Appropriation Bill (No. 1) 2025-2026, Appropriation Bill (No. 2) 2025-2026, Appropriation (Parliamentary Departments) Bill (No. 1) 2025-2026

Senator DEAN SMITH (Western Australia) (19:38): I rise also to speak on Appropriation (Parliamentary Departments) Bill (No. 1) 2025-2026, Appropriation Bill (No. 1) 2025-2026 and Appropriation Bill (No. 2) 2025-2026. These bills provide the legislative authority for the Commonwealth to draw on the Consolidated Revenue Fund to finance the government's programs for the remainder of this financial year—roughly, the final seven-twelfths of 2025-26.

While not controversial in form, they are deeply revealing in substance. They expose a government that has lost control of its spending, abandoned fiscal discipline and lost sight of the intergenerational fairness that should underpin responsible budgeting. In 2024-25 the Commonwealth receipts totalled $717 billion, equal to 25.9 per cent of GDP, the joint highest in nearly 40 years.

That means that this Labor government is collecting more in taxes than at any time since 1986-87, when Bob Hawke was Prime Minister and the Howard-Costello reforms were still a decade away. Yet, despite this record revenue take, Labor still delivered a deficit. Payments in 2024-25 reached 26.2 per cent of GDP, up from 24.5 per cent when Labor came to office.

That additional 1.7 per cent of GDP equates to around $50 billion in extra annual spending every single year. Real spending growth hit 5½ per cent last year, almost triple the average under the Rudd-Gillard-Swan era and nearly five times the growth rate of the final coalition budgets. While Labor spends more, borrows more and regulates more, Australians work harder, only to fall further behind.

In just three budgets Labor has added $160 billion in new spending. That's roughly $16,000 for every Australian household. Worse still, the Parliamentary Budget Office confirms that Labor's policy decisions alone have added $37 billion to this year's deficit.

Had those measures been offset, the deficit would have been as low as $5 billion instead of the forecast $42 billion. When this government came to office, gross Commonwealth debt stood at $887 billion. Today it has already blown past $959 billion and is on track to hit $1.2 trillion by 2028-29, a record both in nominal terms and as a share of GDP outside wartime.

Servicing that debt now costs Australian taxpayers $26 billion every year or around $50,000 in interest every minute. That's money not going to hospitals, money not going to schools and money not going to roads. It's money going to bondholders because this government cannot live within its means.

When interest payments rise faster than spending on defence or aged care, as they now do, you know fiscal management has failed. So where did it all go? It didn't go to better outcomes.

It went to waste, bureaucracy and political vanity projects—projects including $620,000 on a speechwriter for the Prime Minister, $40 million on an advertising campaign for automatic tax changes and $4.4 billion in new regulatory compliance costs created by more than 5,000 new regulations and 400 new laws since Labor took office. At the same time, core services are struggling.

NDIS costs have blown out by $8 billion in just two years; aged-care spending is rising by eight per cent a year with no efficiency dividend in sight; hospital waiting lists are lengthening; and productivity, the true engine of sustainable prosperity, has fallen five per cent since 2022, its weakest growth rate in 60 years. This reckless fiscal expansion has consequences.

OECD data shows that Australia has experienced the biggest fall in living standards in the developed world. By spending at pandemic-level rates long after the emergency passed, Labor has kept inflation higher for longer. The Reserve Bank has said it plainly: government spending is growing very quickly and revenue is not as strong.

That high spending is one reason the RBA has held back from further rate cuts. It means mortgage holders across the country, especially in my home state of Western Australia, are paying more for longer. According to the latest data from the Domain House price report for the September quarter, Perth prices climbed 1.6 per cent, or $15,382, over the three-month period to a record median house price of $981,259.

That means the average family rolling off a fixed-rate loan is paying an extra $1,800 a month. So, when the Treasurer boasts about restraint, he should try explaining that to young Western Australians priced out of homeownership or to small businesses paying eight per cent on their overdrafts. Western Australia remains the engine room of the Australian economy, producing more than 45 per cent of our total exports, including iron ore, LNG, lithium, wheat and beef.

It is WA that delivers the revenue windfall that Canberra now squanders. Iron ore royalties, company tax from miners and income tax from FIFO workers together contributed over $90 billion in 2024-25, roughly one in every eight Commonwealth dollars. Yet, under Labor, WA families and businesses are being punished with higher costs, slower approvals and fewer housing starts.

This is not a state failing to pull its weight; it is a state weighed down by a government that cannot manage its finances or the national economy. A government running a deficit with record revenue is not managing; it's mismanaging. Australia needs a government that lives within its means, rewards effort, restores intergenerational fairness and controls reckless spending—a government focused on productivity, not popularity.

Australians cannot afford a government spending $50,000 a minute on interest while asking future generations to carry the debt for decisions they've never made. This is not just good economics; it's basic fairness. These appropriation bills fund the machinery of government, but they also reveal how profoundly that machinery has been misused.

Labor inherited record revenues, a strong economy and an opportunity to rebuild. Instead, it delivered record spending, record regulation and record debt. This government is running deficits not because Australians aren't paying enough tax but because it is spending too much of what they already pay.

West Australians, who generate so much of the nation's wealth, understand this better than most. They know prosperity cannot be taxed or borrowed into existence; it must be earned, managed and respected. Despite the fact that we are approaching the 50th anniversary of the Senate using its full authority and the powers that it has available to it, the coalition will not use this significant historical anniversary and block supply.

But we will use every opportunity available to us to make sure that we continue to make the case for better economic management and to hold this government to account for every wasted dollar, every missed opportunity and every unfair burden that piles onto the next generation of Australians. Australia deserves better than record revenue and record debt. It deserves a government that lives within its means.