The Rudd Government refers to the federal Executive Government of Australia of the Australian Labor Party from 2007 to 2010, led by Kevin Rudd as Prime Minister. The Rudd Government commenced on 3 December 2007, when Rudd was sworn in along with his ministry. This took place nine days after the defeat at the 2007 federal election of the Howard Government, which had consisted of John Howard and members of the Liberal and National parties. The Rudd Government concluded on 24 June 2010, when Rudd stepped down from the leadership of the Australian Labor Party and was succeeded by his Deputy Prime Minister, Julia Gillard.
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Treasurer Wayne Swan delivered the Rudd government's first budget in May 2008, which he said was designed to fight inflation.[1] Total expenditure, as a share of gross domestic product (GDP), was lower than at any time of the previous government, despite including many of the expensive election promises for "working families".[2] The projected surplus of 1.8% of GDP, or $21.7 billion, exceeded the 1.5% target set by the government in January. Labor supported improving the federal-state funding process through a reform of the Council of Australian Governments.[3] Three nation-building investment funds were established—the infrastructure fund, "Building Australia", was earmarked $20 billion of federal funding. Education received $10 billion as part of Rudd's "education revolution", while health also received $10 billion.[4]
As part of its response to the financial turmoil of the Global Financial Crisis, the Rudd government announced in October 2008 that it would guarantee all bank deposits. The government initially ignored RBA advice to cap the guarantee. After serious distortion of the Australian financial system, the government modified the guarantee, requiring a premium to be paid for amounts over $1 million.[5][6][7]
With the economy facing its biggest slowdown since the early 1990s and facing recession, the government announced an economic stimulus package worth $10.4 billion.[8][9][10]
A second economic stimulus package worth $42 billion was announced in February 2009. It comprised an infrastructure program worth $26 billion, $2.7 billion in small business tax breaks, and $12.7 billion for cash bonuses, including $950 for every Australian taxpayer who earned less than $80,000 during the 2007-8 financial year. At the same time the Reserve Bank cut official interest rates by 1 percent to 3.25 percent, the lowest since 1964.
The package was welcomed by state governments and many economists, as well as the OECD. The Malcolm Turnbull-led coalition opposed the package, stating they believed further tax cuts on top of current tax cuts planned for each financial year over the next few years was a better way to prevent a recession.[11][12][13][14][15] The package was passed in the Senate on 13 February with support from minor parties and independents following amendments that reduced the cash bonuses in the package in order to fund investment in the environment and water.[16]
National accounts released on 4 March 2009 which correspond to the December quarter showed that Australia's non-farm economy was in recession, according to the government's definition of the term.[17]
The 2009 Australian federal budget was released on the evening of 12 May 2009. Labor decided not to extend the investment allowance, and it was phased out by the end of the year. Other measures to support employment—augmenting a first-home buyer's scheme— were initiated.
The March quarter national accounts showed that the Australian economy grew by 0.4%,[18] a number not foreseen by many until the positive balance of trade statistics released the day before. The main contributors to this result were the large fall in the current account deficit and increasing household consumption. Apart from the manufacturing sector, the Australian economy avoided a technical recession. Reserve Bank economists endorsed the first two phases of stimulus a year later, saying it was "undeniable" that government spending had supported the economy.[19][20][21] RBA governor Glenn Stevens remained cautious of American-style fiscal policy, casting doubt on the idea that Australia should have a higher inflation target in order to repair its public accounts.[22]
The Rudd Government established a review of the tax system by the head of the Department of the Treasury, Ken Henry. Among other suggested reforms recommended by the Henry review and adopted by the Rudd Government was a Resource Super Profits Tax on the extractive industry. The proposal met resistance from mining industry bodies and mining companies, and the proposal was later heavily modified when Julia Gillard replaced Rudd as Prime Minister.[23][24]
In December 2007 the Minister for Defence, Joel Fitzgibbon, ordered the Department of Defence to develop a new white paper to guide Australia's defence policy. While the white paper was originally due to be completed in December 2008, it was delayed until 2009 due to the volume of work required.[25] The white paper, entitled Defending Australia in the Asia Pacific Century: Force 2030, was released on 2 May 2009 and outlines a significant expansion to the Australian Defence Force, intended to maximise the military's capacity to act independently in Australia's region.[26]
Other defence policies enacted by the Rudd Government include canceling the contract to purchase 11 Seasprite helicopters in March 2008,[27] and beginning the process of planning the replacement for the Navy's Collins class submarines.[28]
The Rudd Government altered the number of Australian troops deployed to Afghanistan and Iraq. The 550 combat troops[29] deployed on an overwatch mission in central southern Iraq were withdrawn in mid-June 2008, fulfilling an election promise. This reduced the Australian Defence Force presence in the region to 800-900 support personnel, including 440 either on the ground in Iraq or patrolling the coastline.[30] As of early 2009 around 150 support personnel remained in Iraq.[31] In contrast, the Australian force in Afghanistan was expanded, with Rudd announcing in April 2009 an increase from 1,100 to 1,550 personnel.[32]
Fitzgibbon became the first Rudd Government minister to resign on 4 June 2009. He quit after he admitted that meetings held between his brother, the head of the health fund NIB, and defence officials concerning business opportunities had breached the Ministerial Code of Conduct.[33] John Faulkner was appointed to succeeded the Defence portfolio.
One of the Rudd Government's key proposals in the 2007 election campaign was the implementation of an "education revolution". This was to include the provision of computers for every school student in years 9-12 and the implementation of a national curriculum.[34][35]
In 2010 a planned scholarship for disadvantaged university students was cut by 36% and an estimated 150,000 students were still waiting for the changes to pass parliament two weeks before the start of the academic year in March, as a result of disagreements between the government and the Liberal-National opposition, supported by independent senator Stephen Fielding. The government scrapped the old scholarship system that helped around 21,000 students before the bill was passed for the new. One university in Queensland topped up its foodbank, anticipating that the number of students regularly going without food would increase.[36]
In 2009 the Coalition and Senator Fielding had defeated the changes to the Youth Allowance and Austudy system, saying they were unfair to rural and regional students and would leave 26,000 worse off.[37] The bill would have tightened regulations around the work requirements these students needed to fulfill to be considered independent from their parents. Commentators claimed the old system had been rorted by some wealthier families, while others said it was a genuine help to those in need.[38]
In order to win the support of the Greens and Senator Nick Xenephon to pass the bill, Education Minister Julia Gillard loosened some aspects of the changes to rural arrangements, but cut the first year of the scholarships by $820, from $2264 to $1434, in order to pay for these changes.[39] The impasse meant an estimated 150,000 students were still waiting in Mid-February for the bill to pass in time for the start of the Australian academic year.[38]
In opposition, Rudd called climate change "the greatest moral, economic and social challenge of our time" and called for a cut to greenhouse gas emissions by 60% before 2050.[40]
In October 2007, the then Prime Minister John Howard said that Labor's policy on climate change negotiations had no significant differences to the Liberals' policy.[41] At the time, econometric research suggested that providers of carbon credits which had been accredited under the voluntary Australian Greenhouse Office trading scheme were capable of stabilising emissions, such was the demand from households for carbon-neutral products.[42]
On 3 December 2007, hours after being sworn in, Rudd signed the Kyoto Protocol.[43] Rudd stated that:
Australia's official declaration today that we will become a member of the Kyoto Protocol is a significant step forward in our country's efforts to fight climate change domestically - and with the international community.
After a year of accounting of "emissions" and "sinks", the government published its climate change policies in a White Paper released on 15 December 2008. The White Paper mapped out a plan to introduce an emissions trading scheme in 2010 and recommended a target range for Australia's greenhouse gas emissions in 2020 of between 5% and 15% less than 2000 levels. It drew criticism from environmental groups and the Federal Government's climate change advisor, Professor Ross Garnaut. Garnaut said the government's conditional 2020 emission targets were too low, and said the planned assistance measures for Australian emissions intensive industries pose "profound" financial risk for the Government.[44] In May 2009, Rudd announced an increase of the scheme target to 25% less than year 2000 levels, but that the introduction of the scheme would be delayed until July 2011.[45]
In June 2010, the environment minister, Peter Garrett, revealed in an interview with Sky News that he first learned of the change in Government policy when he read about it, published in a newspaper after being leaked by a Government source.[46] This followed damaging comments by Professor Tim Flannery, a strong supporter of Labor's scheme, that he felt "betrayed" by the Prime Minister's decision.[47]
The Government articulated its stance on energy management in general in October 2009. Writing in The Australian Financial Review, the resources minister, Martin Ferguson, acknowledged that withholding resources such as coal (either black or brown) is unlikely to do much to assist in reducing emissions or alter demand.[48] Instead the government hopes to become a world-leading investor in carbon capture and storage technologies, and is expanding Australia's natural gas production, while continuing to support a raft of new coal mining projects worth about $11 billion.[48][49] The government also has plans to build up the entire renewable energy industry.
The Rudd Government attempted to increase Australia's influence internationally.[50] Prime Minister Rudd announced in March 2008 that Australia would seek a non-permanent seat on the United Nations Security Council for 2013-14. Australia last held a seat on the body in 1985-86.[51] A year and a half on from the announcement, the Age newspaper reported that $11 million had been spent campaigning for the seat and had added twenty-seven votes for Australia; the majority of the votes came from small island nations in the south Pacific and six African nations.[52]
On 8 February 2008, the Rudd government ended the previous government's offshore processing policy called the Pacific Solution.[53] In May 2008, the Asylum Seeker Resource Centre said the Department of Immigration and Citizenship was rejecting asylum seeker applications at a higher rate than under the previous government, saying 41 of 42 applications had been rejected.[54] The minister responsible, Chris Evans, claims a denial rate of 77 percent, based on his acknowledgment that of a caseload of 730 appeals, he has intervened in 170.[55]
In July 2008, the Government announced changes to mandatory detention policies, ceasing the detention of children and making legal advice available to unauthorised arrivals.[56][57][58] In April 2009, responding to an increase in illegal entry vessels and a fatal explosion due to sabotage on one of these vessels, the government announced a new strategy of offering financial support to Indonesia to assist in their efforts to reduce people smuggling to Australia.[59][60][61]
Unauthorised boat arrivals in Australia increased from 161 people in 2008 to nearly 3000 people in 2009.[62] In response, Rudd had a conversation with the President of Indonesia on 20 October to intercept vessels bound for Australia. The government had made provisions to house refugees in spare demountable housing on Christmas Island, as the detention centre there was becoming crowded.[63] In 2010, as the Christmas Island facility reached its official capacity, the United Nations High Commissioner for Refugees noted in its annual report that despite global refugee numbers remaining steady, there was a 29% increase in asylum claims for 2009. This supported claims that the government's policy changes had led to the increase.[64]
In October 2009, the MV Oceanic Viking was involved in an emergency operation rescuing 78 Sri Lankan asylum seekers in international waters within the Indonesian sea rescue zone. Those rescued were due to be landed in Indonesia, for transfer to an Australia-funded immigration detention centre on the Indonesian island of Bintan.[65] However, the asylum seekers refused to disembark until 18 November, following assurances of fast-tracked processing of their cases for resettlement.[66] In the Australian Parliament, Rudd described this assurance as "non-extraordinary".[67] According to Geoff Kitney, a Fairfax journalist who has covered immigration since the 1980s, his explanation of the terms of the agreement left the impression that, at the very least, he knew it would be difficult to show that the deal was not a cave-in.[68] The Sri Lankan government said the deal would encourage more people to risk the ocean journey to Australia.[62] A representative of the United Nations Commission for Refugees told The Australian newspaper that the deal was bad practice and would encourage similar behaviour.[69]
By May 2010 a boatload of refugees were arriving daily causing overcrowding on Christmas Island, West Australian Premier Colin Barnett has been told by Immigration Minister Chris Evans that up to 90 asylum seekers will move to an unused mining camp near Leonora, which is more than 800 kilometres north-east of Perth, within days.[70]
Despite an election promise to process 90 per cent of claims for protection visas within 90 days, Immigration Department figures in October 2009 showed no improvement in the speed of processing claims since the change of government.[71] As a proportion of the immigration intake, Australia accepted fewer refugees in 2009 than it did at any time under the Howard government.[72]
The government has been accepting more refugees from regional conflicts as the number of Africans fleeing to Australia has declined. There has been a notable spike in Chin Burmese and Rohingya Burmese refugees being accepted from camps in Thailand and Bangladesh respectively. Almost 1400 Burmese refugees were accepted in the first six months of 2009.[73] They were quietly resettled in northern Brisbane, in spite of a nationalist backlash against refugees that was developing in Queensland.[74][75]
WorkChoices, the industrial relations regime introduced by the Howard government, was overhauled.[76] Rudd's 2007 policy included the phasing out of Australian Workplace Agreements over a period of up to five years, the establishment of a simpler awards system as a safety net, the restoration of unfair dismissal laws for companies with under 100 employees (probation period of 12 months for companies with less than 15 employees), and the retention of the Australian Building and Construction Commission until 2010. It retains the illegality of secondary boycotts, the right of employers to lock workers out, restriction of union right of entry to workplaces, and restrictions on workers' right to strike.[77] Rudd also outlined the establishment of a single industrial relations bureaucracy called Fair Work Australia, which will play a far more interventionist role than the Howard Government's Fair Pay Commission.[78]
Some unions claimed it to be "WorkChoices Lite", although the most fundamental elements were reversed.[79] Employer groups for the hospitality industry expressed concern over the legislation, suggesting more rigid and expensive wage and other outcomes with employees would be particularly difficult for many businesses to afford during an economic downturn.[80]
Construction of a national fibre to the node National Broadband Network (NBN) was a key ALP promise ahead of the 2007 election. The government advertised for requests for proposal to build the network on 11 April 2008 and the tendering period finished on 26 November after being extended from 25 July. The expert panel selected to assess the tenders found that none of them met the Government's requirements. As a result, the Government announced on 7 April 2009 that it was establishing a joint public-private company to build the NBN. Construction of the first stage of the network was planned to begin in July with the project being estimated to take 13 years to complete and cost $A43 Billion.[81]
As the parliament's first order of business, on 13 February 2008, Rudd read an apology directed to Indigenous Australians for the stolen generations. The apology, on behalf of successive parliaments and governments, passed as a motion by both houses of parliament, and was publicly well received; most criticisms were of Labor for refusing to provide victims with monetary compensation as recommended in the Bringing them Home report, and that the apology would not alleviate disadvantage amongst Indigenous Australians.[82][83] Rudd pledged the government to bridging the gap between Indigenous and Non-Indigenous Australian health, education and living conditions.[84] By signing the historic Close the Gap Statement of Intent, Rudd committed the government to achieving health equality in a way that respects the rights of indigenous people.[85][86]
One year after the apology, Michael Mansell, Amnesty International and stolen generations victim Marjorie Woodrow called for the government to provide reparations as recommended in the Bringing them home report.[87][88][89][90] In the first of the government's so-called 'indigenous report cards', delivered each year to parliament, Rudd said that new eye and ear health funding had been secured; noted that 80 houses for indigenous Australians had been built; said that the government had continued the NT Intervention; and gave his personal support to an initiative led by mining magnate Andrew Forrest to provide 50,000 indigenous jobs.[91]
One of the government's first reforms was to the maintenance of Indigenous housing, 95 per cent of which was federally administered. Many Indigenous housing organizations are being wound down, with state and territory governments responsible for managing of all fields of community housing.[92] Currently, community housing in the Northern Territory has a life cycle of less than ten years.
In May 2009, the Rudd government handed over financial responsibility for 500 outstations – small communities in the Northern Territory – to the state government.[93] Under a policy called A Working Future, the state set out $160 million to develop 20 "Territory growth towns" into hubs for surrounding communities.[94] The towns would become economic and service centres, delivering all education and health services for the region and forcing people to move to be treated for diabetes, kidney and heart problems. Acting upon the advice of Patrick Dodson, the state agreed to maintain the $32 million of federal funding already in place for outstations. However, no new settlements would be approved, spelling an end for the Return to Country movement.
After two and a half years, the government's $672 million Strategic Indigenous Housing and Infrastructure Program (SIHIP) has built only 11 of a planned 750 houses, and further funds will be required for the project to retain its 2013 target completion date.[95]
In April 2008 the government proposed greater recognition of LGBT rights in Australia by announcing reforms to the recognition of same-sex relationships in taxation, health, employment, superannuation, aged care and other areas. However, these changes would not affect marriage, IVF access, and adoption rights. Originally, 58 Commonwealth laws where gay couples faced discrimination were identified in HREOC's year-long inquiry, "Same-Sex: Same Entitlements Inquiry", which was tabled in Parliament in June 2007.[96] An audit conducted by the government in early 2008 found around 100 Commonwealth laws where gay couples faced discrimination.[97][98] The last of the legislation to remove the discrimination that was identified in the reviews passed the Senate in November 2008.[99]
In February 2008 Rudd announced the Australia 2020 Summit, held from 19–20 April 2008, which brought together 1000 leading Australians to discuss ten major areas of policy innovation.[100] The summit voted in favour of a plebiscite on Australia relinquishing "ties" to the United Kingdom followed by a referendum on the model for an Australian republic,[101] a bill of rights and the re-formation of an Indigenous peak representative body similar to ATSIC, which was abolished by the Howard Government in 2005.
In April 2009, Rudd announced that of the 962 recommendations of the summit, the following nine would be adopted:[102]
See also: Australia 2020 summit final report, Government response to the Australia 2020 Summit
On 23 June 2010, Kevin Rudd called a press conference announcing that a leadership ballot of the Australian Labor Party would occur on the morning of 24 June 2010, with the candidates being himself and Deputy Prime Minister Julia Gillard.[103] This followed weeks of speculation that senior members of the ALP were beginning to lose confidence in Rudd and would back Gillard in replacing him if necessary. On 24 June 2010, Rudd withdrew his candidacy and resigned as party leader, leaving Gillard to take the leadership unopposed. Gillard was then sworn in as Australia's first female Prime Minister on the same day, with Treasurer Wayne Swan being appointed Deputy Prime Minister.[104]
In her first press conference as Prime Minister, Gillard said a good government had "lost its way" and she had a responsibility to step up and make sure it got "back on track".[105] In the aftermath of the leadership challenge, Bill Shorten, former trade union leader, and key Parliamentary member of the ALP Right Faction, nominated the government's handling of the insulation program; the sudden announcement of change of policy on the Carbon Pollution Reduction Scheme; and the way in which they had "introduced the debate" about the Resource Super Profits Tax as the key considerations which had led to a shift in support from Kevin Rudd to Julia Gillard as leader of the party.[106]
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