Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Hansard source

I thank the member for her question. At the weekend’s IMF meeting, World Bank meetings, G7 meetings and G20 finance ministers meetings, there was a long discussion about the need for there to be coordinated action as well as decisive action, given that the global financial crisis does represent the biggest threat that we have yet seen to the modern market economy. I am pleased to see that in the last 48 hours governments around the world have all moved in a coordinated fashion. It was certainly pleasing to see the initiatives overnight from the United States. I did discuss some of those matters with my counterpart in the United States, as indeed I have been continuing to discuss these matters with counterparts elsewhere in the world.

The initiatives in the United States overnight—an injection of money for capital into banks, a guarantee for financial institution lending and so on—are all welcome. Of course, initiatives will change from country to country, depending on the circumstances in those countries. And of course, as the government has said, we are better placed than many other nations, but nevertheless, because of the threat to growth, the need for action is still as urgent. That is why we have acted swiftly. It is why we acted swiftly to announce the interim guarantee on deposits and term funding and the additional money to residential mortgage backed securities. It is also why we announced the $10.4 billion Economic Security Strategy to strengthen the Australian economy. We can do this today because of responsible decisions the government took in the budget. The IMF noted in its World economic outlook:

… sound fiscal positions provide scope for allowing automatic stabilisers to operate in full and for judicious use of discretionary stimulus if the outlook deteriorates further.

That is indeed the background to the package that the Prime Minister produced yesterday. This government simply will not sit on our hands. In these uncertain times there is need for immediate action to strengthen our economy.

I am pleased to hear that those opposite acknowledge that and support it. That is a good thing. But, of course, they cannot have it both ways. They cannot on the one hand say they support it and then on the other hand keep nitpicking around the edges.

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