PARLIAMENT HOUSE, Canberra: I rise to speak on the Social Security and Other Legislation Amendment (Income Support Bonus) Bill, the purpose of which is to provide two extra cash payments to certain income support recipients. As you would be aware, this bill comes out of a package which the Prime Minister announced with much fanfare last May called Spreading the Benefits of the Boom. The coalition is going to oppose this bill. In the time that I have available this evening, I will outline the reasons that we are going to oppose it.
There are three arguments that I will make as to why we are opposing this bill. Firstly, there is no money to pay for it. This bill asks us to appropriate over $1 billion and put it on the government credit card. Secondly, the stated purpose of this bill, which is to support families with cost-of-living pressures, should be achieved in other ways, notably by scrapping the carbon tax and reducing other taxes. Finally, before we start handing out cash-splashes, the government should restore the funding to hospitals in Victoria. The funding cuts are causing beds to close, including in my electorate.
I go to the first point of no funding being available to pay for this package of measures. When this package was announced, it was said that it was going to be paid for by the mining tax. It was a case of ‘spreading the benefits of the boom’, as the Prime Minister’s statement itself said. If you read her statement, it says very specifically that this package will be funded by redirecting Minerals Resource Rent Tax revenue intended for the company tax cuts. But, of course, we know what occurred: no revenue came in from the Minerals Resource Rent Tax. But, when the government realised the fact that no revenue was coming in from the mining tax, they did not look at the spending connected to the mining tax and think, ‘We’d better examine that and cut back on the spending connected to the tax.’ No, on the contrary, in the typical Labor way, they just did the spending in any case. What does this mean? In essence, it means that this bill asks the parliament to appropriate $1.07 billion and add it to government debt. We are already in billions of dollars of debt.
So far the government has racked up $147 billion in net debt. They have delivered the four biggest government deficits in Australian political history. The government, despite promising 500 times that they would deliver a surplus, they have since abandoned their promise. So now, I presume, they think: ‘We’ve abandoned any sense of financial responsibility. We’ve abandoned any sense of trying to get back to a surplus. What does an additional billion dollars on the government credit card mean, in any case?’ I presume that that is the thinking of the government in relation to this bill and many other spending commitments they are making with no revenue connected to them. This stands in stark contrast, of course, to the period of the Howard government.
Under the Howard government, there were payments made to families to help with cost-of-living pressures. But guess what? Under the Howard government we had budget surpluses, so they were affordable expenditures and affordable payments. Now we are not in a surplus. We are in deep deficit, with huge debts, and this bill just adds an additional $1 billion to the government’s credit card. This is the first reason that we are opposing the bill—the government simply cannot afford it.
The second reason is that there are better and more sustainable ways of meeting the intent of the bill. Again, if I go back to the Prime Minister’s statement in relation to the measures contained in this bill, it said that these cash payments will help with cost-of-living pressures. I have no problem with the intent to help families with cost-of-living pressures. Indeed, it will be one of the central goals and central themes which the coalition will prosecute up until the election and, should we be elected, it will be one of our central platforms to address. We know that many families are doing it exceptionally tough at the moment; we know that because we are out there speaking to families on a daily and weekly basis and because they tell us how difficult it is. They tell us that all the essential goods in life are going up way in excess of inflation and way in excess of their salaries. When you actually look at the statistics, you see that they bear this out. For example, if you look at electricity costs, you see that they have gone up by an amazing 90 per cent since the Rudd-Gillard government was elected in 2007. Water has gone up by 64 per cent; gas, 60 per cent; education, 31 per cent; and medical and hospital services, 38 per cent. Child care has gone up by 15 per cent in the last year alone. So the cost of living is absolutely an issue. Many families are struggling.
What has caused these cost-of-living pressures? It is important to ask that question because we need to get to the bottom of it to determine what the best mechanism is to try to support families with their cost-of-living pressures. When you go through some of the increases in prices you see that it is the government’s own policy positions, their own taxes and their own regulations that have caused many of these cost-of-living pressures. We know about the electricity price increases, where electricity has gone up by 10 per cent alone this year. It was forecast to go up by exactly that amount due to the carbon tax. The government knew that that would occur and they went ahead and did it—so they are responsible. Their tax is responsible for a 10 per cent increase in electricity this year, and this is when the tax is at $23 per tonne. The government want the tax to go up to $350 per tonne by 2050. Gas has gone up by nine per cent, which is also due to the carbon tax.
Health costs have gone up because the government is taking the axe to the private health insurance rebate. It was predicted that, if you take the axe to the private health insurance rebate, the private health insurance rebate will go up for everybody. It adds to cost-of-living pressures. Child care has gone up at a dramatic rate in the last 12 months due to a government policy which is deliberately causing prices to escalate. The Productivity Commission examined the government’s proposals in this area and said, ‘Yes, you proceed with those policies and costs will go up by 15 per cent.’ So what did the government do? They proceeded with those policies. And what have we seen? We have seen costs go up by 15 per cent. The government has introduced 21 new taxes. Generally, of course, the government has added thousands and thousands of new regulations which make it more difficult and more expensive for businesses to operate, and all of that translates to higher costs for goods and higher costs for services for everyday Australians.
And so it is that the government itself has been one of the main drivers of the increases in costs of living for Australian families. Having put up costs for families, the government is now saying: ‘Geez, the costs have gone up for families. We’d better give them a cash payment to make up for those costs.’ That is the wrong way to think about it. Instead, we should actually be thinking, ‘What can we do to take the pressure off the cost side of the equation?’
There are many things which this government should be doing immediately to take costs off families. It starts with getting rid of the world’s largest carbon tax. That tax alone adds $515 per annum to the family’s budget. This measure is only $210 per annum. So, if the government is concerned about cost-of-living pressures, it could get rid of the carbon tax. That is the first thing that you can do. Minimise the other taxes—that is the second thing that the government can do. Re-examine those 21 taxes which it has introduced and minimise them where possible. Third, stop cutting the private health insurance rebate, because that directly increases the cost of private health insurance. Fourth, do not make child care more expensive to operate. If you make child care more expensive for operators then that means prices go up for everyday families. Fifth, cut the regulations off business. Get rid of the red tape and let businesses be more productive and efficient, because that means they can then pass on their lower costs into lower prices for everyday families. These are the things that would have a demonstrable impact on cost-of-living pressures. That is what should be the focus of the government, rather than putting up costs with its policies and then finding that it has to give a cash splash because people have higher cost-of-living pressures. That is the wrong way to go about it.
My final argument as to why I think this bill is not the right one at this time is that the government has got its priorities wrong. We know that it is wasting money in many areas, but it is also at exactly the same time cutting money from core essential services in the community. I am particularly concerned about the $107 million which this government has cut from Victorian hospitals. That is having an impact right across hospitals.
Do you know what that means, even in my electorate? It means that five palliative care beds in Wantirna Health in my electorate alone have now been closed. It also means that in the adjacent electorate, the electorate of La Trobe, five surgical beds have been closed from Angliss Hospital.
When it comes to priorities, they are the types of things that should be done in terms of restoring those cuts which are having a detrimental impact right across my state, including for my constituents in my electorate.
If I could summarise, in conclusion, in the last minute I have available: we all want to be generous for families which are doing it tough. We particularly feel for those who are doing it tough. But if the budget is in serious deficit, as it is now, if there is an enormous government debt, which there is now, then we cannot afford the cash splashes which this bill proposes. What we can do, though, is make a real impact on cost-of-living pressures by cutting the taxes, by cutting the red tape, and by having sensible policies to keep costs down. Those should be the government’s priorities.