Chris Bowen (Prospect, Australian Labor Party, Assistant Treasurer) Share this | Hansard source

The straw that broke the camel’s back for the former shadow Treasurer, the member for Curtin, was when she said that the Liberal Party’s approach to economic management at this time of global financial crisis was to wait and see. That was it. That was the final gaffe. That was the bridge too far that drove her colleagues to say, ‘It’s time to go. You’re fired.’ And what do we see from the new shadow Treasurer? The same approach. We heard it just then. They were different words. Sometimes he even says ‘wait and see’—or a more fancy way of saying wait and see sometimes. We see the same bankrupt approach from the opposition. On Sunday we saw the new shadow Treasurer on Insiders say that the government’s stimulus package was too big and badly targeted. He said:

But you see when you spend all the money that is available, when you reduce the amount of petrol you have in the fuel tank you never know what's going to come around the corner and you might not be able to cope with it.

That is a fancy way of saying, ‘You’re doing too much to support jobs in Australia.’ It is a fancy way of saying, ‘It’d be better to wait and see.’

When you look at the performance so far of the new shadow Treasurer and you consider that he was the second choice for the job, and when you consider that he is the fourth person to be the spokesman on economic matters for the Liberal Party in the last 18 months, you might think that, if Andy Warhol were looking at the Liberal Party, he would say, ‘Everybody gets their 15 minutes as shadow Treasurer in the Liberal Party,’ because that is what we see—this revolving door of spokespeople but the same old message, the same old tunes.

The opposition says—and we heard it again—that the December stimulus package was a waste of money. They say it was a cash splash, a sugar hit. By the way, that was the package that they supported. Remember that? Remember the Leader of the Opposition saying, ‘We won’t be quibbling with this package; it has our support’? Now they say that it was a waste of money. We had the Leader of the National Party saying in the other house that it would be spent against a wall, insulting Australia’s pensioners and low- and middle-income families, saying that they would not know how to spend the money, that it would be a waste of money.

The package was all about jobs—supporting Australian jobs. That is what it comes down to at the end of the day—supporting Australian jobs in an environment where seven out of our 10 largest trading partners are now in recession; where the United States has shed half a million jobs a month in the last three months; where in the United States retail sales fell around three per cent for the month of December; where in Japan sales fell by two per cent in December; and where in Germany and New Zealand sales fell by around one per cent. In Australia, sales increased by 3.8 per cent in December. Can you imagine the furore from the opposition if sales had fallen in December, if we had not had a stimulus package? Can you imagine the outcry—the correct outcry—that would come if they were able to say, ‘The Australian government has not done enough to support Australian jobs’? In Australia, retail sales grew in December by the highest amount in eight years. In fact, it was the fourth highest amount we have seen since that statistical series began—the fourth highest amount in the history of that statistical series.

But it is not just about retail sales. We see the efforts of the government to put a floor under confidence in the construction industry—to boost confidence in the construction industry—and we have seen a 15 per cent increase in loans to purchase new dwellings in Australia as a result of the increase in the first home owner grant, as a result of the government’s stimulus package. But these things are not an end in themselves. Of course, they are not; they are a means to an end. They are a means to support Australian jobs.

The House had to put up with the indignity of having to listen to the shadow Treasurer, the former minister for workplace relations, talking about protections for Australian workers, the indignity of being lectured by the man who said, ‘The cabinet did not realise how much pain Work Choices was causing the Australian people,’ and the indignity of having to listen to the member for North Sydney say that job security was better under Work Choices than it is now. Well, the Australian people have seen through that argument.

But the House does not need to take the government’s word for it when it comes to the effect of the government’s stimulus packages on Australian jobs. The House does not need to take my word for it or the government’s word for it. Just look at what the experts say. Dr Gruen, executive director of the macroeconomic unit in Treasury said:

... we have evidence that the package stimulated consumption. We have strong reason to believe that that would have led to more people being employed than would otherwise have been the case.

The shadow Treasurer quoted the Governor of the Reserve Bank, but, sadly, I have to report to the House that he left quite a few out. He left this one out:

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

That is what the governor said about the government’s actions. Sara Hoenig, the economist with the Commonwealth Bank of Australia, said:

If there were any doubts about the efficacy of the government’s fiscal stimulus packages and Australian consumers’ willingness to spend, the December retail sales report is a clear rebuttal.

The same goes for the government’s second stimulus package. David de Garis, an economist from the National Australia Bank, said it was:

A sizeable fiscal stimulus and, I think, appropriate in the circumstances both in terms of the size of the stimulus and also its construction.

Those well-known socialists down at the Australian Chamber of Commerce and Industry said:

Such is the scope of our current economic difficulties that this package, combined with monetary easing, is absolutely essential. The size of the package at 2% of GDP in 2009 is appropriate and in line with our estimate of what is required.

And, again, we come to the Governor of the Reserve Bank, who said that he was comfortable with the government’s approach.

The Governor of the Reserve Bank specifically rebutted the narrative of the shadow Treasurer, who argues that we are spending too much now. The Governor of the Reserve Bank pointed out that, if you do not act quickly enough, if you do not stimulate the economy at the right time, if you leave it too late, you will be creating bigger deficits and more debt down the line. The shadow Treasurer’s narrative then is an argument for more unemployment and more debt—because, if you do not stimulate the economy, you will see unemployment go up, you will see profits go down, you will see tax revenue go down and you will see deficits and debt go up. The Governor of the Reserve Bank is not the only person who has pointed that out. Saul Eslake has said:

... history ... suggests that the ultimate fiscal cost of episodes such as the present one ends up being considerably greater if appropriate ameliorative action is delayed.

So we have the shadow Treasurer and the former shadow Treasurer singing from the same song book, but a tune completely out of touch with what is going on—a song out of tune with the economic reality in Australia and around the globe; a song out of tune with every economic expert in this country; a song out of tune with the Governor of the Reserve Bank. The shadow Treasurer is singing from the same song book as the former shadow Treasurer. The more things change, the more things stay the same.

Let us look at the composition of the packages. We have dealt with the quantum of the packages, but let us look at how the government’s stimulus packages have been constructed. We have taken the view that, as well as stimulating the economy, these packages provide an opportunity to invest for the future. These packages are an opportunity to invest in Australia’s children. Seventy per cent of the government’s second stimulus package is by way of direct investment. That compares with around 30 per cent for the stimulus package in the United States. So there is 70 per cent by way of direct investment in the future. There are areas where this can be spent quickly but they are areas that have been underfunded for so long—for example, level crossings in areas of high accidents. We all hear about level-crossing accidents, and we all hear the cries from the community: ‘Why can’t we have more boom gates?’ For years, governments have said, ‘We can’t afford it.’ We are taking this opportunity to make a step towards improved and safe level crossings.

Our most important investment is in our schools and in education. What does the opposition say about that part of our stimulus package? The shadow Treasurer said:

Well let me tell you, we wouldn’t be spending $14 billion on school halls. I mean that is a phenomenal amount of money. $14 billion … That is just ridiculous.

Let me respectfully point out a few things to the member for North Sydney. Firstly, school halls are no longer just about school assemblies. Any honourable member who goes to the schools in their electorate knows that those schools with school halls have learning areas, performance areas, or exercise areas in their school halls. They are an important part of the school community. They are not just about assemblies. And every principal will tell you that their school is poorer without them.

But the other thing I would point out to the member for North Sydney is that he either completely misunderstands, or completely misrepresents, the government’s investment in schools—because it is not just about school halls. There is a little thing that I might introduce the member for North Sydney to. It is called a school library. It is quite important. It is about giving the kids a chance to learn in the best possible environment. It is about investing in schools with second-rate or third-rate libraries and giving them a first-rate library that they deserve. It is also about science labs and language labs. It is about those primary schools that already have a good school hall and a good library being able to get rid of demountables and rebuild their classrooms. That is what this investment in schools is about.

I say to the member for North Sydney in all seriousness and with respect: perhaps schools in the North Sydney electorate are not too badly off. Maybe they are doing okay. Maybe he thinks they do not need this investment. I think he is probably wrong but maybe he thinks that. But come out to the rest of Australia, come out to the electorates in rural Australia that the Minister for Agriculture, Fisheries and Forestry goes to and sees. Come out to the electorates in Western Sydney and western Melbourne and the western suburbs of Brisbane. Come out and see whether the school principals in those areas say, ‘We don’t need this money,’ and ‘This amount of money is ridiculous.’ See if they think that this is a ridiculous investment in Australia’s future. I think the member for North Sydney might be the one who will be educated. I think the member for North Sydney might get a wake-up call. I think the member for North Sydney, the shadow Treasurer, might realise that he is the one being ridiculous and that this is not a ridiculous investment, it is an appropriate investment. I think the member for North Sydney needs to be reminded that it is not just investment in hard infrastructure in roads and in rail that creates wealth, but that investment in our kids creates wealth. Investment in our schools creates wealth—and not just now and not just tomorrow. It does not just stimulate the economy now; it stimulates it for years to come. It is the member for North Sydney who needs to be educated about that. It is the shadow Treasurer who needs reminding that the Australian government is determined to invest appropriately in our schools, and that we do not think it is ridiculous.

We then have the opposition saying, ‘We want tax cuts. We do not agree with all this money being handed out. We want tax cuts.’ We do not know what sort of tax cuts they want. The Leader of the Opposition has said that we should bring forward the tax cuts that are due to be paid later in the year and the year after. The former shadow Treasurer argued for ‘broad and sweeping tax cuts that will increase the tax base and increase tax revenues’. I would invite the new shadow Treasurer to disassociate himself from those comments while he has the opportunity. The shadow Treasurer might want to point out that he does not believe that tax cuts actually increase government revenue. I have heard some of the opposition say, ‘We want tax cuts like those in President Obama’s stimulus package.’ But the tax cuts in the United States stimulus package are temporary rebates. They are not dissimilar to the payments in the Australian government’s tax package. So we find the opposition hopelessly at sea under the member for Curtin and equally at sea under the member for North Sydney.

What the Australian people are looking for is leadership. They are not looking for a government that says, ‘We will wait and see.’ They are not looking for a government that says, ‘We will wait until the economy is as bad as Britain or the United States or anywhere else before we act.’ They are not looking for a government which says, ‘We will observe the patient in intensive care before we administer first aid.’ They are not looking for a government which says, ‘We don’t believe that important and urgent action is needed now to protect and support Australian jobs while people are still in employment and before it is too late.’ They are looking for a government that acts. The opposition simply sings the same old tune—too much, too soon. We say it cannot be soon enough.

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