Speech on the 2014-15 Budget - Appropriations (No. 1) Bill and associated bills

29 May 2014

Dr CHALMERS (Rankin) (17:58):  I rise today to speak on the appropriation bills required to implement the stinker of a budget that is the 2014-15 budget. It is one budget but it creates two nations. It is the most extreme and divisive budget in memory from the most extreme and divisive Prime Minister in memory. It seeks to divide the country into haves and have-nots, pitting Australian against Australian, placing the burden unfairly on families on low incomes, on those living week to week, on the pensioners, on the sick and on the disabled. It is a budget that asks the most vulnerable in our community to do the heaviest lifting and as a result it will make our country sick and poorer, less fair, less equal and less educated.

The member for Wannon just said that everything about this budget can be found in Dickens. As the member for Hotham said before, that is right, it is all about Hard Times. This budget is about Hard Times. The people of my electorate are furious, and for good reason. This is a budget built on broken promises and lies and twisted priorities.

It is a smash-and-grab raid on my community and on the good people who live week to week who just want to make ends meet and raise their kids. It is a budget that will contribute to a bleaker, more inequitable future for Australia, and it is one that is founded on extreme ideology and not economic strategy.

The cruel and unnecessary cuts to schools and hospitals, pensions and payments, and tax hikes on petrol will stretch household budgets in my area, in my electorate, to breaking point. Analysis done since the budget has shown that my community in Rankin will be harder hit by this budget than any other community in Queensland. This is also borne out by the NATSEM data that I will discuss in a moment. But, as important as that modelling is and as credible as that modelling is, the people in my area do not need economic modelling to tell them that this budget is a direct attack on them and their families.

To me, the effects of these broken promises and twisted priorities have an entirely human face. It is the pensioners who stop me in the street, worried that they will not be able to pay their bills anymore or that they will have to choose one bill over another. It is the parents already fighting to make ends meet, who fear that they will not be able to afford the kids' new uniforms when they grow out of the old ones. It is the high school students who cannot see a path to university in a world of uncapped fees. It is people like Kerri Morris, whose home I visited with the Leader of the Opposition last week.

Kerri is a single mother recovering from cancer. She has been battling to make ends meet to provide for her kids. She had to step aside temporarily from her job to focus on her health and her family. She is in and out of GP and specialist clinics all the time, and she has to pay not just for consultations now but more for prescriptions as well, and of course for fuel and parking. We calculated what the budget hit would be for Kerri from this budget. When the measures come into full effect, they will hit Kerri's annual household budget by something like $3,800 a year. That is something like $75 per week—$75 a week less that Kerri will be able to spend on the essentials, on medicines and on giving her daughter and her other kids a good start in life.

Kerri, along with millions of other Australians on lower incomes, has been targeted by this budget for no good reason, and they will be bearing the brunt of this government's cruel cuts and new taxes. Sadly, her story is not the exception in my area; it is the norm, and that is why locals are white-hot with anger about this government and its budget of broken promises.

One of the most heartening things from the reaction in my community, whether it be by email or at the mobile offices I have been doing, getting out and about, is that people are saying that even the measures that do not directly impact them trouble them because they are worried about their neighbour, their family member, their friend, their schools and hospitals, the teachers—they are worried about all kinds of people in the community. That says something very good about Australians because it says that, if you attack one member of our community in this way, you attack every member of the community in this way. In attacking one, you attack us all.

This budget will also have an impact on small businesses in my community and right around the country. People will not have the same level of discretionary spending that they had before this budget, and that will have a real impact on small businesses, how many people they can employ and whether or not they keep their head above water.

Last Friday, I was very pleased to welcome the shadow Treasurer to my electorate, and we had a function with the Logan Chamber of Commerce. We also went and saw the good people of Simply Beans, at Underwood, to talk about some of these issues around the budget. We also talked about the huge slump in consumer confidence brought about by the budget and by the ham-fisted way that it was previewed. The ANZ-Roy Morgan consumer confidence report measured its fastest slump since the beginnings of the global financial crisis in 2008. Consumers are worried that they will not be able to afford the essentials anymore, and small businesses will take the hit as a result.

So this budget is a stinker for small businesses in my community, and it is devastating for local families trying to make ends meet. The NATSEM analysis that I mentioned before measures the budget's full impact on families, and it really goes to this point. It reveals that the poorest 20 per cent of homes will see their annual income fall by almost 2.2 per cent, while the richest quintile will lose only 0.2 per cent. A couple with two kids, together earning $60,000 a year, suffers a hit of $6,350 a year, more than one-tenth of their income.

A budget like this can only widen the gap between the wealthiest and the lowest paid in our economy. The depth and scale of the cuts in this budget make it clear that its political architects see rising inequality not as a challenge to overcome but as an objective to be met. Unfairness is no mistake, and it is no side-effect in this budget.

The attack on low- fixed- and middle-income earners is not accidental; it is not unavoidable and it is not inconsequential.

It is a deliberate strategy that is particularly out of place given that right around the world the international economic policy environment is increasingly reducing inequality and supporting social mobility. I have spoken in this place before about mainstream economic thinkers like Miles Corak and Michael Ignatieff, who are working in this space and who argue that inequality in one generation breeds inequality in the next. Even the notoriously dry Economist magazine has described growing inequality as 'one of the biggest social, economic and political challenges of our time'.

Traditionally, Australia has been interested in addressing these problems. Since the Eureka Stockade in the 1850s and the birth of Labor in the 1890s, we have spent a lot of time as a nation talking about fairness and inequality. So much so that the 'fair go' has worked its way into our national identity and is cited by all sides of politics—but only by this side with any credibility.

This budget is the Abbott government's most recent attempt to tear at the social fabric of egalitarianism and a fair go that has long defined this country. That is why Dr Cassandra Goldie from ACOSS has described it, accurately I think, as 'a budget to divide the nation'.

Sadly, its impact will be felt long into the future. It not only magnifies inequality today, it will ingrain inequality for many years to come. The cuts to health, schools and higher education make it harder, not easier, for our nation to develop the rich and deep pools of human capital needed to feed productivity and social mobility in the decades ahead.

The member for Wannon spoke before about being able to look our kids in the eye and not steal from their future. I cannot imagine anything that would more devastatingly steal from their future than cutting $80 billion out of schools and hospitals and putting university out of the reach of more and more kids from low SES households.

We cannot accept a budget that drives greater inequality in Australia. We cannot accept a budget that condemns the poor to life as second-class citizens in our own country, with no prospect of improving their lot in life. We cannot accept a budget that embeds disparities that drive people to feel that their society and their democracy are loaded against them. We cannot accept a budget founded on the twisted priorities of this government who will take from the most disadvantaged to pander to the sectional interests that saw them elected.

Let's not forget that this is a government which will impose a $7 fee on the sick while at the same time paying millionaires $50,000 just to have a baby. It is a government who will rob hundreds of thousands of families of the family tax benefit part B, but will reinstate superannuation tax concessions for the wealthiest 20,000 Australians. It is a government who will radically decrease the indexation rates for age pensioners, meaning less money for them in years to come, but can somehow manage to find $20 million to pay for a marriage counselling scheme and $100 million for a union witch-hunt. The only way to describe this budget is as an ideological attack on low-income Australians.

 What makes it particularly galling is that it is an attack from a government and a coalition who have long shrieked and moaned about class warfare from the Labor Party. The people of Australia are watching as this government and this Prime Minister don the battle armour of class warfare themselves, with their sights set firmly on our most vulnerable and most disadvantaged. I want to reassure people right around the country and around my own community that we will fight against this budget and against this government who hurt them and sentenced our nation to growing inequality in the years ahead.

Those on the other side of the House try and justify this destructive budget by concocting an absurd 'budget emergency'. Let me be really clear: the budget emergency is a con. Those opposite can choose their opinions but they cannot choose the facts. The facts absolutely torpedo the so-called budget emergency. The government inherited an economy from Labor with a AAA credit rating and a stable outlook from all three major credit rating agencies, something never achieved by any Liberal government in the past, including that with Peter Costello as Treasurer. It was a budget which had gone through some substantial structural reform to the tune of $180 billion in savings over the last Labor government, with lower levels of debt than almost all comparable international economies. This government, particularly its Treasurer, worked very hard to feed the public his budget emergency con.

He piled billions of dollars into new spending in the MYEFO last year, doubled the deficit, gave the Reserve Bank money they did not ask for, came up with the most pessimistic economic forecasts he could—all to try to whip up this hysteria about a budget emergency, which was just a big excuse to swing the axe harder at working people.

The good news is that Australians are seeing through this con. They are on to those opposite. They are seeing right through a government which claims to be worried about the deficit but then spends $21 billion giving paid parental leave to millionaires. They are seeing right through a government fighting to deny themselves billions of dollars in revenue from the carbon price and the resources tax. They are seeing through a government willing to finance billions of dollars in tax breaks to the wealthy and to multinational corporations. People know these are not the actions of a government gripped by a budget emergency.

The truth is that the government is in denial about this budget, and now they are in disarray. Backbenchers are bagging the budget in the paper almost every day, and they are in denial about its impact. How many times has the Prime Minister said he is not cutting schools and hospitals? Then you look at page 7 of his own budget overview and it says exactly that: $80 billion is being cut out of schools and hospitals. So Australians are finally seeing this government for what it is, and seeing the budget for what it is: an ambush on a type of Australia and the type of Australians we love.

Of course the Labor Party will not be blocking supply in the parliament. I want to thank and acknowledge the many people who have written to me and urged another course, and I am sure the member for Newcastle has been getting those emails too. I appreciate that input. But we will not be engaging in the Tea Party tactics of government shutdown and thrusting the nation into constitutional crisis. We will not be blocking supply, but we will be opposing the cruellest aspects of this budget, including the GP tax, the devastating changes to the family tax benefit and the unacceptable hit to future indexation of pensions.

Members on this side of the House are here in politics to help our citizens to lead happy and fulfilling lives with real opportunities for upward social mobility. For this reason we cannot support measures that ingrain and magnify inequality. We cannot support budget measures that deny Australians a fair system of health, education and a basic safety net, and that denies Australians tens of billions of dollars of desperately needed money for their schools and for their hospitals. We will not be part of that. That is why we will be fighting this budget and making the case for an Australia where fairness is part of the future and not just part of the past.

This is Labor's reason for being. Budgets like this are our reasons for being. And it is the reason I was sent here by the community I was born in, grew up in, live in, and love.