Yvette D'Ath (Petrie, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Will the Treasurer update the House on the outcome of today’s meeting of the Reserve Bank?

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

I thank the member for Petrie for her question. Today the Reserve Bank board left the official cash rate unchanged at 3.75 per cent, its lowest level since 1967. I am sure all of us on this side of the House certainly welcome this decision. Families will welcome this decision and businesses will welcome this decision, but it is obviously not welcomed by those opposite. They are perhaps the most disappointed people in the House today because they somehow think that they can use these decisions for their political advantage.

Today’s decision means that a family with a $300,000 mortgage are still paying around $600 a month less than they were paying 18 months ago. That does not mean that interest rate rises do not have an impact. They certainly do. They certainly do hit the family budget, but we on this side of the House understand that they impact on the family budget and that is why we are so determined to focus on a low inflationary strategy. That is why we are so determined to make the investments in infrastructure that were not made by those opposite. That is why we are so determined to educate our workforce and to skill our workforce, because under those opposite inflation hit 16-year highs and interest rates went up 10 times in a row after they had promised to keep them at record lows.

So we are committed to a long-term strategy here to do everything we can to expand the productive capacity of the economy to make sure that we can do everything within our power to lessen inflationary pressures in the economy. I think it is worth mentioning that rates are now 300 basis points lower than they were when the Liberal Party were last in office.

If the shadow Treasurer wants to be taken seriously in this whole debate, he should explain how he proposes to keep interest rates at 1967 levels forever. He should explain that to the House. He is out there constantly making erratic and wild statements and we had an example of this only last week when the latest inflation number came out. He went out and made the most weird and extreme statements about that inflation number. Most of them were incorrect. It was the usual ‘sloppy Joe’ approach, but it is no substitute for policy and no substitute for economic analysis. We on this side of the House are determined to do everything we can to see sustainable growth which lifts living standards up and we are determined to make the necessary investments for the future.