Appropriation (Budget Variations) Bill 2008 
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| Wednesday, 14 May 2008 | ||||||
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Mr MIKE BAIRD (Manly) [5.04 p.m.]: I lead for the Opposition on the Appropriation (Budget Variations) Bill 2008. Needless to say, we have serious concerns. The bill seeks to increase the amount of special payments allowed by the Treasurer outside the budget process by more than $400 million. The Parliamentary Secretary, the member for Maroubra, in the agreement in principle speech said that the budget variation was required for "unforeseen and urgent expenditures". The Treasurer simply said, "It is nothing out of the ordinary. It is a top-up." On behalf of the people of New South Wales, I argue that $400 million is very much out of the ordinary and anything but a top-up. The taxpayers of New South Wales are concerned that the Treasurer speaks so dismissively about using $400 million of their hard-earned money for a top-up—bits and pieces here and there. We require greater accountability and disciplined management from the Iemma Government. The object of the bill is to appropriate additional amounts from the Consolidated Fund for recurrent services and capital works and services for 2007-08. In the 2007-08 budget the Treasurer's Advance allocation was $215 million for recurrent services and $110 million for capital works and services. That is $325 million in special payments already outside the parameters of the budget. As outlined in part 2 of the bill, the additional funds now sought comprise a $190 million increase in the Treasurer's Advance and $218 million to be spent on additional recurrent services. So it is a further $400 million on top of the $325 million already allocated. Effectively, the Treasurer has a $700 million overdraft. A bank manager who lent the Treasurer $700 million to do whatever he liked with it whenever he liked would be petrified. He or she would look at the reports every morning to see what the Treasurer had done with the money. The Labor Government lacks discipline but it does not lack fortitude: it spends whatever it wants. The bill amends sections 22 and 26 of the Public Finance and Audit Act 1983 to allow further expenditure to be incurred without authorisation by the Parliament, and the Government does not have to disclose it until the introduction of the 2008 appropriation bills in June. This allocation of $700 million to the Treasurer leads me to consider the recent Federal budget. What is the difference between the Coalition and Labor Federal governments? The answer is $31 billion. It does not take a mathematical calculation to work it out. When John Howard and Peter Costello took government in 1996, they did not inherit a surplus. In fact, they inherited a deficit of $10 billion. In 2007 Kevin Rudd and Wayne Swan inherited not a deficit, but a surplus of $21 billion. Day in and day out we have heard about the hopeless Howard-Costello Government. Last night Kevin Rudd and Wayne Swan should have commended John Howard and Peter Costello for their leadership of the country. The budget surplus and the country's prosperity are due entirely to John Howard and Peter Costello. It is disgraceful for Labor not to acknowledge that they turned a $10 billion deficit in 1996 into a $21 billion surplus. ACTING-SPEAKER (Ms Diane Beamer): Order! The member for Manly will be heard in silence. The member for Wakehurst will stop interrupting the member for Manly. Mr MIKE BAIRD: The other point I wish to make is that the rhetoric of the Australian Labor Party is not often matched by its actions. It is very important to know when considering appropriation bills and when the Government is seeking additional funds that its words match its actions, but in this case we cannot see that. For the past 12 months Wayne Swan has been screaming about inflation. At every press stop, and on every television and radio station he has been going on about how we have to do something about inflation. He went on about it everywhere he went, and in the end we started to think that maybe he does have to do something about inflation. But then we had the Humphrey moment when Wayne Swan sat down to create his budget and he was told, "Mr Treasurer, we love the fact that you have highlighted inflation, but the reality is we cannot really do much about it". Last night Wayne Swan had his first opportunity to do something about inflation and help working families—we have heard it all before—but what did he produce? He produced the biggest spending budget in history. Yes, he made some cuts, but he spent a lot more. Are we seeing Wayne Swan undertake the Gough-style approach to fiscal management? He certainly has started spending. When Peter Costello became Treasurer in 1996 he cut costs by $9 billion, yet Wayne Swan has cut costs by $1 billion. Imagine what the Federal Budget would be like if it was not trying to stop inflation. Let us consider the new taxes the Federal Government is introducing. The Federal Government said it would do something about binge drinking so it will introduce a new tax. Is the Federal Government interested in stopping binge drinking or is it more interested in the $3 billion it will raise and the inflationary impact that will have? All these things are very much connected to the bill because we will have to trust the New South Wales Treasurer with funds to do with whatever he likes. Mrs Karyn Paluzzano: Point of order: The member for Manly is not dealing with the bill; he is talking about the Federal Budget. He should be brought back to the Appropriation (Budget Variations) Bill 2008 and he should deal with that. ACTING-SPEAKER (Ms Diane Beamer): Order! I am sure the member for Manly is making a passing reference to matters broadly related to the legislation. However, I ask him to confine his remarks to the bill before the House. Mr MIKE BAIRD: We will have to trust the Iemma Government and the Treasurer with what is a $700 million overdraft. Last night we heard about the creation of infrastructure funds, which, again, were a Peter Costello and John Howard idea rebadged. The funds will be put towards infrastructure, education, transport, roads and health. If we add police to the list, we no longer need the Iemma Government: Kevin Rudd is going to manage the whole of New South Wales for us. When we consider the State Government's management services, it is debatable whether Kevin Rudd could do a better job—and last night Wayne Swan proved that he probably could not—but from what we are seeing day in and day out from the Iemma Government he certainly could not do a worse job. If we are going to trust Michael Costa with a $700 million overdraft we must have much more transparency. We just had a debate about asking the Treasurer to answer questions from this House after he delivers his Budget Speech. Where is the democracy in that? Where is the scrutiny of a debate on electricity privatisation? How could we not bring to this House a debate on electricity privatisation when it was not an election mandate? It was not mentioned during the election campaign and we do not want to debate it in this House. We are moving into very dangerous territory. Ms Noreen Hay: Point of order: The Opposition should stop demonising people. ACTING-SPEAKER (Ms Diane Beamer): Order! What is the member's point of order? Ms Noreen Hay: I think you have been very lenient with the member for Manly. We continue to hear about the Federal Budget and we are now hearing about privatisation. ACTING-SPEAKER (Ms Diane Beamer): Order! What is the member's point of order? Ms Noreen Hay: The member for Manly should come back to the leave of the bill. ACTING-SPEAKER (Ms Diane Beamer): Order! The member for Manly will confine his remarks to the leave of the bill. Mr MIKE BAIRD: Where were we? We are having a great time. Not only are we treating the electorate with disdain but we are treating the Parliament with disdain also. The important function of Parliament is the oversight of appropriations. In presenting the bill to the lower House the Parliamentary Secretary said:
That management style in the delivery of services indicates a complete lack of attention to detail. If the Government is not worried about trying to hold expenses in line it will not be focused on the service it is trying to deliver for the people of New South Wales because it does not matter. There is no discipline at all. Notwithstanding some of the individual line items have some merit, why were they not included previously? Any management must understand its business: it must understand what its customers want and it must have the budget to meet those expectations. This appropriation bill is clear evidence that the Government does not have management discipline; it does not have a strategy for every single department to tackle the multiple problems that exist. I will not list all the problems across the departments, but the bill is evidence of the problems. If a Minister has to go to the Treasurer six months into a budget process and say, "I need another $140 million", who is in charge of that business? Whoever is in charge should not be in charge. The responsible Minister should not be in charge because he or she is not being held to account on basic business principles. Unforeseen expenses to deal with natural disasters and those types of things are not unexpected. But when the Treasurer was justifying these expenses he said that funds were required for the drought and equine influenza. He said that these were things the Government was not able to anticipate: the drought had got worse and equine influenza had affected the industry. Schedule 1 to the bill states that $20 is for drought assistance and $7.9 million is for equine influenza, which is 6.8 per cent of the $408 million total. Other payments were to the Museum of Contemporary Art. How could that additional funding not be foreseen? How could the Minister not know that the Museum of Contemporary Art required an additional $10 million? For goodness sake, how could the Minister for Health not know that hospitals required more beds? It does not take a budget process to work that out. New South Wales hospitals need more beds. It shows that management does not get it when the Minister for Health goes to the Treasurer six months into the year and says, "I need some more beds. Can you please help out?" The Government does not understand its responsibility as a manager, but it is continually bailed out because the Treasurer says, "No problem. Come to us, we will give you some funds and we will all be merry." I believe this attitude is an abuse of the Treasurer's advance. The Australian Labor Party has a history of seeking many payments after deals have been done. There is nothing more galling in the figures I have reviewed than the $25 million paid in compensation to the Lane Cove Tunnel operators in the lead-up to the 2007 State election and accounted for only recently. That is not the sort of expense that should be met from the public purse. It is complete electioneering and it has nothing to do with improving roads; it is all about delaying the road closure, which, as we have seen, is starting to cause chaos for electorates all around that area. That $25 million from the public purse should be returned. If the Treasurer had any moral compass, the Minister for Roads and, indeed, the entire Government, would return that $25 million; they would hand it back to the people and say, "We are sorry we used it". Why do they not dip into Australian Labor Party funds and get it that way? Other expenditure includes advertising for the Premier's Department, the appointment of a private sector partner to manage the New South Wales Police Force property portfolio—which cost $1 million—and the list goes on. In addition, $27 million was spent last year on essential maintenance and upgrading works at the Opera House. How could the Government not know that the Opera House needed essential maintenance and upgrading before it was done? That is yet another example of the Government or Ministers not being accountable. Does the Minister at the table, Minister Rees, review a profit and loss statement on a monthly basis? Does every Minister get a monthly profit and loss statement? Do they look at the variations and are they held to account for them? If not, it would be a good idea to introduce a process to ensure that Ministers are accountable for the management of their portfolios. How can they be held to account if they do not know what they are spending? It is a simple proposition. The Iemma Government frequently experiences cost blowouts and its record on delivering commitments on time and on budget is not good. We were told that the Iron Cove bridgeworks would cost $100 million. That project is not good news for the election prospects of the member for Drummoyne and the member for Balmain. That project has blown out to $150 million. Who knows what it will eventually cost? We were told in October 2007 that the Tcard project would cost $65 million, but only three months later—just before the contract was terminated—it had blown out to $95 million. I am sure the member for Willoughby will raise that project in her contribution. When the widening of the Spit Bridge was announced on 1 August 2002 the projected cost was $35 million. By the time the Government pulled out of the contract, the projected cost was $115 million to $130 million. Of course, we know the politics of that project. Government expenditure has continued to increase. Members opposite might find this boring, but it is very important to the people of New South Wales. The Government cannot continue to spend more than it collects, which is what it has done for 13 years. Mr Matthew Morris: Is that why we are in surplus? Mr MIKE BAIRD: That is the question. If we subtract the $400 million from Sydney Airport that the Government has not received and will not receive, was there a surplus last year? No, there was not. The Stokes and Vertigan audit report revealed that the Government's expenses are 6 per cent and its revenue is 5 per cent. That means that almost $1 billion has been lost every year for the past 13 years. That is a very serious situation for the people of New South Wales and it should be addressed. Until the Government demands discipline from Ministers, this House will continue to deal with budget variations bills. That is why the Iemma Government is not delivering to the people of New South Wales. Ministers are not being held accountable for their portfolios and they are not monitoring their expenses or their service delivery. That is the reason for the economic problems that this State is experiencing. The Government is also failing to meet fiscal responsibility targets. The State debt was set to more than double from $19.3 billion in 2006 to $39 billion. That is a breach of the Government's Fiscal Responsibility Act. The Treasurer has a different view; he does not want to pay attention to legislation. He says, "Forget about legislation; it does not make sense anymore. We will just do what we want." That abrogation of responsibility to Parliament and the electorate, and Ministers lack of basic management skills have resulted in every service area in this State failing. This Government should not introduce any more retrospective bills. It is unclear how the Government will use the funds allocated in this legislation. The Treasurer and the Government should be held to account and the Government should display some management competence. Add to:          Write Comment
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