House debates
Tuesday, 5 September 2006
Questions without Notice
Economy: Household Debt
2:29 pm
Wayne Swan (Lilley, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source
My question is to the Treasurer and relates to the Reserve Bank’s measure of debt servicing for households. Can the Treasurer confirm that increased household debt, coupled with the seven back-to-back interest rates rises since April 2002, has resulted in households paying a record share of their incomes in mortgage interest payments? Can the Treasurer identify any period previously where households were losing a greater share of income in mortgage interest repayments than today?
Peter Costello (Higgins, Liberal Party, Treasurer) Share this | Link to this | Hansard source
The truth of the matter is that Australians’ asset growth has far outstripped their borrowings. As the Reserve Bank notes, we now have $6 of assets for every dollar of borrowing. As a consequence, for every dollar of debt, households have $2 in financial assets. The nominal wealth of households has increased by 11 per cent per annum, compared with a growth of six per cent per annum over the last seven years of the previous Labor government. What has in fact happened is that the Australian household sector has had the greatest accumulation of wealth that we have seen in generations. In relation to that, because interest rates are low, Australians have felt confident to borrow and, notwithstanding the fact that they have borrowed, their net asset position is still stronger. Let me come back to one thing that would really interrupt this accumulation of wealth by Australians. One thing that would really, really interrupt it would be an Australian Labor Party government.
Wayne Swan (Lilley, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source
Answer the question!
Peter Costello (Higgins, Liberal Party, Treasurer) Share this | Link to this | Hansard source
Not only would they find that their assets would decline but in relation to their borrowings they would be at exposed levels as a consequence.
Wayne Swan (Lilley, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source
Answer the question!
Peter Costello (Higgins, Liberal Party, Treasurer) Share this | Link to this | Hansard source
Everybody in Australia knows this. Labor cannot be trusted with money. Everybody in Australia knows that you cannot trust your money to the Labor Party. You could not do it when they were last in government and you will not be able to do it in the future either.
Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Assistant Treasurer and Revenue) Share this | Link to this | Hansard source
Mr Speaker, earlier I invited the Prime Minister to table the documents from which he was quoting. I now have in my possession the document he tabled, but he tabled selectively. By making reference to the fact that only three per cent of vehicles will have access to this grant, I made it clear that I was seeking information about the take-up rates of the grant scheme which the Prime Minister was quoting. Again, I invite him to table the document from which he was reading.
David Hawker (Speaker) Share this | Link to this | Hansard source
The member for Hunter would be aware that the Prime Minister was asked to table the document from which he was quoting. The Prime Minister has tabled a document for which—
Kim Beazley (Brand, Australian Labor Party, Leader of the Opposition) Share this | Link to this | Hansard source
He tabled the wrong document!
John Howard (Bennelong, Liberal Party, Prime Minister) Share this | Link to this | Hansard source
No, I didn’t.
Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Assistant Treasurer and Revenue) Share this | Link to this | Hansard source
With respect, Mr Speaker, the Prime Minister was quoting from more than one document. He was quoting figures from—
John Howard (Bennelong, Liberal Party, Prime Minister) Share this | Link to this | Hansard source
One marked ‘Confidential’.