I will just shake the dust off these speaking notes! They've been sitting on my table for a while, waiting for the Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017 to come before the parliament for further debate. The optimist in me would take from that that perhaps the government was reconsidering the wisdom of this particular bill, but the realist in me recognises that it's probably more a reflection of their lack of faith in their capacity to get support across the parliament for the bill. Regardless, when this proposed enterprise tax plan was first announced, my Labor colleagues and I made it very clear that we would oppose it, and that position has not changed.
I stand here today, finally speaking on the bill, still opposed to what is a very unfair and ill-judged proposal before us. The legislation we have here is obviously seeking to implement the remainder of the government's company tax cut plans. This particular part of that plan would provide companies with a turnover above $50 million with a tax cut to 25 per cent. It's costing $600 million over the forward estimates and $36.5 billion over the medium term. Over the medium term, the government says this element of their company tax cut plan will cost $36.5 billion, with the cost of the full company tax cut plan being $65.4 billion. Indeed, in the final sitting week before the budget, the government managed to successfully pass part of its company tax cut plans through the Senate. It passed the tax cut, to 25 per cent, for businesses with a turnover of up to $50 million. Consistent with the position that we've had on the company tax cuts presented in this bill, we will be opposing it.
The bill is, in fact, the ultimate example of how wrong this government's priorities are. It is about looking after those that need it least, slugging those who are already struggling, and not addressing problems that are frustrating individuals, communities and businesses. I want to touch on a few of those, because these sorts of significant budget decisions, particularly in a constrained fiscal environment, are a real reflection of where the priorities of a government lie. This government has decided, from a trickle-down theory of economics, that giving cuts to big business is going to benefit the community. I would argue that the things that have been passed over, cut and ignored are far more significant to those in the communities that we represent. First up, obviously, are the penalty rate cuts, which have had, and continue to have, an impact on individuals and their families, and a flow-on impact on discretionary spending and businesses. I would just like to ask members of the parliament to look at the most recent Australian Bureau of Statistics report on retail turnover, which had a 0.6 per cent fall in August. This is a significant fall—I think, in fact, it's the largest fall since about 2013—particularly across areas such as food retailing; cafes, restaurants and takeaway food services; household goods; and clothing, footwear and personal accessories.
What's happening in our communities is that people have a dwindling discretionary spending budget. Their wages have been flatlining for a long time. If they rely on penalty rates—one member of the family might work on a Sunday, for example—to bring them in a bit of extra money, they have now had that severely cut. Under these circumstances—let alone the obvious issue that we've all been debating in this place around the growing hit from energy prices on the household budget—the amount of money that people have left over after paying for their basics, their food costs, their education costs and their housing costs is, no doubt, under huge pressure. The money that they, as locals, have on the Saturday to say, 'Let's go and have some dinner at the local restaurant,' or to say to the kids, 'Come on. We'll go and buy a new outfit for summer,' has been severely hit. The flow-on of that is a hit to our local small businesses, because that's where the locals shop. This blind adherence to attacking wages is completely oblivious to the flow-on impact that has on the movement of money in our local communities and, particularly, to our small businesses. As I said, we're seeing that in the ABS reports on retail turnover.
The other area the government has cut is school funding. They cut it, then they restored part of it, but there is still a significant cut in place compared to what was promised to the Australian population at the 2013 election, when both major parties had a particular position. We've stuck to ours; the government didn't stick to theirs. What that actually means in my own seat is a real cut to the capacity of my local schools to be able to implement targeted, specific, tailored programs to ensure our young people are competitive in the current economy. In my seat of Cunningham, there is $15 million less available to my schools as a result of the government's decisions.
We often talk about money, but one of the important things with the original Gonski reform proposals was that it tied the state, Catholic and independent sector school authorities to a range of performance requirements. When Mr Abbott won the election, became Prime Minister and walked away from the Gonski commitments, the government also did away with all the ties around that funding that required performance across a whole lot of areas, so we don't have a plan for improvement in our schools. Issues such as graduating from high school, going on to further education, literacy and numeracy support and teaching quality—all of these things that we know are critically important—should be priorities for this government, not the bill before us.
If we go beyond the school years, obviously it is very important that our students get postsecondary education. We know that the changes that are occurring in the workforce mean there are going to be very few jobs for people who come out of school and don't get a further qualification. At the moment, the two main pathways for that are our fabulous TAFE and vocational education sector, and our world-class universities. I think the government's cutting of $500 million out of the vocational education sector when it abandoned the national partnership agreement is really a sad indictment of the priorities, and we have seen that flow through to increased costs and pressure on the TAFE sector at the state level. There have been course closures, the endangered future of campuses and increased course costs that are locking out students. Instead, we should be investing in capacities and pathways through the TAFE system. As a former TAFE teacher but also as someone who understands how valuable a vocational education can be, I will continue to fight on that front.
Our university sector is under significant pressure as well. It is not just the universities themselves, which are facing significant direct funding cuts, but also our students at universities. They are going to have to pay higher fees. They are going to have to pay their loans back at a much lower level of pay—down to $42,000 from the previous $55,000. All of those pressures are being added to university students, I have to say, at a time when they're going out, starting their adult life and maybe looking to start a family or take out a mortgage. They are carrying significant financial burdens through the loans that they have to pay back. Really, a bit of time and a bit of space to breathe when they are earning at those low-income levels is particularly important to enable people to start their adult life. As a mother of adult children, I'm sure we don't all want them living at home forever, so we do need to make sure that our policy settings enable young people to start their lives.
The other issue—and it's been significant in my area—is the one I touched on around housing affordability. The government could be taking action much more significantly on housing affordability. I want to draw the parliament's attention to the Domain Regional House Price Report that has recently come out. In Wollongong, house prices jumped 16.7 per cent in the year to December 2016. That put Wollongong as the third most expensive city in Australia for housing. This is an extraordinary outcome. It's great for people who have housing—they look at it and see its value growing—but for our young people, who want to actually be able to stay in their local area, start a family and buy a house, as I said, this is becoming an increasingly difficult challenge.
We need policies. Labor has announced a range of policies around capital gains tax concessions and negative gearing to help make these young people more competitive against the investors. We want people to be able to buy their first home, not to be constantly outbid by people buying their seventh or eighth or ninth investment property. We particularly want those incentives directed towards new housing stock, rather than just buying up what's already available. Labor also has a range of other agreements and reforms that we have proposed around housing affordability and, importantly, homelessness as well.
There is the NBN mess. The government could actually do something about the mess of the NBN. It was fascinating to see the Prime Minister in parliament this week basically boasting about how successful it's been. I can only presume his phone's not working, because even members of his own side are reporting that they're having a hell of a time in their local communities with the NBN rollout. The Prime Minister attempted to say in answer to a question that it was all the fault of retail service providers. I'll tell you what: we should be onto retail service providers. There's some activity that absolutely needs to be called out about transparency in the provision of services. A lot of people—in fact, I surveyed my electorate and I was astonished at the number of people—who took the time to write knew they were on fibre-to-the-node and their problem was reliability, because every time it rained there was water in the pits and their lines went down. People know exactly what the problem is, and in so many cases it's the technology that the Prime Minister, in this former role as the communications minister, rolled out. People have frustrations with that.
Investing in some local infrastructure would be a good alternative because we know that quality infrastructure can drive economic diversification. It's actually about jobs and growth, unlike discredited trickle-down tax concepts. In my own area, for example, the Maldon-Dombarton rail link is currently being promoted by the Illawarra Business Chamber. It's been a project that I've campaigned on for over 10 years. It will be a game changer for our region by linking us with south-western Sydney and the port of Port Kembla. If we could have just one project, it would be great to see the government get behind that.
What we have before us is a bill that has all the priorities wrong. It's based on discredited economic theory, as other colleagues in this debate have been pointed out—a theory that has been proven across the world not to work and has been discredited by even conservative economic bodies, people such as the OECD, the World Bank and so forth. And we are supposed to believe that giving this cut to big business will mean that the improved financial position they find themselves in will automatically translate into jobs. Of course, the first thing they think to do when they are in that improved financial position is to go and employ more people! Well, they don't. Businesses employ more people because they have more work to be done. It is actually about increasing the demand, and that demand relies on people in the community having the capacity to spend and to be out supporting their local businesses.
This bill must be opposed, because it's discredited; it's unfair; and it's a reflection of the wrong priorities in a fiscally constrained environment to be going in this direction. I have to say, when I surveyed my electorate on this direct question, the vast bulk of people who responded to that question did not agree with this particular tax cut. In fact, they outlined their priorities, which I have gone through today, and that's where the government's focus should be.