Craig Kelly (Hughes, Liberal Party) Share this | Hansard source

I second the motion. Unfortunately, this motion is a sad reflection on how hopelessly out of touch this government is as they wallow in dangerous self-delusion. Let us dissect this motion line by line to demonstrate how hopelessly and out of the touch the member for Throsby is and how he is part of the most incompetent and untrustworthy government in living memory.

This motion makes reference to the global financial crisis. Now one thing about the global financial crisis is that it was not global. The main drivers of growth in our region are the economies of China and India and during the peak of the financial crisis in North America and Europe, China continued to grow strongly with quarterly growth rates of 6.8 per cent and 6.2 per cent. Likewise, India also continued to grow strongly during this period with quarterly growth rates of 6.1 per cent and 5.8 per cent. That is why many respected commentators refer to the period as the 'North Atlantic Financial Crisis'. Therefore, with the strong growth of China and India, the prudential reforms to our banking sector implemented by the Howard government, together with the Howard government leaving a healthy budget surplus, many sectors of the Australian economy were shielded from the worst of the financial crisis.

This motion talks about unemployment. A fortnight ago we had the Treasurer, when handing down one of the most uninspiring budgets ever delivered in this House—a budget that was all about debt, debt and more debt—blabbering on about jobs, jobs and jobs. But even before the ink, the very red ink, was dry on the last budget the Bureau of Statistics released figures showing 49,100 full-time jobs were lost in April and even the participation rate fell as many simply gave up looking for a job. This comes at a time when this motion states that many countries are emerging from the recent financial crisis. Yet, in April, Australia went backwards with 49,100 jobs lost.

While on unemployment, one would think that the member moving this motion would be fighting against the high of rate unemployment in his local area. The member represents a region where youth unemployment stands at over 33 per cent and, further, has one of the worst overall unemployment rates in New South Wales and a disturbingly low participation rate. So we would expect the member for Throsby to come into this chamber and stand up and fight for his constituents. That is what he was elected for. We would like to see you in here with a motion calling the House's attention to the shocking rate of unemployment in the seat of Throsby, stamping your fist on the table and demanding action. Instead, not only do you snub your nose at your constituents and serve up this dribble but, even worse, you want to punish them with a job-destroying carbon tax.

This motion makes the claim that the Australian unemployment rate is low by international standards. To make any meaningful comparison we need to compare Australia with countries in our region. And the majority of countries in our region have substantially lower unemployment rates than Australia. For example, Singapore has an unemployment rate of 1.9 per cent, Malaysia 2.8 per cent, Hong Kong 4.6 per cent, Taiwan 4.5 per cent and Japan 4.6 per cent. They are all countries in our region that have substantially lower unemployment rates than Australia. Even further afield, countries such as Norway at 3.2 per cent, Switzerland at 3.4 per cent, Denmark at four per cent and Austria at 4.3 per cent also all have significantly lower unemployment rates than Australia.

Although there is much media attention to the headline 'Unemployment rate', a more accurate measure of the performance of the economy is the underemployment rate. In February this year there were 886,000 underemployed workers across our nation in addition to the 583,000 unemployed workers. So, combined, we have over 1.4 million Australians either unemployed or underemployed at a rate of 12.8 per cent—hardly something to get excited about.

This motion refers to the Australian government's debt to GDP ratio and implies that it is not a problem by making comparisons with comparable countries. Such rationalisation is highly concerning as, not only is it delusional, it fosters a very dangerous complacency that says it is okay for this government to continue on its reckless spending spree, adding to our national debt mountain by $135 million every day. The rationalisation that it is okay to indulge in a reckless spending spree because other countries have greater debt levels is the same type of a rationalisation used by an alcoholic who drinks 10 schooners a day and thinks he does not a problem because he compares himself with someone that drinks a 10 bottles of whisky a day. If we are going to make a meaningful comparison of debt to GDP ratio we should be comparing Australia with countries that are similarly bestowed with natural resources and are major mineral exporters. When we look at countries such as Chile, Sweden, Norway and Finland they are all running comfortable budget surpluses.

This motion likes to talk about international financial comparisons. Unsurprisingly, the member for Throsby does not talk about international comparisons of interest rates. Simply, this is because we have the highest interest rates in the developed world. I have a list of all the developed countries of the world and interest rates, and Australia is dead last of all the developed countries. That means Australian families make higher mortgage repayments and Australian small businesses are placed at an internationally competitive disadvantage, all due to this government's mismanagement of the economy.

This motions talks about fiscal consolidation, but what fiscal consolidation? There has been no fiscal consolidation. We have had the exact opposite. Under this government Australia has gone from a $20 billion surplus to a massive $50 billion deficit. This year alone the deficit has blown out by a further $8 billion. In 2011-12 there is already a forecast of a further blow-out of $10 billion.

Let us take a quick look at the Gillard government's fiscal strategy that this motion refers to. Thanks to the Gillard government's fiscal strategy after inheriting a surplus, Australia now faces debt-servicing costs that are headed towards $7.5 billion a year or $20 million a day. To borrow a phrase from the member for Wentworth, the only way to describe the Gillard government's so-called fiscal strategy is an orgy of frenzied spending and borrowing, a strategy of live for the day, spend everything that comes in and more, say whatever it takes to cling to power, and the future be damned.

Now let us have a look at how the Gillard government is managing inflation to which this motion refers. For the year to March the headline inflation is running at 3.3 per cent, which is well above the RBA's target band, risking further interest rates increases. This is at a time when the surging dollar should be making just about everything that gets imported into the country cheaper. However, the inflation situation for many Australians is much worse than the official figures as each household has different expenditure patterns. For example, pensioners are likely to allocate a greater proportion of their weekly expenditure on food and health services. Therefore, while the official increase in headline inflation is 3.3 per cent over the year to March, the cost of living experienced by families has increased significantly higher at 4.9 per cent. For pensioners the increase was 4.1 per cent and for other welfare recipients it was 5.1 per cent. The Gillard government's management of inflation is only going to further deteriorate when the government pushes ahead, punishing families with a carbon tax.

Finally, this motion concludes with talking about the right course of action for Australia's long-term economic prosperity. It is now almost a year since the Prime Minister admitted, in a rare moment of honesty, that this Labor government had lost its way, but since then the Prime Minister has taken us further off course. Never, not even since the dying days of the Whitlam government and their dealings with Khemlani, has our nation's long-term economic prosperity been threatened by such irrational and incompetent economic policies. The only way to get our great nation back on track and on the right course and to secure our long-term economic prosperity is to change the government.

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