Speech in Parliament on Economic Winners and Losers

1.30pm | November 21, 2016

The Prime Minister has spoken about the need to undertake reforms to deliver long-term gains for all Australians, which may create winners and losers in the near term. It was a fairly clear statement about how he sees that dynamic. But clearly nobody has told the Attorney-General that that is the view of the Prime Minister, because the Attorney informed this chamber earlier that nobody is a loser in a prosperous economy and this economy is prospering.

In that context it might be worth considering what the Attorney-General might consider to be a prospering economy, because he was asked very directly about the nature of the Australian economy during question time today. Are there plenty of well-paid, secure jobs? Just last week the ABS issued its latest labour force figures, and employment growth has slowed. It has slowed to 0.9 per cent, down from 1.9 per cent just months ago. There are now more than 1.8 million Australians who are underemployed or unemployed, and it is underemployment that is causing so much of the hardship that we know we see in our communities. This figure includes 261,000 young people. These are young people who maybe are on the verge of giving up on the hope of their first job, their first step into the labour market, because what we also see is workforce participation amongst young Australians also falling.

And how about wages? How are families going? What are they taking home? Wage growth has hit a fresh record low, below two per cent, the lowest in the series, with workers across all industries seeing pay increases that barely match the increased cost of living. So Senator Brandis can make all of the assertions about prosperity that he likes, but the truth is that Australians do not experience the economy at the moment as a period of prosperity, because all the risks are being passed on to them but the amount of money going home in their pockets is just not keeping up with what is needed to keep yourself together.

Perhaps Senator Brandis would consider a well-balanced budget a mark of a prospering economy. There is a new report out this morning from Deloitte which projects a further $24 billion deterioration in the Commonwealth budget under Mr Morrison, the Treasurer; and Mr Turnbull, the Prime Minister. If that projection eventuates, that is going to put further pressure on Australia's AAA credit rating.

We have had the deficit for 2015-16 blow out by eight times what was projected at the 2013 election, and today the Treasury is confirming that we will not see a surplus until 2021, and their only plan to address it seems to be cuts to essential services and, worse, a corporate tax cut that will blow the deficit out even more and that is completely unfunded and represents the height of irresponsibility.

The fact that reform creates winners and losers is unremarkable, actually, because change does create winners and losers, but what is remarkable is that under this government there is a consistent pattern. It is a pattern that emerges every single time we see a proposition for reform. That pattern is that the winners under any reform process that is commenced are the top end of town every single time and the losers every single time are low- and medium-income Australians.

There are reform agendas—real agendas for economic reform—that would share the growth, benefit middle-income Australians, benefit low-income Australians and benefit the Australian economy, but these are reforms that the government is unwilling to contemplate. They are reforms to education which would see every Australian have the chance to build the skills that they need to contribute to productivity in this country. These are critical reforms that were initiated under Labor, and Gonski is being undermined by this government. They are reforms to housing that would see the playing field levelled so that people who want to buy a home to live in—not just as an investment property—get a fair run at the auction. These are reforms this government refuses to contemplate. There are tax reforms which would ask higher-income earners to pay their fair share rather than give tax cuts to the very big corporations, but none of these reforms are contemplated by the government. That is the real tragedy here, because we know that the economy does need reform.

But Australians are right to be nervous when they hear the Prime Minister talking about winners and losers, because they know that, every time, if they are an ordinary Australian, they will lose.