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Tuesday, 3 February 2009
Page: 78


Mr SIMPKINS (7:36 PM) —Tonight I would like to make a contribution to the debate on Appropriation Bill (No. 3) 2008-2009 and Appropriation Bill (No. 4) 2008-2009. It is vitally important that no government uses the present challenging circumstances to relax the rules by which taxpayers’ contributions to government are spent. It is particularly appropriate in these days that rules and regulations are followed. The government’s budget is now in the red, and accountability is more important than ever. All of the Costello surplus has now gone, and the $10.4 billion of one-off handouts is now a memory. I hear the Victorian gambling revenues had a good bounce in December—a tragic reminder that some Australians now place their faith in the institutions of luck and superstition where before it may have been placed in a well-led and managed government.

Similarly, the New Zealand economy was buoyed when a mother I know of recently left her kids with relatives and used the several thousand dollars of the one-off payment to holiday offshore—hopefully an example of a small minority that will probably never have its priorities in the right place. Yet that is always the way it seems to go in these matters. Some people just cannot manage money. In fact, they can take money and, without any budgetary regulation, spend it all within a period of time and go into the red, which sounds somewhat familiar. The focus has to be on jobs and incentives for businesses that will create jobs whilst at the same time enabling upgrades or improvements to businesses that enable them to comply with other regulations and also recognise efficiencies or savings. That is what the plan of the Leader of the Opposition is fundamentally about.

Let me return to the first point that I made about the need for rules and regulations to be followed. Perhaps I should say that, beyond the rules, conventions should also be adhered to. That is why I am concerned by new terms under Appropriation Bill (No. 4) in schedule 8 such as ‘new administered expenses’. We are provided with an explanatory memorandum that points us to the definition of this term, but I remain uneasy about it, and I will say why. The term ‘new administered expenses’ applies for an outcome of an agency. We are therefore to be reassured about specific outcomes because in theory each appropriated amount can have its success measured. But clearly this assessment of expenses versus outcomes would struggle when we consider another form of one-off payment—namely, those handed out to local government authorities late last year. One such local government authority told me last week how the money, while clearly welcome and of value, could have been more appropriately spent. The conditions in its case were that the money had to be spent within three to four months. Spending the better part of three-quarters of a million dollars within that period completely ruled out any opportunities for building or construction projects, as the preparation and implementation of such projects would take close to six months. This sort of thinking stifles the creation of jobs rather than embracing employment creation as an avenue for stimulating the economy. Instead of construction, the money was spent on play equipment and road resurfacing, which were only possible because of the existence of standing contracts. I would therefore comment that the ability to achieve a wider stimulation of local economies through these sorts of handouts is limited because it is in effect a continuation of existing works. Compare that with a longer spending time frame of, say, six months, which would allow new capital works to be considered, creating wider downstream effects across a greater number of businesses and areas.

Returning to the concept of outcomes in Appropriation Bill (No. 4), I wonder how an outcome would be assigned should local government authorities again receive such a handout. I say that with a great deal of interest, because I look forward to seeing local government authorities’ outcomes published in the future. A key indicator of the success of handouts must relate directly back to job creation, be supported by a cost-benefit analysis and include achieving value for money.

It is worth noting that the last significant construction project for local government in the electorate of Cowan was the Ocean Reef Road extension that the Howard government initiated with a contribution of $7 million to the $10 million required for the project. That project is going to be great when it opens, stretching from the Wangara light industrial area to near the intersection of Alexander Drive and Gnangara Road. It will make that road a lot safer for locals, particularly in the residential suburbs of Landsdale and Darch. This project is basically the last significant construction project that the federal government has contributed to in the electorate of Cowan, so it is clear that the previous government had a good record of working with local governments to achieve effective local infrastructure projects.

The next area of Appropriation Bill (No. 4) that I will address is clause 10, which includes terms such as ‘equity injections’ and ‘loans’, which are always concerning, given the Western Australian experience, and in my opinion are in need of rigorous scrutiny to ensure deliverables are provided. Nevertheless, in reading the explanatory memorandum I worry about what tolerances and liberties will exist for agencies. Accountability for money spent is critical. The concept of ‘expected returns for efficiency savings’ is a case in point. Agencies should expect intense critical analysis of plans provided for under clause 10, but I do not see that stated in the bill. Once again, it must be shown that jobs are being created. Areas within the bill regarding expected returns for efficiency savings are another example of where jobs should be created and sustainable benefits targeted and met.

It is right and appropriate for me to now make comment on some of the current issues and commentaries that are being put about by the government. I refer firstly to the false and political lines that we have heard about the management of the economy by the Howard government. I want the government to know that, although it seems a very long time ago that the Howard-Costello team was running the nation, it was not so long ago that Australians do not remember it. That was the time when this nation’s government had finances in the black. It was the period when good management created jobs and removed the failed, ineffective and anachronistic class warfare concepts that had always provided the divisions in this country that Labor seemed to benefit from.

For a while the current Prime Minister’s claims about being an economic conservative, whilst politically opportune in the last election campaign, seemed to signal a new direction for Labor. That, of course, has all come to an end with the Prime Minister’s attempt to scapegoat so-called neoliberals with responsibility for the current financial situation. I wonder about that term. In the US the Left attempts to denigrate conservatives by calling them neoconservatives. In the readings that I have seen, such attacks in the US even show an anti-Semitic vein. I cannot help but feel that the Prime Minister and whoever writes his lines choose ‘neoliberals’ for two reasons: firstly, the term ‘neoconservative’ is possibly a little too close to the ‘economic conservative’ claim that proved so politically perfect for him and, secondly, the term attempts to lay responsibility for the current economic problems at our feet on this side of the House. What a stretch of credibility that is! It is so incredible and false that the huge salaries paid in the Prime Minister’s office to his principal advisers are clearly unwarranted. If the government looked back at the origins of this international financial challenge it would see that Bill Clinton, that president of high moral standing and integrity, encouraged and, according to what I have read, in fact forced some lenders to offer loans to those who could not afford them. The Prime Minister should confront the reality and look at his own ideological icons when looking to attribute responsibility.

There are very big differences between the two parties in Australia. Of all the countries in the developed world, Australia is in the best position to weather these circumstances, for one reason: the Liberal Party has always embraced constructive reform, whether in opposition or in government. That is in direct contrast to Labor, which has always opposed reforms when in opposition. We supported those reforms of the government before John Howard’s government, and went further forward when we were last in government. The lending practices of the banks and lenders in Australia were never the same as those in the United States, and the difference was due to the attitudes of governments. Our regulations have been better, our attitudes have been better and our commitment to saving for the future has been better—all in direct contrast to Labor, who opposed all the reforms of the previous government. The Labor Party even opposed the paying off of the $96 billion debt and the measures that were required to pay off that debt.

Today we had the announcement of another vast spending outlay by the government, following on from the $10.4 billion of late last year. Of course, the $10.4 billion was to assist the economy. I recall that it was to create 75,000 jobs, according to the Deputy Prime Minister, who now—as some have said—is called the ‘minister for unemployment’. But where are those jobs? The government said $10.4 billion would create 75,000 jobs. The Australian people want to know where they are. The people in my electorate of Cowan and I would like to know how many of these new jobs are going to be in businesses in Gnangara, Landsdale, Wangara or Malaga—all within Cowan. How many are there in every electorate? Is it too much to ask for even a hint of where they are going to be?

If the aim was jobs—and this had top billing—the government should be able to say where the jobs are or where they are going to be. There certainly should be some by now. Given the amount of money that was sent to overseas residents, it would be interesting to know how that money sent and spent overseas supported the economy and jobs in Australia. It would be interesting to know how the economy would have benefited if those who had been given one-off cash payments had been given a debit card, for instance—and it had been given only to those who live in Australia. That would have made an interesting comparison with the figures.

I note that today’s $42 billion has been committed at the same time that unemployment is forecast to rise to seven per cent. What guarantees will be put on this set of payments? What is the economic modelling and what will be the outcomes that we can expect? What is the government expecting to achieve? In fact, where is the economic modelling? It is hard to be confident about the future direction of this government when they are secretive about the evidence behind their decisions to outlay this huge amount of money.

It is also worth noting that the government have admitted that their forecasts show unemployment rising to seven per cent in these challenging times. That is a very serious business, because this government should and will be judged on stopping that from happening. It is an interesting point that, when we took office back in 1996, unemployment was 8.5 per cent. Maybe that is a good point for perspective in this matter.

I have covered a number of different points tonight with regard to the government’s spending and plans to spend, yet it would be wrong of me not to cover at least one of the outlays listed in Appropriation Bill (No. 3). I note that there is included some $13.95 million for advertising to raise public awareness of climate change. While I personally would prefer that such funds actually went into climate research, such as the great work being done by Dr Clive McAlpine at the University of Queensland—a man who is researching reforestation and its effect on rain and climate—I hope that in this case the minister is very careful about the claims and implications made in the advertising. The last lot of advertising last year clearly implied that the drought was entirely due to man-made climate change.

These bills will be supported, but I have taken the opportunity to speak on a number of important issues related to government expenditure. The parliament has a responsibility, or rather the opposition has a responsibility, to provide an appropriate level of scrutiny on the government’s spending of the taxpayers’ money and, as we know now, the government’s borrowing and debt plans. It would be wrong to sit idly by and just accept that the government is right in everything it does.

While that course of action may suit the government’s political agenda, we have a job to do and we will do it. Today the government and the minister trotted out the view of the head of Centrelink that the latest spending round needs to be passed this week. I think that such an act, using a public servant in such a political way, was very unprofessional. The government should have briefed the opposition well in advance if they wanted the new $42 billion in the bills passed so quickly. Clearly, the government should have done better, again.