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

This is Steven Kennedy’s paper, as my colleagues have observed. Then we moved on to another really challenging question that again the Treasurer seems to have no interest in or is paying no attention to. We have very strong economic growth in Australia and we have very low unemployment. But, as the Leader of the Opposition pointed out and as I have been endeavouring to get the Treasurer to address during question time, it is by no means uniform. What we have seen is very strong economic growth in Queensland and Western Australia and very modest growth in Victoria, New South Wales and South Australia. Indeed, in Victoria, New South Wales and South Australia, the economic growth last year was significantly below the 10-year average. We have seen very dramatic falls in unemployment in Queensland and Western Australia, compared to very modest falls in the other states. What we have, on any view, is a two-speed economy. We have very strong growth, fuelled by external demand, in the mining states, and much more modest growth—indeed, very low growth; in South Australia, it was only 0.8 per cent in the last financial year—in the other states.

So a big challenge for economic policy and for a Treasurer is: how do you constrain inflation across the board, recognising that these inflationary pressures are in large measure being driven by the strong growth in the mining states, recognising that an increase in Australian domestic interest rates is not going to stop any of those huge mining projects going ahead in Queensland and WA, because they are being fuelled by external demand? There is a real risk that the blunt instrument of monetary policy, or indeed poorly executed fiscal policy, will have little effect in the boom states and flatten the economies in the other states. That central question is one to which the Treasurer refuses to turn his mind. He has no plan for this country’s economic future and no capacity to develop one, because he is not even prepared to consider the vital challenges that he faces.

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