Second Reading – $900 Stimulus Cheques
Mr PITT (Hinkler) (12:45): I rise to speak on the Tax Bonus for Working Australians Repeal Bill 2013. This bill will ensure that the Commissioner of Taxation does not make any further tax bonus payments or, as they are more commonly referred to, $900 stimulus cheques. These payments were designed to provide stimulus to the Australian economy at the height of the global financial crisis. In opposition, the coalition opposed the payments on the grounds that the package was poorly targeted, ineffective in supporting employment and unaffordable. And were they right? They were right. The total amount of borrowed government money spent on stimulus payments to date is estimated to be around $7.7 billion. Let me repeat that: $7.7 billion of borrowed money. I would hate to think how many taxpayer dollars we are spending on interest just servicing that portion of the debt. That is $7.7 billion, plus interest, that our children and our children’s children will have to find. If you combine that with the debt left by the Queensland state Labor government, that is an enormous amount of money for the five people in my family.
Since the introduction of the stimulus cheques, more than 21,000 payments have been made to dead people, totalling more than $18 million. This includes the payment of 40 stimulus cheques to deceased individuals so far this financial year. Since its introduction, more than 16,000 stimulus payments have been sent directly to taxpayers living overseas, totalling around $14 million. While that is great for France, Spain, England or wherever our citizens decide to reside, it is not great for Australia.
In my electorate of Hinkler, fruit and vegetable growers are continuing to receive stimulus cheques for backpackers they employed years ago who are no longer even in the country. As an example, a gentleman named Craig van Rooyen, the owner of Sweet Sensations on the outskirts of Bundaberg, employs up to 35 backpackers a day, depending on the crop, through the Working Holiday visa program. He grows lychees, macadamias and mangoes. He has previously grown strawberries and bananas. Mr van Rooyen is of South African descent but he has managed to pick up the Australian vernacular. When my office informed him of this bill’s introduction to parliament his response was, ‘It’s about bloody time.’ He said he forwarded stimulus cheques on to backpackers if he knew they were still in the country, as he was satisfied that at least they would spend the money in this nation, but he continues to receive the cheques for people who left the country years ago. These he does not forward on. His position on this matter is shared by many growers across the Hinkler electorate.
This emergency economic stimulus is no longer warranted, so it makes absolutely no sense for the ATO to keep administering the cheques. More than 480,000 payments totalling more than $400 million were made over the financial years following the original payment of stimulus cheques—that is, 4½ years on from the GFC. Stopping the cheques now will save taxpayers an estimated $250,000 over the forward estimates. During the 2013 federal election, the coalition made a commitment to end Labor’s waste, and this repeal bill delivers on that commitment. We are doing what we said we would do.
But Labor waste was not confined to stimulus cheques; it extends far beyond that. For example, Labor wasted $67 million on administering a program to install set-top boxes in people’s homes for an average of $350 each, even though Harvey Norman offers customers the same deal for $168. How many of those are now in operation? I would suggest: very few. Government bureaucrats sold two billiard tables for $6,000 and then promptly stumped up $100,000 to investigate whether the sale was good value. Departments purchased gold-plated coffee machines for $15,000 each. Senate estimates revealed Labor spent $8.5 million on advertising the schoolkids bonus scheme, which was an automatic payment. In mid-2013, just one of the 28 GP superclinics promised during the previous election was operational. Labor was spending $440,000 a month to maintain an empty detention centre in Tasmania. A dozen climate change bureaucrats left taxpayers with a $1,700 bill for one dinner. The Department of Parliamentary Services spent about $2.4 million on training that included advice on how to get a good night’s sleep. I hope that was successful.
We come to the famous school halls. I worked on many of the BER projects. I saw probably over a hundred of these projects rolled out across the state. I will give an example of the absolutely ridiculous amount of administration that went with it. In Western Queensland, I went to a BER project where the building did not look exactly the way it should have looked. I spoke to the builder and the builder said, ‘If we walk around the back you’ll see why it’s been changed and shortened.’ There was a camphor laurel tree. For those who know anything about camphor laurel, it is a noxious weed. However, instead of knocking the tree over, they built around it, so the building got smaller and became less value for money. There is currently a program around independent public schools. If that program were in place, can you imagine the school principal and the school board accepting those changes from a contractor? Even though the rollout was terribly managed for BER projects, it was a huge investment in infrastructure. We could have had much better value for taxpayers’ money if that program were in place—if you had local content, local principals and local people making decisions in the best interests of their school. That is what should have happened. The projects that I saw that were delayed, the ones that were run by private schools, were far more beneficial. They got more building, they got more equipment and they more things inside the building. It was much greater. It has been suggested that the Independent Public Schools program would have helped with this infrastructure spend.
Then we get to the famous home insulation scheme.
Mr Frydenberg: Infamous!
Mr PITT: Infamous! How could you possibly not make the connection between a roof full of alfoil and live wiring in a house which is five, 10, 15, 20 or up to 50 years old? Even with no technical knowledge, how could you not make the connection that it was dangerous? How could you not make the connection that it could cause a fire?
It has been an absolute tragedy for that project to pull up because of the deaths of young workers, a number of which were in Queensland. It is right, fair and just that we should do an investigation into that matter, and I hope we get to the bottom of it.
Possibly the two biggest program failures in Australian history have, of course, been the National Broadband Network and the Strategic Indigenous Housing and Infrastructure Project—NBN and SIHIP, as they are known. The rollout of the National Broadband Network is currently two years behind schedule, with final completion due 11 years later than promised by Kevin Rudd. The cost to taxpayers of completing the NBN under Labor’s plan has blown out to $73 billion.
Mr Stephen Jones: Mr Deputy Speaker, I raise a point of order on relevance. I have been very patient. Normally with a tax bill a lot of latitude is given to speakers, but it is very difficult to see how these completely unrelated programs are relevant to any tax bill or the matter under consideration.
The DEPUTY SPEAKER (Mr Vasta ): I give the call to the member for Hinkler and he will be relevant to the bill.
Mr PITT: Thank you, Mr Deputy Speaker. But this bill is about repairing Labor’s waste, and it is great to set some examples. These are examples that we are aware of and they need to be known to the Australian people. I think it is important that we demonstrate what they are and we continue on that path.
In my region of Hinkler, people were told that they would be connected to the National Broadband Network by Christmas, would you believe? After six years, they would have it in four months. It was a ridiculous outcome. Our plan to use a mix of technologies will save taxpayers $32 billion, keep monthly bills lower and deliver the NBN to all Australians, four years sooner than under Labor’s plan. The average household bill will be $72 per month compared with $139 per month under Labor’s plan.
SIHIP was also out of control under Labor. In its first year the scheme was double over budget and had failed to deliver a single house. There was no transparency in expenditure. As an ,example the Labor government spent $42 million on consultants on house design in the Northern Territory, only to ignore the advice they received. Targets were only met because the Labor government continually lowered the bar on building standards. Much of the work was what is referred to as ‘fix and make safe’, instead of the complete renovations that were promised.
In 2006, before the scheme started, 75 per cent of Indigenous people lived in overcrowded dwellings. In 2011, despite the government spending $1.7 billion on Indigenous housing, the figure remained at 75 per cent. Quick fixes were the hallmark of the Rudd and Gillard governments. They threw money at problems, but the only results they delivered were more debt and deficit.
The Mid-Year Economic and Fiscal Outlook released in December last year forecast a $47 billion deficit in 2013-14 and $123 billion worth of cumulative deficits over the forward estimates. So, despite the Rudd and Gillard governments asking Australians to pay 43 new or increased taxes in 2013-14 alone, they spent $47 billion more than they earned. Under Labor, real government spending grew at around 3.5 per cent over the five years from 2007-08 to 2012-13 and is expected to grow further to 3.7 per cent over the medium term.
If we were to retain the policies we inherited, the budget would not return to surplus within the 10-year medium-term projections, with gross debt on issue increasing to $667 billion. For those mums and dads who are listening to this speech, in simple terms it means this: if you continue to spend more than you earn, and you fill your credit card and you fill the credit card that is sent to you in the mail, you will eventually have to pay the money back and there will be very, very difficult decisions. We are getting on with those decisions.
Politicians talk about debt and deficit and use fancy terminology like ‘horizontal fiscal equalisation’. But at the end of the day Australians just want to know that they are getting a fair go. They want to know that we, their elected representatives, are spending their hard-earned money wisely to deliver the services and infrastructure that they need. Under Labor, Australia was living beyond its means. We were spending more than we earned, year after year after year, leaving future generations with a massive credit card bill. That is not sustainable.
This bill, to put an end to the $900 stimulus cheques, is another step towards prudent and responsible budget management. The adults are in the room and they are back in charge.