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

we will not be having surplus budgets anymore, because the Leader of the Opposition is a wannabe Liberal who can talk the talk but, every time the crunch has come, he has never walked the walk. If Labor actually supported surplus budgets, why did the Leader of the Opposition vote against all those measures required to balance the budget? If Labor really believed in no Commonwealth debt, why did the Leader of the Opposition vote against all the measures that were required to get there? If Labor really believed in a reformed tax system, why did the Leader of the Opposition proclaim the reformation of the tax system as ‘fundamental injustice day’—the day, he said, that the social compact had changed forever? This is not somebody with the record of an economic conservative who was supporting economically conservative policies when they counted; this is the record of somebody who wanted to say ‘me too’ on the results, after the hard work had been done. And after the hard work had been done Kevin Rudd suddenly became an economic conservative. There is no reason to believe that the Leader of the Opposition could take a hard decision in government; everything points to the contrary.

I want to come to a couple of things, because I think they were the only substantive things that were actually said by the member for Lilley. The member for Lilley then engaged in selective quotes. I do not know whether he actually knew he was engaging in selective quotes, because he had had his speech written for him and he did not have the source documents so it is quite possible that the staffer concerned had actually doctored the quotes rather than him. But just for the record I will read the conclusion of these quotes. For example, Mr Macfarlane said on 18 August—this is the part of the quote the member for Lilley did read:

I think the states by and large have had very prudent fiscal policy over most of the period you are referring to. What we are talking about at the moment is half a per cent of GDP which is earmarked for infrastructure. I have no problem with states spending money on infrastructure. I do not even have any problem with the general principle of borrowing for long-lived assets like infrastructure.

Here the member for Lilley stopped. But the quote goes on to say:

My only minor worry is that I wish they had done it a few years earlier. It is a bit procyclical to be doing it just now.

Oh! We just happened to leave that little bit out of the quote, didn’t we! At a time when the economy is strong, at a time when business is investing, for states to go into the spending business is totally procyclical. This quote of course is from back in August 2006, before they went on the $70 billion spend. Let us then go to Glenn Stevens. This is the bit that the member for Lilley read:

... I do not think the problem here is finding the money. Balance sheets of governments in this country, by and large, are in very good shape. They will not have any trouble borrowing money from the lenders of the world for a reasonable project. That will not be the problem.

And here the member for Lilley stopped. This is what the quote goes on to say:

The problem, as I said earlier on, will be how you turn the money into the real resources of labour and capital to do the work if the private sector also wants those resources. This is a timing thing. What we are saying is it would appear, at the moment, that that is a hard ask to find those resources.

Again, what he was saying was that you can borrow the money—of course you can. But, if you are out there borrowing this money at a time when the private sector is engaging in record investment and borrowing itself, you are being procyclical. What he was saying was: if all of this infrastructure was necessary, why weren’t you doing it back in 1999-2000? There is a good question: why weren’t you? Because back in 1999-2000 it would not have been procyclical; it might have also made a difference.

The reason was that none of the Labor states ever believed that resources would come back into vogue. This was the period back in 1999-2000 when the Labor Party, with all of its economic genii, were saying that we were an old economy and we had to get out of mining. That is why there was no money going into infrastructure: because it was commonly believed, not least by the Labor Party, that infrastructure was not important because the whole world was going IT. It might have made a difference back in 1999-2000 if the Queensland government had done something about Dalrymple Bay. They might start doing something now, but it is too late and procyclical. One thing that you will never hear from this member of parliament is a word against the Labor Party, of which he is a paid employee and official. He cannot take an independent position. He cannot pretend that he would be a Liberal. He is a pawn of the Labor Party, created by the Labor Party and in hock to Labor premiers, and is totally unfit to be the Treasurer of Australia.

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