Malcolm Turnbull (Wentworth, Liberal Party, Shadow Treasurer) Share this | Hansard source

Yes, I have read the MPI—absolutely. The Treasurer had the opportunity to be straight and forthright with this House. Instead he denied everything and then today relied on the claim—and no doubt further enquiries and investigations will see how much validity there is in this claim—that the decision had only been taken last night, notwithstanding that we know Treasury had provided him and the government with advice that the Productivity Commission should conduct that inquiry. There is no body in Australia better qualified to look into industry matters of this kind than the Productivity Commission itself—after all, it started off as the Tariff Board and then became the Industry Assistance Commission and the Industry Commission. This is the most distinguished independent economic think tank in Australia. It has years of expertise in looking into these industry matters and so, naturally, Treasury recommended that it would be the appropriate body. That advice was rejected. A political group was assembled, headed by a former Labor Premier aided by a number of trade union officials, and instead the Productivity Commission was reduced to a minor role to do some economic modelling.

When the Rudd opposition were seeking to become the Rudd government, they contended that they were fiscal conservatives, economic conservatives. I recall the Prime Minister saying, shortly after the election, that he wanted the Treasury brought:

... to the centre stage of what this Government does in the future. We cannot afford to fall behind when it comes to national economic reform and I intend to harness the full resources and capabilities of the Treasury in so doing.

We have a vital manufacturing industry in Australia under great pressure, for which the best economic insights and the most objective and clear-headed advice is needed. Treasury says the Productivity Commission is the right body to provide it—and so it was—and that advice is ignored and we have jobs for the boys. What we have here is the wrong job for the wrong boy. If ever there were an appointment that was a political fix, a job for the boys, to get a predetermined outcome, it would be this one, and all of those people who believed that Kevin Rudd and Wayne Swan were going to be economic conservatives now realise that they are only interested in jobs for the boys.

Throughout his term as Treasurer, the Treasurer has acted in a way which is uniquely reckless. When we speak about economic matters and when we speak about inflation, it is vital that we speak about them moderately and objectively. It is particularly vital that treasurers and, indeed, central bank governors do so as well. We need facts. We need sober assessment. But what have we had from Wayne Swan? This is a man who said he was dripping with empathy, concerned about the price of groceries, concerned about the struggles of ordinary Australians sitting at their kitchen table, and worried about the impact that interest rate rises would have on them. And what did he say the day before the Reserve Bank met to consider a rise in interest rates that most commentators regarded as likely or very likely? He said:

The inflation genie is out of the bottle.

There was nothing he could have said which would have been more likely, more certainly calculated, to ensure that that interest rate rise would occur. It was a rhetorical flourish, it was a headline-grabbing flourish, and it reminds me of Paul Keating’s much lamented and much criticised remark that Australia was heading towards a ‘banana republic’, which produced a whole series of economic consequences—because when a Treasurer speaks, the world listens, the whole economy listens, the whole global economy listens, and what he says will inevitably have a consequence as to the way our economy is viewed.

One of the other reckless things the Treasurer has done is run down the Australian economy. We have to recognise that we have problems in our economy; we always will. As I said before, a treasurer complaining about economic challenges is like a firefighter complaining about fires. It is the job of the Treasurer to deal with economic challenges. That is the job description. But, when you for politically partisan purposes create a false impression of the Australian economy, you undermine the living standards of all Australians because it impacts on the regard, the rating, the credibility and the credit of our country. So it is vital to be accurate. To be fair, not everybody in the government is as reckless as the Treasurer. The Assistant Treasurer, Mr Bowen, who I see sitting opposite, said on 22 January, ‘The evidence of a serious inflation problem has only begun to mount over the last six months or so.’ I beg your pardon—that was the finance minister on 5 February. But the Assistant Treasurer said on 22 January, ‘Inflation has been low in Australia over the last few years.’ Those two ministers were correct; they were absolutely correct. The Treasurer has said that inflation has been on the march for a couple of years. He is trying to create the impression that inflation has been ramping up consistently for a couple of years, that the Reserve Bank has been there, warning the former government, and that the former government ignored all those warnings.

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