It also proposes investment allowances to allow businesses to depreciate equipment, and maintenance of the $3 billion infrastructure based rebuild Australia program announced in Fightback mark 2.

  So the Opposition is at it again. It is advocating big new expenditure items but, at the same time, it is saying that we should cut back on government expenditure; it does not say where. It is saying that there should be reductions in income tax, which we have legislated for. At the same time, quite critically—because this is the missing piece in the Opposition's formula—it cannot fund these proposed reductions because it has abandoned its consumption tax.

  So it is a pretty sore and sorry Opposition since the election. I actually feel sympathy for Senator Kemp and the Opposition. These allegations that the Government is breaking its promises since the election are really just part of a campaign to cover up the Opposition's own internal problems: what to do with the Leader of the Opposition (Dr Hewson) and how to deal with the republican issue.

  The Government will be making judgments on these matters over the next couple of months and those judgments will be revealed in the Budget. Every year at Budget time there is, as I said earlier, wild speculation which is pointless and counterproductive. We could add up the hundreds of wild assertions that the Opposition makes. At the end of the day, most of them—occasionally some of them are okay—are wildly incorrect. I reiterate: that is the sad truth of the matter as to why those opposite are in opposition today.