Carol Brown (Tasmania, Australian Labor Party) Share this | Hansard source

I rise to also contribute to the matter of public importance before the Senate today. Contrary to what Senator Cormann would have Australians believe from his contribution—a contribution, I might add, that was full of factually incorrect statements—the Labor govern­ment has a strong track record of proven economic management.

We have delivered strong economic management by shielding Australia from the worst impacts of the global financial crisis. We have been prudent in implementing a cap on new expenditure in our budgets. Our policies are fully costed, with appropriate savings delivered to offset any new expenditure and, despite the difficult economic circumstances we have faced as a nation, we remain on track to bring the budget back into surplus in 2012-13. It is clear we remain committed to fiscal responsibility, which I must say is in stark contrast to what we get from those opposite. Those opposite, led by Mr Abbott and Mr Hockey, have made blunder after blunder in opposition costings, from the black hole in their election commitments to their latest economic debacle, which centres on their $70 billion budget black hole. Mr Abbott and Mr Hockey have been running around announcing policies without maintaining fiscal responsibility, and now they find themselves in a situation where they need to find $70 billion of savings. What will Mr Abbott and Mr Hockey cut? Well might you ask. Where will they deliver their savings? Will they cut age, disability and veteran pensions? Will they cut Medicare? Will they cut education funding? Will they claw back tax cuts? I challenge the Liberals to tell us where these savings are going to come from. It is time for Mr Abbott and Mr Hockey to come clean with the Australian people about what services they plan on cutting.

While both Mr Abbott and Mr Hockey are looking at cutting services and perhaps pensions, they are split on the size of the black hole, even though Mr Robb seems to be able to count and has indicated on ABC AM that the figure is $70 billion. Mr Hockey says that the coalition need to identify $50 billion, $60 billion, $70 billion of savings that they will make. He is happily going from $50 billion to $70 billion as if we were talking about hundreds of dollars. Then we have Mr Abbott, who refutes that the figure is $70 billion, but we know that it is. We know that Mr Abbott is not interested in economics; he is not interested in balancing the budget. We know that because of the comments that he has made publicly. He continues to have thought bubbles as he roams the country on a massive scare campaign against the government's carbon tax. He is not interested in backing up what he says with any facts or substance.

So, while those opposite continue to make countless economic blunders, we on this side have had to deal with continuous conjecture and negativity surrounding the Australian economy, which is neither helpful nor accurate, to say the least. Senators in this place are aware of the wild swings in international finance markets. This has no doubt made people anxious about the state of the global economy. As the Treasurer, Mr Swan, rightly pointed out, cautioning against reading too much into short-term movements in the share market:

Just as a big gain in trading over a day or a couple of days doesn't mean the challenges faced by Europe and the United States have been solved, a big fall doesn't mean they're insurmountable either.

As the government have highlighted, it will take time for the European and United States economies to get their houses in order. They will have to make tough decisions to reduce their debt and ensure their budgets are sustainable. This will have an impact on the global economic outlook for some time. However, we should remember that in Australia the fundamentals of our economy remains strong in comparison to the rest of the world. Recently, the International Monetary Fund highlighted the fact that in Australia we have very low public debt, low unemployment and a massive pipeline of investment, and we expect to bring the budget back to surplus—although, as the Treasurer has highlighted, this task has been made much tougher by current global events. This government has a strong track record of economic management of the Australian economy. We can also look to our record during the global financial crisis. In a period when advanced economies around the world have been suffering from the largest global recession in over 70 years, the Australian economy has performed remarkably well. This is no coincidence. The strong performance of the Australian economy can be put down to the early decisive action taken by the Labor government. We injected short-term cash stimulus as well as medium- and long-term infrastructure spending to keep the Australian economy in strong shape. What did those opposite want us to do in those times of global financial crisis? They advocated the sit-on-your-hands and the wait-and-see approaches. They wanted to send the Australian economy down the gurgler, essentially abrogating their responsibility to protect and support the Australian economy. But the Labor government's decisive action, stimulus measures and sound fiscal management helped to cushion the Australian economy from the worst impacts of the global recession.

Whilst our economy has remained relatively strong during the GFC, this sum­mer's natural disasters have also impacted on our economy. Recently the full effects of the natural disasters were felt with the release of the national accounts for the March quarter. GDP fell 1.2 per cent in the quarter to be one per cent higher throughout the year. As the Treasurer outlined after the release of the negative GDP result, a period of weak growth was broadly expected after the devastating natural disasters. He said:

This weakness is likely to be followed by a strong rebound in the June quarter as the economic impacts of the disasters ease and reconstruction picks up.

However, the Treasurer has outlined that we remain on track to restoring the budget to surplus in 2012-13. Treasury has estimated the floods and cyclones will cost the econ­omy about $12 billion, with lost commodity production likely to be around $9 billion and crop damage more than $2 billion.

The Treasurer has also said that we expect to create another 500,000 jobs in the next couple of years. This is on top of 750,000 jobs we have already created since coming to office in 2007, including 189,000 in the last year alone. Whilst there was a slight increase in July to 5.1 per cent, fundamentally the strength of our labour force participation rate remains strong, especially in comparison to the rest of the world. The unemployment rate is 9.1 per cent in the United States, 7.2 per cent in Canada, 7.7 per cent in the United Kingdom, 9.7 per cent in France and 20.9 per cent in Spain. When we entered the global financial crisis, Australia's unemployment rate was the same as that of the United States. If that were still the case and we had the same unemployment levels as the US, around 9 per cent, then an extra 486,000 Australians would be out of work. Our swift action during the GFC has ensured that Australians have remained in work and that our economy is the envy of the rest of the developed world.

Let us look at some figures. Official interest rates are two full percentage points lower than when the Liberals lost office, currently 4.75 per cent compared to 6.75 per cent in November 2007. Our national government debt is low, currently 7.2 per cent of GDP or 10 times less than the United Kingdom at 75 per cent of GDP and the United states at 72 per cent of GDP. Wages are rising faster— (Time expired)