I rise today to speak to Appropriation Bill (No. 3) 2008-2009 and Appropriation Bill (No. 4) 2008-2009. These additional estimates bills are presented during a crisis that is unprecedented in our lifetimenot just in scale but due to the global nature of the modern economic system. The macroeconomic imbalances that built up prior to the middle of last year are being painfully corrected around the world, causing disruption to financial markets, export markets and Australian households and businesses. Australia is not immune from this crisis.
I rise today to speak to Appropriation Bill (No. 3) 2008-2009 and Appropriation Bill (No. 4) 2008-2009. These additional estimates bills are presented during a crisis that is unprecedented in our lifetimenot just in scale but due to the global nature of the modern economic system. The macroeconomic imbalances that built up prior to the middle of last year are being painfully corrected around the world, causing disruption to financial markets, export markets and Australian households and businesses. Australia is not immune from this crisis.
Governments have a responsibility to respond in a timely, targeted and efficient manner during economic crises. They have a critical role to play in restoring confidence in financial markets, in stimulating demand through encouraging consumption and investment and in ensuring that our regulatory framework is appropriately calibrated to the proper functioning of globalised, deep and liquid financial markets. That is precisely what this government is doing.
It has become evident that financial markets will not self-correct without causing enormous damage to businesses and to Australian families. It has therefore become critically important to stabilise financial markets and in particular the banking sector. This government has done this through the guarantee of deposits and of wholesale funding of authorised deposit-taking institutions. The government has purchased $8 billion in residential mortgage backed securities and has established the Australian Business Investment Partnership to ensure the strength of the commercial property market.
During a period such as this it is not sufficient to rely on automatic stabilisers or monetary policy to stimulate demand. The circumstances that we face, with the loss of confidence in financial markets and consequently among families and among businesses, make it vital that the government use the full weight of measures at its disposal, including fiscal policy. Permanent across-the-board tax cuts, which the opposition has advocated, simply do not meet the criteria for stimulating the economy. This sort of movethe most base, senseless, conservative reaction to a crisis such as thiswould not generate the economic stimulus that is required as four of the five largest economies fall into recession.
Any stimulus package must be targeted to boost consumption and investment. We have boosted consumption through the Economic Security Strategy announced on 4 October last yearthrough $4.9 billion in assistance to pensioners, $3.9 billion in assistance to low- and middle-income families, $1.5 billion to first home buyers to help them purchase a home and $187 million to create 56,000 training places. People in my electorate have told me almost every day since this package was announced, and most particularly since the start of December last year, how much they appreciated the assistance that came on or around 8 December. They have told me that they spent that assistance on major purchases such as a new stove, essential repairs or purchasing Christmas presents.
As part of the governments response to the global economic crisis there has also been established the Regional and Local Community Infrastructure Program, which was announced at the Australian local government conference held in this building in November last year. I attended the conference with the mayors of Frankston and Kingston and also the Chief Executive Officer of the City of Greater Dandenong. I can say from the reactions of the mayors and local councillors in my electorate, and indeed from the reactions of the hundreds of local government officers, councillors and mayors who attended the local government conference here last year, how much the conference was appreciated by those attending from the local government area as an opportunity to meet with the Prime Minister, to meet with other ministers and to have direct contact with the federal government of our country.
In part, Appropriation Bill (No. 4) 2008-2009 appropriates $300 million for the Regional and Local Community Infrastructure Program, and members will recall that some $250 million of that $300 million was directly allocated to individual councils in accordance, essentially, with a needs based formula and that the remaining $50 million was to be allocated to larger scale projects. So there were grants of $250 million going directly to local councils straight away and the possibility of bidding for appropriate larger-scale local projects which were to have been allocated from that $50 million. It has, of course, been announced by the Prime Minister today that this amount will be increased to $500 million.
This program will not only help restore national economic growth but also, particularly in our area, help restore the regional economy in south-east Melbourne. The City of Frankston, the City of Greater Dandenong and the City of Kingston have all determined how to spend the money which was already allocated to them at the November conference on useful local projects. I would like to take the opportunity to express my support for the three projects being proposed in my electorate as larger-scale local projects under the additional funding. As I mentioned, this is, of course, the additional funding that is to be increased as announced today, which will make it more likely that these well-thought-out local projects can in fact be funded.
The City of Greater Dandenong has applied for funding to help redevelop the Noble Park Swim Centre, which is an ageing but essential community facility. This redevelopment focuses on rebuilding the swim centre to meet community needs both for the short term and into the future. The proposed redevelopment would see a new 50-metre swimming pool installed, the construction of a new learn-to-swim pool, new change rooms, a new cafe, a multipurpose function room, shade protection and more trees, as well as the incorporation of water and energy saving measures. This year Noble Park is celebrating its centenary, and I can think of no better way to celebrate the commencement of the next hundred years of Noble Park than a major redevelopment of the Noble Park Swim Centre. The City of Greater Dandenong estimates that construction would require more than 70 people to be employed and, in addition, to help address some of the employment difficulties that are being experienced in the local community, the City of Greater Dandenong has proposed that the successful contractor would be required to engage two apprentices from the local area.
The City of Kingston, another of the major municipalities in my electorate, has applied for funding to redevelop Kingston Heath Reserve into the Kingston Heath regional soccer facility. The proposal has the support of the neighbouring Bayside City Council and also the Football Federation Victoria and Sport and Recreation Victoria, the state government body charged with developing sport and facilities in Victoria. The kinds of capital works that are proposed under this project are an upgrade which would see two new synthetic pitches installed, training lights installed, a cosmetic upgrade of the existing pavilion, construction of a new car park, water storage tanks for future irrigation needs, two new electronic scoreboards and two new coaches boxes.
The third of the large-scale local infrastructure projects that are being proposed in my electorate is Frankston City Councils proposal for funding to restore the historic Frankston Mechanics Institute, which was built in 1880 and was upgraded in 1957 but has since fallen into poor condition, with major renovations required. The proposed restoration would see hazardous materials removed from the site, new administration space built and new rooms constructed.
I have met with each of the three councils to discuss these proposals in detail. They are proposals which are spade readya phrase that I think was used earlier todayor ready to go, and construction can commence very soon if approval can be given to them. These are local capital works, decided on by local people, which will bring local investment and jobs. Each of these three projects is a worthy project which I fully support, and I hope that they will be favourably considered for funding under this program. Indeed, I have made representations to relevant ministers in respect of these three proposed large-scale projects in the electorate.
The actions that this government is taking stand in stark contrast to the failures of the previous government and the continued failure of the opposition to have any coherent input into the problems that beset the nation. In their final years in government, they blew the years of prosperity that had been created by the economic reforms undertaken during the Hawke and Keating governments. They were unable to manage the economy for long-term economic prosperity rather than for their short-term political expediency. The former government, the Howard government, pursued procyclical fiscal policies. They pump-primed the economy at the height of a resources boom, fuelling inflation that resulted in interest rate rise after interest rate rise. When it came to using the level of fiscal policy, they acted in an irresponsible and counterproductive manner, leaving the Reserve Bank to keep inflation under control with one arm tied behind its back.
Under their watch, investment in infrastructure stalled. The former governments failure reduced our nations ability to reach its potential and to take full advantage of the global demand for Australian resources at the height of the boom. Under their watch, productivity growth flatlined. Under their watch, the current account deficit blew out while Australia had the best terms of trade in a generation. It needs to be borne in mind that this was the government of the Liberal Party which ran around the country with a so-called debt truck during the 1996 election, at a time when the current account deficit was some $200 billion. When the Liberal Party left office at the end of 2007, the foreign debt was in excess of $600 billion, and that is the economic legacy of the Howard government.
In opposition, nothing has changed. They have learnt nothing and forgotten nothing. They are incorrigible, they are incoherent and they are incompetent. The Leader of the Opposition has said that the opposition want to cooperate with the government. I would suggest that, first, those opposite might start cooperating with themselves. I would suggest that, to get this process underway, they could start by at least agreeing to be wrong in the same way, rather than in several different and contradictory ways, which would be an improvement on their current position.
I was listening earlier to the contribution to the debate made by the member for Cowper, who had the extraordinary hidewhich would not be too strong a wordto say that the former government bequeathed a surplus to the nation. It is an interesting word to choose, because the only time you bequeath anything is when you are dead. So perhaps the member for Cowper is saying that the Liberal Party and the National Party are dead, and that is why they left this bequest to the people of Australia. I would perhaps not go quite so far as the member for Cowper, but I would agree with him that the Liberal Party and the National Party are dead in at least one sensethat is, intellectually dead. Bequeath, which was the member for Cowpers choice of word, also betrays a deep-seated false attitude that those opposite have to the government of this country. It suggests that the Liberal Party and the National Party own the government of Australiathat the government of Australia is their property and theirs to bequeath. Those on this side of the House know full well that the government of Australia belongs only to the people of Australia and that, when you occupy the government benches, you hold the government in trust for the people of Australia.
The kinds of attitudes that we have heard from those opposite during this debate and, indeed, over the last several months show that the opposition have been unable to craft any coherent response to this economic crisis. They have departed the playing field of ideasas I said a moment ago, they are intellectually deadand instead are choosing to carp from the sidelines. They have no answers to the key questions that face our nation in this global crisisquestions like: how do we stabilise and restore confidence in our financial system? How do we encourage consumption and investment and maintain employment? How do we reform and rebuild the global regulatory framework for financial markets in the post-crisis economy? What policy action should we undertake to maintain Australia as a dynamic, open and internationally competitive economy which will provide high-skill, high-wage jobs for Australian workers?
The Rudd government will continue the education revolution, as we demonstrated again today with the announcement of $14.7 billion to rebuild primary school infrastructure, science laboratories and language learning centres in schools. The Rudd government will continue with the program of tax reform that was commenced in the 2008 budget. The Rudd government will continue to take the steps necessary to lift productivity growth to ensure our future prosperity. The Rudd government is taking action to ensure that Australia is prepared for a low-pollution, carbon-efficient future, as the member for Wills demonstrated in his speech in this debate. The Rudd government has shown its commitment to ensuring that fiscal policy and monetary policy work in tandem, supporting each other in controlling inflation while maintaining employment as the need arises. Not for us, and not for Australia, the reckless approach that the Howard government took to fiscal policy.
The Rudd government will continue to engage with other nations and multilateral economic institutions, because Australia must not turn away from the global economy. Countries must not resurrect tariff walls that offer false promise but which will only deepen the pain felt by all. Instead, we must be engaged in helping to shape the global economic order that arises out of this crisis. We heard from the speeches and participation of the Deputy Prime Minister and the Minister for Trade in Davos in the last week immediately before parliament recommenced the contribution that Australia is seeking to make to the development of a new world economic architecture and the contribution that Australia is attempting to make through the encouragement of trade in every sense and the discouragement of the building of tariff walls and of protectionism. The Rudd government, through participation in these international forums, is showing its consistent policy of the encouragement of trade. Australia needs to work with other nations to fashion a system of global financial regulation that reflects the globalised nature of the financial sector, and we must continue to pursue multilateral trade liberalisation that will strengthen our economy and create more opportunities for our highly skilled workforce.
This legislation also appropriates $2.5 million for the Department of the Treasury to ensure that Australias regulatory environment becomes worlds best practice and to pursue reform of the global financial architecture. It is the case that Australias financial system is well regulated when one compares it to many other countries around the world, but it is also painfully clear that there has been a failure of regulation in many senses in this countryinadequacies of regulation which the former government was not prepared to attend to, which have been identified not merely in this country but also in other countries throughout the Western world and which right-thinking governments are now attending to. It has been squarely recognised that there is a need to improve regulation of the financial sector, and that task of improving regulation in the financial sector is a task that the Rudd government will not shirk. This crisis has presented our nation with monumental challenges in the short term. The government is taking the decisive action to meet these challenges. In the long term, we will have the opportunity to build a dynamic, open economyand, unlike those opposite, this government will make the most of that opportunity. I commend the bills to the House.
