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Thursday, 19 August 1993
Page: 386


Senator BOSWELL (Leader of the National Party of Australia) (8.17 p.m.) —This is the 11th budget that this government has brought down since it gained office in 1983. Each budget over the past five years has heralded deteriorating economic and social conditions. We have seen over one million unemployed, 29 per cent of our young people are out of work and have never had a job, our trade deficit has risen to $15.5 billion and our foreign debt has risen to over $160 billion.

  These woeful economic indicators and unemployment figures are the manifestation of this government's total inability to handle an economy. Sadly, there is very little reason to expect any improvement over the next three years. The official budget deficit is $16 billion. However, when government assets sales are taken into account—and these include the sale of the Commonwealth Serum Laboratories, the sale of 19 per cent of the Commonwealth Bank, the Moomba-Sydney pipeline, the Snowy Mountains Engineering Corporation and others, to the value of $2.4 billion, with the inclusion of an extraordinary $3.2 billion profit from the Reserve Bank and $800 million from higher dividends from government business enterprises—the real government deficit would be in the vicinity of $23 billion.

  The government has engaged in some creative accounting, flogged the country's assets and raided the state governments' hollow logs. This is evident in the case of the rural adjustment scheme, where the states have been forced to return $123 million to Canberra to make their deficit look better, only to have it paid back to the states at a later date, something like the thimble and pea trick.

  The government has spent $23 billion more than it took in revenue, despite cutting spending by $285 billion and increasing taxes by $32 billion over the next four years. That is after the Prime Minister (Mr Keating) told us time and time again that he would not raise taxes.

  There are pages of quotes of the Prime Minister promising no tax increases, but no amount of quoting broken promises will remove the government from the other side of the House until the next election. I have always worked on the principle `winners are grinners and you've got to cop it', but the Prime Minister's deceit has made me determined that I will do everything possible to play a role in removing him from office at the next election.

  The tax on fuel will rise by 5c a litre on diesel and unleaded fuel and by 10c a litre on leaded petrol, raising $1.4 billion in increased excise—increased excise which falls on two sectors of the economy that can afford it least. Our export sector, our great primary industries and mining industries, will be forced to pay the increased excise as they freight their commodities to the wharves, the abattoirs and the mills. How much more internationally competitive would those industries have been, how many more jobs would they have provided or created, and how much better off would our farmers have been if $2 billion had been removed from Australia's fuel excise bill instead of increasing it by $1.4 billion? The price of diesel fuel alone would have been 31c a litre cheaper.

  The other hard-pressed sector of the community to bear the brunt of this fuel excise increase is the owners of cars over seven years old which require leaded petrol: the family man, the worker, the student, the unionist, the young married couple saving for a house, some in the ranks of the one million unemployed, and the men and women earning $23,000 a year or less—people whom the Prime Minister had picked up with his magnanimous gesture of $2 a week in a tax cut. All these people will suffer due to this unprecedented tax hike.

  Let us be sure about this and be under no delusions. The increase in leaded petrol excise is a sop to the environmentalist and a severe blow to the family man and the worker whose total assets would be a mortgaged house and an older model car. Not only will they pay more for their fuel; the resale on their trade-in of a leaded petrol car will be much less. I know everyone has seen—and everyone would agree with me—that if there is ever a conflict of interest between the environmental lobby and the worker in this parliament, we can confidently put our money on the environmentalists. They have never lost a round yet. Senator Harradine would agree with that.

  I now turn to the devastating problem of unemployment. Once again, I do not believe the government has shown any answers. Last year it spent $1.2 billion in employment programs in a desperate attempt to keep unemployment down. This year the government weighed in again with an extra $120 million to expand to 500,000 the number of places in the already existing training schemes of jobstart, jobtrain, jobskill, jobclub, skillshare, and the landcare and environmental programs.

  Despite Mr Dawkins's repeated assertion that this budget is about jobs, one million people will find very little hope in it. They want to work, not to take part in the endless training schemes that are short term in duration and lead nowhere. While the misery of unemployment cuts across all age groups, the plight of the young unemployed, particularly those who have never had a job, is absolutely tragic. The one hundred thousand 15-year-olds to 19-year-olds who are unable to gain employment will not find anything in this budget which promises genuine job creation.

  There are forty-seven thousand 15- to 19-year-old school leavers who have been unemployed for between three and nine months. There are 16,000 who have been trying to find their first job for more than a year and a further 6,000 who have spent over two years looking for their first job. In the 20- to 24-year-old group there are 31,000 people who have never worked at all and a core of 8,000 who have been looking for their first job for over two years. These young people are our future, yet how are they ever to have a future if they cannot find work and all the government can do is offer them extra places in meaningless training schemes?

  We now have a generation of young Australians who are unable to look at the future with any optimism whatsoever. Without the opportunity to work, saving, home ownership, marriage and family all become impossible goals; yet for our generation, endowed with full employment, these events were the standard milestones in all our lives.

  The tightening-up of the Austudy criteria will impact particularly heavily on rural students and their families. The raising of the age threshold from 16 to 17 will impose severe financial hardship on these families. As of 1 January 1994, payment for students under the age of 17 will be transferred to the family payments scheme, which is rigorously means tested and assets tested. Many rural families will be hard-hit by the loss of these payments.

  Rural students have been further disadvantaged by the government's axing of country area programs. This commendable program had provided rural students with access to music, drama and cultural activities, as well as career projects with local industry. The abolition of the program means that rural students are once again denied the opportunities available to students in the city.

  In relation to the assistance for isolated children scheme, the government has made some recognition of the financial difficulties faced by rural families in educating their children. The National and Liberal parties have long campaigned for the abolition of the assets test for the isolated children scheme.

  The government's decision to remove the concessional tax treatment of unused annual leave and long service leave will also hit Australian families. We are being told that we must prepare for our retirement. When people have done that, they have been hit with these regressive taxes.

  In general terms, the 1993-94 budget is a horror budget for rural Australia. Primary industry has had government expenditure cut by $80 million this year after a fall of $98 million last year. The average level of farm business profits is minus $10,500 and the average farm debt is $114,800. This is not the time to remove support for primary industries.

  The government has announced that the wool tax will increase from 8.5 per cent this year to 12 per cent for 1994-95. This will cost the average woolgrower another $2,000 a year at a time when producers are losing an average of $33,700. Last year 91 per cent of woolgrowers made a loss.

  The government—in fact, the whole parliament—should remember that in 1987 and 1988 the wool industry brought in export earnings of nearly $6 billion and in 1988-89 that figure rose to $6 billion, or 14.3 percent of Australia's total export earnings. The wool industry would be in a position to make that type of contribution again if it were able to keep the structure in place and the farmers on their land. The next two or three years will be critical for this great industry.

  The government has budgeted $20 million to the Australian Wool Corporation this financial year for wool promotion. However, this grant is the final payment of the $75 million package that commenced in 1990. On all accounts, the level of wool production is already inadequate and woolgrowers will have to find another $50 million or $60 million to keep up their wool promotion in Australia, which now has roughly the same advertising budget as that for Mars bars or Kit Kats.

  Synthetic fibre manufacturers outspend the wool industry on promotion and research by at least three to one. I believe that the government must continue to support the promotion of this industry next year. It may be down on its knees now, but in good years it is one of the foundations of our export successes. The estimates for the rural adjustment scheme show that the government is attempting to hold down its expenditure in primary industry areas by increasing the states' contribution to the scheme.


Senator Sherry —It's our money. It's federal money.


Senator BOSWELL —I know, but one does not give it in one hand and then say, `Look, the budget deficit is a bit high. We want it back and then we will give it back to you'. According to the budget, the total level of federal and state expenditure on the scheme will increase slightly in 1993 and 1994. The federal government's own outlays on the scheme, however, will fall sharply this financial year and its total outlays over the period will increase only slightly. The government has forced the states to promise to make up the shortfall by raiding the hollow log of the RAS reserves, although the Minister for Primary Industries and Energy (Mr Crean) has told them that they may have to increase their own spending on the scheme as well.

  Mr Crean's threat shows that the states may have to make a choice between increasing their own rural adjustment budgets and reducing the number eligible for RAS assistance. Mr Crean must guarantee that no primary producer will be disadvantaged by the new funding arrangements.

  Yet another attack on primary industry and the mining industry was opened up in the budget when the government signalled an alteration to the diesel fuel rebate scheme—a scheme that is sacrosanct to farmers, who are price takers on international markets. They must be super efficient to meet competition from heavily subsidised commodities under American EEP schemes and European common agricultural programs.

  Our farmers have two strikes against them before they even get on the tractor. The increase of 5c a litre on diesel fuel will increase their costs and erode further their profits. But to change the diesel fuel rebate by charging an administration fee of one per cent on the diesel rebate shows just how far this government is prepared to go to hurt primary industry. This reduction in the diesel rebate scheme can only be seen as a complete vote of no confidence by the government in the Australian farmer.

  The alteration to the scheme will increase revenue by $19.6 million this financial year, rising to $29.1 million next year. Who knows what will happen after that, once this legislation is in place. It puts the government in a strong position to raid the scheme when faced with a budget deficit. With this government's record of financial incompetence, I reckon we can expect more of those deficits in the future. The emasculating of the diesel rebate scheme legislation deserves special consideration by this Senate if it believes that our farmers must be cost efficient to stay internationally competitive.

  The government also seems set on a course to wreck Australia's biggest export earner—the Australian mining industry, which brought in $28 billion in export earnings last year and gave work to 160,000 employees. The Prime Minister is determined to carve out a name for himself in Australian history as the solver, with one piece of legislation, of all problems that have occurred over the last 200 years between blacks and whites. If a solution was so easy, it would have been done long ago.

  The 1993 budget is a horror budget for Australia. It is a budget of misery and despair for the one million unemployed, especially the youth. It has received universal condemnation. Even the ACTU President was scathing in his criticism when he proclaimed that you could not defend the indefensible.

  I would like to conclude by touching on the debate about the ability to block the government's tax legislation. The Prime Minister told caucus on Tuesday that he hoped the Senate would not vandalise the political process. Yesterday, the Treasurer cited the government's mandate as the reason the Senate should pass the bills. But the facts are clear: section 53 of the constitution clearly grants the Senate the power to reject tax bills. The Senate would hardly be vandalising the political process if it used its legitimate powers under the constitution.

  The Treasurer says that the government has a mandate to implement its budget proposals. I do not remember seeing Mr Dawkins or the Prime Minister telling the farmers that their diesel fuel rebates would be slashed. I do not remember anyone going out and telling Queensland truck drivers and owners that they would have to pay an extra $6,000 a year for their fuel.

  I can promise the Treasurer that we will not let them go through without a fight. The opposition has already decided to oppose the increase in the petrol excise, the across-the-board wholesale tax increases, the increases in the sales tax on wine and the tax on unused recreation and long service leave. This is not denying the government its budget by blocking supply but merely keeping it to its mandate of not increasing taxes. If that results in a double dissolution, so be it—and the sooner the better as far as I am concerned.


Senator Kemp —Mr Acting Deputy President, I raise a point of order and seek your guidance. I noticed during the speech by the Leader of the Opposition that, for the first time in my memory—and, I am sure, probably in the history of this chamber—senior ministers of the government were not present. Indeed, we had the most junior minister of the government here. I know that Mr Keating spat the dummy in the other place, but I wonder whether you could tell us whether this is the first occasion when such a discourtesy has occurred in this chamber. Could you inquire of the government whether this is the sort of behaviour we will come to expect in the coming years?

  The ACTING DEPUTY PRESIDENT (Senator Colston)—I do not think it is the role of the person in the chair, but I will refer the matter to the President.