 Speech to Parliament
4 February2009
Mr SECKER (Barker) (7.51 pm)—
In speaking on Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 and related bills I pose the question: What is too big, irresponsible and poorly targeted, does nothing to reduce the cost of employment and will not help the estimated 2,000 people in the Barker electorate who will lose their jobs, according to the government?
The answer is the Rudd government’s so-called economic stimulus package.
The people in the electorate of Barker, whom I am proud to represent, are not short-sighted. They are not stupid. They recognise what this is all about.
The long-term goals that they have for their communities’ future generations of sustainable employment, health and aged care, affordable education, thriving small business and a strong rural market economy will not be helped one bit by this package.
Much of my electorate is declared exceptional circumstances farming areas. Hardworking farmers, growers and small business operators are doing it tough with drought and water shortages such that they have difficulty meeting family and personal living expenses.
I note that the member for Blair referred to the National Farmers Federation supporting some parts of this package. I also note that the South Australian Farmers Federation, a member of the National Farmers Federation, came out today and said that by giving a farmer in a declared exceptional circumstances area a one-off payment of $950, as this package does, he or she may be able to buy one tonne of fertiliser or a couple of tonnes of seed—but then what?
While everybody welcomes what seems like a bit of free money, in this situation people recognise that we could actually do a lot better. Farmers in my electorate are still facing high interest rates on farm loans.
As Deputy Speaker Adams would recognise, I am a farmer myself. He would also recognise that I understand farming and farmers.
Farmers are still facing high interest rates on farm loans because interest rate reductions have not been passed on to them at all. It would be better for them if those interest rate reductions were actually passed on to them.
This government has done nothing to help farmers secure reduced overdraft or loan payments. A common overdraft is about $200,000, although there are many larger than that, while a few are a bit smaller.
On a common $200,000 overdraft, a two per cent reduction in the loan rate would be worth more than four times $950 every year.
It would be much more worth while for farmers to receive the reductions in interest rates that the banks have not been passing on than to receive a one-off payment of $950.
The banks have passed the cuts on to homeowners by and large, but when it comes to small business and farmers they have not been passed on at all. In fact, a constituent rang me up and said their rates had actually gone up rather than down.
Farming families are still paying extraordinarily high loan interest rates on their farm loans. They continue to struggle to keep their farm business afloat while city-based Australians have up to a hundred dollars a week more in their pocket as a consequence of reduced bank interest rates.
Farmers and food manufacturers have already seen their profit margins squeezed by drought and the financial crisis – and giving them $950 does nothing to address this.
They will still wake up tomorrow and face drought, water shortages, reduced farm gate prices and they will continue to compete against cheap imported food products from overseas.
On ABC Radio 891 this morning, in response to the announcement of tax bonuses, Greg from Loxton on the River Murray in my electorate said: “Wouldn’t this money be money be better put into infrastructure?”
Greg is absolutely right.
Loxton is currently suffering the effects of the drought. As with other communities in the Riverland, shops are shutting and a growing number of workers are facing redundancy.
The crisis in the Riverland's once-mighty irrigation industries is taking a horrific toll and more and more Riverland families are struggling to put food on the table as spending tightens.
What an inspiration it was to celebrate just last week when a Loxton High School student Daniel Schulz, was named South Australia's Young Citizen of the Year, in recognition of his extensive volunteer work with organisations across the region including the State Emergency Service.
Daniel is an inspiration with his sense of belonging to his local community and wanting to give to his local community, but he is not alone – these qualities abound in many rural Australians of all ages.
But what does this package offer young rural and regional Australians such as Daniel? It does nothing to guarantee them employment, it does nothing for the additional 2000 people in my electorate who are facing unemployment as this Government forecasts.
Rural and Regional Australians are not fools. I have always said that farmers and growers are among the most entrepreneurial and resilient of Australians, because necessity has forced them to be so.
You can’t run a sustainable rural property in a careless, irresponsible manner, with hasty action and with no care for the consequences. Yet this is precisely the way the Rudd Government is implementing this package.
The Prime Minister yesterday demanded that the House of Representatives approve $42 billion in expenditure within 48 hours: almost a billion dollars an hour! .
I oppose the Rudd Government’s latest $42 billion expenditure package because it is not a responsible or sustainable way to run the national economy.
I know this decision will not be popular, but it is the right decision.
Earlier today the Minister for Agriculture, Fisheries and Forestry asked how I would explain to my constituents my decision to oppose these Bills.
Not a problem Minister, because from Bordertown to the Barossa, from Murraylands to the Riverland; people in my electorate have been telephoning my electorate offices saying that they are not fooled.
They don’t want the debt that comes with this package; they would happily trade the payment for jobs for their children, for security in the small businesses in their communities and for a stronger rural economy.
Without exception, callers to my office have reported that they consider this package to be poorly targeted, ill-thought through and irresponsible in today’s economic climate.
The objective of any package must be to protect and create jobs, support small business and strengthen our economy. This package will not achieve this.
That’s because yesterday’s fiscal stimulus package was a political announcement not an economic one – it will make almost no difference to the economy.
I look at this package and we see little evidence that it will underpin the jobs of Australians.
There is no evidence the Government’s $10.4 billion spending package before Christmas created the 75,000 jobs Mr Rudd promised.
I talk to publicans in my electorate who tell me they had the best December ever.
The latest figures from the Office of the Liquor and Gambling Commissioner in South Australia show people spent $68.1 million on poker machines in December, an increase of more than $8 million on the $59.76 million spent in December, 2007.
Alarmingly, the Prime Minister is already talking about a third stimulus package, even though the first one last October was a certified failure, except for pubs and poker machines.
This Government has scared Australians, including those in my electorate.
Last year, at a time when grocery and petrol prices were high, we saw a Treasurer talking down the economy and talking up inflation, which made business owners nervous, and certainly made them less likely to put on new staff or offer workers extra hours.
Australians are even more scared when, just a few months later, they see the Government spending $42.5 billion, in addition the $10.4 billion in December, even though tax revenue has fallen $115 billion over four years and the budget is already in deficit.
Be afraid, rural and regional Australia, be very afraid. This is a scary way of managing your economy.
Even with his reckless cash hand-outs and massive, debt-fuelled spending, the Prime Minister’s package predicts unemployment will top 7% in just over a year – another 300,000 Australians out of work.
Twelve months ago, Kevin Rudd announced a budget surplus of 1.5 percent of GDP. He went on to say that this would require a determined and disciplined approach to spending.
But a budget bears no relation to what will actually happen. This should be filed with Labor’s budget of 1996 – in the fiction section of the Parliamentary library. It has no other use.
Last May, Treasurer Wayne Swan was projecting $80 billion of cash surpluses over the four years from the 2008 -09 financial year.
Now he is projecting budget deficits of $118 billion – that’s a staggering $198 billion turnaround – an average $50 billion for each year.
The previous Labor Government left a legacy of $96 billion in government debt and the Budget had been in deficit for six successive years.
It took the Australian people a decade to repay this debt: a scenario we are now facing again.
Now, another Labor Government is asking me, on behalf of the hard working Australians in my electorate, to agree to plunge headlong back into large deficits and significant debt.
Yesterday Mr Rudd railed against neo-liberalism and free market fundamentalism – he claimed that the same free-market fundamentalists who rejected financial regulation also opposed labour market regulation.
Mr Rudd clearly has an unusual understanding of free market fundamentalism and extreme capitalism.
The only sector of the economy that you could possibly say has become less regulated in the past two decades is the labour market.
This deregulation has helped to give us the lowest unemployment rate in 30 years and it gives us the best chance of protecting jobs from the effects of the economic crisis.
Labor market deregulation had nothing to do with the economic crisis, yet this is the first area that the Government wants to re-regulate through its Fair Work legislation.
What Mr Rudd is not telling Australia is that this legislation allows for the Labor Government to take the nation $200 billion into deficit – $9,500 debt for every Australian.
I said earlier that rural and regional Australians are not fools.
They have already twigged that in return for the $950 handout, they are also being given a $2,000 debt.
What Prime Minster Rudd are borrowing to fund this package is the equivalent of $2,000 for every man, woman and child in Australia.
Rural and Regional Australians know that when they receive their $950 payment there will be some red pen on that paper as well - $2,000 will have to be paid back in the future, along with your families, to fund what is happening today.
Earlier today a young man from Mt Gambier contacted my website.
He tells me that last year, he began full time employment as a teacher in Mount Gambier, and thus became financially independent, soon after graduating from University.
He will not qualify for the $950 bonus, because during the 2007/08 financial year, as a student, he did not have a net tax liability.
Throughout his years at uni, this young man never received one cent help with living costs from the government or payments from Centrelink or other government departments.
Even though he was forced to move from country South Australia to Adelaide in order to gain a university education, he was not entitled to Youth Allowance, Rent Assistance, Commonwealth Learning Scholarship or any other payment because these are means tested against parental income.
He quite rightly points out the difficulty this caused him as a country student, given that the costs of relocating, finding accommodation, meeting food and other living costs are far higher than for city families, as city students have the option of living at home.
This young man tells me that this package is a slap in the face by the government, and I agree with him.
I commend him for toughing it out, gaining a tertiary qualification and then returning to regional Australia who will benefit from his teaching skill.
I don’t envy his financial future.
He is a working Australian, and will be paying many thousands of dollars in tax for the 2008/09 financial year and beyond. He will also be incurring the $2000 debt that comes as a consequence of Labor’s bonus payment that he won’t receive.
These Bills an irresponsible spending spree.
The title of the Appropriation (Nation Building and Jobs) Bill (No. 1) 2008-2009 includes the phrase ‘nation building and jobs’, but it does not build the nation and it does not create jobs.
The timing is wrong. It repeats the failures of the past package. There is no lasting investment or leverage for the future. There are handouts but no permanent fixes.
At the end of this package, the pension will still be too low and taxes will still be too high and Rural and Regional Australians will be worse off.
It is an undeniable fact that this $42 billion cash splash means that, in the future, taxes will have to increase by $42 billion to repay it and by even more to repay the loans.
We know Whitlam ran our economy into the ground with debt and overspending. We know that Keating ran our economy into the ground with debt and overspending and, true to form; the Rudd Labor government is doing the same. Labor has form on this and it cannot be trusted with either the economy or taxpayers’ money.
My father used to say—and this is not in the economic textbooks, I can assure you, because I do have an economics degree and a politics degree—that it is easy to be generous and compassionate with other people’s money.
Never has a truer word been said, and Labor is proving it!
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