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

I refer to yet another extraordinary question from the member for Curtin. The Deputy Leader of the Opposition, the member for Curtin, would be aware that the government last year, acting in concert with the Reserve Bank and reflecting global economic circumstances at the time, moved both fiscal and monetary policy in the same direction, given the challenges which existed at the time. I say to those opposite that one of the challenges we face—and I would suggest to those opposite that they be mindful of this—is that, as we respond to the global financial crisis and embrace the series of fiscal measures which are contained in this package, the packages last year and whatever further action we may take, it is equally important that we have a clear-cut strategy to exit from deficits and a clear-cut strategy to avoid problems at the other end of the economic cycle in terms of what then happens with inflation long term. The problem with previous responses by governments around the world is that they have not been appropriately sensitised to where they are in the economic cycle and therefore how to respond appropriately over time. We have seen that reflected most recently.

I would suggest to the Deputy Leader of the Opposition that, again consistent with the position taken by the government today on fiscal policy, she peruse the formal statement by the Governor of the Reserve Bank, which says:

In making its decision, the Board—

of the Reserve Bank—

took into account the package of measures announced by the Government earlier today. The combination of expansionary monetary and fiscal policies now in place—

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