Chris Bowen (Prospect, Australian Labor Party, Assistant Treasurer) Share this | Hansard source

I am trying to prove the point that those opposite think everything was going along just dandy. The other suggestion from the honourable member for Wentworth was that consumer confidence has nothing to do with international trends. You would therefore expect that Australia would be the only country which had experienced these types of falls in consumer confidence over the last few months. That is the logical conclusion from the honourable member for Wentworth. Well, let us check the facts. What has happened to consumer confidence in the United States of America? We have heard much from the member for Wentworth about how bad it is that consumer confidence is at the lowest level since 1992. And the Deputy Leader of the Opposition interjected to say that ‘it’s extraordinary’ that it is at the lowest levels it has been since 1992. Well, where do you think United States consumer confidence is at the moment? It is at the lowest level since 1992. Isn’t that amazing? Consumer confidence has fallen to the lowest level since 1992.

Consumer confidence is down in Europe, down in the United Kingdom and down in New Zealand, and it is all due, apparently, to the Rudd government! The people of Brussels, The Hague and Lucerne have been waking up saying, ‘I’m very worried about Wayne Swan and Kevin Rudd and what they’re doing to the international economy.’ The people of Auckland and Wellington have simultaneously been rising up and saying, ‘I wish Kevin Rudd would get petrol prices under control.’ The people of Minnesota and Connecticut have all been concerned, as they read the Daily Telegraph online, about what is happening in the Australian economy, and it has been affecting their consumer confidence! That is the proposition the honourable member for Wentworth seriously puts before the House today—that this has nothing to do with international trends, nothing to do with the international shock; it is all the fault of the Rudd Labor government. We are good but we are not quite that good, I must confess to the House!

In all seriousness, governments are looked to by their people to make a difference. We have seen oil prices at record levels throughout the world. I think the member for Wentworth would acknowledge that oil prices are at the highest level that they have been; they are at a record high. I think the member for Wentworth would acknowledge that those oil prices have flowed through to prices in Australia, Europe, the United States and every other comparable country in the world. I think the member for Wentworth would acknowledge that there are cost-of-living pressures in every country in the world at the moment. I think he would acknowledge that, or maybe he would suggest that inflation is a fairytale or a charade—I am not sure. I think he does acknowledge that inflation is high around the world. What do people do? They look to their government for leadership. They look to their government to put downward pressure on inflation. They look to their government to rein in public spending. They look to their government to get public spending under control.

It is a well-known economic principle that when you are in recession governments should spend more, and when you are booming governments should reduce their expenditure. But the previous government had the determined policy to spend their way out of the boom. That was their policy: ‘We’ll just keep spending through the boom.’ There were increases in government spending of 4½ per cent a year, on average, for the past five years—that was their policy. We have a different policy. We have got government spending back under control. We have reduced government spending as a percentage of GDP to its lowest level since 1989-90. What does the Reserve Bank think about that? We heard yesterday that the Reserve Bank board minutes—the official record of the central bank of Australia—note that, since their last meeting when considering what to do with interest rates, the federal government had brought down a budget which was ‘mildly contractionary’, contrary to the suggestion made by the honourable gentleman opposite.

The other thing that the Reserve Bank Governor said in a speech last week was that this government was letting fiscal policy assist monetary policy, that this government was allowing the automatic stabilisers in the economy to work. In his words, he said, ‘That was helpful’—the Australian government is finally getting fiscal policy to help monetary policy; the federal government is finally getting the budgetary process to put downward pressure on interest rates and downward pressure on inflation. Those guys opposite had been determined to spend their way out of the boom. They knew how to get out of the boom: ‘We’ll just keep throwing money at it,’ they said. That was their policy.

We have a slightly more rigorous approach. We have a policy of reducing government spending as a percentage of GDP to put downward pressure on inflation. They still just do not seem to get it. In the other house, as we speak, they are still trying to increase government expenditure. They are still trying to reduce government revenue, reduce the budget surplus and put more upward pressure on interest rates, perhaps to deliver another 25 basis point increase. The honourable member for Wentworth, based on his previous experience, would no doubt say that the impact on the community has been overdramatised: ‘It’s not that bad an increase in interest rates. It doesn’t have that much of an effect,’ he says, ‘It’s all overdramatised.’ The mortgage holders of Western Sydney do not think it is overdramatised. Small businesses struggling with debt to run their business do not think it is overdramatised when you have an interest rate increase, when a government in this nation does not support the Reserve Bank, does not give the Reserve Bank the assistance it needs and does not get fiscal policy actually moving in the same direction as monetary policy.

The other important thing that this government has done is provide some relief to the people doing it tough. That is why we have had low- and middle-income tax cuts. But there was relief not just for them. There was the introduction of the education tax rebate; the increase in the childcare rebate from 30 per cent to 50 per cent—a very significant reform, helping families with kids at childcare centres, which is one of the biggest costs facing families; the introduction of the first home saver accounts to help young couples in particular save the money for their first home; and the increase in the utilities allowance for pensioners to help pensioners who are doing it tough. A typical family with a couple of kids will be $52 a week better off after 1 July as a result of this budget. Or, for example, a couple on $58,000 with two children aged 10 and 13 who are not in child care would increase their income over a year by $2,775. That is real assistance for working families, that is real assistance for people doing it tough, as opposed to—and this is something we did not hear about from the member for Wentworth; I cannot possibly think why—a 5c a litre petrol cut which would result in about $2.50 a week at a cost of $2 billion. No wonder they have lost the mantle as Australia’s responsible managers of the economy; no wonder the Australian people have come to the conclusion that those guys opposite cannot run an economy. They did not just come to that conclusion on 24 November; they have confirmed it. Talking about consumer confidence, what about confidence in their economic management? That is what has gone through the floor since the honourable member for Wentworth has sat in this place as the alternative Treasurer of the nation. That is what has plummeted; that is what has really gone down.

We have seen a massive turnaround in economic management. Who is respected as the economic managers of this nation? They know. The honourable member for Wentworth just criticised us for it. He said, ‘You hear a lot of empathy from this government. You hear a lot of empathy for people doing it tough.’ Well, I acknowledge that you did not hear much about that from the previous government. I acknowledge that what you heard from the previous government was a Prime Minister who said Australian working families have never been better off. That was their official policy: Australian working families have never been better off, so while we are at it let’s attack their working conditions.

There are some things we have not heard about the Sensis report that was released today. We have not heard any quotes from the opposition about what the Australian people think about Work Choices, how they are more confident in the workplace and how they now think that their working conditions are better protected. We have heard no quotes from the member for Wentworth or from the member for Curtin because that is not very comfortable reading for those opposite. We have heard all about the Sensis report but nothing about what the Sensis report says about Australia’s working conditions, nothing about what the Sensis report says about what the Australian people thought about Work Choices and what they think about this government’s response. This government’s response is to say that Australian people deserve some protection in the workplace—that Australian families that are doing it tough deserve to have their penalty rates, their working conditions and their salaries protected; that Australian working families deserve a bit of help from the government in the workplace; that this is not a government which sits around the cabinet table trying to think of ways to attack their working conditions but a government which sits around the cabinet table actually debating ways to help them. That is the difference that the Australian people have and that is what is recognised in the comments in the Sensis report about Work Choices and workplace relations. It is a ringing endorsement of this government’s approach when it comes to workplace relations.

The honourable members opposite did nothing about cost-of-living pressures when they sat on these benches because they did not recognise they had a problem. They had a mindset which said Australian working families had never been better off. They had a mindset which said it was ‘a golden era’. They had a mindset which said: ‘We do not care about interest rate increases, because they are overdramatised.’ They had a mindset which said it is mission accomplished about inflation. And what is inflation? It is an impact on Australian working families and cost of living. They had a mindset that said: ‘We just don’t care.’ They say we are being too empathetic. They say we are hearing too much empathy from the Australian government. Well, we make no apologies for it, because it stands in stark contrast to those who preceded us. It stands in stark contrast to the arrogant approach that we had from the former Prime Minister, the member for Higgins and the member for Wentworth. It stands in stark contrast and it will continue to, because we will continue to stand up for Australian working families.

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