When interest rates were at three per cent those opposite declared it to be a national emergency. Well, if three per cent is a national emergency, then one per cent is a national crisis, an absolute crisis, on their watch. They are now in their third term and they have no-one else to blame but themselves. When the Reserve Bank made that statement today, they said:
Consumption growth has been subdued, weighed down by a protracted period of low income growth and declining housing prices.
What have they identified? We have low consumption growth. We have economic growth at around 1.8 per cent on an annual basis, which is well below trend. We have wages that are decreasing. We know that that's occurring in real terms. They are stagnating. The Reserve Bank has identified wage stagnation as a major issue in the economy. So, what's the solution? It is to decrease people's wages, as of yesterday. From yesterday, 700,000 Australians will lose their penalty rates: low- and middle-income earners who work in hospitality; people who are building cleaners; and people who work on weekends and late at night to put food on the table for their families, to put petrol in their cars, to pay their school fees and to pay their rates. They copped a cut as a result of this government's contempt—contempt!—for working Australians. So, don't come in here and speak about the rights of working Australians. The Reserve Bank has said that they, and monetary policy, can't do all the heavy lifting—once you hit a one per cent cash rate, there's not far to go. They have said that it is time for all arms of policy to be used together. We agree with the Reserve Bank.
At the moment we have a trifecta from this mob. On top of the pathetic growth figures, we have low wages, weak consumption and weak productivity. At the moment, in their third term there are no economic indicators of which they can be proud. What is Labor's response to that? Our response is to be economically responsible. It is to put the national economic interest before politics.
Those opposite are focused on what will happen in 2024-25. I say, the Reserve Bank of Australia says and every economist who knows anything about what is happening in our economy says: the time for action is right now, not in five years time. Now. That is what is required and that is what we are focused on. That's why, under Labor's proposals, put forward constructively in a spirit of cooperation, you will see more tax cuts sooner with the amendments that we will move tonight. And if the government vote against Labor's amendments, they'll be saying that they don't think all Australians are deserving of a tax cut this term.
Those opposite speak about mandate. Look at the Treasurer's speech tonight with its absurdly, frankly, titled bill, which the government should be embarrassed by—that sort of Orwellian behaviour that it engages in. But the fact is it should say 'some tax relief so some workers keep a bit of their money', because not every worker is going to get a tax cut this term in this proposal, far from it.
Those opposite speak about aspiration. Well guess what? The cuts stop at $126,000 for this term under the bill that's just been presented by the Treasurer. If you earn a dollar more than that, you don't get a dollar, not one. You get absolutely nothing. Because it's not actually adjusting the scales—it's through the offset—you will not actually get any flow through. The only people arguing the case for those hard-working Australians who have done well is those on this side of the House, who are putting forward a proposition that would see every single worker get a tax cut, not after the next election, not after the one after that, but right now.
To the arrogance of those opposite: yes, they succeeded on 18 May, but they didn't get elected for life. The truth is that if politics was like an Aussie Rules game and this was Carlton-Hawthorn, then Carlton would be ahead at this stage by 78 to 68. But the thing about politics, unlike Aussie Rules, is that it doesn't end. The siren goes but there's another quarter and, in another three years, there's another one. Guess what? Scoring two goals is pretty easy, so don't get too arrogant, those opposite, because what you are suggesting is that you are prepared to hold up tax cuts today because of something that might happen in 2025. Is that really your position? Because you're the only people who are speaking about holding up tax cuts for Australians.
We on this side of the House are talking about bigger tax cuts sooner. That's our position. We're not talking about holding anything up, and that's why we facilitated debate in this chamber right now. The fact is that the government do have a choice if our amendments are carried. The government can choose national economic policy and the national interest or they can choose politics. But good luck arguing that when people realise that what those opposite are really saying is they'll hold up tax cuts if our amendments are successful in the Senate. We're up for that debate, frankly. We're up for a debate on national economic policy, we are up for a debate about what's required in the economy and we're up for a debate about putting firmly and squarely on the shoulders of those opposite the responsibility they have as a third-term government to deal with the national economic issues which aren't just about tax and a fair tax system but about wage stagnation. The government has no wages policy beyond getting rid of penalty rates. That's about productivity growth. It has no policy for productivity beside cuts to education, more cuts to TAFE, other measures as well, and an infrastructure plan that is also way off in the never-never.
So the amendments that we'll be moving before this House tonight will do two things, essentially. Firstly, they mean we will support—and we did support this before the election—stage 1. That provides, for those who earn up to $126,000, up to $1,080 of benefit. We think that's a good thing, because people, particularly at the lower end of the scale, will spend the money. That creates economic activity and supports jobs.
On stage 2, the Treasurer say it's good in 2022. I ask the Treasurer this: if it's good in 2022, why isn't it good in 2019, right now? It's right now that it's required. Our proposal of bringing forward that change to the 37 per cent marginal rate from $90,000 to $120,000 would mean that, from $90,000, an increase would be more cash in the hand and, up to $120,000, people would receive $1,350. But, because it's a change to the marginal rate, it will be a flat increase beyond that. So, if you are on $150,000, you'd get that $1,350. If you are on $250,000, you'd get it as well—the same amount. A tax cut for every working Australian is what we are proposing here. The government really has to put forward a case of why, if it's good to do that in 2022, it's no good in 2019—because today's alarm bells from the Reserve Bank of Australia indicate that stimulus is required right now.
Second, in terms of economic activity—and this, in part, would deal with some of the productivity growth—would be bringing forward the government's infrastructure investment plan. We're not arguing that the government should see sense and fund Cross River Rail in Brisbane, which is underway, or that Melbourne Metro should be fast-tracked for the economy. We are prepared to not even argue that case, because we know they don't like public transport. But we will say that the government could bring forward now their own proposals they have put forward in their plan for off in the future. They could bring forward now some of the work on the North-South road in Adelaide. They could bring forward the western rail line in Sydney through Badgerys Creek airport. They could bring forward stage 2 of the Mackay Ring Road. They could bring forward stage 5 of the Townsville Ring Road. They could bring forward some of the Perth METRONET projects. They could bring forward the Bridgewater Bridge in Tasmania. They could do that now, not off in the never-never.
I'll give you one example of the fraud that is this government's infrastructure package. During the election campaign, both sides of politics committed to upgrading the Linkfield Road. That's a road across the Bruce Highway. It runs between two marginal seats in which there was a bit of interest during the campaign—the seat of Dickson and the seat of Petrie in the northern suburbs of Queensland. I visited there and it is, indeed, a choke point. The government said that, yes, it would match the commitment that we made many months ago—about a year ago, indeed—to upgrade that particular project. But when the budget came down there were Senate estimates afterwards and we got the timeline for the projects. If you thought the tax cuts for 2024-25 were bad and on the never-never, the Linkfield Road project funding commences in 2026-27. It doesn't finish or open then; they dig a hole in 2026-27! Do you think those people who got the direct mail letters from the member for Petrie and the member for Dickson said: 'Oh, it's great! Peter Dutton is going to dig a hole in 2026'? I reckon they thought he was going to do it this term. We are saying: do it this term. You committed to it, so bring it forward—that's what we're saying.
When the government talk about the infrastructure package, it is way off on the never-never. Indeed, the Reserve Bank have explicitly called for infrastructure investment to be brought forward. They did it last month. They did it this month. They've been doing it for some time. The government has these figures. Even in the Governor-General's speech today, the East West Link was spoken about. That isn't going to happen. The Victorian government says it isn't happening. It's in the contingency fund. There's not a dollar of actual investment against a year, but it made the GG's speech. I mean, for goodness sake, get real. Forget fantasy projects. There are projects that need real funds, with real workers earning real money and producing real productivity benefits, right now. I say bring forward stage 2. Bring forward the infrastructure investment.
Now I come to our other amendment, which is about stage 3, the 2024-25 proposal that's going to help the economy now because in five or six years time someone will get some benefit. That's their proposal. We know in this chamber that, through the House and through the Senate, they've already flattened the tax levels in 2018. That has already happened. The level of 32.5c, down from 41c, to $200,000 has already been done—it's legislated. What's actually before this chamber is decreasing the 32.5c rate to 30c. And that has a cost of $95 billion. It has an annual cost in its first year of $19 billion. Now, think about a household budget. If you said to someone: 'Mr and Mrs Smith of Kooyong, you're going to have to save. You're going to get $95 less in your budget every week,' do you think they'd go: 'Oh, okay. That's okay. That's just $95 less we have,' and that would be it? No, they wouldn't. They'd have to work out what they could no longer buy. They'd have to budget for it.
We've asked the government to provide information about two things. The first is the distributional impact—basically, who benefits. They won't provide the information. The member for Melbourne—I won't often say that he's got a point—had a point earlier, because there's no information being given by the government about the distributional impacts that are made. The second thing is that they have to say what the response is. What cuts will be required to health, to schools, to aged care, to child care and to regions? What will the impact be of ripping that much money out of the budget on an annual basis? What's the plan? What's the impact? Where's the modelling?
This is a very significant change being proposed by the government. It is more than half a decade off into the future, and they say, 'We've got to vote on it this week.' I say to them: that's all about politics, not about good, sound economic policy, because if we're reminded of anything that the Reserve Bank did today it's the uncertainty of the economic times in which we live. Since May 2018, they have made a decision to cut interest rates twice in under two months. Did the government go to an election saying, 'Vote for us and we'll get interest rates cut twice in under two months'? What's the impact? They like to talk about people on retirement incomes. I tell you what, sunshine, people who rely upon interest rates to be at a certain level in order to survive and to do well just lost a lot of money. They just had a cut in their incomes today as a result of that Reserve Bank decision.
What we're also concerned about is that what we're dealing with in this legislation is the 2014 budget but in stealth mode, silently going across and bombing the household budgets of Australians. That is what this potentially does: bomb the budgets of Australians like a stealth fighter. That's what they're doing here, silently, not talking about the impact. They won't give us the information. They just say, 'Just vote for it down the track because we've been elected for life'—apparently. According to those opposite, there won't be an election in 2021, 2022 or 2024. They are there forever, according to them!
Mr McCormack interjecting—
Mr ALBANESE: The Deputy Prime Minister supports this concept of abolishing democracy! That is consistent with their approach towards debate on these issues. But the truth is this: whether you face north or south in this chamber, those of us who were privileged enough to be sworn in to this chamber—facing this way or that way, and I have done both—have an enormous responsibility. We have a responsibility to those who we represent. We also have a responsibility greater than that. We have a responsibility not just to our electorates but to the national economic interest.
Those opposite have a nonsense debate about aspiration. I understand aspiration. I regard myself as someone who aspired to a lot in life compared to how I began life. Australia provides that opportunity. I stand here, as the leader of the Labor Party, as someone who was born in a council house to a single mum. This country provides that opportunity, but we shouldn't take it for granted and we shouldn't play politics by saying that we know what the economy will look like in 2024-25. That really would be a triumph of hope over economic experience and economic reality. We are better than that, and the parliament needs to be better than that. We cannot just leap into the unknown, which is what the government is asking us to do. That's why we are putting forward responsible amendments in two forms. We would ask for the support of the crossbench, and we want to negotiate with the government. We want to negotiate not by trying to impose our positions but by trying to impose some economic common sense on this debate. At the moment, there hasn't been any of that.
The government suggests that they went out there, with a pamphlet—just show it to me—and by direct mail, and said, 'If you vote for us in 2024-25, we will decrease the rate from 32.5 per cent to 30 per cent.' They didn't do that. What they did was say that Australians would get a tax cut on 1 July, and they have broken that promise. Parliament was due to come back. At that time, they knew—because of what happened with the writs—that that wouldn't occur.
We, on this side of the House, are going to put the national economic interest first. We are not going to play politics. One things I have said is that I don't want to be known as the Leader of the Opposition; I want to be known as the Labor leader. We are being constructive. We're not just saying no. We wouldn't even be having this debate unless we were prepared to facilitate the legislation. Our amendments won't be successful in this House, but we will vote in this House for the legislation so as to facilitate its discussion in the Senate on Thursday. We also will agree that the House and the Senate should stay here, this week, until it gets done. The government have asked for our cooperation on that. We are being cooperative with regard to the procedures. Notwithstanding that, I think the member for Melbourne had a legitimate complaint to put forward.
We have not been intransigent about this. We have changed our position, since the election, about stage 2. We are saying two things. Firstly, when the economy is flatlining like it is and when the Reserve Bank have gone to two interest rate cuts in two months and are saying that they can't continue to do all of the heavy lifting, the bringing forward of stage 2 is a sensible proposition, as is the bringing forward of infrastructure investment. That isn't dealt with in this legislation, but the government has the capacity to do that. Secondly, we are saying that it should be separated out. We can have it through, and we can stop talking in the Senate, really quickly.
If we get through stage 1 and stage 2, you can come back with stage 3 whenever you like. You have many years to do it. There is a bit of time! I'll give you that big tip. You haven't got much of an agenda, so you have to fill in the time with something! This is an idea that I'll put to you, which you wouldn't have heard of before: why don't the government filibuster? We saw them do it in the last term. They actually filibustered in this chamber quite remarkably in order to avoid votes in this chamber. But we are being constructive and economically responsible. You have the opportunity of having more tax cuts sooner under our proposals, and you should be voting for them.