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Tuesday, 26 August 1980
Page: 743


Mr Eric Robinson (MCPHERSON, QUEENSLAND) - The Opposition wants to be all things to all people, at a massive cost to the taxpayer. In government it would adopt the 'blunderbuss' approach, showering government supports and assistance in all directions so that no one misses out. Never mind about directing government expenditure to those in need. Never mind about the cost to the taxpayer. Never mind about the disastrous impact of a bloated public sector on private enterprise and economic growth. Under a Labor Government no one would forgo some form of Government assistance. After all Labor's philosophy says that the State spends money and makes decisions far better than do individuals. Everyone in the community would pay dearly for Labor's excesses and profligate spending as tax burdens rose, inflation skyrocketed and government debts steadily accumulated.

Labor's so-called 'alternative' approach to economic management simply amounts to increasing the size and pervasiveness of the public sector, building a ball and chain around the leg of private enterprise. The Leader of the Opposition (Mr Hayden) on numerous occasions has admitted his partiality to a large public sector. In 1978 he said:

I am committed to seeing a larger public sector over time.

In 1980 Mr Hayden said: 1 favour the maintenance of a steady rate of growth in the real level of public expenditure to fulfil Labor's policy aspirations.

The private sector be damned under a Labor government! If Australians do not see clearly that Labor's alternative means big government, high taxation and increasing public sector control and interference in the economy, they should look carefully at Labor's binding commitments in the following areas: To spend a minimum additional amount of $2,000m in five policy areas alone - manpower, health, housing, welfare and education; to increase government expenditure on over 200 other policy commitments in other areas; to set up more than 50 new qangos, councils or committees; to abolish staff ceilings in the Commonwealth Public Service; and to introduce a whole new range of taxes such as a capital gains tax, a resource rental tax and a number of other punitive measures.

How large are Labor's proposed spending programs? The Government estimates that Labor's additional spending in five policy areas alone will be around $2, 000m in one year - $l,000m in manpower, $380m in health, $276m in welfare, $164m in education, $175m in housing. Our estimate of $2,000m must be regarded as an absolute minimum extra to be spent under Labor. It substantially underestimates the total cost of the Opposition's programs, by excluding many other proposals and commitments within the five areas which are not costed by Labor; by grossly erring on the conservative side in the estimates of the numbers who may be eligible for assistance under Labor's many schemes; by taking no account of the costs of over 200 other binding commitments in the Opposition's policy statements and platform; by ignoring the cost of setting up over 50 new statutory authorities, councils and committees; by excluding the costs associated with the proposed abolition of staff ceilings in the Commonwealth Public Service and by omitting the $500m extra that the Leader of the Opposition has committed to raising pensions and benefits to 25 per cent of average weekly earnings. In each of the five areas of spending, the same fundamental principle of 'big government' shines through: To the taxpayer Labor says: 'Give us your money because we know how to spend it better than you do'.

How much does Labor propose to spend in manpower? According to our estimates the total is $ 1,000m in a full year, made up of $600m for the establishment of a community services corps- although I am told that the Labor candidate for La Trobe said the other day: 'Do not worry about that; it is only temporary' - $338m for the work program scheme, $48m for the private sector employment training program, and an uncosted plan to 'restructure' the apprenticeship system.

Unlike Labor's costings, our estimates are based on the up to date costings of not only the wages component in project work but also the other related expenses such as worker's compensation, transport, accommodation, tools and equipment plus the costs of supervision and administration. The honourable member for Port Adelaide (Mr Young) has described Labor's manpower policy as the biggest job creation program ever to be undertaken. Given the disaster that occurred with the Regional Employment Development scheme under Mr Whitlam, one shudders to think what would happen if the Hayden scheme were to be introduced. It is ironical that a manpower program which is so similar to the old, thoroughly discredited RED scheme can be proposed by the Leader of the Opposition, when it was he who abandoned the original RED scheme in his 1975-76 Budget.

In addition to the enormous cost to be borne by taxpayers, the problem with Labor's make work schemes is that they simply will not work. 'Job creation', as envisaged by our opponents, is just another way of describing increased government spending. In fact it is a prescription for job destruction. For every government job 'created' by more spending there would be several lost in the private sector once the inflationary impact of Labor's policies was felt. Unlike the claim in the Leader of the Opposition's comments there are no offsets. Given the Opposition's commitment to boosting apprenticeship training by 50 per cent and to pursuing many other programs under the direction of a new statutory authority - the Australian manpower office - the figure of $ 1,000m, representing our estimate of the cost of Labor's manpower programs looks very conservative indeed.

What about Labor's proposed additional spending in Health? Labor's family health care plan, which we estimate will cost $380m in one year, is the first step towards the restoration of a universal health scheme. The $380m is made up of Labor's estimate of $1 30m for the provision of full medical coverage to all children under 1 6, to dependant students and to expectant mothers, plus $2 50m which is our estimate of the increase in institutional costs that would result from a decrease in the number of people covered for hospital insurance.

Let me itemise how I assess the $250m. It comprises $78m for recognised hospitals with private patients, $146m for private hospitals; $14m for nursing homes; $10m for outpatients services; and $2m for professional services charges. There may be small savings by way of reduced payments of the private hospital bed-day subsidy but they would make very little impact on the overall cost of Labor's program.

In addition to the $380m, the Leader of the Opposition has already foreshadowed the staged reintroduction of Medibank, which he says will cost $600m. In his words:

Labor will restore Medibank . . . it is a commitment we will not back away from.

There is no doubt Labor would do this, irrespective of the cost. Labor's estimates of the total cost of its proposed family health care plan are way out. They take no account of the impact of health costs on increasing numbers of Australians abandoning private health insurance funds. Institutional health costs must rise under Labor's scheme as more and more people are encouraged to drop health insurance cover and jump on to the government-subsidised health bandwagon. Because of the Leader of the Opposition's commitment to restoring Medibank fully, because of the so-called free nature of Labor's family health care plan, under a Labor government the community could expect massive and escalating government expenditures on health - far in excess of our humble estimate of Labor's additional spending in only one year. Just think of what Labor's openended, universal health scheme would cost in subsequent years.

I turn to Labor's foreshadowed expenditure on housing. The lack of details, the vagueness, the ambiguities in the Opposition's proposals in this area make accurate costing a difficult task. Nevertheless, we estimate that when fully implemented the additional full-year cost of Labor's housing programs will not be less than S 1 75m. Here again we find that Labor is significantly underestimating the cost of its programs by underestimating the numbers eligible for assistance. Under the family home ownership grant scheme, assistance to homebuyers is not exclusively directed to those in the community whose housing needs are greatest. The family home improvement scheme will provide very little real assistance to low income earners. It is a token gesture, again at the taxpayers expense, which would not significantly improve the standard of housing or the general stock of existing dwellings in the community. Labor's commitment to greatly increasing its spending on public housing shows the Opposition's blind faith in the belief that the solution to housing problems is to be found in higher government expenditure. In addition to these three schemes, Labor would also re-establish the Australian Housing Corporation with wide-ranging functions and a rural housing improvement fund scheme. We would see not only much higher government spending on housing under a Labor Government but also the employment of more bureaucrats to administer the programs, and greater government interference in the housing marketplace.

Let us examine the Opposition's spending proposals in the fourth area that I want to cost tonight - education. We estimate that a Labor government would spend at least an additional $164m. The Opposition's figure of $101 m once again grossly underestimates the cost of its programs. The additional $63m is made up of the following items, again detailed: $ 12m on universities and colleges of advanced education; $1 .5m on nurse education; $38m on Tertiary Education Assistance Scheme allowances; S2m on assistance to isolated children; $4. 3m on secondary students assistance and $4. 7m on needs funding of schools. Labor's underestimates in these areas represent serious errors of judgment.

In addition to the proposals we have been able to cost and include in our costing of $ 164m, there are several commitments in Labor's policy statement which indicate increased funding in future years but for which no cost estimates are provided. For example, quotes from Labor spokesman on policies include references to encouragement of a national tertiary academic staff superannuation scheme; pilot projects to develop more effective co-ordination of post-secondary institutions, and additional funding to a variety of non-institutional mature-age education organisations and centres to increase access to recurrent education. For these and many other policy commitments, which would involve substantial additional government spending, the public is entitled to know how much they would cost and over what period. Certainly, there is the potential for an explosion in government spending on education. If we add to the Opposition's shopping list the special inquiries into Asian studies and technological innovation, there can be no doubt that a Labor government would spend far in excess of our minimum estimate of $ 1 64m for its additional expenditure on education.

I turn now to the final costing area of welfare. We estimate that Labor would spend an extra $276m on welfare.


Mr Young - I will tell the National Country Party about you.


Mr Eric Robinson (MCPHERSON, QUEENSLAND) - They are all itemised. The honourable member can scrutinise them all night if he wishes. This amount is made up of an expenditure of $250m on the family income supplement and $26m on the mother's.guardian's allowance. The Labor Party's own costing and our costing take no account of the Leader of the Opposition's recently stated commitment to raise pension levels to 25 per cent, and thereafter to 30 per cent, of average weekly earnings. The cost of increasing pensions to 25 per cent of average weekly earnings would be of the order of $500m. To put them up to 30 per cent would cost $ 1,900m in a full year over and above the $2,000m that I have already indicated.


Mr N A Brown (DIAMOND VALLEY, VICTORIA) - In one year?


Mr Eric Robinson (MCPHERSON, QUEENSLAND) - An amount of $ 1,900m extra in a full year. It is plain for all to see that in government Labor would be big spenders once again. The $2,000m that I have estimated is the Government's conservative figuring of the Labor Party's proposed additional spending in a year in five, and five only, policy areas. To that total we have to add: The $500m expenditure for which the Leader of the Opposition has committed a Labor, government to in respect of raising pensions to 25 per cent of average weekly earnings; all the uncosted items of which there are an abundance in the five costed policy areas; Labor's binding financial commitments to tourism, sport and recreation- a minimum of $12. 5m- and to all the other yet uncosted areas of spending to be found within the policy statements and platform of the Labor Party; and the multitude of new statutory authorities. The establishment of bodies such as the national fuel and energy commission, the Australian hydrocarbon corporation, the economic planning advisory council and the technology planning council would have only one effect on private enterprise- that is, to stifle its growth.

It is obvious that if all Labor's commitments to additional expenditures were implemented the cost to the taxpayer would be many billions of dollars. If the Labor Party is to support a much bigger public sector, it has an obligation to explain to the taxpayers where the money is to come from. Where is it going to find the funds for its profligate spending programs, its army of bureaucrats, and its new statutory authorities, committees, councils and the like? The Government challenges the Leader of the Opposition to reveal to the public the total cost of all his expenditure promises and the means by which Labor intends to pay for the explosion in government spending. I wonder how long it would take before Labor's open-ended commitments in health, education, housing and the rest necessitated significant rises in income tax. The Leader of the Opposition has already promised to impose punitive taxes on high income earners. It is not difficult to see what would follow. A big spending party by definition has to be a high taxation party. Australians will not be fooled again by Labor's election pledge of 'vote for us and we will spend your money for you'.

The Opposition's policies are rooted in the past. The Labor Party has no credible economic strategy because it has no policy to contain inflation. In fact its alternative Budget is highly inflationary. Labor's big spending answers to Australia's problems - doing all things for all people at enormous cost to the taxpayer - are totally unsuited to the requirements of responsible economic management. Australians want an economy to be managed sensibly with stability in direction and an overriding emphasis on containing inflation. They want the Government to be selective in spending programs, directing assistance, not everywhere, but to those in need. They do not want a party in power that promises to spend money willy-nilly on their behalf. Those are good enough reasons for the great majority of Australians to reject Labor and to wholeheartedly endorse the Fraser Government's policies in the 1980s.

Tonight the Leader of the Opposition had an opportunity, in his reply to the Budget Speech, to announce alternative economic policies for this country. Instead, he chose to spend the greater part of his speech on abuse of the Prime Minister and members of the Government. Personal abuse is not a substitute for sound policies. The Opposition leader has distinguished himself, during his period in office, as having a great capacity to hurl abuse. He will discover, to his political cost, that the Australian electorate will reject this approach with the scorn it deserves. When I listened to the Leader of the Opposition projecting his Party's socalled alternative economic policy I got a strong feeling of deja vu Somewhere, some time not long ago, I recall the Australian Labor Party, then the Government of the day, proposing similar programs to those which have been announced in this House tonight.

Mr DEPUTY SPEAKER (Mr Armitage)Order!The Minister's time has expired.







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