Nick Sherry (Tasmania, Australian Labor Party, Shadow Minister for Banking and Financial Services) Share this | Link to this | Hansard source

I seek leave to incorporate a very fine speech by the Leader of the Opposition, the Hon. Kim Beazley.

Leave granted.

The incorporated speech read as follows—

This Budget fails middle Australia and mortgages our kids’ future. That’s why tonight I want to speak to the families of Australia about our shared hopes and aspirations for the future.

I want to speak directly to the millions of middle Australians at home with their families. In the suburbs, the country towns, the cities and the bush. This is for them. Probably they’re just finishing dinner, washing the dishes, helping the kids with their homework. All the time trying to keep half an eye on the television.

Managing the competing demands that crowd each waking moment. Sitting at tables in kitchens where the magnets chase the bills around the fridge door until pay day.

Figuring out if there’s enough in the bank to cover this month’s mortgage. Or if there’s enough petrol in the car to get to the childcare centre, then school, then to work and then home.

Doing the mental arithmetic of family life. Tired at the end of another working day. Knowing it starts all over again tomorrow.

They’re the ones I really want to speak to. Not the politicians. Not the journalists.

The people who are important to me and crucial to our nation’s future—the families of middle Australia. The ones who’ve built our prosperity. Because after 10 long years of the Howard Government they’re the ones who need a break. Not an easy ride or a hand out—just a fair go.

Reward for all the effort they’ve put in to build our national wealth. Recognition that our future prosperity rests squarely on them.

I have one critical message for them: millions of middle Australian families will build the next generation of prosperity. And I will reward them for it, when they do.

Middle Australians need a government that makes their lives simpler not more complicated; that lightens the load not weighs them down.

A government that gives parents the time and flexibility they need to do the most important job there is—raising the next generation.

A government that looks at those kids and sees the prosperous future of an entire nation. That understands that investment in the hopes and aspirations of Australian families brings the dividend of a modern dynamic economy.

Mr Speaker, through you, I say this to the families of middle Australia.

Tonight I seek a binding agreement between us: between you and the government I’ll lead. Tonight I announce my Pact with Middle Australia.

Because, quite simply, it’s your hard work, the hard slog of middle Australia that has generated our economic good fortune.

And looking ahead, Australia is counting on you to do the next round of heavy lifting that will deliver future prosperity. We’re relying on you to drive a new wave of economic prosperity and it’s about time you got something back.

So, Mr Speaker, my Pact with Middle Australia has, at its core, one promise. Through you, Mr Speaker, it is this. Under a Beazley Labor Government: when you put in, you get back.

Here’s the deal. When you work hard I’ll make sure you get a tax system that rewards you. When you put in those long hours at work and at home, I’ll give you more time with the kids.

When you do your job properly you’ll have the certainty that job security provides. When you work overtime and on public holidays I will protect your penalty rates.

When you want to learn and train, I’ll ensure you get all the support you need.

I will ensure that when you put in, you get back. And I will correct a great wrong imposed on middle Australia. The people who built the good times but who’ve long been dudded by the Government and again this week by the Treasurer.

Five budgets without a decent tax break. Then $10. $10—already gone. Gone on the triple whammy. Wages slashed. Rising interest rates. Soaring petrol prices.

Fair dinkum. This Treasurer’s like a poker machine. You put in. You pull the arm. Nothing. You put in again. Another pull. Nothing. Time after time. Nothing.

But then….At last…The lights flash….The bells ring….Crowds gather round. “Jackpot!” he crows… 10 bucks. That’s the drop. 10 bucks.

Surely middle Australia deserves better than this.

Day in day out, they’re putting in and getting too little back. Giving so much. Working so hard. For so little in return.

No wonder they’re thinking “if the economy is so good why am I under so much pressure?” And why paying the bills and filling the car and servicing the mortgage gets tougher, not easier.

Why they’re forced to endure all the pain of extreme industrial relations changes without any economic gain for the country.

How can this Government be so pleased with itself? They’ve dudded middle Australian families and mortgaged our kids’ future.

MY PACT WITH MIDDLE AUSTRALIA

Mr Speaker, the Treasurer has a Budget for today—we have a pact for tomorrow.

He smirks at the future—I embrace it. I look ahead to a deal with the millions of Australians he’s neglected. A deal that will guarantee our future prosperity.

My Pact with Middle Australia has that one core promise.

When you put in, you get back. And, tonight, five key commitments to begin.

Childcare

First, new childcare centres at schools.

When you want to go back to work after having a child, you shouldn’t have to face the dreaded “double drop off”.

My plan for childcare centres at schools ends the dreaded “double drop-off” of kids—for the mums and dads who’ve got kids at childcare and kids at school.

For a family in Lonsdale it means more time at home together; less time in the car. For the economy it means increased workforce participation.

I want to meet the Australian economy’s pressing need for more skilled workers. My government will do its bit by giving parents the incentive to work without killing family life.

That’s why I announce tonight that a Federal Labor Government will provide $200 million to establish 260 new childcare centres on primary school grounds and other community land.

And we will ensure that these places go to the areas in our suburbs and towns where childcare shortages mean they’re needed most. So that parents can work knowing their kids are getting an educational experience that will set them up for life.

I will have more to say about childcare in the lead up to the next election. But I make this commitment tonight: When Australian families put in by working hard, I’ll put in. I’ll get rid of the “double drop off”.

Skills

Second, when Australians want to learn a traditional trade to become one of the skilled workers the country desperately needs, they shouldn’t have to pay.

My Government will get rid of TAFE fees for the traditional trades. If you do a traditional apprenticeship, you won’t pay TAFE fees.

I want to get more of the skilled workers our economy needs. So we need to get rid of TAFE fees for the 60,000 traditional apprentices who start training each year.

Labor’s priority is clear: train Australians first and train Australians now.

That’s why I announce tonight that a Federal Labor Government will set up what I call Skills Accounts to help Australian families save for training and skills. And we will make an initial deposit of $800 per year, for up to four years, in an apprentice’s Skills Account to get rid of up-front TAFE fees.

Eight hundred dollars a year for the kid in Blacktown who wants to be a plumber. Eight hundred dollars a year for kids in Wynnum and Townsville who want to train to be electricians, welders, motor mechanics, chefs and hairdressers.

To help solve Australia’s massive shortage of childcare workers, I will extend my Skills Account plan to get rid of TAFE fees for the thousands of Australian trainee child carers who start courses each year.

So I announce tonight that a Federal Labor Government will get rid of TAFE fees for eligible childcare courses by making an initial deposit of $1200 per year, for up to two years, in a trainee’s Skills Account.

Young people training to teach and care for our kids can use this to pay upfront fees at a TAFE or eligible provider. Or they can use it for materials and resources charges.

Mr Speaker, this country made a mistake when we turned our back on trades education in schools. So tonight I make these commitments.

Labor will give every Australian student the opportunity to study at specialised trades schools.

We will give younger students the chance to try their hand at a trade with the Trade Taster Program. For older students there’ll be more school-based apprenticeships.

I’ll invest in real apprenticeship schemes not the Government’s fake apprenticeships that use our kids as cheap labour and give them no skills.

And I’ll deliver a $2,000 Trade Completion bonus to encourage kids to finish their courses and produce an extra 10,000 tradespeople. The plumbers, the builders, the childcare workers that we need now.

Mr Speaker, my commitment tonight is this. When Australian kids want to learn a new trade my government will be there to help them. And when mums and dads need childcare to go back to work, I’ll make sure they can find the childcare they need.

Unfair dismissal

Third, no unfair dismissals. When you do the right thing at work, you won’t be unfairly dismissed.

I will tear up this Government’s extreme industrial relations laws and establish genuine protection for anyone who’s unfairly dismissed.

The Howard Government’s law gives supervisors and bosses the green light to sack a worker for any reason or no reason at all.

What we need are balanced laws to protect both employers and employees from rogue behaviour—not one-sided rules that give employers all power over their staff. A system that gets Australian values back into the way we work.

That’s why I announce tonight that a Federal Labor Government will put in place a new system to protect working Australians from the threat of unfair dismissal.

A simple process for resolving claims which gets the balance right. Protecting both sides. Plus we’ll let employers and employees negotiate over family friendly conditions and safety training.

This is my commitment to working Australians. When you put in every day to build our future prosperity, I’ll give you the job security you deserve.

Foreign apprentices

Fourth, no foreign apprentices. If you’re prepared to learn a trade, you won’t have to compete with foreign apprentices.

I want young Australians to get the training opportunities they deserve and which the Australian economy so badly needs.

As long as young Australians in Launceston and Gosford are being turned away from apprenticeships and TAFE, I won’t allow foreign apprentices to take away their chances in life.

We’ve already had 270,000 extra skilled workers enter this country over the last 10 years but 300,000 Australians have been turned away from TAFE. And we’re seeing Australians laid off while foreign workers take their places on conditions no one should have to put up with.

Now, the Prime Minister’s allowing foreign apprentices to come to Australia and take apprenticeship places here. He’s even giving businesses incentives to take them on.

These foreign apprentices are headed to regional areas where youth unemployment is already too high and wages too low. And to get their visas, foreign apprentices must accept whatever wages and conditions are on offer. And young Aussies have to compete with them.

Over time, this will ruin the job prospects of young Australians.

That’s why I announce tonight that a Federal Labor Government will abolish foreign apprenticeship visas.

No government I lead will import foreign apprentices from overseas while Aussie kids are turned away from training. It’s just plain wrong.

So this is my commitment: train our kids first, before you train anyone else’s.

Broadband

Fifth, real broadband for your kids and your business.

If you invest in a computer for your kids’ education, they’ll have real broadband to equip them for the learning of the future.

Australia needs a “fibre-to-the-node” broadband network across the country. To you and me, that means a broadband system twenty five times faster than the sort of speeds available in Australia today.

That’s why I announce tonight that a Federal Labor Government will invest in a joint venture with telecommunications companies to build this super fast computer network.

Labor would draw on the $757 million Broadband Connect program as well as provide an equity injection from the $2 billion earmarked for the Communications Fund to deliver the public funding of this partnership with the private sector.

This will deliver broadband that can instantly download documentaries, educational software and digital books.

Broadband which can host virtual classrooms where children could video conference around Australia. A digital School of the Air—for all. Plus we’ll offer a ‘clean feed’ to parents who want to make sure their kids are learning on the internet, not exposed to pornography and violence.

Half a century ago, Labor imagined an Australia where every child had a desk with a lamp to study on at night.

Tonight this is my commitment.

When you put a computer on that desk, I’ll give you a connection that plugs you into the world and brings every book ever written into your home.

This is an investment in national infrastructure that equips our kids for the future. Part of my plan to rebuild Australia’s crumbling road, rail, ports, electricity and communications networks.

We’ll take the politics out of infrastructure spending, with an independent expert body—Infrastructure Australia. We’ll make it easier for super funds to invest in infrastructure, and we’ll set up a Building Australia Fund to invest in the productive infrastructure of the future.

When Australians want to compete in the world I’ll make sure they’ve got the 21st century infrastructure to take on the world’s best, and win.

A PACT FOR FUTURE PROSPERITY

Mr Speaker, why a Pact like this for middle Australia? Because it’s middle Australia that’s driven 14 years of prosperity.

With proper rewards and the right incentives, middle Australia will have the capacity and the will to lead the next generation of economic growth too.

Right now our country has great opportunities.

And I have great hopes for our future—an unshakeable faith in the Australian people.

I know their talent, ingenuity, hard work and good humour is unmatched. The Beaconsfield miracle is proof enough of that. If only I could say the same of this Government.

If only I saw at the Cabinet table the same values I see at the kitchen tables of middle Australia.

World economic conditions have given this Government the best luck and the best opportunities. And a real chance to do something for the nation, not just for themselves.

Australia is part of the fastest growing region in a world economy growing at its fastest rate in thirty years. This on top of:

• Mineral prices soaring to record levels.
• Export prices at their best in half a century.
• Globally, lower interest rates than anyone can remember.

The minerals boom is putting an extra $160 billion straight into this Government’s pockets. There’s never been anything like it. Yet where’s it gone?

What can we point to that lasts?

With the minerals boom, the Treasurer had a once-in-a-lifetime chance in this Budget to set Australia up for the 21st century and he blew it.

Just imagine what we could be achieving.

Just imagine if this Government was making real investments in our schools, TAFE colleges, universities and research labs, so that we led the world with the best trained workforce.

Instead Australia is the only advanced country that’s actually cut its public investment in training in professions and trades.

Imagine if they were building a communications network that gave all Australians access to world class internet infrastructure.

Instead we lag behind, with internet infrastructure that leaves us trailing the rest of the developed world and even Slovenia and the Slovak Republic.

Imagine if people could drive through cities like Sydney, Brisbane and Melbourne without it taking half a day’s work to get to work.

Imagine if we had a Government with the foresight to deal with climate change now, so that great Australian icons like the Great Barrier Reef and Kakadu are still there for our grandkids.

Imagine if we had a Government which thought enough of pensioners to give them a decent break.

Imagine if infrastructure decisions were taken in the national interest not just the interests of the Nationals.

Imagine if we had a government that governed for middle Australian families, instead of governing for themselves and their mates.

If this Government thought that any of these things was important—it would be doing more. Much more. More to lift workforce participation and productivity. More to build a better future for our kids. To fireproof our economy from future risks. Nation building.

Instead our kids’ inheritance from this Government is foreign debt reaching half a trillion dollars, and growing faster than ever before. One of the world’s highest foreign debts.

For our kids—this Government leaves a massive burden—already $500 million of interest payments every single week.

While Australia racks up even more debt with the worst run of trade deficits in our history. Even the Treasurer’s own Department has warned this year that Australia’s foreign liabilities “cannot continue to rise forever”.

Things are good right now, because of the years of hard slog by middle Australia. But according to the Treasurer he’s the one who’s created the good times.

You only have to look at his smug capering on the day interest rates went up, like Wile E Coyote in momentary triumph before the anvil falls, to see what he really thinks of middle Australia.

For 10 years he’s ignored the long hours they’ve put in, the sacrifices they’ve made to achieve our nation’s economic success. And still he refuses to acknowledge that, if we’re serious about building our future prosperity, middle Australia must start getting something back.

Mr Speaker, what has this Budget done?

When the Budget party’s over, when the back slapping’s done, when the tuxedo’s been dry cleaned and the champagne’s run out—what’s left in the morning? Nothing to help middle Australia.

Nothing to help middle Australia build the nation’s future prosperity. Because to build that future prosperity, middle Australia needs a lot more than just tax relief.

Mr Speaker, I support the modest, overdue tax relief middle Australian families received in the Budget. They’ll need every cent of it. Especially when they’re facing the triple whammy of higher interest rates, higher petrol prices, and extreme industrial relations changes.

So of course I welcome this tax break for the families of middle Australia. But I make this point:

No tax cut can make up for losing your penalty rates.

No tax cut can make up for being unfairly dismissed.

No tax cut can find you extra time to spend with your family.

And no tax cut will give the Ballarat apprentice welders back the jobs they lost to Chinese workers.

My point is this. Sure, the Government is offering tax cuts. I support those tax cuts. But I’ll also deliver job security, education and training, childcare and nation building.

That’s my Pact with Middle Australia.

Because, like me, middle Australia is asking: what else?

Where’s the down payment on the future?

Where’s the investment in skills, in kids, in families?

Where is the vision Australia needs?

The vision we need to build prosperity.

This Budget fails middle Australia and mortgages our future. It has no plan to take pressure off interest rates. If interest rates go up again, middle Australia knows who to blame—the Prime Minister.

Prime Minister, if your failure to fix the skills crisis forces interest rates up again—the buck stops with you.

If your failure to show national leadership on infrastructure forces interest rates up again—the buck stops with you.

And if your failure to turn around Australia’s current account deficit forces interest rates up again—the buck stops with you.

Mr Speaker there are dangerous holes in this Budget.

There’s no plan to free us from being hostage to Middle Eastern oil prices—no plan to develop new Australian fuels.

No plan to fix our crumbling infrastructure—clogged roads, slow internet connection, near-empty dams and over-burdened ports.

No plan to stop kids being turned away from TAFE colleges, or if they get into uni—ending up with a debt the size of a home mortgage.

No plan to tackle the growing crisis in kids’ health.

No plan for childcare.

I have these plans. I have these ambitions. And I can do these things because there are some things I won’t be spending money on.

Unlike the Howard Government I won’t splurge a billion dollars on advertising. I won’t spend a billion dollars on their war in Iraq. The wrong war. A war where Australian money bought Saddam’s bullets.

And I will never spend half a billion dollars with lawyers and consultants to impose a nasty, American dog-eat-dog industrial relations system on hardworking, decent Australians.

Mr Speaker, this Government’s legacy is this: a nation not equipped for the future. An economy vulnerable when the sun stops shining. A Government that doesn’t reward middle Australia.

Under their watch, the boom times aren’t building future prosperity. They’re building foreign debt.

This Government isn’t laying the solid foundation our kids need for a prosperous future. That’s what middle Australia needs—a government that will build a future for our kids and the country. One that builds prosperity.

A government with new economic policies, based on Australian values. One that will protect the Australian way of life. A Government with my Blueprints to tackle skills and infrastructure; climate change and children’s health; Australian fuels and national security.

A Government with my Pact with Middle Australia.

• A Pact to end the “double drop-off”;
• To get rid of TAFE fees in trades and childcare;
• To end unfair dismissals;
• To train Australians first; and
• To give our kids a high tech future.

In short, a Pact with one crucial promise.

When you put in, you get back.

A promise at the heart of every policy I will take to the next election.

Mr Speaker, the Treasurer has always been arrogant. He hasn’t changed. But the Prime Minister has changed. Remember his annual family holidays at Hawks Nest? Not anymore. Now it’s Washington, Ottawa, Dublin.

When the Prime Minister leaves Australia tomorrow, I’ll stay and fight.

I’ll stay and fight for middle Australia. I won’t cut and run from a debate on our national future. Or from an election fought in middle Australia.

And when I’m Prime Minister expect three things.

Expect nation building.

Expect Australian values at work.

Most of all, expect me to reward the hard work of middle Australia.

Because under a Beazley Labor Government: when you put in, you get back.

My Pact with Middle Australia is the way forward.

Lyn Allison (Victoria, Australian Democrats) Share this | Link to this | Hansard source

The Treasurer told the parliament on Tuesday night that tax breaks would carry Australia into the next decade. The Democrats are not convinced, and that is what I want to talk about tonight. In our view, the Treasurer’s budget comes from a vision of Australia seen through the eyes of political strategists who cannot and do not see beyond the next election. This budget is about votes and not about nation building. In fact, there is very little by way of planning in this budget for those who are not couples with one or two high incomes, with 2.5 children at school or those not 60 and over with a generous nest egg on which to retire. This budget has been prepared with little interest in fact in the social, economic and environmental mess that is being left behind for the next generation of Australians.

First, let us acknowledge that the coffers are full. The government will spend nearly $217 billion next year and still have $10 billion left over. Or will it? Treasury projected a surplus for 2005-06 of $11 billion, but it was $8.4 billion out and it still has not explained where it went wrong. The Treasurer tells us that he has $8 billion a year more to spend because he is no longer paying interest on the debt that was there before he sold Telstra and before funding to universities and the ABC was so savagely cut. The remainder of Telstra will net another $25 billion; Medibank and the Snowy Hydro will net a few billion more. Those moneys are destined for the Future Fund, where we hope it will earn as much as those entities once earned in profits.

Australia is the lucky country right now. Jobs are up, wages are up, China is buying our coal and income from the mining sector—from selling off our mineral wealth—is putting $30 billion more into Treasury than it did in 1996. We are riding the greatest commodities boom and the fastest global growth in our history. Sales of iron ore, zinc, aluminium and copper are the highest ever. The economy is slowing now, but after 15 years of sustained growth. Access Economics say revenue is $34 billion higher than it was projected to be just four years ago.

But there is another side of the story. Manufacturing cannot compete against cheap imports and its share of the value adding industry declined from 15 per cent to 12 per cent over the Howard decade. The annual trade deficit was $24.8 billion in March this year, and it is climbing. Altogether, Australia owes more than $450 billion in foreign debt, and that is a lot higher than the $193 billion in 1996 that the Treasurer relied upon so heavily to paint the opposition as economic mismanagers. Ordinary homeowners are juggling the mortgage and child care, and motorists—particularly those stuck with gas guzzlers—are paying 25c more a litre than they were only 12 months ago. The ABS says bankruptcies are at their highest level since 2001, and mortgage repayment levels are at an all time low. Household debt increased by a colossal 221 per cent to $927 billion over the last decade, and average household debts rose 174 per cent. Interest rates are now 5.75 per cent and about $11 in every $100 in income is now being used to pay back interest on debt. That is up from $7 in 1996.

Since 1996 the median price of established houses in capital cities has risen 144 per cent. These are figures to be reckoned with, but you will not read about them in this budget, and that is why Peter Costello is spending $6.9 billion a year on tax cuts and giving half a million more families family tax benefits. He knows now that it is a battle to keep your head above water and he needs to be seen to be doing something to help. Of course, if you are a family on an income of $20,000 or $30,000, the handouts probably will not even match your higher petrol costs.

There will be $248 million spent on large families of three children—an extra $5 a week as an incentive to have a third child. There is $1.5 billion a year extra on defence and security. There are business tax cuts and a massive $6.2 billion to make superannuation tax-free for over 60-year-olds. All in all, the government is spending $13.7 billion more next year than it did this year. As most householders know, the secret of long-term sustainability is not spending like a kid in a lolly shop when you get a windfall—in this case a $16 billion surplus—but spending the money carefully and in a planned fashion. That surplus should have been invested in the future beyond the current economic boom, a future in which our children will not have to fix the problems that we left behind, like foreign debt, the HECS debt, climate change and water and skills shortages.

The Treasurer uses the term ‘nation building’ very loosely. I suggest he is spending our future now and leaving little for up-and-coming generations. This is actually a budget about the future of the coalition—for buying votes; not for the long-term future of a nation. The Democrats said early childhood development, climate change, water, oil, mental health, education and training, Indigenous inequality, infrastructure, research and development and tax reform should be the priorities of government but few if any made it into this budget.

Child care turned out not to be the priority that the Treasurer suggested, despite hints that it might be and it remains inaccessible and too expensive for a lot of families. Costs rose by 60 per cent in the last four years, but the child-care benefit has barely changed. In the last budget the government tossed parents a 30 per cent child-care rebate. Of course, this rebate will take up to two years to come through, after families have paid out the cash. So why did the Treasurer, who bragged about this being such a family and women-friendly budget, not just fold the rebate into the benefit and pay it to families when they need it?

This government’s great obsession with the private sector and competition has allowed a duopoly of for-profit centres with their economies of scale and scrooge-like control over costs, particularly wages, to take over the delivery of most child care. Community based centres where parents have a say in the management and where quality is what matters are closing and the waiting lists are growing. But Mr Costello, this is not about child-care places. Parents want skilled, well qualified staff and they want quality—something this budget does not deliver.

More than one-quarter of a million children below the age of six attend long day care but not all of them are receiving formal preschool once they turn four, and many other families cannot afford the fees that need to be charged for preschool. Since the Keating government removed preschool funding, the Commonwealth has contributed nothing to that vitally important first year of transition into school. For around $400 million a year this budget could have provided free preschool in child-care centres and in stand-alone kinders, but it has not. The thousands of new family day care places are good, but there are as many out there that have not been taken up. Treasurer, we still need to see a complete overhaul of the early childhood system, not your ad hoc bandaids. Early childhood education and care are essential in reducing poverty, and progress here would have been a very good step in nation building.

The government has lost whatever environmental credentials it claimed over the last decade, ignoring its own powerful federal environment and heritage laws, undermining its renewable energy target, decimating the Australian Greenhouse Office, allowing the $400 million Greenhouse Gas Abatement Program to be dissipated over a decade, and letting the Natural Heritage Trust peter out after next year. The Democrats were proud to have been involved in improving, refining and indeed initiating many of these measures for the environment, and it is irksome to see them undermined, watered down or just ignored by a government arrogantly using its numbers in the Senate. The environment, I would suggest, was in far better hands when the Democrats held the balance of power.

Australia would have been well on the track of reducing its emissions through renewables had the promised greenhouse trigger been put into the environment laws. Instead we now have a minister for the environment who has become antagonistic to, rather than a champion of, renewable energy development. He tried to rob a three-turbine wind development in Western Australia of money under the remote power renewable energy program, another initiative of the Democrats. This tiny wind farm was proposed by members of the community in Denmark, but he stopped it as well as the Bald Hills proposal because of a handful of objectors.

Funding stops in this budget for CSIRO’s programs on improved water allocation and management, including irrigation, sustainable natural resource management, understanding and responding to climate change, sustainable marine fisheries, healthy coastal rivers, estuaries and coastal zones and the Australian wildlife hospitals. Funding stops after next year for the photovoltaic rebate, the Renewable Energy Commercialisation Program, protecting Australia’s biodiversity hotspots, the regional national heritage program, the Renewable Energy Equity Fund and the Alternative Fuel Conversion Program—all of them gone. This budget pays lip service to alternative and renewable transport fuel despite rocketing petrol prices. Nothing has been done to reduce our consumption of or reliance on oil and yet there were so many opportunities. The $4 billion Automotive Competitiveness and Investment Scheme and the $52.5 million in this budget to prop up Ford’s new pickup trucks could have been used to leverage fuel efficiency and provide incentives to make hybrid vehicles in this country.

The government claims that public transport is a state responsibility but the Whitlam, Fraser, Hawke and Keating governments all provided public transport funds. You cannot have a national approach to transport, as AusLink claims, and ignore public transport. Our cities are congested with passenger cars and trucks, noise and pollution. Sitting back, funding more freeways, does not work, is not sustainable, uses up more oil and most definitely is not nation building.

So where is the plan to shift freight from road to rail along the east coast? This budget provides massive upgrades for the Hume and Bruce highways but where is the $3 billion recommended by the Neville committee back in 1998 to straighten and strengthen existing interstate main lines? The $270 million allocated in this budget is pitifully small and a fraction of what needs to be spent on rail.

The Democrats welcome the $500 million for the Murray-Darling Basin Commission but, again, it is not enough. It may improve water quality but it is unlikely to deliver water in anything like the quantity—1,500 gigalitres—that scientists say is so desperately needed to restore the system. There are two main ways to deliver more water to the Murray-Darling. The first is to purchase existing water entitlements or engage in entitlements buyback schemes, and the second is to reduce the huge losses in seepage and evaporation from irrigation channels. $500 million over five years will not go very far in doing either of those. The fact that the government is selling its $1 billion share of the Snowy Mountains Hydro Scheme and losing control of billions of litres of water flows makes a mockery of this gesture. Mr Costello, this is neither visionary nor generous. As droughts still rack much of New South Wales and south-west Queensland, it is astounding that the government has not set aside funds to help these states with effluent treatment and reuse, stormwater harvesting and, in the cities, household incentives to collect, reuse and save water.

Infrastructure investment underpins economic activity in telecommunications, transport, education, health, water and power generation. Australia needs adventurous, forward-looking infrastructure plans which are designed for sustainable communities, the environment and economies 15 years ahead. But there are no such plans in this budget.

Eight out of 10 Australian companies say that building the skills base is the key to international competitiveness. There is a pitiful $6 million for the National Skills Shortage Strategy, which says a lot about the government’s priorities or lack of them. Investing in people and their education, leaving aside all of those other benefits, increases productivity and economic wellbeing, but no budget in recent history has had less of a focus on the university and TAFE sectors. It makes no sense for a government to let our knowledge and applied skills sector fall into such a deplorable state. The ‘voluntary student unionism transition fund’—so-called—has not even been extended to student advocacy or health. The $10 million over four years for small businesses to set up shop on campuses is, frankly, laughable. Increases in the FEE HELP will mean more student debt. Australians now owe more than $11 billion in HECS, and we are burdening generations with personal debt that the majority will never be able to repay.

TAFE funding is still not indexed and the sector cannot seriously address the skills shortages, especially in our ailing manufacturing sector. Australia is the seventh lowest amongst the 25 richest OECD countries in VET funding. Three hundred thousand long-term unemployed cannot access the training and support needed to get them back into the workforce. Where is the concerted effort to improve the employment chances for mature aged workers, for the long-term unemployed and for upskilling existing workers? In fact the government actually cut the Basic Information Technology Enabling Skills for Older Workers program, the Career Planning program and the Women in Non-Traditional Occupations incentive. The Democrats again call on the government in this budget to increase funding to public schools to at least the average for the OECD nations. Schools also need extra funding for remoteness, students with disabilities, learning difficulties and challenging behaviours, and for Indigenous students and those from low-income families. I put it to the government that its failure to properly fund our education sectors is an act of vandalism which will eat at the productive heart of the nation.

I now turn to a core value of the coalition—income tax cuts. I understand that Australians will be grateful for tax relief in the budget but they will surely be disappointed that there is no strategic income tax reform plan. The Democrats and economics commentators say that structural tax reform is essential to a simpler, fairer and more transparent system. But Mr Costello is the ‘no plan tax man’. He has only adjusted rates and thresholds within the existing system—something a well-programmed computer could do with ease. The GST and the New Tax System took several years of hard work to develop, and so it is with income tax reform.

We say—and we have been saying this for many years—that a structural tax reform plan must include raising the tax free threshold so, at the very least, people with income below the poverty line do not pay tax. Indexing the rates to account for bracket creep is necessary, as are broadening the tax base by eliminating inequitable, inefficient and out-dated tax concessions, and reforming the tax welfare intersects to encourage people to move from welfare to work. If concessions were rationalised we could perhaps eliminate the need for tax returns—it is just an idea. Why do we need to do this? It is because effective marginal tax rates of up to 70 per cent apply to low-income earners right now when they move from welfare to work, and this is just unfair. No Australian should have to accept an effective marginal tax rate greater—much greater—than the new top rate of 45 per cent. The ‘no plan tax man’, in his largesse has just fiddled at the edges, rewarding those on the highest incomes the most.

The government’s bolt from the blue—to take tax off superannuation payouts—is perhaps the most blatant vote-buying measure that we have seen in this budget and it is most likely to advantage only the baby boomers due for retirement soon. Our guess is that this policy will become unsustainable and the claw-back will start sometime down the track and it will not be that far away. Removing tax is not simplification: it is a gift, benefiting those who least need it. We would like to make a suggestion on superannuation. Why not tax contributions going in progressively so that those on the 15 per cent tax rate would pay no super contribution tax at all; those on 30 per cent would pay 15 per cent; and those on 40 per cent would pay 25 per cent tax on contributions; and those on 45 per cent would pay 30 per cent tax on contributions?

We also think that lump sum payments should be very much discouraged. Retirement money is much safer in super funds than at the hands of investment shysters. These are just our thoughts and, like tax reform, they need more work to get them right—work to make sure that the tax system is sustainable, fair and equitable.

The $1.9 billion promised by the government in the wake of the Senate inquiry into mental health is indeed welcome and will go some way to alleviating the problem, but it is still about one-third of the increase that the committee was told was the minimum required to deliver mental health services to those who need them. We urge the government to take all the recommendations of this inquiry to the COAG meeting in June and to negotiate in good faith with the states to see that they are properly funded. There are no quick fixes in mental health, but we must work at alleviating the pain and the alienation of almost one million Australians affected by mental illness. The government must, together with the states, commit to funding well-staffed community based mental health centres and prevention and early intervention, to name just a few measures.

There is nothing in the health budget to drive down the rate of smoking—the addiction that still kills 19,000 people a year and is absolutely preventable. Minister Abbott’s school canteen guidelines will not solve the looming wave of obesity related disease. There is again nothing to bring down the dental waiting lists or to stop the onslaught of sexually transmitted infection. The Treasurer’s generosity has not been extended to the PBS, where there is enormous pressure right now to reduce costs, at the risk of making some medicines unavailable in this country.

It is clear that the Howard government is cynically failing Indigenous Australians. Here is an example: DEST’s Abstudy for the next four years has tied attendance to payments. They have revised their figures downwards by $1.8 million in the expectation that Indigenous people will not attend schools. Leaving aside the unlikelihood that the government can predict the future actions of people, this is a cynical and cold-hearted cost-cutting exercise. Fewer than one-fifth of Indigenous people over 15 go on to year 12. Not surprisingly, they have much lower rates of tertiary education, and unemployment for them is almost three times higher than for non-Indigenous people. They earn much less and are more likely to live in substandard conditions. The gross overcrowding in Indigenous communities would never be tolerated elsewhere.

Indigenous community housing organisations across Australia need at least a further $141 million a year for five years to fix the Indigenous housing shortfall. Indigenous people are more likely to have inadequate water and washing facilities and poor sanitation and sewerage. The AMA says that Indigenous health is underfunded by at least $452.5 million every year, and an additional $50 million is needed for the Indigenous workforce to be trained. But none of this is in the budget, and I doubt Indigenous Australians will welcome another 10 years of Mr Costello’s economic reforms. Mutual obligation has not worked for them so far, any more than practical reconciliation did.

Those on benefits will, like the rest of us, soon have to pay for the highly elaborate infrastructure being set up around an ID card, which will track their welfare payments, wiping out, we are told, welfare fraud to the tune of $3 billion. We think this is doubtful, judging by the harshness with which Centrelink already treats its clients.

The Treasurer argues that helping families is one of the government’s highest priorities and that this budget delivers through tax cuts and the family tax benefit. I am sure that families will welcome the additional income, but they will do so knowing they will also have less job security, greater casualisation and less job flexibility, thanks to the government’s Work Choices.

The Treasurer wants women to have more children, but they know, as I do, that it costs more than $5 extra a week to raise a child. They also know that they will need at least one good, stable income in a family before they take that step. Work Choices attacks secure family incomes. It delivers job insecurity and uncertain wages and conditions. Work Choices will likely drive down the minimum wage and reduce rights and benefits, especially for the vulnerable, the disadvantaged and women who are in and out of the workforce because of their caring responsibilities.

In this law, the government has failed families and failed Australia. We have not heard much about intergenerational equity in this budget because, frankly, there is none. The current generation of students and children—our next generation of workers and parents and custodians of the economy and the environment—are not considered much in this budget and the government is leaving them the most difficult problems to solve.

Mr Howard and Mr Costello’s political strategists have sacrificed the great tenets of liberalism—freedom, investment in people and investment in the future—for a good headline. The Democrats are committed to what we know to be the priorities for a sustainable future for all Australians, well beyond a Costello next decade and most definitely beyond the next election.

Christine Milne (Tasmania, Australian Greens) Share this | Link to this | Hansard source

The budget reflects the soul of a nation. It is the economic tool that gives effect to the vision and values that a government has for its people. On Tuesday night, Australians heard that the vision and values of the Howard government over 10 years in office had delivered rivers of gold and manna from heaven. They heard that the vision and values had turned Australia into a debt-free country, awash with cash—some $178 billion in extra revenue since 2002—and that the same vision and values, business as usual, would see the good times roll on into the future. It was a live-for-today package, a reaffirmation of the Howard government philosophy that the richer you are, the more you are valued and rewarded.

The budget message was that the Howard government had perfected the Midas touch, and people were prompted to rejoice and be glad to spend, spend, spend—for the vision and values of Prime Minister Howard and his Treasurer, the Hon. Peter Costello, would guarantee that the only direction for the Australian economy was up, and, on that assumption, the tax revenue base could be permanently narrowed. In the next four years, $45 billion will be forgone in tax cuts, as if there were no national imperatives to fund nor any global responsibilities, as if an ecological deficit did not exist, as if the nation’s health and education systems were already world class and as if the $2.6 billion required to address Indigenous health and housing were not a priority.

The nation got the message, and the partying and the backslapping began. The media was euphoric and most commentators gushed. Few political and economic analysts could find any fault with the formula or the outcome, so much so that the Treasurer felt sorry for the opposition for, seemingly, it had nowhere to go. And from the response of the opposition, I have to say, it appears to have felt sorry for itself, by repeating the refrain ‘we was robbed’. What were they robbed of? The opportunity to say and deliver the same things themselves, because the Beazley opposition supports the tax cuts.

The Howard government’s vision and values expressed through its budget have made me realise that we have actually become two nations in Australia: one that is fixated on the present and cannot see what the problem is and the other that can see the problem and the huge risks for our children, grandchildren and future generations. The Howard government’s budget is a budget for those who cannot see what the problem is. It is predicated on the assumption that it is the Howard government’s own policies and ‘business as usual’ economics that have delivered and will continue to deliver prosperities to Australians into the future. Its fundamental flaw is that in its supreme confidence that the surplus is of its own making, the Howard government has lost sight of the fact that the global economy and ongoing economic growth depend on the natural environment and its resources. The Howard government does not seem to understand that without the environment there is no economy.

What is different in 2006 is that the capacity of the earth and its ecosystems to sustain economic growth is in doubt if ‘business as usual’ use and exploitation of resources such as fossil fuels continues. Whereas previously individual civilisations or regions have collapsed because of unsustainable use of water, soils, forests or fisheries, the difference now is that the whole globe is at risk. As leading environmental thinker Lester Brown has said:

In our preoccupation with quarterly earnings reports and year-to-year economic growth, we have lost sight of how large the human enterprise has become relative to the earth’s resources—

Take China, for example—

China has overtaken the United States in the consumption of most basic resources. Among the leading commodities in the food sector (grain and meat), in the energy sector (oil and coal), and in the industrial sector (steel), China now leads the United States in the consumption of all except oil.

What if China reaches the U.S. resource consumption level per person? If China’s economy continues to expand at 8 percent per year, its income per person will reach the current U.S. level in 2031.

If we further assume that Chinese resource consumption per person in 2031 will be the same as that in the United States today, then the country’s projected population of 1.45 billion will consume an amount of grain equal to two thirds of the current world grain harvest ... and it would use 99 million barrels of oil per day—well above current world production of 84 million barrels.

The western economic model ... is not going to work for China.

... in an increasingly integrated world economy, where all countries are competing for the same oil, grain and steel and mineral resources, the existing economic model will not work for industrial countries either.

Lester Brown concludes:

The days of the fossil-fuel-based, automobile-centered, throwaway economy are numbered.

This has greater ramifications for Australia than it has for most other countries in the OECD because it is not the Howard government’s vision that has delivered metaphoric rivers of gold but, rather, real truckloads and shipholds of minerals powered by fossil fuels. Total mineral exports from Australia doubled in value between 2000 and 2006.

Australia is awash with cash because of a minerals boom which has delivered corporate profits to the Treasury. Between 2002 and 2007 company tax collections will have doubled to $57 billion. But instead of recognising that these profits are completely unsustainable and using the cash to invest in nation-building through the development of a highly educated nation and a more sophisticated low-carbon economy significantly less dependent on extraction of natural resources and fossil fuels, the Howard government has pursued policies that have narrowed and weakened the economy to the point where we have virtually no manufacturing industry and only a weak tertiary sector left. In 1990 manufacturing contributed 13.4 per cent of GDP and it now contributes 10.9 per cent. We have regressed under the Howard government to riding on the sheep’s back. As Doug Cameron, from the Australian Manufacturing Workers Union, has said: ‘A farm, a quarry, and a nice place to visit.’

When the Howard government came to power, the current account deficit was three per cent of gross domestic product and now it is six per cent. Then, the Treasurer could not stop talking about it. Now, it is as unmentionable as climate change. Australia’s economy is on shaky ground and is vulnerable to a global loss of confidence in financing these deficits. If that happens there will be upward pressure on interest rates. This is hardly a situation in which Treasurer Costello should be boasting about being a good economic manager and throwing money around. The economy is structurally weak. The Howard government has exposed Australia to perilous economic risks.

What happens when the boom ends or when the rest of the world decides not to use our coal because of global warming or our uranium because nuclear power is shown to be too expensive, too dangerous and too slow? What happens when we need to import 70 per cent of our oil and we have already exported the bulk of our liquid natural gas? Will we feel so confident then of the decision to decrease the tax revenue base when oil imports alone add an extra $30 billion to the already shameful trade deficit and therefore to our current account deficit as well?

What happens when salinity continues to render farmland infertile and rivers too saline to use? What happens when climate change causes dislocation to traditional agriculture, and the benefits of the $500 million injection into the Murray-Darling river system are negated by reduced rainfall and higher evaporation rates? Who will pay for the damage from the increased frequency and intensity of the floods, fires and storms that climate change is bringing? Whilst the Howard government budget provides for $394 million in national security spending, it fails to recognise the greatest risk to Australia, to Australian people, to Australian families—and that is climate change.

In the budget papers one risk that is identified is the possible need for greater expenditure on drought relief, although the analysis concludes that this is unlikely to occur and that agricultural production forecasts are similar to previous years. Does no-one in the government listen to the CSIRO climate scientists—or have they now all been replaced by coal and petroleum industry spokespeople? In this budget 170 CSIRO jobs have been cut; so much for the clever or innovative country. Does the Prime Minister expect, when he dons the Akubra hat and visits drought affected and storm damaged areas, to be taken seriously when he expresses surprise that these events have occurred?

The Australian Greens believe that it is both prudent and equitable to develop a climate change disaster fund to provide certainty to individuals and communities. As the threat of climate change increases, so too should the amount allocated to this fund increase. The federal government does not publish an annual assessment of the costs of natural disasters, but government figures averaged over decades and adjusted for inflation put the average cost of natural disasters at around $13.7 billion per decade to date. The climate change disaster relief fund should be funded by taxes on activities that will increase the likelihood of climate change related disasters, as such an approach ensures that the incidence of the tax will have a double dividend of decreasing reliance on harmful activities. While a carbon tax would be the most effective mechanism for achieving such an objective, the reintroduction of fuel excise indexation or the introduction of the planned increase in the heavy vehicle road user charge would easily fund such a scheme.

It is hard to estimate just how far Australia has fallen behind the rest of the world. I doubt there is any other country in the OECD which does not identify climate change and oil depletion as high risks to their economy. I cannot imagine one of those OECD countries which has a budget and puts out budget papers which identify the risks to its economy not mentioning climate change. In fact, the Australian risk assessment is that there is a greater risk of space objects falling out of the sky; it does not mention climate change.

The Kyoto protocol must be ratified and Australia must join the world at the table for the post-2012 dialogue, with serious intent to invest in mitigation and adaptation by the adoption of a new post-Kyoto multilateral treaty. Voluntary approaches such as the Asia-Pacific Partnership do not work, and the failure of voluntary action is exactly why the Kyoto protocol was negotiated in the first place. It would therefore appear prudent for the Commonwealth government to invest around $1.5 billion per year in order to provide appropriate resources to mitigate the financial, if not the personal, costs of natural disasters.

Australia has no strategy to deal with oil depletion or to oil-proof the nation. The expectation is that, given enough tax breaks, the explorers will simply go out and find more oil. The assumption is that there is plentiful, cheap, easily accessible oil to be found, that the market will set the price and that, when it gets too high, alternatives will be found. But even the federal government’s experts, Geoscience Australia, say that by 2012 there is a 90 per cent chance Australia will be producing less than half of its oil requirement. In contrast, the Swedish government in its budget announced a strategy to make Sweden oil free by 2020. All over the world nations have introduced regulation for energy efficiency. The Greens want an energy efficiency target. Instead of providing accelerated depreciation across the board, the Greens believe that accelerated depreciation should be restricted to those companies which implement energy efficiency measures identified in the energy efficiency audit mandated by the government.

In Europe, governments have invested heavily in public transport, renewable energy and alternative fuels. They have moved freight off the roads and onto rail. They have recognised that oil-proofing a nation improves the resilience of its economy and its quality of life by reducing private vehicle use, improving air quality and reducing traffic congestion and greenhouse gases. As a first step, they have provided incentives for making car fleets fuel efficient. In this country Western Australia has taken the lead in a similar initiative to improve the fuel efficiency of its car fleet, and the Commonwealth would do well to do exactly the same with its own government fleet.

While Australia panders to the whim of the automobile industry by setting toothless voluntary fuel efficiency targets, California and nine other US states are fighting the Bush administration for the right to impose tighter mandatory vehicle emission limits. Even China has adopted a mandatory fuel efficiency target of 6.8 litres per 100 kilometres. It is a similar target to Australia’s, except that the Chinese are serious about actually achieving it. It is hard to believe that Treasurer Costello has granted a subsidy—that is, corporate welfare—to Ford of $52 million, without tying it to fuel efficient design. I cannot imagine any other OECD country that would give a handout to a motor vehicle company for design specifications and not tie it to fuel efficiency. The Howard government clearly does not recognise energy security as a risk to this country’s economic wellbeing.

Other nations have recognised that urbanisation requires national oversight. Whereas public transport is a state issue in Australia, oil depletion and choked and congested cities are a national concern because they impact on the productivity of cities and on the quality of life of those who live there. A government with vision for the future would have instigated a COAG process and a financial strategy for the oil proofing of Australian cities and would have invested heavily in public transport. In the 1970s, 12 per cent of Australia’s passenger kilometres were carried by public transport and today it is less than eight per cent. We need to exempt public transport and low-emission vehicles from the GST. But, no, nation building for the Howard government consists of road building, with the oil price approaching $100 a barrel. It is a brilliant strategy!

AusLink is set to receive $13 billion over five years, but new road funding in this week’s budget has been allocated at nearly 10 times the amount for rail. Until we invest more in rail than we do in road, we cannot hope to shift the freight task from our crumbling roads and on to fast tracks linking our major cities. The decision not to proceed with the planned increase in the heavy vehicle road user charge is a slap in the face for transport reform.

If Australians had been asked whether they would prefer to permanently reduce their energy and petrol costs by being assisted to upgrade to a more fuel efficient vehicle, to put a solar hot water system on their roof or to access faster and better public transport or, alternatively, to have tax cuts to enable them to pay higher petrol and energy costs, the government would have found that the community would prefer government intervention to accelerate the transition to a low-carbon economy to head off higher costs rather than just being assisted to meet them if future budgets allow for it. At the moment, Australia has the third cheapest petrol in the OECD and our electricity is 40 per cent cheaper than the OECD average cost, yet energy affordability is up there with housing affordability as a major issue in our community. How much worse will it become?

Whilst reducing fuel excise on alternative fuels is essential, cutting fuel excise on conventional fuels is not the answer, because in a world experiencing peak oil it is economically unsustainable and it lulls people into thinking that they do not need to make changes to their vehicle standards or use. Being strategic and proactive provides national energy security, whereas reacting to short-term market forces leaves the nation insecure and exposed to the vagaries of the global market.

The same applies to other fossil fuels. It is reckless and irresponsible not to plan for adaptation to climate change, because we know that the costs of acting now are far less than the costs will be if we do not. In that regard, how can we argue that we have a surplus when we have failed to assess the financial risks and costs of climate change? This is not just about the Great Barrier Reef. This is about the liveability of country towns. It is about health; it is estimated that 10,000 people will die from heat exhaustion because of increased temperatures. It is about dislocation in agriculture. It is about just about every aspect of our lives.

Whilst the Howard government is relying on coal and pinning our future on unproven carbon capture and storage technology, other nations are moving rapidly to invest in renewable energy technology and products. One day Australia will price carbon. The cost of disposing of carbon dioxide into the atmosphere has been subsidised by the community for too long. This subsidy must end. Whilst the switch towards taxing atmospheric pollution is a complex area of policy, what is simple is the need to send a signal to the market. The longer we delay sending the signal the longer plans for coal-fired power stations will continue to be advanced.

The Greens propose that the government introduce an emissions trading scheme and/or a carbon tax as a matter of urgency to send a clear signal to the market, to shift the financial risk from the government to the market, to minimise transition costs and to fund emerging renewable energy industries. This is good business. Australia is blessed with fantastic solar and wind energy. We could lead the world in photovoltaics, but to do so we need to invest in the commercialisation of existing technologies and R&D for improved technologies. We need to provide incentives for the roll-out of those technologies, including reform of electricity tariffs through guaranteed prices for renewable energy and, in the short term, an extension of the photovoltaic rebate scheme.

Germany has created 150,000 jobs by introducing legislation to drive the solar industry. Over 19 US states have introduced renewable energy targets to attract those industries, whilst in Australia the government has effectively strangled the renewable energy industry by refusing to extend the mandatory renewable energy targets. We have an Australian solar energy billionaire who made his money by investing in China. There is no capacity for him to do the same in Australia, and those jobs are being created in China. Just today, Roaring Forties announced that it will not proceed with its Heemskirk wind farm, blaming the government’s failure to expand MRET. Not dealing with climate change is costing Australia jobs and innovation.

As to uranium, a leadership role for Australia in global nonproliferation, global security and antiterrorism would be to see us decide to leave it in the ground. Apart from the danger of weapons and waste, the nuclear fuel cycle is dangerous, expensive and replete with uncosted externalities that the taxpayer will have to pay for. The budget papers themselves reveal that taxpayers already have to pay $7 million to clean up the Kakadu World Heritage area of abandoned uranium mines. Who will pay for the clean up if the current uranium mining speculation ever leads to new mines opening? As well, the budget statement of risks makes it clear that there is no way to cost the decommissioning of the Lucas Heights reactor. What does that say about the government’s assertion that nuclear power may become financially viable in Australia?

Rather than seeing Australia’s coal and uranium reserves as a competitive advantage, Australia needs to see them as a competitive disadvantage, because focusing on coal and uranium is blinding the government and the nation to risk and to the cause and consequences of climate change, and it is preventing investment in the innovative industries that will power this country. Dependence on natural resources will leave the nation vulnerable to resource depletion, new foreign sources and technological changes that reduce and eliminate resource needs. That is according to Michael Porter, a quite well-known economist.

Australia is being held back, jobs growth is being restricted and the nation’s ability to build a sophisticated economy, manufacturing base and tertiary sector is being constrained by the Howard government’s short-termism, intellectual laziness and indebtedness to the resource sector for its political support. To effectively capitalise on the opportunities inherent in the transition to a low-carbon economy which is knowledge, skills and service based, a massive injection of funds into education, research and training is needed.

Our children are our future, and if you had an eye to the future you would not reduce education spending as a proportion of government outlays, as has occurred in this budget. Would most Australians choose a tax cut if they realised that their children would have to borrow as much for their university fees as they had to borrow for their first home? The tax cuts could make tertiary education free again. In the Howard government’s values system, this is a lesser priority than increasing the ability to consume for people who are earning over $100,000.

In addition to putting further education beyond the reach of most Australians, the government has provided no extra funding for university research. We need that public interest research. We cannot rely on industry partnerships to deliver the science we need to address climate change and the public interest dimensions of the ethical dilemmas posed by the biotech and nanotech revolutions. The wealth of the country should be seen in its people and in its ability to capture creativity and innovation in adapting to changing global circumstances. In this context, we have to fund the arts.

Adaptation to changing global circumstances needs to be reflected in building a coherent society in which there is not a massive gap between the rich and the poor, in which women are given equal opportunity to participate and in which no child is kept behind razor wire. Conflict and antisocial behaviour occur when some in the community are left without hope, worthwhile work or provision for their old age while others benefit from tax cuts and superannuation advantages. What an opportunity we have missed to adequately fund primary health care from early childhood right through to old age! What an opportunity we have missed to reduce the gap between the rich and the poor, and to provide support for people with disabilities and for carers!

The government may claim that the budget is in surplus, but what does that say about its values if the nation is deep in deficit, if its children are not properly cared for and if its Indigenous communities are forced to live in Third World conditions? If we cannot address Aboriginal disadvantage in an economic boom time, when can we address it?

Unlike the Howard government, the Greens’ vision for Australia and the values we hold mean we would not squander the surplus on a spending spree. We do not support the tax cuts or superannuation windfall for high-income earners. We would spend the $45 billion instead on fostering equity and high standards of education and public health and on accelerating the transition from a narrow resource based economy to a low-carbon economy with a strong innovative new industry and employment base. We would oil-proof the country and invest in energy security and adaptation to climate change. We would offer the leadership that Australia needs in the 21st century. Just as Tony Blair identified climate change and making poverty history as the themes of Britain’s leadership of the European Union and the G8 so, too, Australia should adopt climate change, renewable energy and energy efficiency as key themes for APEC in 2007. This would truly provide genuine leadership for the region.

Steve Fielding (Victoria, Family First Party) Share this | Link to this | Hansard source

Ordinary Australian families will be grateful for whatever help they can get from this budget. At a time when they are battling with high petrol prices and an increase in interest rates, everything helps. But the fact is that ordinary Australian families have not got as much help out of this budget as they could have. For example, politicians have fared much better from the tax cuts than the average Australian. I will get a tax cut of about $66 a week. But somebody earning $50,000 or $60,000 will get a tax cut of just $10 a week. The government has also expanded access to the large family supplement. Parents with three children—and that includes my wife, Sue, and I—will now receive an extra $5 a week. But that does not do much to fill the car or pay the mortgage. And the Treasurer has to be kidding if he thinks $5 extra a week will encourage families to have more children.

The government claims this is a budget for families, but the big winners are the high-income earners. Can you believe that a single person earning $100,000 a year with no children gets twice as much as a two-income family on $100,000 with two children? I quote from an article in the Financial Review yesterday entitled ‘At last, it’s a win for the high income earners’. It said:

The changes mean the 2 per cent of taxpayers earning more than $150,000 next financial year and paying the top tax rate will save $6200 a year, or more than 12 times the $510 saving pocketed by average workers.

Another article in the Financial Review reveals:

Even a single person on $70,000 a year will receive $190 a year more in tax cuts than a dual-income family with two children on the same income which starts to lose family tax benefits once income reaches a certain level.

So much for putting families first.

Family First thinks there is a better way. For example, consider a two-income, two-child family. One wage earner is on $60,000 and the other is on $20,000. They have two cars—a Commodore and a Corolla—and they fill up the tanks with petrol once a week. If the government had adopted Family First’s plan to cut the petrol tax by 10c a litre, this family would have saved about $13 a week in its petrol bill alone. This petrol tax cut would have cost the government $3.8 billion. Instead, under the government’s plan, that family will get $16 a week in tax cuts. Yes, that is just $3 more out of the government’s package, but that will cost about $9 billion a year for the next four years. However, under Family First’s proposal, the family could have had the $13 extra a week, plus there would have been more than $5 billion left over for income tax cuts. Clearly, the average Australian family would have been better off under Family First’s plan.

Also, a cut in petrol taxes delivers three times the savings as a proportion of income to the poorest 20 per cent of households compared to the wealthiest 20 per cent. Taxing petrol is both regressive and inefficient. Whacking a tax on petrol penalises people in regional and rural areas in particular because it increases the cost of transport, encouraging people into metropolitan areas and increasing congestion. Some say petrol price rises are good for the environment. It is right to say that petrol prices should rise in response to demand to stimulate new investment in production of fuel alternatives, but petrol tax is not part of the price received by producers. Cutting tax does not affect the price petrol companies get. The petrol tax hits thousands of other prices and operates as an insidious tax on the basic living costs of ordinary families. And, perhaps more importantly, soaring petrol prices risk further interest rate rises.

The Prime Minister has admitted petrol prices are inflationary. But the Treasurer in his statement on tax reform still harks back to 2001—five years ago—which was the last time the government did anything to reduce petrol excise. Family First are disappointed the government still stubbornly refuses to cut petrol taxes, but we know the reason why. The budget confirms the government is drunk on petrol tax. Next financial year the government expects to reap $14 billion in tax from motorists, yet it continues to arrogantly ignore the petrol pain on families and small businesses. Perhaps politicians would be more understanding if they had to fork out for petrol themselves.

Turning to the big issue of child care, Family First is pleased that more families will receive family tax benefit A. But Family First wants the child-care rebate, which only goes to parents of children attending formal child care, to be replaced by an increased family tax benefit payment that goes to all parents with children under five. In other words, the government’s current policy is to only give the child-care rebate to those parents who can afford the high child-care fees and who want to put their children in professional child-care centres or other approved care. Instead, Family First’s proposal would mean that all parents are treated equally, regardless of whether they choose formal child care or have their children looked after by a relative, friend or neighbour. This is also an equity issue. For example, families on $60,000 a year receive $10,000 per child if they use formal child care but less than $2,000 if they use informal care or if they care for their children themselves. Clearly the government has a market-friendly policy, not a family-friendly policy. Parents are in the best position to decide who is best able to care for their children, and Family First’s policy would give them that choice. Families do benefit from this budget and will welcome it. But, for the average Australian family, this budget will not be the bonanza the government would like us all to believe it is.

Debate (on motion by Senator Abetz) adjourned.