House debates

Thursday, 4 February 2016

Questions without Notice

Goods and Services Tax

2:08 pm

Photo of Scott MorrisonScott Morrison (Cook, Liberal Party, Treasurer) Share this | Hansard source

I will give him some advice. I will give him some advice in relation to the last part of the question. I will quote someone else who was on radio today. In fact, the former Prime Minister and Treasurer, Paul Keating, was talking to Alan Jones this morning. Here is a bit of advice: 'When Commonwealth revenue has been so affected'—this is what Paul Keating said to Alan Jones—'the penny ought to drop that what we should be doing is cutting spending.' That is what the former Treasurer, Paul Keating—he was referring to me—said and has said for some weeks now. On this point, he is actually right.

What we are doing on this side of the House is reducing government spending as a share of the economy from 25.9 per cent down to 25.3 per cent. If we had done nothing over the last several years, it would have hit 26.5 per cent of GDP under the high-spending, high-taxing policies of those who previously occupied these benches. On this side of the House, we are absolutely committed to getting the fiscal consolidation plans implemented, because, at times like this, when we know of the volatility that is occurring globally and we have Australians looking at what could be happening to their savings and their investments and all of these things, they will look at these things with some uncertainty. That is why the government has to focus on strengthening our financial position and not engage in the reckless tax-and-spend approach which left this government with the reckless fiscal position those opposite bequeathed to us. As a government, we are focused on the task of strengthening our budget and strengthening our finances, and the former Treasurer, Paul Keating, says we have that right.

Comments

Tibor Majlath
Posted on 18 Feb 2016 11:29 am (Report this comment)

If Paul Keating agrees with the Coalition then he must be right.

Don't governments spend in bad times to provide fiscal stimulus to a sluggish economy and go into deficit? Don't governments cut spending in good times to put on the economic brakes to prevent overheating and thereby generate a surplus? Perhaps, that no longer applies in the 21st. Century.

The Coalition kept telling us the economy was in bad shape for six years under Labor. Then in government the Coalition said it was the budget that was in crisis.

But isn't the state of the budget being confused with national and global economic conditions? The current logic says that a poor fiscal position requires cutting spending to 'repair the budget'. But is it the right time to be cutting spending in such a weak economic environment which even the Treasurer admits is a bit volatile? Between a rock and a hard place.

Andrew JACKSON
Posted on 22 Feb 2016 12:31 am (Report this comment)

Tibor is partly right. Keynesian economics supports deficits in times of crisis. Problem we face at the moment is that both ALP and LNP governments are running deficits all of time.

THe Libs pretend they do not but they do. ALP makes no secret that they will spend us into massive debt.

I for one think that we need to both cut waste AND raise revenue.

Andrew Jackson
apjackson@hotkey.net.au