Mark Dreyfus (Isaacs, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Prime Minister. Can the Prime Minister inform the House of steps taken by the government to stabilise the financial system and strengthen employment in the face of the global financial crisis?

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I thank the honourable member for his question. The nation is challenged with the huge impact of the global economic recession and what to do about it in practical terms. You either stand back and sit on your hands and do nothing—the prescribed course of action on the part of those opposite—or you step up to the plate and seek to act and make a difference by stepping in while the private sector is in retreat. That is what the government have done. We have done so at multiple levels. We have done so by our investment in the economic stimulus strategy last October.

In phase 1 we provided support through cash payments to pensioners, carers, veterans and later to families in order to provide a boost to domestic consumption at a time when consumption figures around the world were collapsing. The consequence of that is reflected in the most recent retail sales figures. Those figures put us light-years ahead of the rest of the world and have underpinned one of those drivers of demand that we saw reflected in the growth numbers, which were confirmed in the national accounts yesterday.

Phase 2 of the government’s economic strategy is for the government to invest in medium-term infrastructure—the biggest school modernisation program in the country’s history, the biggest investment in social housing in the country’s history and the biggest investment in home insulation and energy efficiency in the country’s history—with the objective of making sure that we have provided every owner-occupied dwelling in the country with the opportunity to obtain ceiling insulation and thereby pull down greenhouse gas emissions by something like 50 millions tonnes of CO2 equivalent. These are practical measures for the future but, critically, they are also providing jobs today.

Phase 3 of what we have sought to do is to invest in long-term infrastructure, nation-building infrastructure—rail, roads, ports, solar energy, clean energy, clean coal as well as desalination plants. There is also investment in a new national broadband corporation so that we can lay out the infrastructure we need for the 21st century and, on top of that, create economic incentive and opportunity on the way through.

Phase 1, phase 2 and phase 3—what is our overall principle? To step up to the plate while the private sector is in retreat. Nation building for recovery while the rest of the world is in retreat. Nation building by supporting jobs, small business and apprenticeships today and by investing in the infrastructure we need for tomorrow.

Also underpinning these measures, Mr Speaker—and I go directly to an element of the question which was just asked—are the actions taken by the government to assist with the stresses which have been placed on the financial sector. We acted decisively to provide a government guarantee for every single deposit holder in the country in banks, in building societies and in credit unions. Every person in the gallery today who is listening to the debate knows that their deposits are secure in their banks because of the government guarantee. For the first time in the history of the Federation, notwithstanding multiple recommendations to those opposite in their 12 years in office, we act in a parallel fashion.

When it comes to necessary support for the flow of finance in the community, we have also been out there agreeing on other measures with the banks. We have the Australian Business Investment Partnership, ABIP. We have provided an alternative financial vehicle, a special purpose vehicle, conjointly invested in by the banks and by the Australian government with the purpose of providing necessary lines of credit—assuming commercial viability tests are passed—for the crucially important commercial property sector in Australia. It is capable of generating tens of thousands of jobs in this country. Of course, if projects collapse in that sector the unemployment consequences would be great as well.

And then, of course, the other vehicle of which the government is proud is the special purpose vehicle we have created in the motor vehicle sector. We are proud of that as an Australian government initiative, despite the frustrations we are encountering in the Senate on this matter. Once again industry has come to government and said, ‘How can you partner with the banks to make a difference?’ We have done so and provided a vehicle that is open to all those out there in the critically important car dealership industry to ensure that we can provide support and incentive for them as well. That is what the government is doing by way of positive measures in the economy, positive measures to make a difference, to build the economy up rather than simply having it torn down by the negative language from those opposite.

On the question of the special purpose vehicle, let me say in response to some of the insinuations that have been made by the Leader of the Opposition: (1) I have been advised that neither I nor my office have ever spoken with Mr Grant in relation to OzCar; (2) neither I nor my office have ever made any representations on his behalf; and (3) I have not been aware of any representations on his behalf made by anyone in the government, including the referral referred to before by the Treasurer’s office.

What we have here is the politics of fear on the economy being replaced by the politics of smear in this House by the Leader of the Opposition. The Leader of the Opposition has engaged in deliberate smear in this place—fear on the economy, smear in terms of the politics in this place—without a single positive message to say about the future economic direction of this country. I would suggest that the Leader of the Opposition stand at the dispatch box and apologise.

Government Members:

Government members interjecting—

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! Those on my right!

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

Mr Rudd interjecting

Opposition Members:

Opposition members interjecting—

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! I have no idea what was said but, based on the reaction, it would assist the House if the Prime Minister withdrew.

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I withdraw, Mr Speaker.

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

I thank the Prime Minister.