Budget Reply Speech, 11 May 2023
Senator BABET (Victoria—United Australia Party Whip) (20:15): Everyone’s a winner in Treasurer Chalmers’s budget. At least that’s what Treasurer Chalmers will tell you. The Treasurer himself is certainly a winner. His budget windfall victory is one which is largely driven by luck, but many expect, as I do, that his luck will be short-lived. Following the budget release, if you believe the rhetoric, you might also believe that maybe you’re a winner, unless you understand that inflation is a tax. That’s what it is. It is a tax that does not require legislation. It is a tax that hurts the most vulnerable.
Inflation is not driven exclusively by consumer spending. Government spending also drives inflation. They promise to spend around $185 billion more of your money. The RBA’s money printing obviously drives inflation, and government debt accumulation also drives inflation. Inflation raids all of our pockets. Like a thief in the night, it makes us all a little poorer every single time. The trouble with politics nowadays is that all the incentives are upside down. We have created a system whereby, over time, politicians are rewarded not for what they achieve, as they should be. Instead, they are rewarded for how much they spend. Politicians know that they will rarely be judged based on the outcome of their actions and are all too often tempted to announce a big spend, knowing that the return may not be there for hardworking taxpayers. Our politicians, unfortunately, find it much too easy to spend other people’s money.
Treasurer Chalmers had an opportunity to cut spending and to post a large surplus and repay debt. Instead, Labor continues to frivolously spend taxpayer funds. They are paying $450 million to our nation’s largest industrial businesses to reduce emissions. There is an additional $200 million for the war in Ukraine, and there is $360 million for the Indigenous Voice to Parliament. Those are just a couple of examples. We congratulate the Treasurer on projecting a budget surplus for 2022-23. This is something that, obviously, every single government should aspire to do. Our challenge for the government is this: produce back-to-back surpluses. Can they post a budget surplus in 2023-24, I wonder? Probably not.
The other victory for the Australian people in this budget is a lower projected federal debt. That is a good thing for our country, of course. We urge the government to make a concerted effort to repay debt, because low debt is a youth policy. Higher debt means higher taxes for our kids. I think our Treasurer is the luckiest Treasurer in history. He’s pocketed an unexpected windfall that, on the surface, makes him look rather competent. Low unemployment, higher-than-expected commodity prices and high inflation have boosted the Treasurer’s bottom line. Our farmers and our miners unfortunately don’t get any
thanks from the government, but it is these hardworking Australians who produce our minerals and our food and create real economic value. The blood, sweat and tears feed and literally clothe us. Do you know what our regional industries they do? They sustain us and they build our cities.
The hidden, but very painful, tax of bracket creep is another key driver of the Treasurer’s windfall. Bracket creep occurs when wage growth forces employees into a higher tax bracket. The brackets are fixed, and they do not increase in line with the cost of living and wages. Without the indexing of tax brackets, we all end up with less money in our pockets and the tax revenue received by the government obviously balloons. I urge the Treasurer to not only pass on the legislated stage 3 tax cuts but also consider indexing our tax brackets to alleviate the silent theft of bracket creep.
Many Australians are going to get $500 or so towards their energy bills. The government feels the need to hand out cash to help everyday Australians keep the lights on, but it then assures us that it has nothing to do with our forced transition to expensive and unreliable renewables. Of course, we beg to differ. Green energy policies are impacting family budgets. The government also has the audacity to claim that this measure will temper inflation. How does handing out money to people temper inflation?
There are no tough decisions in the budget. Courage, it seems, is not the Treasurer’s strong point. Unions are happy, globalists are happy, big corporates are elated. Productivity-boosting measures are non-existent in this budget. It’s all about big government and short-term fixes to large problems—large problems often created by the very government that chooses to ignore them.
Average families are forgotten. They are the forgotten people in our nation. It wasn’t that long ago that a single income family could own a home, go on an annual holiday and buy a new car every few years or so. Those days are gone. They are over. But there are many things that government can do to ease the cost-of-living pressures —for example, income-splitting. It is such a simple policy that would yield incredible results for Australian families. Imagine this: a family comprising one primary income earner and one stay-at-home parent. What if they were able to split their incomes for tax purposes? For example, a household with one party earning $100,000 a year currently pays roughly $23,000 of income tax. If they were able to split their income with their spouse, the combined tax they would pay reduces to around $13,000. That’s around $10,000 of their money back in their
pockets to spend as they wish. Treasurer Chalmers, this is the kind of family friendly tax reform our nation needs.
The solution to our nation’s headwinds is not more spending or a bigger government; the solution is cutting re and green tape, removing barriers for business and promoting entrepreneurial attitudes. We must grow the pie so that everyone can eat, not just hand a slice of pie to a select few. In the United Australia Party, we believe in small government, fiscal responsibility, entrepreneurship, free-market capitalism and family. We will continue to hold the Treasurer to account. He has said that he plans to remake capitalism, and we know what that means. That means more socialism, which has failed and will continue to fail everywhere. It has been tried.