Sean Edwards (SA, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister for Finance, Senator Cormann, representing the Treasurer. Can the minister please provide an update on the economy and jobs?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

I thank Senator Edwards for that question. Our economy is in transition from resource investment in construction driven growth to broader drivers of growth and economic activity. While self-evidently we are facing some challenges and global economic headwinds as we are working through that transition, the Australian economy continues to perform comparatively well. Economic growth, of course, for the most recently reported quarter came in at 0.9 per cent, one of the highest quarterly growth rates in the developed world. We are in our 25th year of continuous growth, with 2.5 per cent growth over the most recent 12-month period, which is of course above the OECD average. More than 300,000 new jobs were created in the Australian economy over the past 12 months. Our unemployment rate, at 5.8 per cent, is well below the OECD average of 6.5 per cent and, of course, below what was previously anticipated for our economy.

These things do not happen by accident. Yes, our floating exchange rate helps. Yes, our record low investment rates help. Yes, of course, the significant increases in export volumes on the back of increased capital investment in recent years have helped cushion the effect of significant falls in price for our key commodity exports. But on top of that the government have worked and continue to work to implement and pursue policies which deliver stronger growth and more jobs: our ambitious innovation agenda, our ambitious deregulation agenda, our ambitious free trade agenda, our ambitious infrastructure investment program, our work to make the tax system more growth friendly, which continues, and, on top of that, our work to get the budget back into balance by controlling public expenditure and improving the quality of our public expenditure.

Sean Edwards (SA, Liberal Party) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. On the minister's final point: could the minister provide an update on the budget?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

Thank you very much. Since the parliament last met, the government has released the mid-year economic and fiscal update by way of half-yearly update on our 2015-16 budget. What the half-yearly budget update shows is that our budget position continues to be on an improving trajectory. The deficit is projected to reduce year on year, both in dollar terms and as a share of GDP. The net debt is expected to peak at 18.5 per cent in 2017-18, before it comes down. Expenditure in our half-yearly budget update is $13.3 billion lower over the forward estimates than anticipated at budget time. Expenditure as a share of GDP is projected to fall from 25.9 per cent this year to 25.3 per cent at the end of the forward estimates. And we have maintained the discipline not to go backwards—as a result of policy decisions of the government—with all decisions to increase spending on high-priority areas more than offset in other areas. Of course, the rating agencies have confirmed our AAA credit rating— (Time expired)

Sean Edwards (SA, Liberal Party) Share this | Link to this | Hansard source

Mr President, I ask a further supplementary question. Would the minister be able to let us know if there are any alternative approaches to economic and fiscal policy, and what would their implication be for our economy and jobs?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

Thank you. What we have seen in recent weeks from the alternative government is a return to the bad and discredited approach of the previous Rudd-Gillard-Rudd Labor governments. Of course, as a country we are still working to digest Labor's last spending binge—a spending binge which they locked into legislation over the forward trajectory.

Last week we had Labor promise to increase expenditure, in relation to education in particular, without telling the Australian people how to pay for it. None other than the Premier of South Australia—Senator Conroy's good friend Premier Jay Weatherill—has commented on the fact that Labor does not have a coherent plan to pay for its spending promises.

What I would say to the Labor Party is, 'Listen to your friend and colleague, the Premier of South Australia, when he says you need a coherent plan to pay for your promises, because the country is still working to digest your last spending binge.' (Time expired)