16 June, 2014
I would like to talk about the recent budget which we on our side of the chamber think promotes fairness and opportunity. Fairness and opportunity are great Australian values which we all in general terms support. Governments, like families, need the money to be able to provide these things and to provide fairness and opportunity. The cold hard truth is that, under the Labor government, the Australian government did not have the money to provide good services. Under the Rudd-Gillard government, the projected deficit for Australia was going to be $667 billion—an amazing amount of money; almost too much to imagine.
A national budget is no different to a family budget as I just said. Families who live beyond their means find themselves in trouble, and so do countries. The simple message from the recent budget is that this government is determined that Australia will live within its means and that we will reduce the ever-growing level of debt, which occurred under the Rudd-Gillard governments, and have some financial responsibility in our financial affairs.
This budget is a key component of the Abbott government's economic action strategy which will build a strong prosperous economy and a safe and secure Australia
The budget calls on everyone and every business to contribute, to join or to grow the workforce, to boost productivity and to help build a stronger economy with more investment. The budget redirects taxpayers' dollars from unaffordable consumption today to productive investment for tomorrow. It will do this while supporting the most vulnerable and taking significant steps towards ensuring that the government can live within its means. The Abbott government will have reduced the Labor deficits by $43.8 billion through to 2017-18. Gross government debt is also forecast to be $389 billion in 2023-24, compared, as I said earlier, to the $667 billion that Labor left, including providing for future tax relief to address bracket creep.
There are several key signature budget reforms that I would like to make some reference to. The days of borrow and spend must come to an end. The time to contribute and build has begun. The first program the Abbott government proposes is an infrastructure growth package, which will take the government's transport investment to $50 billion by 2019-20. As a result, total infrastructure investment from the Commonwealth, state and local government as well as the private sector will build to over $125 billion by 2019-20.
We are planning to bring full deregulation of the higher education sector, which will remove fee caps for universities and higher education providers and expand the demand driven system to bachelor and sub-bachelor courses at all accredited higher education institutions. Australian universities will be able to compete with the best in the world by giving them the freedom to innovate, a greater ability to invest in world-class research and the capacity to respond to the needs of students and businesses. Some fees may go up but other fees may well fall.
The government will create the world's largest medical research endowment fund—the $20 billion Medical Research Future Fund. Contributions to the fund will come from a new patient contribution to health services and from the other health savings from the budget. This endowment fund, when mature, will double current direct medical research funding, with an additional $1 billion a year. Australia is already one of the leading countries in the world for medical research, and this will enable us to maintain that position and in fact enhance it.
Young people with a work capacity will be required to be earning, learning or participating in Work for the Dole. So there will be no money without a contribution from young people towards earning it. Businesses will receive up to $10,000 for employing workers older than 50 who have been on income support for six months or more—meaning there will be stronger incentives to hire older workers. We live in an age where the average age of the population is going up, so addressing the needs of older workers and ensuring that they can get work is a very important step forward.
This budget takes steps to ensure the government is living within its means and to reign in the age of entitlement. The government will reform the age pension to make it sustainable. This includes gradually increasing the age pension age to 70 by 2035 and linking pension indexation to CPI movements from September 2017. Family payments will also be changed to target payments to those who need it most. Eligibility will be tightened on family tax benefit part B. Low-income single parents will be able to access a new assistance package of $750 per annum for each child aged between six and 12. All payment eligibility thresholds will be maintained for three years from 1 July 2014 for non-pension payments, including family payments and allowances like Newstart, and from 1 July 2015 for the private health insurance rebate.
In addition, there will be a three-year temporary budget repair levy. From July it will be payable by individuals with a taxable income over $180,000 a year at a rate of two per cent. The levy will raise an estimated $3.1 billion over the forward estimates period and will ensure that higher income Australians contribute to the budget repair. Surely, that must be seen as a very equitable move. The government will secure funding for additional road infrastructure by reintroducing twice-yearly indexation of fuel to the CPI from 1 August 2014. In difficult budget circumstances, this is a responsible way to immediately start building the productivity-boosting roads Australia needs and this will be linked by legislation.
If you consider these points, criticism of the government's budget as being unfair and unreasonably targeting the underprivileged is quite misplaced. This is a very responsible, very economically wise budget which will mean that Australia, like a prudent family, lives within its means instead of living on the credit cards—which, of course, in the end, have to be paid and, if you cannot pay the credit card off, at the end of the day, there are tears all round. The Abbott government is seeking to save the Australian people from having tears all round when we find that we have an enormous debt, like that of countries such as China, the United States and Japan. We do not want to be in the position they are in. That is why this budget has been crafted in the way it has, to bring financial responsibility to Australia's financial affairs.