COALITION SENATORS OPPOSE SPENDING SPREE
Coalition Senators on the Senate Finance and Public Administration Committee inquiry into the Government’s stimulus package have recommended the Senate vote against the bills.
Senators Fifield, Ryan, Joyce, Abetz and Coonan condemned the poorly targeted, over-sized and fiscally irresponsible package as being a spending spree not a stimulus.
Coalition Senators believe the package:
– will not achieve the Government objectives of stimulating the economy and supporting employment;
– is too big at this time, leaving little scope for further measures if needed later;
– is poorly thought through and a poor quality use of $42 billion of taxpayers’ money;
– lacks ingredients that should be part of packages of this kind measures to increase employment, productivity, efficiency and competitiveness; and
– commits Australia to record amounts of debt (the Government seeks authority to borrow $200 billion), endangering the nation’s long-term economic security.
Nothing heard in evidence gives any confidence that the package has been subject to the full intellectual rigour and detailed examination that should be required when committing to spending $42 billion of taxpayers’ money.
The development of the package and its contents have been driven by political rather than economic considerations.
The package will result in unprecedented levels of debt which the Government has no plan to repay. Mr Rudd is seeking to increase his credit card limit to $200 billion. Judging by Labor’s repayment history, this is a very risky loan.
The quality of the expenditure is poor. Simply subsidising activities such as insulating homes will not add to Australia’s productive capacity.
Cash handouts may be popular, but beyond the immediate hit provide no ongoing stimulus to the Australian economy.
Independent economists gave evidence that permanent tax cuts are more likely to stimulate the economy. It is disappointing the Government will not consider the Coalition’s proposal to bring forward scheduled tax cuts.
The package is one of the largest single outlays of taxpayers’ money in Australian history and deserves careful examination and debate. The Government wanted to ram this legislation through Parliament in 48 hours. The Government knew extended scrutiny would expose serious flaws.