Joe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | Hansard source

In response to that point, you are absolutely right. PEFO, the Pre-election Economic and Fiscal Outlook, is the only document produced by the Treasury that has the Treasury's economic forecast and the Treasury's economic numbers. All of the other documents that the PBO will use are in fact the Treasurer's numbers. I have been there; I know what they do. They are the Treasurer's numbers, and when they are doing the so-called confidential analysis of policies before the issuing of the writs it will be based solely on the economic forecasts of the Treasurer. I know that in the past Treasurers have played with the economic growth figures in order to inflate income.

Mr Crean interjecting—

I could tell you. Paul Keating boasted about it, mate. In fact, there were numerous occasions on which Paul Keating, as Treasurer—

Mr Crean interjecting—

Keep pushing me! As Treasurer, Paul Keating admitted that he changed economic numbers from those provided by the Treasury. That is why it is so important that the PBO has the capacity to get independent forecasts, independent economic growth data and independent inflation data. It is so important for it to get independent unemployment numbers and to take an aggregate, even to the extent of relying on the Reserve Bank.

As we know, at various times during the recent financial crisis the Reserve Bank had different economic growth numbers to those of the Treasury. Therefore, that had a material impact on some of the forecasts and budget forecasts as they stood. I think we would want in this place to have a range of different sources of information and that the PBO could go to the Reserve Bank, the IMF or the World Bank and form an independent view about economic growth, inflation and a range of other data. But instead, under this bill, not just for election costings—which, you are right, are based on PEFO—but for every other activity of the PBO during the course of the year, the PBO is constrained to use the Treasurer's numbers, not the Treasury's.

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