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, 1 August 2022
Page: 300

Senator SCARR (QueenslandDeputy Opposition Whip in the Senate) (15:45): I thank my good friend Senator Payne, who I've known a long time, for proposing this MPI. This is what the matter of public importance is: the need for the government to adopt a plan to ease pressure on cost of living for Australian families and small businesses now— to actually address the issue not in October but now, because we know that Australians are facing those cost-of-living pressures today. We know that because of the economic statement released last week and also the most recent inflation figures. Australia now has, for the year ending 30 June 2022, an annual inflation rate CPI of 6.1 per cent. This is the largest CPI rate since the Australian government introduced the goods and services tax. Even if you take out some of the outliers in terms of the inflationary pressures and trim it down, the trimmed mean inflation rate is 4.9 per cent. Even if you take down the factors which are pulling that inflation rate up to 6.1 per cent and maybe on the other side pulling it down—so you take the trimmed mean inflation rate—it's at 4.9 per cent. That's the highest level since that particular measurement was actually used from 2003—the highest level in nearly 20 years. The forecasts are even more grim. The Treasury forecast is that by the end of the year Australia will be facing an inflation rate of 7.75 per cent; that's the forecast for the end of the year.

Australia is crying out for a government that has a positive plan that will actually counter these inflationary pressures, and we simply do not have it. In fact, we have the contrary. At a point in time when Australia is facing these inflationary cost pressures, what is the obsession of those opposite? The obsession of those opposite is with the Australian Building and Construction Commission—gutting the powers of the ABCC and then ultimately seeking, when they take the time to actually present legislation to this place, to abolish the Australian Building and Construction Commission. That will actually feed into inflation, and you don't need to believe me; you can look at an independent report that was put out by Ernst & Young. The ABCC is the cop on the beat at our construction sites around Australia. And the work they do is incredibly important in terms of keeping those construction costs down for our schools, for our roads, for our hospitals and for our important social infrastructure. The result of abolishing the ABCC would be to increase those construction costs.

I quote from a study released by Ernst & Young in relation to their economy-wide modelling, in relation to the impact of abolishing the ABCC:

Key economic costs indicated by the modelling involve:

Output in the construction industry could fall by around $35.4 billion by 2030 as higher cost inflation makes fewer projects possible, and capital is reallocated to other economic activities.

Why would you introduce that sort of policy in a high-inflation environment? What is the sense of it, apart from providing a sop to the CFMMEU? There's no sense to it in this environment. It's entirely the wrong thing to do if you want to take those cost pressures off the Australian economy.

Ernst & Young says:

Overall economic activity—

as a result of Labor's policy—

could decline by $47.5 billion by 2030 as higher costs and lower productivity act as a handbrake on other sectors.

So those costs that will increase through the construction industry, as a result of the Labor government's policy to abolish the ABCC, will infect all sorts of sectors across the whole of the Australian economy. It goes on:

If the ABCC were abolished—

and that is the intention of the current Australian government, the Albanese government—

this could lead to a total economic loss of around $47.5 billion, compared to baseline estimates, to 2030.

Under the heading 'Employment and labour cost impacts', Ernst & Young go on:

The construction industry is one of the largest employers in Australia, employing almost 1.15 million people. The industry also directly supports jobs in other Australian industries such as timber, steel, and cement manufacturing.

…   …   …

Modelling suggests that abolishing the ABCC could cost the Australian economy up to 4,000 jobs. Job losses are felt immediately as output in the construction industry falls and labour costs rise.

Then there's the fiscal cost, when every school, every hospital and every road project is going to cost an estimated 30 per cent more because of the lawless behaviour of the construction division of the CFMMEU, whose representatives sit on the Labor Party's national executive. And as a result of those costs—

The DEPUTY PRESIDENT: Senator Urquhart, a point of order?

Senator Urquhart: I note that the MPI specifically talks about electricity prices. I haven't heard one mention of any electricity. I've heard a beat-up on unions, I've heard a beat-up on the CFMMEU and I've heard him talk about the ABCC, but there has not been one mention of anything to do with what's in the MPI that was proposed today. So I would ask you to draw the senator's attention to what the MPI is based on and ask him to point his remarks to that point.

The DEPUTY PRESIDENT: Senator Scarr, do you wish to make a submission?

Senator SCARR: I'm absolutely happy to talk about electricity costs. I didn't see the $275 saving which is supposedly going to flow through to electricity users across Australia. It was promised by the Labor Party during the campaign. I saw absolutely no mention of that when the Governor-General attended this place and gave his presentation in relation to the Labor Party's agenda in government.

The DEPUTY PRESIDENT: Senator Scarr, you've moved on from the point of order, have you?

Senator SCARR: Yes.

The DEPUTY PRESIDENT: Okay, return to your speech. Thank you. I was just clarifying.

Senator SCARR: The caravan moves on. I saw absolutely no mention of electricity price savings for the Australian consumer when the Governor-General attended in this place last week for the opening of this parliament and effectively laid down the government's agenda. I saw absolutely no reference to that $275 electricity price saving. And I will be happy, Senator Urquhart, to come back every week this parliament sits, between now and the next federal election, to that $275 saving that those opposite are supposedly going to deliver to Australian electricity users, because I do not believe that you will deliver that cost saving in this inflationary environment. I don't believe you're going to deliver that cost saving at all.

It will be fascinating to see how the construction costs, which are going to blow out as a result of your policy of abolishing the ABCC, will mean that every single transmission tower that is built in this country will cost approximately 30 per cent more. That's what's going to happen to electricity costs, because those construction costs feed into every single cost across the whole of the Australian economy, including electricity prices, because you've got to get the electricity from point A to point B. When you construct your solar panel farm or your wind farm—whatever it is, in terms of renewables—you've got to construct the transmission lines, and that's where the construction costs are extraordinarily relevant.

I'll be happy to be corrected at the time, but I do not believe that those opposite will deliver that $275 saving in electricity costs. We will wait and see. Those, including those in the gallery, who will be receiving their electricity bills between now and the next election can be the judges. They should ask themselves, before the next election, whether or not their electricity prices have decreased by $275. We'll see what happens.

Those electricity costs are affecting every single part of Australian society—not just the retail consumer but also the business consumer—and it also includes small businesses where I have my patch in Queensland. I was speaking to a small business owner just this week about cost pressures on their small business. Nick runs a cafe, and he has been hit with the cost increases in terms of electricity, in terms of wages and also in terms of rent. Small business rent increases are going to go up as a direct result of the inflationary impact and are provided for under his lease.

That's what we are facing in this country. We are facing increased costs across the board and, in that environment, it is simply not credible, given the government's own plans, that electricity prices will fall by $275. In fact, all the evidence, I believe, will be to the contrary, especially when we consider the costs of transmission, actually providing stability to the electricity grid and getting the renewable energy sources fed into the grid. On that $275 guarantee: Senator Urquhart was keen for me to mention it, and I'm happy to. I suggest that promise will haunt those sitting opposite between this day and the next federal election.