13.2.13 Appropriation BIll (No 3) 2012-2013- Appropriation Bill (No 4) 2012-2013

Mr HAWKE (Mitchell) (16:13): I rise to speak on the appropriation bills and to follow the excellent contribution from the member for Forde in relation to the spending of the Australian government. I have spoken in relation to appropriations over the past five years that I have been in this place, and once again we see the government seeking funds to conduct the ordinary business of government—but in the context of a budgetary condition that you could only describe as absolute free fall.

Let us have a look at what is happening right now in the nation's budgetary situation—with perhaps the worst example of public policy in our era being the mining resource rent tax debacle. This has a profound impact on the economy's bottom line and the budget's bottom line and is another reason that the government will need to appropriate money at a rate that I think is completely unsustainable. I have spoken on many occasions on how already in the Australian budget every single dollar that is collected in individual income tax is sent out the door in the form of welfare—a completely unsustainable budget footing. What you have with a mining resource rent tax that does not bring in any revenue is, of course, a bad tax—something that discourages investment and hinders the ability of companies to plan securely for their future. But what is worse is to find a government of the calibre of this Labor government that spends up to $15 billion against money that is not going to ever come in. That is completely unsustainable expenditure. That is completely unsustainable expenditure. It is not the first time we have seen it from this government. Each day in question time we see a series of questions put to this government. What is it going to do to fix this situation? Why has it put $15 billion expenditure against no incoming revenue? How is this going to be funded? Of course, the Treasurer today was completely embarrassing when he really had no answer about how it was to be funded. Of course, he does not know how it is going to be funded—he has not thought about it. The only answer, of course, is borrowing, more borrowing—more debt and more deficit. Borrowing against the future of this country, borrowing against the future employment of this country, borrowing against the future generations who will have pay for the flagrant expenditure of this out-of-control Labor government.

We have seen the whiz-kids of the Labor Party come up with the slogans about the surplus. Not only did we see Penny Wong and the Treasurer on 650 occasions go out and say that we were going to get a surplus. We saw the wonder kids of the Labor Party put out on Twitter a little logo that said, 'Back to the surplus in 2012-13'—playing off the movie Back to the Future, thinking they were being clever. I know the member for Bruce is having a little chuckle. It is funny—'Back to the surplus 2012-13.' Those crazy Labor kids! What are they going to do next? The only problem is that the same people are running this country's government. I know I have found some sympathy in the member for Bruce about the state of the current government. 'Back to the surplus'—these crazy Labor kids running the government seem to think this is some kind of joke.

It is not funny. On 650 occasions you have the finance minister and the Treasurer announcing a surplus. You have the Assistant Treasurer David Bradbury announcing to his electors that he had already delivered a budget surplus—that is, all those families and businesses and honest hard-working people in Western Sydney have been told by their local member, who serves in this place as Assistant Treasurer, that he has delivered a budget surplus. He has delivered it! But he has refused to retract, to correct, to respond to his voters—to tell his electorate the truth, to update them that 'Back to the surplus' was just a movie concept. It was never going to get made; it was a low-budget film that was never going to get into production because the actors were too D-grade. On a serious note, he refuses to go out and front his electorate and tell them that his much vaunted budget surplus is never going to be delivered under this government.

Are we to believe that this is due to commodity prices? My answer is that I do not think so. We know for a fact that federal government revenue is now $70 billion higher than it was when the government took office. We know that just from MYEFO. Commodity price revenue is forecast to rise by $37 billion and the write-down was in the order of $3 billion to $4 billion. The write-down in commodity prices was just a small percentage of the total increase in government revenue, and yet this government says, 'Because we have lost a couple of billion on the commodity market, the entire budget is going to fall into chaos.' That is what we are supposed to believe from this government. What are the Australian public, investors, businesses, people from overseas to make of a government that seriously links its political fortunes and its ability to deliver a surplus to commodity prices? Commodity prices are volatile. Commodity prices will rise and fall. For the first time in this country's history we have the unedifying spectacle of a Treasurer who has gone to the media on a week-by-week basis essentially to say each week: 'Well, this week the surplus is not going to happen. I'm sorry, commodities are down.' Then the next week there is a bounce in the commodity prices and he starts to say, 'Well, look, maybe we'll get there.' This is an unsustainable approach to government. This is an unsustainable approach to managing the budget. No wonder we are in an economic climate where people are hanging onto their money. People are hanging onto their money because they know the kind of people who are running this Labor government. They know the kind of people who are running this country.

You cannot trust them. If you are a large mining company, you cannot trust the word of this government. We know what would happen if this government were re-elected in September. We know what they will do. Their word means nothing. Their signature means nothing. They will go to any length to cover up their own grave inadequacies and failings. The MRRT represents perhaps the single biggest public policy blunder in Australian history. It is a completely unedifying spectacle and it has serious consequences for ordinary people who lack confidence in the economic climate and the ability of the government to manage the economy.

In the context of this appropriations bill, I think it is important that we continue to talk about what Labor is doing to the budget and some of the expenditure, because expenditure is the problem. I mentioned that we have had $70 billion of increased revenue since Labor came to office; however, the problem is that we have had $90 billion worth of expenditure increases since Labor came to office. Expenditure has now reached proportions that mean that our deficit is becoming larger and larger. Of course, the government is right to say that comparatively, in an international context, our deficit is low; that is because of the conditions they inherited from the previous Howard government.

What we see now is this completely out-of-the-ether set of concepts—whether it be Gonski, whether it be the dental scheme, whether it be the National Disability Insurance Scheme or whether it be the NBN—and projects of a size and scale which makes them completely unaffordable. These projects, which are completely unsustainable in a budgetary context, are simply being announced to try to salvage the government's political fortunes. It is a daily exercise in this parliament. It is a daily exercise in the public arena. How can we afford to fund $6 billion for Gonski, billions of dollars for dental work, $4 billion to $5 billion for the National Disability Insurance Scheme and $40 billion for a National Broadband Network? Who is going to earn that money? Where are those funds going to come from? And who is going to pay for all that debt you will have to go into to try to fund these schemes?

Some of these ideas are worthy. Some of these ideas have merit. But you cannot fix the world's problems without having the how. You have to know how you are going to fix it. You have to know how you are going to fund it. If you do not have a plan to do that then you really have no idea how you are going to solve the problems that challenge us for the future. It is crazy to think that even with one of the most socialist governments of our time, it cannot even redistribute wealth properly. This is a government that cannot even take from the rich and give to the poor. They have buggered up the mining tax. It is a pretty simple job. The member for Bruce would know this. Socialists throughout history have been able to take from the rich and give to the poor. This is a government that cannot even do that. It is completely failing in all regards.

I want to turn to my electorate and some of the real plans and solutions that the coalition has. What I have been very pleased to see is the Leader of the Opposition bringing forward our plans for the next election. I am happy to lend the member for Bruce a copy of this booklet here, which is Our plan—real solutions for all Australians. It contains 21 points. He will find it good reading.

An honourable member: I'm sure it is a very quick read.

Mr HAWKE: It is quick. It is not of the length of a speech by an Independent about forming government; it is really a concise summary of the plans that we intend to take to the election.

Mr Schultz interjecting—

Mr HAWKE: No, Member for Hume, this is not confidential stuff—I am happy to gift a copy to the member for Bruce right now for his benefit. I think the most important part of this document, Our plan—real solutions for all Australians, is helping small business create stronger jobs growth. The economic plan that the coalition has is based around the understanding that small business is the fundamental driver of economic wealth in this country. It is not that business is the enemy, not that every time you change the industrial relations law or other forms of law that you ignore the impact on small business—the real drivers of economic growth and employment in this country—like the government does. It is about understanding that at the heart of government decisions we must ensure that the changes we make are friendly to small business. The five pillars that the coalition is talking about are very important: ensuring that we have a good mining sector; ensuring that growth is at the heart of the economy; stopping small businesses paying an extra 10 per cent for their electricity by removing the carbon tax; removing the wasteful and investment-discouraging tax of the minerals resource rent tax; and getting on with cutting red tape and reducing costs by $1 billion a year. It is an important plan, which focuses on manufacturing innovation, agricultural exports, advanced services, world-class education and research, and boosting our mining exports to make the most of our advantages in the international marketplace. It is a realistic plan and I think Australians can have some fundamental confidence in knowing what their government is going to be doing. That is the real criticism of this government and the people that run it: nobody in any sector of this economy knows what is going on with the federal government. Nobody can tell. It does not matter what sector you go to, everybody says the same thing: we cannot get an answer from the minister; we cannot get an understanding from that department about what is going on, about what is next, about what this legislation will do, what it means, where it will head. Nobody knows because the government do not know where they are heading with all of these programs.

But perhaps, as I have spoken about many times in this place, the most distressing thing about the budget and the appropriations and where this government is headed is of course defence expenditure. I have mentioned in this place before that the primary function of a federal government—in fact, one of the reasons for being of the federal government and the prime motivator—is having a Defence Force for Australia. The Labor Party's website says that the first priority of government must be the defence of the nation. The first priority! That is why it is shocking to this House to understand that the Defence portfolio has had its spending cut by 10.5 per cent in one year—the largest annual reduction since the end of the Korean War in 1953. When I saw the Minister for Defence, Stephen Smith, standing at the dispatch box today, I thought, 'How does he stand at that dispatch box every day as the cabinet minister who took the biggest annual expenditure cut in his portfolio—such a significant cabinet portfolio?'

There are people in this chamber who have been in cabinet who are no longer in cabinet. How can you front up to parliament each day as the cabinet minister that lost 10.5 per cent out of your portfolio in such a critical and vital area? It is distressing I think for most Australians to understand that we are now ranked 65th in the world in defence spending. Considering we regard ourselves as one of the most advanced nations, with a role to play in our region, with a role to play in the free world, how can we sustain that mission for our ADF and our defence personnel if we are ranked 65th in the world in defence spending and we are sustaining 10.5 per cent cuts in the annual defence budget each year? That is the real consequence of economic mismanagement. The fundamental priorities of government suffer. The defence of our nation, which is at the very core of what this place is supposed to be about, is taking a substantial financial penalty. Not only that, but all of the ordinary families, businesses and hardworking people out there are suffering as a consequence of the fundamental economic mismanagement of the government.

It is time for a new government in Australia. It is time for a government that understands the economy and what drives growth and prosperity in an economy. It is time for this government to pack it in.