Malcolm Turnbull (Wentworth, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

My question is again to the Acting Treasurer. I note the Acting Treasurer has conceded that payment under the wholesale guarantee cannot be made without an appropriation bill being passed by parliament. Is the Acting Treasurer aware that Standard and Poor’s has ruled it will not give the government guarantee a AAA credit rating unless the payment on the guarantee is ‘unconditional, irrevocable and timely’? Why won’t the government act to fix this flawed guarantee and allow banks to receive its full benefits, which must then be passed on to the millions of Australian customers through lower interest charges and fees?

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

I do not really have much to add to the previous answer that I gave to this question. The same position applies. The position is that the government believes that it has full executive power in order to enter into these contracts and that these will have the desired effect with respect to delivering the guarantees that the financial institutions require in order to ensure that they enjoy the confidence of investors who are lending money to them, particularly international investors.

Daryl Melham (Banks, Australian Labor Party) Share this | Link to this | Hansard source

You sent us to war without legislation!

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

The member for Banks has actually made a very important interjection, because it illustrates the point that the government of this country, under Liberal or Labor, from time to time enters into a variety of very serious obligations that are not necessarily legislated by the parliament, including decisions to go to war. So when John Howard decided to go to war in Iraq he did not go to the parliament first and get money for that decision. He made a decision and the government made a decision to go to war without parliamentary authority, which he was entitled to do under the executive authority of the Commonwealth. So it is within the executive authority of the government to take these decisions, and they will provide the guarantees under the basis of contract that these institutions require. Should it ever be required that a guarantee of this kind must be delivered upon, then that will need to be appropriated.

I conclude on this point: when this was announced by the government, the opposition said it gave bipartisan support to the initiative.

Malcolm Turnbull (Wentworth, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

Mr Turnbull interjecting

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! The Leader of the Opposition has asked his question.

Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

So, in other words, yet again the opposition is trying to slide out of its initial phoney, statesmanlike position, trying to pretend that it is both supporting the government’s initiative to stabilise the economy—and in this case help to produce lower interest rates—and, at the same time, sniping relentlessly at those initiatives. If the opposition were fair dinkum about its support for these positions then it would not be asking these questions, because implicit in these questions is the assumption that they would block an appropriation in the Senate for any such guarantee.