Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Hansard source

Australia has begun, through this budget, a new era of responsible economic management, because we have delivered a big surplus of $21 billion plus. It is a budget surplus which is the second highest in 35 years. It is a budget surplus of which this government is proud. Furthermore, we have done so by bringing down government outlays. We have generated one per cent growth in government outlays in contrast to the 4.5 per cent real increase in outlays inherited from our predecessors. And, before they talk about what they were planning to do in the future, look at what they projected for the year ahead, 2008-09, in terms of their own outlays when they were last in government—an increase in outlays of nearly three per cent. Even against that measure we represent one-third of what those opposite were proposing to spend. This is not just a comparison in reflection; it is a comparison in anticipation of the clear plans outlined by those opposite.

So in terms of delivering a responsible outcome on outlays we have delivered an outcome with expenditure as a proportion of GDP being the lowest since 1989-90—lower than any of the budget outcomes delivered by those opposite. On top of that we are reducing the overall taxation burden as a proportion of gross domestic product, which is consistent with our pre-election promises, and we do so having inherited economic circumstances whereby those opposite delivered to this nation the highest inflation rate in 16 years.

Therefore, within that framework, the government has brought forward an economic strategy which does three things. Firstly, it fights against inflation by delivering a responsible economic outcome with a significant budget surplus. Secondly, it does not accept the proposition advanced by those opposite that working families have never been better off—that was their boast and they never contested it. We believe that working families are under pressure. That is why the centrepiece of our budget strategy is a $55 billion support package for working families, of which we are proud.

On top of that, as the Treasurer has just outlined, we have brought down a nation-building budget for the 21st century. We have brought down three investment funds for the future totalling $40 billion. We have brought forward the $20 billion Building Australia Fund, the $10 billion Health and Hospitals Fund and the $11 billion Education Investment Fund. We have done this because these have been areas of systematic neglect on the part of those opposite who year after year have taken budget surpluses and squandered them through unprofitable consumption.

We in contrast have a different economic strategy, which is to invest in the future. If you take infrastructure alone, CEDA reports that, as a result of underinvestment, the backlog in infrastructure investment for water, energy and land transport is alone around $25 billion. That is costing around 0.8 per cent of GDP a year in lost production—that is $8 billion a year. That is a stunning statistic given that those opposite had 12 long years to act on that underinvestment.

Well, we have decided to act. We have established the Building Australia Fund and we therefore will be acting on these key areas of challenge—challenges that the Reserve Bank of Australia presented those opposite with multiple warnings on during their period in government: skills constraints and infrastructure bottlenecks.

Look at the specific projects that we will investigate, with the states, in the 12 months from here, before the funds flow from the Building Australia Fund, from 1 July 2009: the western metro rail link and the eastern section of the M5 in New South Wales; components of the east-west transport corridor and the Western Ring Road in Victoria; key sections of the Bruce Highway and the Gateway Motorway in Queensland; a transport master plan for Perth airport; a transport sustainability study for Adelaide; and other projects as well.

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