Tony Abbott (Warringah, Liberal Party, Shadow Minister for Families, Housing, Community Services and Indigenous Affairs) Share this | Link to this | Hansard source

My question is to the Prime Minister. Given the IMF’s statement that providing cash to individuals is the best fiscal stimulus and given the Prime Minister’s own statements just now about intelligently deploying the surplus and about supporting the household economy, will the Prime Minister now give single age pensioners an extra $30 a week to help them through these difficult times?

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

One of the remarkable things about the opposition’s position on pensions is the fact that they leave so many millions of pensioners out. I say to those opposite that if they were serious in the policy debate on this they would have had a consistent and comprehensive position all along. Secondly, if those opposite were serious about pension reform—and the member who has just asked the question was in cabinet for a long time—when did they argue to reform the pension and why didn’t the Howard government act to reform the pension for 12 years?

My third point is that we are committed to a policy of long-term pension reform. As I said in my answer to the question put to me before, the government believes that the right course of action is to act decisively to continue to support economic growth in the Australian economy in the future. We will do that. This government, despite considerable criticism from various people in the commentariat and from those opposite, put to one side a significant surplus for the budget in May. The reason that we put aside a surplus was to have that surplus to deal with tough times in the future. Those tough times have arrived. We are in a position to deploy the surplus. We will deploy the surplus in the interests of underpinning long-term positive growth in the Australian economy and in the interests of supporting the household economy as well.

Julie Owens (Parramatta, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister for Trade. Given the current global economic uncertainty, why is a strong trade performance important for Australia?

Simon Crean (Hotham, Australian Labor Party, Minister for Trade) Share this | Link to this | Hansard source

I thank the honourable member for her question. I know the importance that she places on improving Australia’s trade performance. The fact is that the global crisis is undermining confidence. One indication of that is that spot prices for most commodities have taken a dramatic drop. This underscores the reason why when coming to office we said that we were going to set about developing a new trade policy that positioned Australia beyond the resources boom. This trade policy recognises the importance of diversification both in content as well as the direction of our trade focus. The other point that I would make is that improving trade performance is another arrow in the quiver of building confidence. The reason for that—

Opposition Members:

Opposition members interjecting—

Simon Crean (Hotham, Australian Labor Party, Minister for Trade) Share this | Link to this | Hansard source

The opposition never understand when in government the importance of increasing trade performance. They presided over 72 trade deficits in a row and they did that in the middle of a resources boom. Just imagine what it would be like if they were still in charge today. They never had the wit or wisdom to understand the importance of this diversification. Why does trade matter? It matters because world trade grows three times faster than world output. If economies are to secure their economic future, they have to engage in trade. They also have to pursue policies that not only liberalise trade and open markets but do the structural reforms to the economy to make sure that they are competitive enough and productive enough to achieve that outcome.

Recently, we concluded a free trade agreement with the ASEAN group of nations. I have spoken in the House about this before. In the break I had the opportunity to visit both Malaysia and the Philippines. Today, in discussions with the Prime Minister of Vietnam I had the opportunity to engage three of those countries in the new framework that this ASEAN free trade agreement gives us to better diversify and to strengthen our trade between those countries. This is not just off the back of the platform that is the multilateral negotiations but by sensibly driving the bilateral relations to continue to strengthen our position.

We have a great opportunity in the ASEAN region and in Asia as a whole. People have talked before about the IMF report, which does show that world growth is slowing, but growth in Asia is still solid and this is where we do have to engage. We have to engage on a broader front than was hitherto the case. We have to diversify into the services economy because it represents 80 per cent of our GDP but only 23 per cent of our export market. Why is it that the previous government was never able to perform better on the services front in all of its 12 years? The fact is that it had a narrow view as to what trade policy involved. It focused primarily around agriculture, not elaborately transformed manufactures or services. It has been to the detriment of this country and it has taken a Labor government to come back into office to get the balance right. I assure the House that we will do everything possible to ensure that we do get that balance back.