We did not create this problem-Australia did not create this problem; the problem started in the United States-but we are better prepared than most countries in the world to cope with it, due in part to a budget that we put together in May and due to the work of previous governments over the last 20 years. To give credit where credit is due, decisions like floating the dollar, deregulation ofthe financial system, competition policy and universal superannuation are, in large part, responsible for the last 15 years of economic growth. This, coupled with decisions of the former government and the mining boom, set us up well. Our banks are amongst the strongest in the world. Our big four banks are amongst the world’s 20 AA rated banks. Our prudential system is the envy of the world.
Our strong terms of trade, and our biggest trading partner, China, which is expected to grow by more than nine per cent next year, make us well placed. You would not want to be anywhere else in the world, but the problem will affect us. No country in the world is immune. In his address to the nation last night, the Prime Minister said:
In the last few weeks, the global financial crisis has moved into a new and dangerous stage. And that is its effect on the real economy, on growth and jobs, around the world and here in Australia. Growth will slow, and unemployment will rise.
That is why this package is important and that is why it is important that we act now. All the advice says that the Australian economy will continue to grow. The IMF report on the state of the global economy that was released last week projects two per cent growth in the next year, and that at a time when the rest of the developed world is expected to go backwards. The report said:
The world economy is now entering a major downturn in the face of the most dangerous shock in mature financial markets since the 1930s … The major advanced economies-
those of North America, Europe and Japan-
are already in or close to recession …
So we have to act quickly to make sure that we continue to grow and to protect jobs here in Australia. History teaches us that, when an economy slows, responsible governments have to step in and act swiftly and decisively. That is a lesson that governments and central banks have both learnt. That is why, on the weekend, we stepped in to guarantee deposits and bank-to-bank lending to inject confidence into our financial system.
But we also need to give confidence to the people who sit around the dinner tables of Australia-confidence to invest but also confidence to spend; confidence that they will have a job; confidence to buy a house. That is why the Prime Minister announced yesterday a $10.4 billion package to help families, pensioners, carers and first home buyers. The $4.8 billion package for pensioners and carers means singles will receive a $1,400 lump sum payment and couples will receive a $2,100 payment. Carers will also receive $1,000 for each eligible person being cared for.
The important point here is that the package will help all pensioners as well as carers and veterans. There was a fundamental flaw in what the coalition proposed a couple of weeks ago. In my electorate, our package will help 31,000 pensioners and carers. The coalition plan proposed by the former Leader of the Opposition and the current Leader of the Opposition would only have helped 7,000 pensioners in my electorate. Last night I spoke to the president of one of my local senior citizens groups. He told me that the $2,100 will help pay for a very serious operation that he needs to have in the next couple of weeks. He and his wife would not have been covered under the coalition’s plan.
There is another benefit in paying this as a lump sum: by doing this pensioners will get all of the money instead of part of it. If it was part of the base rate, a lot of that money would go to nursing home companies or to housing commissions. I note that on Sydney talkback radio this afternoon, on the Chris Smith program on 2GB, there was a call about this issue. There have been a number of people that have been concerned about this, asking, ‘Will I have access to all the money or will some of the money be sucked out of my account and be given to the place where I live.’ A caller, Vicky, said that her father is a pensioner who has a gold card and currently resides in a hostel. She was concerned that every time her father receives an increase the hostel appears to take more for the cost of his care. Chris Smith praised Justine Elliot, the Minister for Ageing, who he said ‘is the goods’ and ‘has done a lot of things after discussion on talkback programs’.
I see that the member for North Sydney does not agree with Chris Smith, which is unfortunate. Mr Smith said that Ms Elliot has ‘helped to make nursing home operators behave more in the interests of their clients’ and quoted a press release from Ms Elliott’s office which says that nursing home owners will not be allowed to increase their fees after the federal government’s latest stimulus package. That is a good thing. That is a minister doing what she is supposed to do-protecting the interests of people-and Chris Smith agrees with that.
But this is only the start of pension reform. It is a down payment. Long-term reforms to the budget next year are necessary to provide pensioners with a real sense of security, and that is why it has been endorsed-by every pensioner group in the country-as have the payments to families and the payments for first home buyers. Some 3.9 million children will benefit from a one-off payment of $1,000-payments for families who need it the most; families who are currently on family tax benefit A or families with children receiving the Youth Allowance, Abstudy or Veterans’ Children Education Scheme payments.
The doubling of the first home buyer grant to $14,000 and the tripling of it for first home buyers who buy newly constructed homes will also get first home buyers back into the market and help get the building industry back on its feet. It also has a multiplier effect, creating jobs in retail, manufacturing and elsewhere. All of this will help keep us afloat in rough weather.
In my own electorate the package will help 60,000 families, pensioners, carers and veterans. It will also help create new jobs, with an almost doubling of the job training places. On top of the interest rate cut last week it will help a lot of families keep their heads above water. The cut in interest rate means, for example, that someone who has a mortgage of $300,000-there are many of them in my electorate-will have an extra $164 a month in their pockets, wallets and purses rather than it going to the banks. That equates to an extra $2,000 a year.
There has been a lot of talk about bipartisanship in this place in the last few weeks, and I welcome the comments yesterday of the Leader of the Opposition in support of this package, but talk is cheap. It counts for nothing if it is not backed up by the actions of the party or by the words of the rest of the team. If you are committed to bipartisanship, support what we are trying to do in getting the budget through in the Senate. I am afraid I do not think the opposition will do that, because they are more interested in playing politics. The proof of that can be seen in the petrol excise debate that we had in this parliament only a few months ago. Remember when the former Leader of the Opposition introduced that policy and the current Leader of the Opposition then said that it was good politics but bad policy. When he became Leader of the Opposition he had a chance to change that, but he decided to keep it because he suddenly thought politics was a lot more important than policy. In these uncertain times the job of Prime Minister is to make decisions in the best interests of Australia and the Australian people, not to play politics over policy. That is the core problem here: just at a time when he became Leader of the Opposition, just at one of the most difficult times in global financial markets, he has decided to play politics over policy. They are still doing it in the Senate today.
But it gets worse. It is moments like these in a financial crisis when the opposition show their true colours. The Leader of the Opposition now wants to delay action on climate change. The member for Warringah, interestingly, says that, in these troubled economic times, we should keep Work Choices. This is what he said in his blog in the Daily Telegraph on Friday:
This is not the time for any action that could further hurt business confidence. Workplace relations changes to give unions more power; changes that make workers more expensive to employ; and new environmental imposts might need to be rethought.
That is what the member for Warringah said. Presumably it is endorsed by the Leader of the Opposition. We do not know. He might have an opportunity to get up and make a five-minute contribution to this debate. But I can tell you this: whether it is good times or bad, Work Choices is bad policy and, unless the opposition come in here in a few weeks and vote that legislation out of town, we will know once and for all that they are still the party of Work Choices. The challenge today for the next speaker or anyone who cares to take the microphone in the next few weeks is to disown this statement from the member for Warringah, say that Work Choices is bad policy and get rid of it once and for all.’