Senator SMITH (Western Australia) (15:58): Sometimes in politics progress can be very slow, but I would like to congratulate the Labor Party on their contribution just then because we might have seen a glimmer—just a glimmer—of progress when it comes to reforming our nation's financial mess. I would like to start by talking about Senator Moore's contribution. It was very pleasing to hear Senator Moore suggest that the opposition is not necessarily opposed to the idea of a Commission of Audit. That is a small tick. We heard from Senator Moore that the Labor opposition is not opposed to reviewing programs to make sure that we do get better value for taxpayers' money, so that is a small tick. It was heartening to hear Senator Moore's contribution where she said that the Labor opposition is not alleging automatically that the new government will slash services to Australian taxpayers. So progress is slow in politics but I think, ladies and gentlemen, we might have had a glimmer of some progress in Senator Moore's contribution just a moment ago. Senator Moore made the point, quite correctly, that we should start as we intend to finish. I think that is very, very important and I would like to come back to that point in a moment. However, what we did not hear from the Labor opposition was an admission that there is a problem. We did not hear from the Labor opposition that we have a problem in our country. I do not think Australian voters will accept that; I do not think Australian voters will buy that particular suggestion. So do not believe Senator Moore, do not even believe Senator Smith; however I would like to quote from a number of eminent commentators in our country. I thought I might start with Paul Kelly from the Australian. He provided some commentary around the Commission of Audit when it was first announced by our Treasurer and by the Minister for Finance, my Western Australian colleague Senator Cormann. So do not believe me, do not believe the Labor opposition; instead let us hear what Paul Kelly from the Australian had to say. He said: This was documented by Finance Minister Mathias Cormann, who said that in six years of ALP government the average annual spending increase was more than 4 per cent in real terms, irrespective of Labor's fiscal rules. So irrespective of what the previous government had tried to do, average spending increased by four per cent annually. This figure will haunt Labor. Not my words, not Tony Abbott's words but Paul Kelly's words about the performance of the previous government. In short, the fiscal stimulus from the 2008-09 global crisis created a new spending plateau— under the former government. Mr Kelly said: The daunting strategic task facing Abbott and Hockey now emerges: they seek to impose off the Audit Commission a vast fiscal and public sector efficiency reform on an economy that is fragile and facing great investment uncertainties. There is a problem and it needs to be addressed, but we heard not a hint from the Labor opposition that this country might be facing some dark days. So that is Paul Kelly. I would also like to quote Adam Creighton, the economics contributor to the Australian. Adam says, in a very, very informed article in the Weekend Australian on 26 October this year: Australia's apparent immunity to the economic travails of Europe and the US rests mainly on China's powerhouse economy and its demand for our resources. This conveniently papers over an economy beset by excessive regulation, public spending and federal dysfunction. This is an economy that was presided over for six years by the now Labor opposition, and we heard not one word in the previous speaker's contribution that there was a problem. Adam goes on to say: Resource revenues are tipped to recede, leaving Australian governments' growing structural deficits starkly exposed. The RBA is anticipating a slump in mining investment and early signs other sectors will take up the slack aren't promising. Unemployment continues to edge towards 6 per cent and investment levels outside mining, as Reserve Bank deputy governor— Senator Gallacher: Mr Deputy President, I rise on a point of order: may I ask that the senator address his speech to the chair. The DEPUTY PRESIDENT: He has been largely addressing his speech to the chamber, and I noticed he is acknowledging the gallery, but Senator Smith you have the call. Senator SMITH: I would be very, very pleased to share my contribution with you, Mr Deputy President. I will restart the quote: Unemployment continues to edge towards 6 per cent and investment levels outside mining, as Reserve Bank deputy governor Phil Lowe pointed out this week, are at 50-year lows, despite rock-bottom official interest rates. So we have inherited the frontbenches, the Treasury benches, and we know there is a problem. The Labor Party, the opposition—full credit to the small concessions that Senator Moore made in her contribution—are still blind to the fact that our country has a problem. I just want to go back to Senator Moore's contribution where she reflected on the fact that we should start where we intend to finish. When we want to understand the motivation of our colleagues opposite, I think it is important to understand where they finished on 7 September. This might give some insight into their lack of willingness to understand and appreciate and acknowledge the serious economic predicaments they have left our country. So where did the Australian Labor Party finish on 7 September? The coalition, in contrast to Labor, had swings towards it in every state and territory. The coalition finished well, achieving a majority of the two-party preferred vote in all six states for the first time since 1977. Where did Labor finish? Labor reported its lowest primary vote in 100 years. The Greens, Labor's friends in government, had their worst Senate vote in three elections. In my state of Western Australia, Labor's primary vote crashed to just 28.7 per cent. Senator Gallacher, are you grimacing? Senator Gallacher: No, no. Senator SMITH: Oh, right. The Liberal Party's primary vote in Western Australia, by contrast, was 47.3 per cent. I am proud to share that this was the highest across the country. When you look around electorates across the country, the coalition won 51 seats on the primary vote alone. Where did Labor finish? Labor won just seven seats on the primary vote. This resulted in a clear mandate for the Abbott-Truss coalition government, and I will come to that at another time in another debate in this place. So we can see Labor does not want to admit there is a problem, but it is making some progress minute by minute. Unfortunately, we have not seen much imagination from Labor in the past two days. In question time, this very issue was asked of our leader Senator Eric Abetz, the Leader of the Government in the Senate. He was asked this question by Senator Wong: 'I refer to the Prime Minister's election commitment and his absolute assurance to the Australian people that this government would not make cuts to health and education.' It sounds very familiar. It is what we are talking about today. But the Labor opposition was not satisfied with yesterday's answer and they have brought the same issue back to the chamber today. The message will get through over time, I am sure. Senator Abetz's contribution in response to Senator Wong's question was: 'This government has every intention of abiding by its election promises.' Could it be clearer? 'This government has every intention of abiding by its election promises.' Senator Abetz went on to say: 'It really does come as a shock to those opposite'—those in the Labor opposition—'that we can have a government in this country that has every intention of abiding by its election promises.' In relation to health and education, which we are talking about here this afternoon, we have said that the totality of the moneys made available in those portfolios would remain. What we have also said is that we will look at the quality of the spend in areas to ascertain whether money can be redirected and as a result get even better results but within the parameters of those two portfolio areas. We were very specific in relation to that. If I might go out on a limb, I think that Senator Moore might have heard the answer yesterday and that was part of her small concession this afternoon that we may actually be able to achieve better value for taxpayers' money without spending less. Senator Abetz did go on to say that the Labor opposition should be very cautious about judging us by their own standards. So today we are talking about health and education cuts. I thought I might share the perspective of the previous government's health minister and bring to the Senate chamber some views, some learnings, that Senator Moore's esteemed Labor House colleague Nicola Roxon shared just recently at the John Button memorial address. This gives us a powerful insight. Senator Cormann: Kevin Rudd didn't like the speech much. Senator SMITH: That is exactly right, Senator Cormann; it is not a speech that would have been received by Kevin Rudd and his peers very well. I might share some of the attitudes of the former minister for health, given that today's discussion is about health and education. Senator Gallacher: You must have run out of substance. Senator SMITH: Please do not encourage me to rush to the part of my speech which talks about the parlous state of Labor Party finances. Would you like me to rush to that part of my speech now or are you happy to hear what the former minister for health had to say about the performance of the former Prime Minister and indeed the government? I am quoting from the John Button memorial address of 16 October 2013: Kevin had a fatal attraction to everyone else's problems. He never saw a problem that he didn't believe he should try and fix. She went on to say: [Kevin] also had an overwhelming inclination to focus on minutiae as a way of avoiding the big, harder decisions. So the Labor opposition would like to come to this place to talk about the spectre of possible health and education cuts when in actual fact their government was dysfunctional and full of waste. Honourable senators interjecting— The DEPUTY PRESIDENT: Order! Only one senator is entitled to speak and that is Senator Smith. Interjections across the chamber are disorderly. Also, Senator Smith, could I remind you to direct your remarks to the chair. Senator SMITH: Mr Deputy President, just two more quotes and then I would like to get to the substance of what is a very important issue in correcting our nation's finances. This one is important because it goes to the heart of process and how the former government functioned. As a consequence of this poor process there was clearly waste. The former health minister said: In addition to the lack of Cabinet engagement on some big strategic calls, Cabinet was also misused by being asked to deal in enormous detail with material it could never hope to be fully across. This meant that many Ministers managed to be both frustrated about a lack of attention to some key areas as well as being exhausted by huge amounts of energy required on less significant matters. Nicola Roxon went on to say: There were some contentious issues— Senator Carol Brown: Mr Deputy President, I raise a point of order. The general business motion is that the Senate condemns the government—and I remind Senator Smith that he is now part of the government—for its failure to rule out cuts to health and education programs. That was the commitment that was given by Mr Abbott prior to the election, and now we see and we know that in relation to the Commission of Audit as announced by the Treasurer no area of the budget has been ruled out. The DEPUTY PRESIDENT: You are starting to debate the issue. You have raised a point of order and I am happy to rule on it. Senator Cormann. Senator Cormann: On the point of order, Mr Deputy President, the Labor opposition is clearly embarrassed by what Senator Smith is so eloquently— The DEPUTY PRESIDENT: Senator Cormann, you are also debating the point of order. Senator Cormann: Mr Deputy President, what Senator Smith is doing is comparing and contrasting the performance of the Abbott government with the dysfunctional, chaotic and incompetent performance in health and education by the Rudd and Gillard governments. Opposition senators interjecting— The DEPUTY PRESIDENT: Order on both sides! Senator Smith has been referring to the subject matter constantly throughout his speech. He is referring to other matters at the moment but he has been returning to the subject matter. You are in order and you can continue, Senator Smith. Senator SMITH: Thank you, Mr Deputy President. I left to the last the quote in regards to health issues from Nicola Roxon in October this year: There were some contentious issues and policy problems that ran for months, in some cases years, without there seeming to be a way to bring contentious issues to a head. There was no avenue for Ministers to bring genuinely difficult issues, where there were legitimately tricky calls to be made, to Cabinet for a real discussion. Health and climate change were the two longest running 'non-discussions' for the first term of Government, with some other contentious policies getting only cursory Cabinet approval at the last minute. There was a reticence by the Prime Minister for big strategic calls to be made by Cabinet, or sufficiently in advance to prepare properly. So it is no surprise that the Labor opposition in its contribution so far does not want to concede that there is a problem that needs to be addressed by a commission of audit. I would now like to turn briefly to the Commission of Audit and why it is important. As many will know, the National Commission of Audit's role is to assess the role and scope of government—that is a timely and necessary activity—and to ensure, most importantly, that taxpayers' money is spent wisely and efficiently. Certainly my colleagues on this side of the Senate chamber regard that as a high and important priority of any government. In addition to that—and this is a topic of great interest to Western Australian senators and to me in particular—the work of the Commission of Audit will specifically address the division of responsibilities between local, state and federal governments. Again, this is a timely and necessary activity, one that could have easily been undertaken in the last six years but for the chaos and dysfunction and waste that we saw; in the former minister's comments, that was not taking place. I would like to note a point that Senator Moore made in her contribution that is worthy of illumination, and that is that it will be, importantly, a public process as well as an internal government process. I would expect that the various stakeholders and interest groups across the country will make a sizeable contribution to that. Importantly, the discussion will be about how we can do more with less, because it is not necessarily correct to suggest that because you spend more you have a better outcome. I can point to no end of public policy areas in this country where taxpayers think, quite rightly, that huge sums of money have been spent with little or no positive outcome. Importantly—and I think this speaks to the efficiency with which the government is embracing its new responsibilities—the initial report will be provided to government at the end of January 2014, at the end of January next year, so that the final report can be incorporated into this government's first budget. That is an important element in the progress of this important initiative. I am also pleased to say that the Commission of Audit includes a prominent Western Australian in Mr Bob Fisher. I am sure that Mr Fisher will make an outstanding contribution in making sure that the issues and interests of Western Australia taxpayers are certainly front and centre in this review. It is important to identify the fact that for the first time in 20 years we are having a commission of audit of this kind. The objective is a clear one: to deliver a surplus of one per cent of GDP prior to 2023. By any measure that is a noble objective and one that is in our national interest. I would like to hear my Senate colleagues on the other side embracing that as a sound objective for the Commission of Audit. Before I move on it is important to recognise that there are 932—almost 1,000—federal agencies in our Commonwealth that will be part of this review. By any measure that sounds like a large number of bodies. It is worthy to undertake an inquiry into whether or not they are all necessary and whether or not they are all doing what is required of them in the most efficient and effective way. We also need to recognise this fact: that 76 per cent of the budget is spent on health, welfare and social services alone. It is right to have a discussion, to have a process, where we say, 'Are we doing things as effectively and efficiently with taxpayers' money as we possibly could?' To suggest for a moment that the world in 2013 should be the same as the world that existed in 2007 to 7 September 2013 is absolutely ridiculous. In the contributions that follow I hope there will be sensible, reasoned discussion and that people will be able to point to the merits of this particular process in reforming our nation's finances so that we can put ourselves in the best position to capture the opportunities which exist for us not only in the region but globally. I hope that as a parliament we will all be able to embrace that and, importantly, start to think out of our box, out of our ideological prisms, so that we can get the best for the Australian community through this particular process. I have every confidence that, when that interim report is provided to government in January, and when the budget is presented next year, even those— (Time expired)