Senator Mitch Fifield
Shadow Parliamentary Secretary
for Disabilities, Carers and the Voluntary Sector
Sky News AM Agenda
Kieran Gilbert and Senator Mark Arbib
11 May 2009
8:45am
EO & E
Subjects: paid maternity leave, deficit, debt, broken promises
KIERAN GILBERT:
Welcome back to AM Agenda and goof morning to our panel. Labor Senator and Parliamentary Secretary for Government Service Delivery Mark Arbib, good morning Mark.
MARK ARBIB:
Morning, Kieran.
GILBERT:
And Liberal Senator Mitch Fifield, Shadow Parliamentary Secretary, good to see you too Mitch.
MITCH FIFIELD:
Good morning Kieran.
GILBERT:
Maternity leave scheme, the parental leave scheme is up and running, what is the Coalition going to do about it? Do you like what you see?
FIFIELD:
Well it is important to look at what Labor has actually done since they’ve been in government in relation to new mothers. What Labor have done is to means test the baby bonus and means test Family Tax Benefit Part B. What was announced yesterday by the Treasurer is just an election promise. It’s not proposed to take effect in 2009. Not proposed to take effect in 2010. It’s proposed to take effect in 2011, after the next election. So what this is, is an election promise, and we know how much stock Labor put in election promises. Labor put their hand on their heart and declared that they would defend the private health insurance rebate, that they would defend the Medicare Safety Net, and the Prime Minister said that they wouldn’t change superannuation arrangements, not one jot, not one tiddle. Yet by the sound of things all of those are going by boards. So we can’t have any faith at all that Labor will deliver on this, which is nothing more than an election promise.
GILBERT:
It is beyond 2011, the promise is beyond 2011 isn’t it? So it is beyond the next election.
ARBIB:
Can’t Mitch just be positive for once? Here we are, one of two nations in the OECD that don’t have paid parental leave. Finally the Australian Government is taking action on it. They had 12 years to do something about it, didn’t do anything about it. We are doing something about it, we’re acting. Here it is, parents are going to get a benefit, working families are going to benefit. Rather than just being positive and saying that it is a good thing, we’ll support it or we’ll think about it or we’ll have a look at it. Here we go, Coalition once again just knocking it. This is the way they react to everything. They are negative on everything we do. You guys think, you say…
FIFIELD:
We’re saying you’ve got form…
ARBIB:
You think you’re born to rule…
FIFIELD:
You’ve got form is what we’re saying.
ARBIB:
Born to rule. You think you’re a government, a defacto government
FIFIELD:
Not at all. You’ve got form. Labor fib.
ARBIB:
This is the right decision for parents. It is, in the end. The immediate time after a child is born is the most stressful for any parents. We know that, we’ve got kids. Very stressful and the last thing you need to worry about is where the income is coming from. This should have been done many years ago, it has taken too long. The Treasurer, the Prime Minister have made the right decision. It’s a good thing. It is a good thing for the country and it is a good thing for families.
GILBERT:
The fact that it has been delayed until 2011, that does give the Government some room to move doesn’t it? In terms of the spending, this looks like it will probably form the model for other spending initiatives in this budget, that they will wait until the economy kicks back into gear in a couple of years.
ARBIB:
Well it is responsible. And given that the global recession has put a wrecking ball through our government revenue. Two-thirds of the deficit coming forward will be from revenue down-writes. It is a good thing that we are actually being responsible with all of our spending and that is the way we are looking at the budget. Short term stimulus, but long term savings to ensure that we come out of deficit in the future.
GILBERT:
That makes sense doesn’t it Mitch, to reign in the spending in the medium term, to have that roadmap back to surplus? Chris Richardson at Access Economics says that politicians on both sides of the fence need courage to deal with the spending cuts needed and it sounds like the Treasurer is going to be following that path.
FIFIELD:
Well I don’t think Labor are going to be reigning in spending. We’ve heard the Treasurer say that they are going to fund various things through savings measures. This isn’t a budget which contains new measures which are funded by savings. This is a budget which is built on borrowings and built on debt. We shouldn’t be in any doubt at all about that. This government has no plan for getting the budget back into surplus. We hear the government talk about the concept of a temporary deficit. A temporary deficit is 6 or 7 years. I heard the Prime Minister say the other day, he started talking about temporary borrowing as well. Now the borrowing that’s in place will be in place for at least 20 years. So this government has a funny definition of temporary. A government having a major debt of something of the order of $200 or $300 billion being temporary…
ARBIB:
Here comes the scare campaign.
FIFIELD:
It’s not a scare campaign.
ARBIB:
Mitch, then you are going to have to…
FIFIELD:
It’s the facts, and the facts are scary. This government has no plan, no plan to bring the budget back into surplus.
GILBERT:
Well in terms of the debt, it is true that $200 billion has been wiped off due to the global effects of the recession. But close to $100 billion on top of that is government spending. At least a third, or around a third of the debt is from your own doing.
ARBIB:
Well let’s wait and see what the figures show but in terms of the deficit we know, the Treasurer’s said, that two-thirds has been wiped off by revenue crashing through the global recession and the end of the mining boom. That’s fact. In terms of that now, I mean Mitch can run his scare campaign and Malcolm Turnbull can run a scare campaign.
FIFIELD:
They’re facts. They’re facts. And they are scary.
ARBIB:
But the truth is they are going to have to borrow as well. They know it. And if they are not going to borrow, if they are not going to go into deficit, what are they going to do? Are they going to increase taxes? Or are they going to cut programs, cut spending? That’s the question that Malcolm Turnbull is going to have to answer when he gets up on Thursday night. Mitch knows it. They are running a scare campaign, its duplicitous. In the end, Malcolm Turnbull has already said that their spending, that they will be borrowing something lime $177 billion.
GILBERT:
How is it duplicitous if they are going to spend less? If they are, if they still have a debt and deficit, fine, but if it is a lot less than yours, how is it duplicitous?
ARBIB:
Well because they are running a dual line here. Turnbull has had to admit it under pressure, but at the same time as that they are happy to run the Mitch Fifield scare campaign on deficits. They know there is going to be very little difference in the end, when you look at our deficit compared to their deficit. Because the truth is that it has been caused by the global recession, by the end of the mining boom. And as the Treasurer said this morning, I mean you look at the spending that the Coalition wracked up, if you talk about spending, talk about the spending that the Coalition wracked up over their 12 years in office. So bad that your former boss Peter Costello is saying that he didn’t think it was sustainable. John Howard’s spending was not sustainable and he was worried about footing the bill. Well footing the bill is what we have inherited, footing the bill for the spending you put in place during your time in office, and that was during the mining boom.
FIFIELD:
This is absurd Kieran.
ARBIB:
It’s not absurd, it is the truth.
FIFIELD:
This is absurd and what Wayne Swan was saying on the front page of the Australian this morning is absurd. That the budget situation that the government faces is partly as a result of the spending of the previous government. This budget, apparently, and its framing, is nothing to do with this government. The difficult circumstances, all the fault of the global financial crisis and the previous government. How can it be the fault of the previous government when the previous government repaid $96 billion of Labor’s debt, and when the previous government…
ARBIB:
Sold Telstra to do it.
FIFIELD:
…the previous government handed this administration a $22 billion surplus. It is the most absurd thing I have heard in a long time, that the budget situation today is somehow the fault of the previous government.
GILBERT:
But during the boom, middle class welfare did blow out, didn’t it? There wasn’t means testing on anything.
FIFIELD:
Well it’s interesting. At the last election Labor committed to the private health insurance rebate. They committed to the superannuation reforms which we introduced. They committed to our Family Tax Benefit arrangements. Labor didn’t have that view at the last election. Labor put their hand on their heart at the last election and said that all of those were good things. Now all of a sudden Labor are saying don’t believe us at the last election, believe us now. The truth is you can’t believe a thing that this government says.
GILBERT:
The Prime Minister has made a big deal of honouring his election commitments. He did say last year in the last budget that it was a big priority for him. But this recession has seen that go by the wayside hasn’t it?
ARBIB:
No I mean this is something that the Prime Minister is deeply committed to. But at the same time…
GILBERT:
But there are a lot of promises that aren’t being honoured.
ARBIB:
But at the same time as that. We have got to see
FIFIELD:
They’ve been broken, Mark.
ARBIB:
We’ve got to see what the budget shows tomorrow night. But at the same time as that, no one could have imagined how big an effect the global financial crisis and recession has had on our bottom line and on our revenues. It has absolutely just been a wrecking ball through the government. Through the budget. At the same time can I just come back to something Mitch said, he talks about paying off debt, he forgets the way the Coalition paid off some debt was they sold Telstra and at the same time they underinvested in infrastructure. Took 10% of GDP in terms of infrastructure, they underinvested in hospitals, a billion dollars out of the hospitals and the health system, underinvested in education, took 5% off education. The only country in the developed world that was actually devesting in education was Australia, we went…
FIFIELD:
Not true.
ARBIB:
You look at it, we were taking money out of the education system
FIFIELD:
After we paid off the debt we invested the proceeds of Telstra.
ARBIB:
Taking money out of education, that was the previous government. That was what they did.
FIFIELD:
Labor spent the proceeds of the Commonwealth bank on day to day spending.
GILBERT:
Let me just ask you. Let’s look forward now and I want to ask you about this budget, this deficit spending. Really it seems to me that the arguments are at the margins on the deficit when it comes to the focus of it, one being the cash splash which was a third and then you’ve got two-thirds being spent on infrastructure. You’re arguing for it to be spent on infrastructure, what’s your problem with two-thirds of it going in that direction? A lot of it is going out as we speak.
FIFIELD:
Well when you say two-thirds, look at the $42 billion stimulus package. Two-thirds of that wasn’t on infrastructure. The little bit of infrastructure that that money went on…
ARBIB:
Yes it was, $30 billion
FIFIELD:
…included school halls. Well school halls are important, but school halls are not serious economic infrastructure in the way that roads are. $42 billion package, not one new road…
GILBERT:
They create new jobs though, don’t they, the schools?
FIFIELD:
It’s short term. It doesn’t go to the long term productive capacity of the nation. And that’s what we have been arguing for all along.
ARBIB:
Mitch that is just absolute rubbish and its amazing that you will say that given the Coalition supported the stimulus package. You supported the first stimulus package which already had…
FIFIELD:
We gave you the benefit of the doubt. We did. And we won’t make that mistake again.
ARBIB:
Which already had infrastructure in it. First home buyers scheme, money for pensioners, money for carers. You supported that.
FIFIELD:
We’d been arguing for money for pensioners and carers.
ARBIB:
Let’s just get down to infrastructure…
FIFIELD:
That was our agenda
ARBIB:
The second stimulus, 70% of it, almost 70% of it was infrastructure. And in terms of…
FIFIELD:
Bike paths, don’t tell me bike paths are serious economic infrastructure.
ARBIB:
I cannot believe that you would be criticising money going in to schools. Part of my role in terms of getting around as Parliamentary Secretary is actually ensuring the stimulus actually gets to the schools. I have not met a parent, a principle, a school community that hasn’t been ecstatic by the infrastructure coming in. We are talking about new classrooms, new halls, we are talking about new science wings…
FIFIELD:
It’s all about the balance. It’s all about the balance. And there wasn’t balance in the package.
ARBIB:
…language labs. And if you are saying that investing in education is not productive for the future then you are absolutely so out of touch.
FIFIELD:
Oh, come on Mark.
ARBIB:
This is the modern Liberal Party, they think investing in education is not about the future.
FIFIELD:
School halls. School Halls does not an infrastructure agenda make.
ARBIB:
Mitch, you’re out of touch. You’re out of touch,
FIFIELD:
School Halls does not an infrastructure agenda make.
ARBIB:
Mitch I think you’ve made the point clearly.
GILBERT:
Let me ask you something about the pension increase, and will, do you think, the Treasurer he wouldn’t answer it this morning doesn’t it make sense to tie the revenue measures to this increase. Because this is something the Coalition does support, the increase to the pension, it is going to cost around $4 billion over four years. You are going to have to fund it so why not tie the other measures, controversial measures, like the reigning in of the private health insurance rebate, to that increase?
ARBIB:
Kieran we’ll have to wait and see what happens tomorrow night but you are right, in what you are saying, this is a huge we are delivering on our commitment in terms of our reforming pensions…
FIFIELD:
You broke your election commitments.
ARBIB:
You had plenty of time to do it, you failed to do it
GILBERT:
Can the Treasurer do both? Can he do both?
ARBIB:
Mal Brough turned up to Cabinet and they knocked him over. He said we should reform pensions and they said sorry, it’s a bit too hard for us. We’ve taken it on, we are delivering it. In terms of what it means, it means yes there are some tough decisions in terms of the budget going forward to pay for that, and in the end that will come back to the Senate and…
GILBERT:
Can’t you pin the legislation to the pension increase?
ARBIB:
Well we will have to wait and see. But in the end the question and the pressure is going to be on them, onto the Liberal Party.
FIFIELD:
I’ve got to respond to that.
ARBIB:
On the independents to make a call on that. The block everything, they tried to block the fair work bill, they tried to block the infrastructure and the stimulus, and they considered themselves so economically responsible that they blocked the alcopop measure.
GILBERT:
Let’s hear from Senator Fifield.
FIFIELD:
Kieran, Labor’s new initiatives are not funded by savings. This is a budget which is funded by borrowing. And the government taking an axe to a few programs which they have always hated, such as the private health insurance rebate, does not a fiscal strategy make. The government has got to be honest, there are a few things they have always despised such as the Medicare safety net, the private health insurance rebate, our reforms to superannuation. They pretended at the last election they were in favour of them. They weren’t. They’re using the current situation as a cover to take the axe to those. They shouldn’t for a minute pretend that they are actually funding their new initiatives from those sorts of measures. This is a budget which is built on debt and borrowing.
GILBERT:
Ok gentlemen, Senators Mitch Fifield and Senator Mark Arbib it should be a fascinating week ahead, and thanks for a lively discussion this morning gentlemen.
FIFIELD:
Thanks Kieran.
ARBIB:
Thanks Kieran.
ENDS