Monday, 9 September 2019
Questions without Notice
My question is to Senator Cormann, the Minister representing the Prime Minister. The Reserve Bank governor, Dr Lowe, has called for an increase in infrastructure investment seven times in the four months since the election. Why has the government ignored the repeated warnings of the independent Governor of the Reserve Bank of Australia?
Let me just make the first point, and that is that, under our government, we are increasing infrastructure investment. The information that is in front of the Governor of the Reserve Bank is the information that was in front of us as we were putting our budget together, and we have put forward $100 billion in infrastructure investment, which is a significant boost from the $75 billion pipeline the year before. I would also refer you to comments that the Governor of the Reserve Bank has made repeatedly now, over the last two months—because you're selectively quoting him. He has made it very clear that his expectation is that economic growth will strengthen, moving forward, on the back of lower interest rates; on the back of our income tax cuts; on the back of continued high infrastructure investment, including, and in particular, from the federal government; on the back of a pick-up in the resources sector; and on the back of a stabilisation in our housing market—in particular, in Sydney and Melbourne.
The proposition that somehow there is a difference in direction between monetary policy and fiscal policy is wrong. Fiscal policy and monetary policy are absolutely heading in the same direction, and we are dealing with serious global economic headwinds.
We have a plan. We're working through that plan. It's a plan that was endorsed by the Australian people at an election only a few months ago. They fundamentally rejected the alternative plan, and even the member for Port Adelaide, who is hardly known as a right-wing free-marketeer, is now saying that the Labor Party may have gone too far with its socialist agenda. Even Mr Butler now is concerned about the fact that Labor might have gone too far with its socialist economic policy agenda—he is very concerned about the fact that the former Treasurer, the now national president of the Labor Party, wants to protect Labor's socialist economic agenda—when the Australian people know that it would have made our economy weaker and it would have made all Australians poorer.
Dr Lowe has made it clear that the Reserve Bank of Australia cannot do all the heavy lifting with monetary policy alone, telling the House economics committee:
One option is for fiscal support, including through spending on infrastructure.
Can the minister confirm the government is continuing to ignore the advice of the Governor of the Reserve Bank of Australia?
(—) (): We agree 100 per cent that monetary policy cannot do the heavy lifting on its own. We absolutely agree, which is why we put forward a plan to build a stronger economy in our budget, which is of course designed to deal with all of the challenges that we're facing in terms of global economic headwinds and in terms of the downside risks to the domestic economy. That is precisely what we're doing. We are lowering income taxes. We've legislated more than $300 billion worth of income tax relief. We have an ambitious infrastructure investment program. We boosted that from $75 billion to $100 billion in terms of infrastructure investment pipeline over the next decade. We have an ambitious free-trade agenda to ensure that our exporting businesses get better access to overseas markets to sell Australian products and services. We've got an ambitious agenda to reduce the cost of doing business through deregulation. We've got an ambitious agenda to bring down the cost of energy, moving forward, in order to make our economy more competitive—
Australians are working harder and going backwards. When will the government finally heed the warnings of the Governor of the Reserve Bank of Australia and take action to stimulate the Australian economy?
The Australian economy continues to grow. We are into our 28th year of continuous growth, unprecedented in any developed economy around the world—unprecedented. We are one of just 10 AAA rated economies. I'm surprised that Senator Kitching would ask me this question, because I'm sure she would share my concern that there are some in the Labor Party who want to blame the loss of the last election entirely on Mr Shorten, when what is actually to blame was their antibusiness, higher taxing, socialist politics-of-envy agenda, which a majority of Australians understood would have—
No, I am objecting to the fact that he wants to talk about the Labor Party and not the Governor of the Reserve Bank. And, if you cared about Australians' jobs and incomes, you might want him to listen to the Governor of the Reserve Bank, too.
I remind ministers again that any additional information they provide must also be directly relevant. Questions, however, that are not as specific as they were earlier today do allow ministers a wider range in answering a question and being directly relevant. You've reminded the minister of the question, Senator Wong. I call the minister to continue.
The thing about fiscal policy is that it always comes down to alternative options in terms of the way forward. Our approach is: lower taxes, encouraging business, encouraging free enterprise, reward for effort, encouraging people to stretch themselves and get ahead and, indeed, ensuring that wages will grow on a sustainable basis. (Time expired)