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

The test of any budget is the degree to which it builds for the future. This Treasurer has splashed a lot of money around. It is always popular to do that, and it is easy to do that in very good times when there is a 21st century gold rush on. He has been splashing money around like confetti. But doing that is not building for the future. At the Press Club today the Treasurer said that this budget contained far-sighted reform, that it was all about the future. There is an old saying: if you think education is expensive, try ignorance. What the Treasurer has tried in this budget is ignorance.

The absence in this budget of any far-sighted initiatives when it comes to training and education means that we have prejudiced our future—we have not put forward the initiatives required to invest in productivity, to lift our growth and to maintain prosperity well into the future. So it is the failure of the government particularly to invest in education and training as well as the failure of the government to put forward a national infrastructure plan that mean that this Treasurer has turned his back on the future. He did not fairly face the future; he turned his back on the future.

This budget is more directed at the government’s short-term political needs than the long-term needs of the country. This Treasurer has turned his back on far-sighted, serious, broad based reform that is absolutely essential to lift productivity and to ease the speed limits on the Australian economy. In doing that, the Treasurer has turned his back on all of the expert advice that is coming to this government about the need to lift productivity to ensure that we can create wealth for the future. Let me quote the Business Council, an organisation that is close to the Treasurer and the government. The Business Council had this to say:

Serious constraints and imbalances are emerging within the economy that, in the absence of reform in key areas, will slow growth, limit opportunities and undermine the economy’s capacity to deal with longer-term challenges ...

Or why don’t we quote the OECD:

... reform efforts have slackened off, despite new challenges.

Perhaps most significantly, particularly for all those Australian families paying higher interest rates, the Treasurer has ignored the concerns of the Reserve Bank in their Statement on Monetary Policy published only last week. So Australians have had two interest rate rises in the last 14 months from this Treasurer, who promised record low interest rates at the last election. They have had two interest rate rises since that time, which is putting families in this country under considerable financial pressure. This is what the Reserve Bank board had to say last week, after they raised interest rates for the second time:

... the economy has been operating with limited spare capacity, and underlying inflation has been forecast to increase gradually ... the Board had taken the view that the next move in interest rates was more likely to be up than down ...

So what does the Treasurer do in the face of this challenge, clearly outlined by the Reserve Bank board in their Statement on Monetary Policy? Despite the fact that we have a 21st century gold rush, he does not include in this budget a national plan for infrastructure. We get a bit of National Party pork-barrelling and a bit more, but no overall national plan for infrastructure, which is so essential to lift our productivity.

And we most certainly get no action when it comes to the skills of our people to address the skills crisis and the government’s neglect of education. We are the only country in the OECD that has gone backwards in our investment when it comes to the education of our people. Investment in all the other countries is going up, particularly countries in our region. It is absolutely critical that we be more competitive because we have escalating foreign debt.

The Treasurer in this House has never before conceded that foreign debt—or our current account deficit—is a problem. Indeed, he did not concede that in the budget. You could not find very much in the budget about the Treasurer’s concern about the current account deficit. But we did get it at the Press Club today. He did admit that it was a problem. The truth is that the Treasurer is forecasting a recovery in exports in the budget. He has done so in every one of the last six budgets, and it has failed to materialise. It is our escalating current account deficit that is leading to an explosion in our foreign debt—up 2½ times from $193 billion to $500 billion. So this Treasurer here is the half-trillion dollar man! He has a foreign debt of $500 billion.

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