Kim Beazley (Brand, Australian Labor Party, Leader of the Opposition) Share this | Hansard source

I move

That this House:

(1)

notes that there have been three interest rate rises since the Prime Minister promised the Australian people in 2004 that, if re-elected, he would ‘keep interest rates at record lows’;

(2)

notes that there have been seven consecutive interest rate rises since 2002;

(3)

notes that the Howard Government has spent a billion dollars advertising itself, a billion dollars on the wrong war in Iraq, hundreds of millions of dollars on regional rorts and half a billion dollars on lawyers and consultants to implement its extreme industrial relations laws;

(4)

notes that, despite spending billions of dollars on itself, the Howard Government has failed to invest in the drivers of national productivity including skills, infrastructure and innovation; and

(5)

calls on the Prime Minister to immediately bring down a mini budget to redirect wasteful spending to invest in these productivity drivers necessary to build the economy’s productive capacity and put downward pressure on interest rates.

The government must immediately bring down a minibudget to invest in the essential drivers of productivity—skills, innovation and infrastructure. Middle Australia is hurting but this government is so out of touch that it does nothing—nothing for Australian families, nothing for their future, nothing to boost our national productivity to make Australia a smart nation standing on its own two feet and competitive in the global economy. Instead of nation building, Australian families have copped three consecutive interest rates rises since John Howard promised to keep rates at record lows. There have been seven consecutive rises since 2002. Just this morning, we find that average home loan repayments for a first home have exploded past the $2,000 a month mark for the very first time, rising from $1,941 to $2,078 in the June quarter. That does not include this month’s interest rate rise. It reflects only the May increase, plus the impact of increasing housing prices. First home buyers now entering the market will have to spend almost 28 per cent of their income on mortgage repayments—dangerously close to the Housing Industry Association’s no-go zone. We are sure to be catapulted smack bang into the no-go zone when the August rate rise is factored in, but today this out-of-touch Treasurer is wandering about trying to shift the blame. Blaming the states is much easier than taking it on the chin. It is much easier to blame someone else than it is to do something yourself.

This is a very different story from last week, when the Treasurer and the Prime Minister were arrogantly claiming all the credit for increased householder wealth. They cannot have it both ways. If they take the credit, they have to shoulder the blame for exploding mortgage repayments. Howard and Costello need to roll up their sleeves and start doing the hard work to put downward pressure on interest rates. Low inflation is the key to low interest rates.

Australia needs a mini-budget now. We cannot afford to wait to see whether inflationary pressures abate. The government has spent a billion dollars to advertise themselves, a billion dollars on the wrong war in Iraq, hundreds of millions of dollars on regional rorts and half a billion dollars on lawyers and consultants to create their extreme IR system. John Howard should cut this wasteful spending and invest it in Australia’s future. We should invest in the problems identified by the Reserve Bank—the critical skills shortage, our crumbling infrastructure and our flagging levels of workforce participation. We need urgent action on the supply side of our economy. The longer John Howard delays, the higher inflation and interest rates will go and the harder it will be on families. A decade of neglect cannot be fixed overnight. We have to start now. For the sake of Australia’s future, we cannot wait nine months until next year’s budget.

This morning, when I spoke at the Australian Industry Group conference, I was fascinated by the little system they have—their equivalent of ‘the worm’, of debate fame—in which everybody there has a hand-held object which, when you press various buttons, registers a vote on the screen. They waited until the end of my speech, and then they put up a list of about eight things. They asked: what should be the priorities of the federal opposition? They had interest rates on the list, from memory. They had industrial relations on it. They had skills on it; they had infrastructure—they had the whole lot. There was an interesting result. Only seven per cent suggested that the federal opposition should be worried about doing something with its policies on industrial relations; 26 per cent, about skills; and 29 per cent, about innovation.

These are business men and women who are investing in the future of this nation, and they know what the priorities should be. They know that in these crucial areas which are imposing such capacity constraints on the economy—according to the Governor of the Reserve Bank—there is a critical need now for some nation-building investment. The time is now for reprioritisation. The time is now for spending in this area and not in the government’s favourite areas. We will need a mini-budget to do that. (Time expired)

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