Peter Costello (Higgins, Liberal Party, Treasurer) Share this | Hansard source

I thank the honourable member for Deakin for his question. Since the House last met we have had the consumer price index for the December quarter, which showed an increase of 0.5 per cent in the quarter and 2.8 per cent through the year. These were very good outcomes, considering the pressure that petrol prices are putting on the economy and on inflation generally. We cannot afford to be complacent about this. There will be further pressure in the current quarter, but the important thing is to make sure that we do not have second-round effects, with petrol prices feeding into prices generally.

We have had, since the House last met, labour force figures for the month of December showing that unemployment remains at a 29-year low, at 5.1 per cent. We have also had moderate retail trade figures showing that in the December quarter retail trade volumes rose by 0.3 per cent to be 1.9 per cent higher than a year ago. As we have just heard from the Deputy Prime Minister, we have had welcome recovery in the trade performance, with a substantial increase in exports. All of this says that the Australian economy is in a strong position going forward, but we cannot afford to be complacent.

At the time of the last election I described the economy as a highly tuned performance car which, if you fiddled with modifications in different parts, you could knock off balance and easily turn into a mangled wreck. I had in mind the damage that could have been done to the Australian economy if Labor had been elected in October 2004.

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