Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

My question is to the Prime Minister and refers to his continued claim that the Liberal Party will always have lower interest rates than the Labor Party.

Alexander Downer (Mayo, Liberal Party, Minister for Foreign Affairs) Share this | Link to this | Hansard source

Mr Downer interjecting

David Hawker (Speaker) Share this | Link to this | Hansard source

Order! The Minister for Foreign Affairs has completed his answer. The member for Melbourne has the call.

Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

Thank you very much, Mr Speaker. I will commence my question again. My question is to the Prime Minister and refers to his continued claim that the Liberal Party will always have lower interest rates than the Labor Party. Is the Prime Minister aware of comments by former Reserve Bank Governor Ian Macfarlane, who said that these claims, also made at the last election, were ‘incorrect’ ? Prime Minister, who should Australian families with a mortgage trust? The former Reserve Bank Governor or you?

John Howard (Bennelong, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

I do not know what comments of Mr Macfarlane the member is referring to. But let us put that aside and look at the facts. The last time the Labor Party was in office, housing interest rates averaged 12¾ per cent. The housing interest rate after the latest increase will be 8.3 per cent—that is a full 4½ per cent below. Housing interest rates hit 17 per cent. If you double 8.3 you get 16.6, which is still 0.4 below 17 per cent. So the facts speak for themselves.

I imagine that the member for Melbourne has verballed Ian Macfarlane. They verbal just about everybody when they get up in this House. They even verbal some members of the government when they get up in the parliament and ask these questions. If the member for Melbourne wants to have a serious debate about which party has got a better interest rate record, all we say is: bring it on. Look at the last Labor government and compare it with this government. Look at the policies of the Labor Party on display at the moment in industrial relations, which will, according to Econtech, according to the ACCI, drive up inflation and thereby put upward pressure on interest rates.

Labor would take away the industrial relations system we now have. You would have wages break-outs because sectors of the economy could not afford to pay wage increases demanded and received in the more prosperous areas of the economy. You would therefore end up with an extraordinary situation where there would be upward pressure on interest rates, and that would be to the detriment of the entire Australian community. If the member for Melbourne wants to continue to argue that interest rates would be lower under a Labor government than under a coalition government, he is fighting against all of the available evidence and he is about as misguided on the subject as the member for Lilley is.

Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

Mr Speaker, I seek leave to table an article from the Sydney Morning Herald of 19 August 2006 which states that the Reserve Bank governor revealed that the Reserve Bank had considered going public before the 2004 election to point out that the government was incorrect.

Leave granted.