27 October, 2020
These appropriation bills give effect to the elements outlined in the budget. It's time to be brave and bold and secure our economic future. There are some good measures, but unfortunately on the whole it is an opportunity missed.
The government is putting Australia into record debt: nearly $1 trillion net debt by July 2024, borrowing more to spend on business-as-usual measures that will not set Australia up for the challenges that we know lie ahead. Sadly, the government has announced four times more stimulus funding for fossil fuels than renewables. This seems just crazy. The government is digging its heels in against the global tide away from fossil fuels, desperately trying to put the brakes on the green recovery that is so desperately needed, and wasting the public's money in the process.
Nevertheless, there is an opportunity. The business community can take control of this. Business and individuals have the opportunity to jettison the government's planned gas recovery. They can supercharge a green recovery with the government's own measures. The biggest single measure in this budget, worth an estimated $26.7 billion, is focused on encouraging businesses to invest freely through full asset write-offs. This is an opportunity for businesses to supercharge Australia's transition to net zero emissions. Businesses can deliver the policy the government does not want to do and can undermine the government's obsession with the short-sighted gas-led recovery. With the tax incentives, businesses can take control of Australia's emission reductions in future and remain competitive in the net zero world that is coming, whether the Morrison government likes it or not. The tax incentives include the temporary full expensing measure—it's the largest single line item in the budget—instant asset write-offs; and the extension of the research and development tax incentive. These incentives total an investment opportunity of nearly $30 billion, according to the Treasury estimates.
All of these incentives provide an opportunity for businesses to invest in green initiatives, such as clean energy through installing solar, batteries and smart metres on your businesses. Many local companies in Warringah have already made this investment with great returns on that investment in their business. For example, Manly Spirits Co, Colourmaker, 4 Pines Brewery, Three Beans coffee group, McCreath Prestige Paint & Panel, Powerhouse Automotive and many more have all told me about how happy they were with their decision to install solar to power their business and reduce their operating costs. They know they are setting themselves up for the future.
Transport: electrifying vehicle fleets to bring down operating and maintenance costs, or installing an electric vehicle charger which will attract more customers to your business, especially if you're in a tourism industry—these are all measures in which you can take advantage of the measures in the budget but build a green recovery. Colourmaker, for example, have told me how happy they are with the electric vehicles they bought three months ago and that they're already looking at adding another EV to their fleet. This means as a business they have nearly negligible maintenance costs on a business fleet vehicle. Installing a charging station at your business opens up new marketing opportunities and puts you on the tourism map. These are important measures you can do to make your business future proof.
Reducing waste through investing in new and more precise technologies such as laser cutting tools: specialists in this area can also take advantage of incentives and opportunities in recycling and waste reduction that have, in fact, just passed. For example, I spoke just last week to Budgy Smuggler, a local Warringah icon, and they told me their new laser cutting machine has reduced waste fabric from their locally made swimwear production by over one-third. That's a huge saving in materials and costs for this great local textiles and design business.
Increasing water storage to future proof your business from drought: installing water tanks, water butts or a grey water system—all these initiatives and many more will make your business more competitive, and, businesses, you now have a limited opportunity for the next two years to write-off these assets. I've spoken about this to the Council of Small Business Organisations Australia, and they have agreed that this is a great opportunity to improve the efficiency and productivity of businesses and improve cash flow and prospects for the future. With environmental, social and good governance goals becoming an increasing priority for businesses around the world, these initiatives will increase business objectives. They will increase efficiency and lower operating costs. They will access innovative and niche markets. They will increase employee motivation, and you will see increased engagement with clients. Businesses have been crying out for policy certainty in the face of global pressure.
The talk of Europe introducing a carbon import tax and the US following suit—depending on the result on 3 November—has many looking for ways to reduce their carbon footprint. The Morrison government's inaction on energy and emission reductions is making it harder for businesses to be globally competitive. Businesses need to take matters into their own hands to avoid being excluded from these markets.
Similarly, bringing forward the personal income tax cut will cut some $17.8 billion from government revenues, giving it back to individuals. The real question is: what will you do with it? I know that for many you are doing it tough and of course it must go to essentials. But, for those who can, consider investing this cash flow boost into your future: offset your household emissions with tree planting programs; improve your insulation; install a water tank; switch to 100 per cent renewable power; install rooftop solar; switch from gas to induction cooking; or switch your car to an EV or a hybrid. There are so many actions you can take. For more information, please check out the road map to zero on my website. It's absolutely time for each and every one of us to take control of our future. The tax cuts to both businesses and individuals empower us all to choose where we want to spend and invest our money.
The Governor of the Reserve Bank has said that we need much deeper reform to pull the economy out of this recession. There was no Nation Building Program and no focus on protecting our communities and building adaptation and resilience measures on climate impacts, like we have seen in so many other countries. This was a missed opportunity, as it will become more and more urgent. Communities hit by the bushfires last summer know that more needs to be done to protect and prepare their communities.
There were some positives announced by the government in the budget. I welcome the focus on youth and the JobMaker program, particularly the wage subsidies to employ young people, but I will closely scrutinise what the outcome of this policy is and how many jobs actually result from it. I welcome opportunities in the extension of the research and development funding of $2 billion; $1 billion for research at universities; $459 million for CSIRO, a nod to the need for innovation; and $1 billion for the National Housing Finance and Investment Corporation to incentivise institutional investment in affordable housing. Of course more could have been done with this budget to stimulate the construction sector and provide affordable housing and community housing. This was a missed opportunity. The Indigenous Home Ownership Program is another positive contribution to job creation for our regions and home creation for Indigenous people.
Unfortunately, we continue to have serious gender inequity, disparity, occurring in our society. The $240 million for the Women's Economic Security Statement is a tokenistic contribution to gender equality, and I found it personally quite offensive. This was largely seen as a blokey budget, and I have to agree. There was no stimulus package for industries that mostly employ women and no improvement of child-care and parental leave provisions. Australia spends 33 per cent less than the OECD average and nearly 75 per cent less than the UK on child care as a percentage of GDP. This is despite the Grattan Institute estimating that an extra $5 billion spent on child care would give a return on investment of over $11 billion. This is simple maths, and it beggars belief that the government would not take those opportunities.
Astoundingly, considering the outpouring of sympathy in parliament when Hannah Clarke and her children were murdered—and the statistics are not getting any better when it comes to domestic violence—women's safety and domestic violence missed out in this budget. We know that through the lockdowns and through the pandemic family violence has increased. More could have been done and should have been done to address this issue. I heard many of my fellow parliamentarians talk about their football teams in the grand finals over the weekend, but not a single bloke stood up and raised the issue of the increased domestic violence rates that occur around the grand finals. This was a missed opportunity.
The government fell short on aged care as well. There's a boost of 23,600 new home-care packages, but that still leaves more than 75,000 on the waiting list. What is supposed to happen to those?
Integrity and accountability have also been ignored in this budget. The Australian National Audit Office have had their funding frozen and their funding for investigations reduced. This means that the office will not be able to undertake the many investigations into how public money is being spent. Imagine no investigation into the Leppington land sale or sports rorts. There has been no substantial new money set aside for the National Integrity Commission and certainly no commitment to date from the Morrison government about establishing a federal integrity commission.
We have to get real here. Record amounts of public money are being spent. This is a debt that will impact Australians for generations to come—you, me and our children, especially our teenagers, who are currently facing huge challenges. We cannot allow this amount of record spending to result in record pork-barrelling. Surely everyone in this place has enough integrity to say, 'We need some safeguards. We need a federal integrity commission to make sure that money is spent appropriately in the public interest.' Accountability is sorely needed when we are facing such spending with so very little detail and so little scrutiny.
I'd like to thank the many organisations that tried so hard to make positive contributions to the government in preparing the budget: the state and territory governments, the business community, many lobby groups, including the BCA and the ACTU, green groups, Beyond Zero Emissions, economists, scientists, and many, many others, who all advocated so strongly that there be a green stimulus and that we address the threats of the future and build our economy to be future proof. We need that commitment to net zero by 2050 and we need an economy and a plan to match.
I want to thank all of those organisations for highlighting the opportunity that this budget presented to stimulate Australia's economy recovery from the COVID recession but, at the same time, demonstrate a commitment to achieving emissions reduction and making some real progress to that end. I know many were disappointed on budget night. And it was disappointing that the government did not listen and seems determined to put the brakes on Australia's economic opportunities in a net zero world.
I'm not interested in getting caught up in the partisan games that we see from the major parties on so many issues. We need to see our opportunities and we need to run with them. We need to keep pressuring both sides of government to support our more vulnerable. We need to make sure we take up the opportunities that we have and don't get stuck in the past. There is a big job ahead and we face many headwinds. Our youth, in particular, are the ones who will be burdened by the higher costs of living, huge debt and the increasing economic, social and environment or costs of climate impacts. We have a duty to invest into our future, into their future, and into the solutions.
The government may be short sighted and determined to put the brakes on our transition but we can get on without them. The world is moving to net zero by 2050. The list of countries and organisations grow every day. We need to legislate for net zero by 2050 with the Climate Change Act, and there will be an opportunity in November when I table the Climate Change Bill. It will set that five-year carbon reduction budgets and develop adaptation and mitigation plans which will give policy certainty for the business community.
We've got a duty to ensure communities develop more diverse business and employment opportunities. You can't stop progress, but you can be part of it. I urge the Morrison government to listen to the business community, listen to the investor community, listen to the broader Australian community and listen to the global community. Show leadership and be part of the solution, instead of being part of the problem and holding onto the past.