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

I thank the member for Lindsay for his question. It is a very important question; it goes to all of the steps that this government has taken to restore and reinforce confidence in our financial system and to maintain stability in our banking system, including guaranteeing bank deposits and wholesale funding. And, of course, it goes directly to the point that the Prime Minister was making before about our Nation Building and Jobs Plan, which has been put in place in response to events in the international economy in recent times.

All of these measures have been absolutely essential for maintaining stability in the wider economy and in the financial system, and this program has had the support of respected economists the world over; certainly, last Friday we had the benefit of hearing the views of the Governor of the Reserve Bank. Those opposite have been questioning the rationale for this program. There has been question after question in this House about whether there was sufficient stimulus—too much, too early, too late and so on. I think the governor had a number of very important things to say, and the most important thing that he had to say on Friday was:

Growth will be stronger than it would have been without those actions. I do not think there is any doubt about that.

We have had the deputy shadow Treasurer, the Leader of the Opposition and others all making points about our Nation Building and Jobs Plan. The first thing that they have been saying is that our Economic Security Strategy that was announced last August did not work. What did the Governor of the Reserve Bank have to say about this last Friday? He said:

I think the indications are that the pre-Christmas package did have quite a measurable impact on consumer demand.

How many times have those opposite come into this House and said it did not have a measurable impact on consumer demand? Despite the retail sales from December, despite the evidence from Woolworths, Westfield and so on, they continue to say that in this House, and of course it is untrue. You have heard a lot from those opposite about the bank guarantee and how ineffective it was, how bungled it was, how it does not work and how it is not necessary. This is what the governor had to say last Friday:

… the decision, by and large, did what was needed, which was that it avoided any perception of a systemic problem in the Australian banking system …

…            …            …

That is a very much better outcome than we might have otherwise had.

And, of course, we have heard from them—we heard it again today, in fact—that the Nation Building and Jobs Plan is excessive. They claim we are spending too much, that there is too much investment in schools. Indeed, the deputy shadow Treasurer thinks the investments in schools are ridiculous. What did the governor say on Friday? He said:

… it does not strike me as obvious that somehow it is grossly excessive.

This is another exposure of the naked political point-scoring that has been coming from those opposite. Every time they bowled up another one of their shonky assertions it was exposed for what it was by the Governor of the Reserve Bank. Their claims about doing too much were smashed; their claim the ESS did not work was smashed; their claim that the bank guarantee is not needed was completely smashed. The ultimate came when the deputy shadow Treasurer asked the governor a question about whether we were spending too much too soon. This is what the governor said:

You can make that argument, but I think you can also make the argument that, the longer you wait, the more ammunition you will end up having to use. These things can get a sort of self-fulfilling momentum behind them and we may or may not be able to head that off. But I think you should try …

Of course the approach of those opposite is simply to sit and wait and see, because they do not understand that if you do not act early then you do not avoid some of the catastrophic effects that come down the track, particularly the tragedy of much higher unemployment. There could not have been a more humiliating debut for the deputy shadow Treasurer—

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