Parliament Updates

Zali Steggall MP critiques what was missing in the 2021 Budget - environment and a long term plan for reopening the borders

24 May, 2021


I rise to speak on Appropriation Bill (No. 1) 2021-2022 and Appropriation Bill (No. 2) 2021-2022, which allow the government to collect and spend public money as outlined in the budget. In the economic overview, I had hoped to see a road map for reopening the Australian economy, a phased approach to international borders, development of national quarantine and goals for the vaccine rollout. Sadly, all we saw was an ill-defined goal for vaccines, confusion from those defending it and a vague assumption that borders would reopen in mid-2022, far further in the future than many expected, and no road map or realistic time line on how that was going to happen.

There are also two main areas that were missed out in the October budget last year that I was looking for in this recent budget: environment and climate change, and gender equity measures. These two areas had been highlighted by events inside and outside Parliament House in the lead-up to the budget. The implementation of the response to the Royal Commission into National Natural Disaster Arrangements was clearly not a sufficient reminder of the cost of climate impacts, because we didn't see any evidence of that being seriously taken into account in this budget. And, while the revelations of sexual assault and harassment inside Parliament House also brought to the forefront the need for greater support for women and cultural change, we need a budget that is focused on futureproofing our country and culturally ensuring change happens.

The budget papers assume that Australia's international borders will remain closed until mid-2022. Many in my electorate were shocked by this prediction and questioned why a plan has not been developed to get them open sooner. Over 30 per cent of my electorate were born overseas, and I regularly hear from dual citizens trying to leave, long-term partners separated for more than a year due to visa issues, and families cut off from one another. There are many making a lot of decisions, and, whilst they accepted the imposition of the borders as an emergency measure, the lack of long-term planning is having serious impact. No other country in the OECD has outbound restrictions on its citizens. Businesses need people from overseas to come and work in the many jobs that they can't fill locally, and educational institutions need international students. We need a road map to reopening and what we need to do as a long-term solution to deal with COVID and live with it. Quarantine, as the experts keep telling us, is a key issue. It is our ring fence. Quarantine is likely to be a feature of international travel arrangements for some years to come, and yet we've maintained the status quo in the situation of hotel quarantine, where leaks have occurred, and it is a flaw in the system.

The urgency shown by Australia in initially suppressing and then locally eliminating COVID-19 now needs to be shown towards preparing the country for reopening its international borders. The University of Sydney policy institute argues that we need to move from the anxiety of last year to a more confident and outward-looking future. If we don't, it's no exaggeration to say that young people, in particular, will face a lost decade. If we sit and wait until mid-2022, the rest of the world will be reopening around us, leaving Australia behind economically, socially and psychologically. This budget didn't allow or account for any of that planning.

Whilst the budget had several positives, it was lacking in funds for environmental protection and climate change, issues that will eclipse any other before us. It's surprising because, throughout the budget speech, the Treasurer talked, boastfully, about being custodians of this continent. But those words weren't matched with any kind of commensurate action. We are facing interconnected crises. Biodiversity loss is compounding. Global heating is accelerating. Oceans are acidifying and overflowing with plastic. Alarmingly, the World Economic Forum has found that around $44 trillion of global GDP, more than half the world's GDP, is highly or moderately dependent on nature. Climate change alone will cause $2.7 trillion of economic losses by 2050 if we miss our Paris targets. It's hard to fathom. In a situation where we have record levels of public debt, we absolutely must engage with the biggest economic risk that our future generations will face. It's on top of the mountain of debt we've accrued through this COVID-19 pandemic. It's forecast to rise to over $980 billion net debt by 2024.

Further damage to the environment and our climate is simply unaffordable. Addressing the looming crisis is not a threat but rather an enormous opportunity for our economy and one I would argue the government has simply missed. We can create good, sustainable jobs through well-targeted policies. The Beyond Zero Emissions Million Jobs Plan proposes significant investments in battery manufacturing, green industry, renewable energy, electric vehicle infrastructure and more to create more than 1.8 million jobs. But where was any of that on budget night? Nowhere.

Independent economic analysis found the plan would boost private investment by some $25 billion annually, adding one to two per cent of GDP and would boost wages by one per cent. That's why it was so disappointing in this budget to see a lack of funding for the environment; it's a missed opportunity. Only 0.8 per cent of the $590 billion in budget expenses was given to environmental programs. In contrast, the EU has targeted over 30 per cent of its budget spend towards green measures. Total environmental spending has decreased by 39 per cent in Australia since this government came into office. That is not heading into ensuring a good economic outcome.

On climate change, we saw loose change for climate adaptation. Australia will get a new climate service to help government manage climate impacts, alongside a $600 million fund to help people prepare for natural disasters. But these measures are nowhere near enough for the scale of climate change impacts that are coming. Natural disasters alone will cost the economy $39 billion per year by 2050, so several hundred million for climate impacts is not going to cover it.

On energy, we saw hundreds of millions going to support a gas-fired recovery, including opening up further basins and gas fields. The Beetaloo Basin project is a carbon bomb of historic proportions. The Northern Territory government has said the basin could increase Australia's annual emissions by seven per cent. It must not be mined or we risk absolutely fouling our commitment to the Paris agreement. The International Energy Agency found for us to be on a pathway consistent with net zero by 2050, a target which the government agrees is preferable, then there can be no new oil or gas projects from now.

In the budget, quite shockingly, $9.5 billion was allocated to the decision taken but not yet announced slush fund, which can only be seen as for the next election. We learnt of an up to $2.4 billion support package for oil refineries. The minister claims this is to secure Australia's energy but there can be no security if we rely on imported oil. The only way to secure our energy is to invest in the transition to electric vehicles that will ensure that energy comes from Australian electricity generators and not Saudi oil plants.

Another part of the budget was a slush fund. Used from this was $600 million announced some days after the budget for a gas-fired plant at Kurri Kurri. This is a plant with absolutely no business case. Coming from a government that claims good economic management, it is essentially a plan to write off $600 million worth of public funds. The chair of the Energy Security Board, Kerry Schott, has said it doesn't stack up because it is expensive power. AMO has outlined there will be a minor shortfall when Liddell closes, but all projects financially committed will be sufficient. There is simply no market for this project. The government claims the plant will create 600 construction jobs. At $1 million per job, that's a terrible return on investment; worse still, there will only be 10 ongoing jobs. People have asked what would I do instead to promote jobs in the area? I would invest in renewables and batteries, as the market is doing. Nearby the site, the CEP energy will be building a record 1,200 megawatt battery. Energy Estate has also formed a consortium of energy developers to launch a project called the Hunter Hydrogen Network, which could be Australia's very first hydrogen valley. The first stage of the project aims to produce green hydrogen and associated green feed stock for mining, vehicles and other industrial uses in the Upper Hunter.

The government's energy measures don't stack up. They're very expensive interventions that go against good judgement and sound economic management. If we want a vision of what's possible for the next budget, we should turn to discussions of a $4 trillion infrastructure bill proposed by the Biden administration in the United States which centres around clean energy investments, electric vehicle infrastructure, energy efficiency and creating new industries of the future.

I welcomed the re-establishment of the women's budget impact statement. It was noteworthy, however, that, of the $1.8 billion dedicated to women's economic security, $1.7 billion was for child care, prompting many, including myself, to comment 'But aren't men parents, too?' It seems to be that anything to do with children is put on the balance sheet for women. But, ultimately, it is all in society that benefit from proper childcare policies. Despite the women's budget impact statement coming back, there is still only one woman among seven members of the Expenditure Review Committee. To that end, the government has missed the opportunity to address the inequalities of the paid parental leave scheme, such as removing the means testing or, at the minimum, means testing the family income rather than solely that of the primary career. There are enormous economic benefits in getting child care and parental leave right, as shown by the motion I tabled earlier this year. But we have underinvested yet again and we won't see a full return realised. The benefits of this strategy, if implemented, would be substantial, with the Australian parenting strategy report estimating an 8.7 boost to GDP by 2050.

I welcome the funding and implementation of the Respect@Work recommendations—$20.5 million for the implementation of the 55 recommendations is a good first step. I've met with the Attorney-General, who assured me that more funding would be forthcoming in collaboration with states and territories. But I urge the Attorney-General to rapidly action the response to Respect@Work and make general improvements in this space.

Domestic violence is an issue that we have to deal with all too often. It was good to see nearly $1 billion over four years for initiatives to reduce the number and support the victims of family, domestic and sexual violence. I welcomed the increase from $150 million announced in the COVID response package in March last year. We can't underestimate the impact violence against women ultimately has on Australia. It costs Australia an estimated $26 billion annually. We need to do more to address this.

There are still so many areas where there was an attempt at starting to address issues but they've become so big that it really isn't enough to just have a first go at it. This can be seen in terms of aged care and NDIS, where the full amounts recommended were not allocated, and so only a part addressing of the problem will occur. We need to increase care and staffing ratios in so many of our services to ensure that we are properly taking care of the more fragile and vulnerable in our society. We need to ensure that staff are adequately remunerated for their work and that they receive proper training and support to enable them to do their jobs to the best of their abilities.

The budget had a little bit for everyone, but I would say that, overall, it missed a crucial vision for reopening Australia, for supporting the environment and for giving our young people a sense that this government has a vision for their future, has in mind the biggest intergenerational debt that is coming, recognises the costs that are coming and is actually investing wisely—that public money is being spent on infrastructure that will pay off in the long-term—and is not just following ideology. Sadly, that didn't happen, but I urge the government to use the $9.5 billion line item in this budget which is allocated but not announced towards measures that will actually ensure prosperity for future generations. You need to invest in our young people's future and not leave the biggest intergenerational debt we've ever seen.