Federal Budget 2014 impact on Scullin residents - speech in Parliament

Mr GILES (Scullin) (17:33): For all the bluster, for all the wannabe Churchillian posturing we have seen in the past couple of weeks, this is fundamentally a government that lacks the courage of its convictions. The budget makes this clear—sadly, with devastating effects for our society. It presents a deeply ideological agenda, shrinking our sense of the public good, suggesting it is something that somehow arises out of necessity—but this simply is not so.

The rationale underpinning this budget of broken promises is that there is an emergency. However, there seems to be some confusion, to say the least, amongst members opposite about the exact nature of this supposed emergency. We have heard the Prime Minister claim the house was on fire and then, confusingly, that Labor itself was the fire. On the other hand, we have heard the Treasurer downgrading the fire, saying it was just the kitchen, not the house, on fire. This is a government that cannot get its metaphors straight, let alone give a true account of its actions and purpose. Since then we have heard the Prime Minister say:

You see, we had a fire, and the budget is the fire brigade. And sure, sometimes the fire brigade knocks over a few fences in order to put out the fire.

'A few fences'? What the Prime Minister refers to as a few fences being knocked over are in fact people, families, communities, neighbourhoods—all of whom quite reasonably expected their government to be on their side and not to be using dehumanising rhetoric to justify knocking them over.

Of course, there is no fire, no emergency. The notion of an emergency is one that has been refuted by every economist in the country and, I might add, in other countries too. Even the National Commission of Audit chairman, Tony Shepherd, says so. If the government cannot convince one of the budget's architects that there is an emergency, then the argument is running threadbare, to say the least. The only crisis here is in the government's credibility and it is telling that they will not directly say what they mean, but they want to divide Australia and divide Australians, to take us back to the future, before Medicare, before higher education was opened up and before modern Australia.

There are, however, some clues as to what is meant. In his second reading speech, the Treasurer said, invoking Menzies, that we are a nation of lifters, not leaners. In this budget it is the most vulnerable Australians who are doing most of the lifting. The Treasurer spoke also of fairness and intergenerational responsibility, and yet young people will bear the brunt of this government's cruelty. The National Centre for Social and Economic Modelling found that low-income couples, children and single parents will lose up to 15 per cent of their disposable income when these measures are fully implemented. NATSEM Principle Research Fellow, Ben Phillips, told Emma Griffiths from ABC News that around 1.2 million families would be, on average, around $3,000 a year worse off by 2017-18. An unemployed single parent of two school aged children would lose over $4,000 a year, or nearly 15 per cent of their disposable income, by 2017. This parent would still lose this amount if they found a job that paid $40,000. A couple with two school aged children who both work to bring in a combined income of $60,000 would lose $6,000 a year of their disposable income. Even if their annual income climbed to $90,000, the loss would remain the same. Mr Phillips described this as 'a substantial hit and these are of course to the families who are already in the most precarious positions'. I am inclined to stronger language. It is taking the most from those who have the least.

In addition, research by the Crawford School of Public Policy at the ANU has found that those receiving government benefits do the heavy lifting, as the Treasurer would say, in this budget. This research found that an unemployed single parent with an eight-year-old child would lose $54 a week, 12 per cent of their disposable income. The GP tax, which is another broken promise, whatever members opposite might say, will also hit the most vulnerable the hardest, tearing down a signal Australian achievement—universal health care—and undermining great steps forward that have been taken in terms of preventative health. The Scullin electorate has the highest rate of bulk-billing in Victoria and I would like to keep it this way. Those opposite have other ideas. We have seen the Prime Minister and the Treasurer mislead the public about who would have to pay the GP tax. The coalition have also been repeating the canard that people are seeing a GP too often, using an inaccurate and an inflated figure. Surely a general practitioner is better qualified than a right-wing ideologue in assessing someone's medical condition or someone's health needs. The sick are doing the lifting in this budget.

The Treasurer has spoken about values being more important than figures in this budget—and I am sure that is true; I agree with him on that—but these are the wrong values that inform these budget decisions. The values message here is all too clear: if you are poor, then do not get sick. Or, more starkly: do not be poor—or young, for that matter. And the government's message to motorists, most of us, is just as blunt: if you drive, you will pay more. If you want to get public transport in the outer suburbs, good luck, because the coalition is ideologically opposed to investing in public transport infrastructure, much to the frustration of state colleagues in Victoria, at least. People in Scullin are crying out for public transport infrastructure investment because they have no choice but to drive all too often, and now they will pay at the pump for this government's broken promise on the petrol tax and its refusal to invest in Melbourne Metro and other public transport infrastructure projects. People in Scullin see through the accountancy tricks of this self-described infrastructure Prime Minister. They see no vision to keep our cities productive and liveable.

A division having been called in the House of Representatives—

Sitting suspended from 17:39 to 17:53

Mr GILES: Finally, I note the biggest lifters of all in this budget are the world's most vulnerable, as 21 per cent in budget savings come from our foreign aid budget. The cruellest cuts of all fall on those who are unable to defend themselves or even be heard here, those who rely on us the most. That is perhaps the most shameful aspect of this budget.

The public's instinctive awareness of the unequal distribution of budget pain has been backed up by NATSEM research, which found that the temporary two per cent income tax increase for the nation's top earners would have a token impact. As Mr Phillips stated:

If you're on $200,000 … your impact would be around $400 per year, and that compares to a single-earner family … who may be losing $3,000 to $4,000 per year by 2017-18 … the top income groups - so the top 20 per cent of households - would have either no impact or a very small positive impact.

A key difference between the government's debt tax and the attacks on low- and middle-income earners is that the debt tax is temporary. The cuts to family payments and other cuts are permanent. It is also worth mentioning, and it is quite interesting, that these figures would have been included in previous budget papers but in this budget they were missing—funny that.

I want to touch briefly on the impact this budget will have on young Australians, on our future. Firstly, I regard spending on education as investment not some dead-weight cost like those opposite seem to treat it. Investing in our young and sometimes our not so young through lifelong learning is how we grow our economy in large part. Making education unaffordable by crippling students with large high-interest loans does not help grow our economy. It does not enable us to get the best and brightest into the most productive vocations.

I think of the conversations I have had with constituents in recent days. One constituent was fearful and angry at the government's proposal to allow for an increase in university fees and the impact this would have on his two daughters—one at university and another aspiring to study medicine at the University of Melbourne—and on the community in general. He was of the view that, as a country, we need to ensure at least that if people apply themselves, then they have the same opportunities no matter their economic background. I could not agree more with my constituent but I am disappointed that I was unable to assure him that this government would hold to that maxim.

Prior to the election, when asked about increasing university fees, the minister, the member for Sturt, said:

…we have no plans to increase fees …

And after the election he said:

I'm not even considering it because we promised that we wouldn't.

So much for that: another broken promise, another callous disregard and breach of faith with the Australian community.

Secondly, in terms of young people, I note the complete cut-off of any form of support for those under 30 is simply unconscionable in a society such as ours. The Treasurer and Prime Minister insist with robotic insistence that young people will simply find a job, even though Australia's youth unemployment rate is persistently at 12 per cent. The budget projections offer no prospect of this falling in the near future. Where are the jobs to come from, let alone the investment in these young Australians?

The government has also cut programs like Youth Connections which helped young people remain engaged in education and training, and to find work. Why would the government make education more expensive, shut down youth employment programs and then cut off the safety net—any safety net—for young people? It is difficult not to arrive at the conclusion that this government just wants to hurt young, vulnerable Australians. So much for the rhetoric of intergenerational fairness and responsibility.

Last week, I spoke with members of the Whittlesea and District Greek Elderly Club about the budget—or rather, they spoke to me. I did most of the listening as they told me in heartbreaking detail how difficult their lives would become because of decisions contained in this budget. They wanted to know why, if there was supposedly a budget emergency, there were still tax concessions for the wealthy to contribute to their superannuation and, in particular, how there could be $50,000 cheques sent to millionaires. They wanted to know how a one-off pay freeze to politicians pay was fair compared to a permanent cut to the pension. I had—and I have—no answer to these basic questions of fairness, because this budget is fundamentally unjust. It is also dishonest in its pretence at fairness when there is none. Constituents I hear from are in disbelief and anger about what this government is seeking to do, and this is compounded by the words of the member for Higgins, who unselfconsciously writes today in the Australian Financial Reviewthat:

Selfishness has taken over from self-reliance. For our children's sake, we need to reverse the trend.

This budget entrenches and embodies selfishness. And for our children's sake, I am seeking to reverse this trend—the trend of the government's making.

I don't think people want to get into a mathematical debate about the price of everything, but people are right to be concerned with the standard and quality of living. It is no accident that in recent weeks inequality has become a hot topic right across the developed world. Thomas Piketty's Capital in the Twenty-First Century has shone the light on intergenerational inequality—something much spoken about by this government but little attended to. And yet this government seems determined to return Australia to a gilded age of inequality, whereby if you are not born into wealth, the game of life is rigged against you.

As Piketty writes:

The history of inequality is shaped by the way economic, social and political actors what is just and what is not, as well as by the relative power of those actors and the collective choices that result …

This budget before us is an enactment of the excesses of wealth and power over the poor and vulnerable. It is unjust, and the Labor Party chooses to stand against these excesses.

The Prime Minister promised—I think this was a solemn promise—that this would be a 'no surprises, no excuses' government. On Melbourne radio, the day before the election, the Prime Minister said: 'The fact is the most important thing I can do for our country in the coming months is to ensure that it is possible once more to have faith in your polity, to have faith in your government and that means keeping commitments.' I could not agree more with the then opposition leader and now Prime Minister. But, sadly, the months since that day show that the people of Australia can have no faith whatever in this government, a government that treats the promises it made before the election as mere statements of puffery which can be walked away from, if not openly laughed at, as the Minister for Education seemed to do in the chamber today.

I am holding them to account for the broken promises of their government. The Treasurer of Australia described this process as 'silly populist games'. Treasurer, let me say this: keeping your promises is not a silly populist game. It is how elected officials keep faith with the Australian people. It is fundamental to the operation of our democratic system.

The Prime Minister said that he would be prepared to take a hit in the polls for the country. How terribly noble of him! But families, students, the poor and so many others in our society are taking a hit already, a hit much larger and with a considerably more painful impact than this government's decline in polling—a decline that I am sure will continue.

The premiers and chief ministers—most of them conservative—were clearly labouring under the delusion the Abbott government would keep its promises. I think they have learned their lesson now. The Prime Minister attempted to muddy the waters in this regard, claiming this government's $80 billion cuts to the health and education budgets of states and territories would not take effect for years. It turns out, of course, they will start taking effect on 1 July. As with cuts in other areas, there is no plan for how schools and hospitals are meant to cope with these cuts. They are expected to simply find efficiencies. Only the coalition could regard a hospital as more efficient when it closes beds or a school more efficient as it sacks teachers.

While the people of Scullin will pay the price for this government's broken promises, this government will wear this budget like a crown of thorns at the next election—as it should. I was inspired by the Leader of the Opposition's rousing budget reply. It captured the real mood of the nation. I look forward to prosecuting the case against this government. But, more importantly, I look forward to making the case for a better, more inclusive government, one that keeps faith with the Australian people and one the Australian people can have faith in.

This is a cruel budget that rests on a false premise, but it is so much worse than that. It is narrow, unfair, bereft of vision or competence and deeply, dishonestly ideological. It has already defined this government, and Labor will ensure that it does not confine Australia's future.


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